Case Number: ITA 1120/DEL/2020
Appellant: Fortune Fasteners Pvt Ltd, New Delhi
Respondent: ITO WARD – 9(3), New Delhi
Assessment Year: 2011-12
Result: 2011-12
Case Filed On: 2020-03-19
Order Type: Final Tribunal Order
Date of Order: 2022-07-26
Pronounced On: 2022-07-26
This case involves Fortune Fasteners Pvt Ltd’s appeal against the order of the Income Tax Officer (ITO), Ward-9(3), New Delhi, pertaining to the assessment year 2011-12. The primary issues under consideration include the validity of notices issued under section 148, procedural irregularities, and the treatment of unsecured loans as undisclosed income.
Fortune Fasteners Pvt Ltd filed its return for the assessment year 2011-12. The Assessing Officer (AO) issued a notice under section 148 of the Income Tax Act, 1961, prompting the reopening of the assessment. The AO added Rs. 51,80,000 as unsecured loans, treating them as undisclosed income.
During the hearing, the appellant’s counsel emphasized the lack of proper opportunity for the appellant to present their case. The CIT(A) dismissed the appeal ex-parte, which the appellant contends was against the principles of natural justice.
The appellant also argued that the notice under section 148 was invalid and without jurisdiction, and that the AO did not provide the reasons recorded under section 148, which is a procedural lapse.
The Revenue’s Senior Departmental Representative (Sr. DR) agreed that the case should be remanded back to the CIT(A) for a fresh hearing, providing the appellant a reasonable opportunity to present their case.
The Income Tax Appellate Tribunal (ITAT) examined the submissions and concluded that the CIT(A) had indeed dismissed the appeal without providing a proper opportunity to the appellant. The Tribunal emphasized the importance of adhering to the principles of natural justice and providing reasonable opportunities for both sides to present their case.
The Tribunal set aside the impugned appellate order dated 20/01/2020 and remanded the matter back to the CIT(A) with directions to pass a fresh order after providing a reasonable opportunity to the appellant. The Tribunal clarified that it expressed no opinion on the merits of the case, and all legal remedies are available to both parties during the proceedings.
Order pronounced in the open court on 26/07/2022 by Saktijit Dey, Judicial Member, and Anadee Nath Misshra, Accountant Member.
In conclusion, the appeal was partly allowed for statistical purposes, emphasizing the need for a fair hearing and proper adherence to procedural requirements. This case highlights the importance of ensuring due process and the right to a fair hearing in tax assessment proceedings.
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