ITAT sets aside ex-parte order due to advocate's family incidents affecting mental health, finds reasonable cause for non-appearance

ITAT Pune set aside ex-parte order passed by CIT(A)/NFAC due to assessee's non-appearance caused by advocate's family incidents affecting mental health. Tribunal found reasonable cause for non-compliance with statutory notices and deemed ex-parte order bad in law. Matter remanded to CIT(A)/NFAC for fresh adjudication on merits including disallowance of VAT, CGST, SGST for A.Y. 2018-19 after providing reasonable opportunity of hearing to assessee with new counsel.

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Issues Involved:
1. Appeal against orders dated 06.12.2023 and 14.02.2023 for assessment years 2017-18 and 2019-20.
2. Ex-parte dismissal of appeal by Ld CIT(A)/NFAC.
3. Grounds of appeal challenging orders related to business income, expenditure disallowance, and computation of total income.
4. Non-appearance of assessee in first appeal due to reasonable cause.
5. Request for another opportunity of hearing before ld. CIT(A)/NFAC.
6. Failure to adjudicate on specific grounds in the appeal orders.
7. Additions made by CPC related to PF contribution and VAT, CGST, and SGST payable.

Analysis:

Issue 1: Appeal against orders dated 06.12.2023 and 14.02.2023
- The appeals were directed against separate orders passed for the assessment years 2017-18 and 2019-20.
- Both appeals were heard together, and a common order was issued.

Issue 2: Ex-parte dismissal of appeal by Ld CIT(A)/NFAC
- The assessee was absent during the first appeal, leading to the ex-parte dismissal by Ld CIT(A)/NFAC.
- The ex-parte order was challenged by the assessee before the Tribunal.

Issue 3: Grounds of appeal related to business income, expenditure disallowance, and computation of total income
- Grounds raised by the assessee included challenging the reclassification of income, disallowance of expenditure, and incorrect computation of total income.
- The Tribunal considered the arguments presented by both sides and found merit in the assessee's contentions.

Issue 4: Non-appearance of assessee in first appeal due to reasonable cause
- The assessee's representative was unable to attend the appeal hearings due to a family tragedy.
- The Tribunal acknowledged the reasonable cause for non-appearance and set aside the ex-parte order.

Issue 5: Request for another opportunity of hearing before ld. CIT(A)/NFAC
- The assessee's counsel requested another chance to present the case before ld. CIT(A)/NFAC with supporting documents.
- The Tribunal granted the request, emphasizing the importance of a fair hearing.

Issue 6: Failure to adjudicate on specific grounds in the appeal orders
- The Tribunal noted the failure of Ld CIT(A)/NFAC to adjudicate on certain grounds raised by the assessee in the appeal orders.
- The matter was remanded back to ld. CIT(A)/NFAC for a proper decision on the pending issues.

Issue 7: Additions made by CPC related to PF contribution and VAT, CGST, and SGST payable
- The CPC made additions related to PF contribution and VAT, CGST, and SGST payable, which were contested in the appeals.
- The Tribunal reviewed the additions and directed ld. CIT(A)/NFAC to reconsider the issues after providing a fair opportunity to the assessee.

In conclusion, the Tribunal allowed both appeals for statistical purposes, highlighting the importance of fair hearings and proper adjudication of grounds raised by the parties involved.

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