2015 (8) TMI 1544 - AT - Income Tax

Tribunal Sets Aside Assessment Order Due to Violation of Natural Justice

The tribunal found that the Dispute Resolution Panel (DRP) and Assessing Officer violated natural justice by not providing the assessee with a reasonable ... Validity of DRP order - violating the principle of natural justice - Failure to provide reasonable opportunity to the Appellant to furnish documents and evidences - HELD THAT:- It would meet the ends of justice if the order of the DRP is set aside, because in our opinion certainly adequate opportunity of being heard is not allowed by the DRP to the assessee. There are different dates mentioned in the order of the DRP supplied to the assessee and the order in the file of the DRP. No satisfactory explanation for this variation in dates in both the orders could be given by the ld. CIT-DR. In the order-sheet there is a noting of only one date of hearing, i.e., 28.11.2014 on which date the assessee was directed to file chart/submission and time was granted up to 05.12.2014. However, thereafter there is no other noting whether any further hearing took place or not. DRP has passed the order without allowing adequate opportunity of being heard to the assessee. We, therefore, set aside the order of the DRP and restore the matter back to its file. We direct the DRP to allow adequate opportunity of being heard to the assessee, and thereafter pass a speaking order in respect of assessee’s objections in accordance with law. Assessee’s appeal is deemed to be allowed for statistical purposes. Issues:Violation of natural justice by the Assessing Officer and Dispute Resolution Panel (DRP) by not providing a reasonable opportunity to the assessee to furnish documents and evidences.Detailed Analysis:The appeal by the assessee was against the order of the Transfer Pricing Officer passed under relevant sections of the Income-tax Act for Assessment Year 2010-11. The main contention raised by the assessee was the violation of natural justice by the Assessing Officer and the DRP for not allowing a reasonable opportunity to submit necessary documents and evidence. The DRP had fixed a hearing date after issuing the order, which the assessee argued was illegal and void. The CIT-DR, however, claimed a typographical error in the order and presented evidence to support that the original order date was different from what was mentioned in the order supplied to the assessee.The arguments presented by both sides were carefully considered by the tribunal. It was noted that discrepancies existed in the dates mentioned in the order supplied to the assessee and the original order in the DRP file. The tribunal found that the DRP had not provided adequate opportunity for the assessee to be heard before passing the order. As a result, the tribunal set aside the DRP's order and directed a fresh hearing to allow the assessee a fair chance to present their case. Consequently, the assessment order passed by the Assessing Officer based on the DRP's directions was also set aside, and the matter was restored back for a fresh assessment in accordance with the law.The tribunal concluded that since the assessment order was set aside, there was no need to further adjudicate on the other grounds raised in the appeal. Therefore, the assessee's appeal was deemed allowed for statistical purposes. The order was pronounced in court on a specific date in Ahmedabad.In summary, the judgment focused on the violation of natural justice by the DRP and the Assessing Officer, leading to the setting aside of the assessment order and the direction for a fresh assessment after providing the assessee with a fair opportunity to be heard.