Ex-parte appellate order set aside for denying proper hearing opportunity despite delayed notice receipt

ITAT Raipur set aside CIT(A)'s ex-parte appellate order for violating natural justice principles. The assessee company had requested adjournment on 15.10.2018 but CIT(A) incorrectly noted non-compliance. Subsequently, hearing notice dated 19.11.2018 for 03.12.2018 was received only on 04.12.2018, making attendance impossible. Despite assessee's letter dated 06.12.2018 explaining the delayed receipt, CIT(A) dismissed the appeal on 07.12.2018 without providing reasonable opportunity. ITAT restored matter to CIT(A) with directions to re-adjudicate after affording proper hearing opportunity. Appeal allowed for statistical purposes.

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Issues Involved:
1. Ex-parte appellate order by CIT(A) without providing reasonable opportunity.
2. Addition of Rs.7,83,43,683 as unexplained investment u/s 69.
3. Addition of Rs.13,51,466 as unaccounted sales.
4. Validity of the assessment order u/s 143(3).
5. Additional grounds regarding the legality of the assessment order.

Issue-wise Summary:

1. Ex-parte appellate order by CIT(A) without providing reasonable opportunity:
The assessee contended that the ex-parte order passed by the CIT(A) was "highly unjustified, bad in law, without providing reasonable opportunity of being heard, against the principles of natural justice and not in accordance with the provisions of law." The Tribunal found merit in the assessee's claim that the notice for the hearing on 03.12.2018 was received only on 04.12.2018, and the CIT(A) dismissed the appeal ex-parte without considering the request for adjournment. The Tribunal restored the matter to the file of the CIT(A) for re-adjudication after affording a reasonable opportunity of being heard to the assessee.

2. Addition of Rs.7,83,43,683 as unexplained investment u/s 69:
The assessee challenged the addition of Rs.7,83,43,683 made by the AO on account of alleged excess stock found during the survey, treating it as unexplained investment u/s 69. The assessee argued that the stock verification was done using a crude volumetric method, which was inaccurate. The Tribunal did not delve into the merits of this contention as the matter was restored to the CIT(A) for fresh adjudication.

3. Addition of Rs.13,51,466 as unaccounted sales:
The assessee also contested the addition of Rs.13,51,466 made by the AO for alleged stock shortage, treating it as unaccounted sales. Similar to the previous issue, the assessee argued that the stock verification method was improper. The Tribunal refrained from addressing the merits of this issue, directing the CIT(A) to re-examine it.

4. Validity of the assessment order u/s 143(3):
The assessee argued that the assessment order u/s 143(3) was "illegal, bad in law and suffering from legal infirmities." The Tribunal noted that the assessee's case was selected for "limited scrutiny," and the additions made by the AO were beyond the scope of the issues selected for scrutiny. The Tribunal did not decide on this issue, leaving it to the CIT(A) to consider during the re-adjudication.

5. Additional grounds regarding the legality of the assessment order:
The assessee raised additional grounds challenging the validity of the assessment order on the basis that it was void ab initio, invalid, and barred by limitation. The Tribunal did not address these additional grounds, allowing the assessee to raise them before the CIT(A) during the fresh proceedings.

Conclusion:
The Tribunal allowed the appeal for statistical purposes, restoring the matter to the CIT(A) for re-adjudication after providing a reasonable opportunity of being heard to the assessee. The Tribunal refrained from addressing the merits of the various contentions raised by the assessee, leaving them to be considered by the CIT(A) in the fresh proceedings.

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