Natural justice in income tax appeals: matter remanded for fresh hearing after ineffective service of notices.

The appeal was restored and remitted to the first appellate authority for fresh adjudication because the assessee had not received an effective opportunity of hearing and the notices were not duly served. In line with the High Court's direction, the CIT(A)/NFAC was required to decide the matter afresh after granting reasonable hearing. The additions relating to delayed employees' contribution and unexplained cash deposits were not finally examined on merits at this stage. The appeal was thus partly allowed for statistical purposes.

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Issues: Whether the assessee's appeal should be restored and the matter remitted to the first appellate authority for fresh adjudication after granting an opportunity of hearing.

Analysis: The appeal had remained unadjudicated on merits before the first appellate authority because the assessee was unable to participate, and the record indicated absence of effective service of notices. In view of the High Court's direction to restore the appeal and decide it after hearing the assessee, and considering the admitted grievance that the assessee had not been afforded a proper opportunity before the first appellate forum, the matter was considered fit for fresh examination. The dispute on additions relating to delayed employees' contribution and unexplained cash deposits was therefore not finally determined at this stage.

Conclusion: The matter was remitted to the CIT(A)/NFAC for fresh adjudication in accordance with law after granting a reasonable opportunity of hearing to the assessee, and the appeal was partly allowed for statistical purposes.

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