2020 (10) TMI 875 - AT - Income Tax

Assessee's Tax Appeal Allowed for Reassessment: Procedural Fairness Emphasized

M/s Ganpati Breweries Ltd. Versus ITO, Ward 12 (1), New Delhi

The Assessee challenged various aspects of the tax assessment process, including the validity of notices, legality of assessment orders, and addition of ... Reopening of assessment u/s 148 - non-issuance of notice u/s. 143(2) - HELD THAT:- Both the parties agreed that the issue of non-issuance of notice u/s. 143(2) of the Act may be set aside to the Ld. CIT(A) to decide the same as per law, after examining the assessment records and give adequate opportunity of being heard to the assessee. Non-issuance of notice u/s. 143(2) after examining the assessment records, and give full opportunity of being heard to the assessee, as per law. Even otherwise, after perusing the orders passed by the revenue authorities, we find that the revenue authorities have decided the issues in dispute against the assessee exparte and Ld. CIT(A) has not passed the speaking order on merits also. CIT(A) has not elaborately discussed the evidences filed by the assessee and decide the issues in a summary manner. Therefore, we are also of the view that the contentions raised by the Assessee in the grounds of appeal on merits also require re-adjudication at the level of the Ld. CIT(A). Assessee’s Appeal is allowed for statistical purposes. Issues:1. Challenge to the impugned order dated 30.03.2015 by the Assessee.2. Validity of notice u/s. 148 issued by the AO.3. Legality of exparte assessment order u/s. 147/144 dated 27.12.2011.4. Non-issuance of notice u/s. 143(2) of the Act.5. Addition of income by Ld. CIT(A) under section 68 of the I.T. Act, 1961.6. Adequate opportunity of being heard and adducing evidence by the Assessee.7. Legality of exparte assessment and income enhancement by Ld. CIT(A).Analysis:1. The Assessee challenged the impugned order dated 30.03.2015, arguing that it was bad in law and on facts. The issues raised included the validity of the notice u/s. 148, legality of the exparte assessment order u/s. 147/144 dated 27.12.2011, and the addition of income by Ld. CIT(A) under section 68 of the I.T. Act, 1961.2. The Assessee contested the AO's action of issuing notice u/s. 148, alleging failure to disclose commission income. The Ld. CIT(A) held that the AO erred in making the addition, but did not cancel the exparte assessment order. The Assessee argued that the notice u/s. 143(2) was not issued, which is crucial for assessment jurisdiction.3. The Ld. CIT(A) rejected the arguments on non-issuance of notice u/s. 143(2) as the Assessee failed to raise objections during assessment proceedings. The Tribunal directed the Ld. CIT(A) to decide this issue after examining assessment records and providing a hearing opportunity to the Assessee.4. Both parties agreed that the issue of non-issuance of notice u/s. 143(2) should be reconsidered by the Ld. CIT(A) for a fair decision. The Tribunal sent the case back to the Ld. CIT(A) for a proper determination of this issue and a full hearing for the Assessee.5. The Tribunal found that the Ld. CIT(A) did not adequately discuss the Assessee's evidences and decided issues summarily. It directed the Ld. CIT(A) to re-adjudicate the case on merits after examining all evidence and providing a full opportunity for the Assessee to present their claims.6. Ultimately, the Assessee's appeal was allowed for statistical purposes, emphasizing the need for a fair and thorough reconsideration of the case by the Ld. CIT(A) to ensure justice and proper assessment procedures.Judgment Date: 22.09.2020.