This case involves the Income Tax Officer (ITO), Ward-29(4), New Delhi (the appellant) and Ritesh Singh (the respondent), concerning the Assessment Year (AY) 2014-15. The primary issue in this appeal is the deletion of additions made by the Assessing Officer (AO) based on technical grounds.
Ritesh Singh filed his return for AY 2014-15 electronically on 03.12.2014, declaring an income of Rs. 7,17,470/-. His case was selected for scrutiny under the Computer-Assisted Scrutiny Selection (CASS) system. A statutory notice under section 143(2) of the Income Tax Act, 1961 (the “Act”) was issued on 30.09.2015, fixing the hearing for 08.10.2015. This notice was sent via speed post and email, to which the assessee responded. However, subsequent notices were not complied with, leading the AO to pass an ex-parte order under section 144 of the Act on 23.12.2016, determining the total income at Rs. 1,80,40,240/-.
The Revenue raised the following grounds of appeal:
The appeal was heard by the ITAT Delhi Bench “F,” with Shri N.K. Billaiya, Accountant Member, and Ms. Astha Chandra, Judicial Member, presiding. The appellant was represented by Shri Vivek Vardhan, Sr. DR. The respondent did not appear.
During the hearing on 21.09.2023, the Revenue argued that the CIT(A) ignored the Supreme Court judgment in V.R.A. Cotton Mills Pvt. Ltd. vs. Union of India, which clarified that the expression ‘serve’ means the date of issue of notice, thereby justifying the notice issued within the limitation period. The CIT(A) had declared the assessment order null and void on the grounds that the notice was not served within the prescribed time.
The ITAT considered the submissions, the orders of the lower authorities, and the Supreme Court’s judgment in V.R.A. Cotton Mills Pvt. Ltd. The ITAT noted that the CIT(A) had not considered the Supreme Court’s interpretation that the date of issue of notice is sufficient compliance with the requirements under section 143(2) of the Act.
The ITAT held that the matter should be remanded to the CIT(A) for reconsideration in light of the Supreme Court judgment. The CIT(A) was directed to adjudicate the appeal afresh on merits, taking into account the additional evidence and allowing reasonable opportunity of hearing to both parties.
The ITAT’s decision to remand the case underscores the importance of adhering to judicial precedents and ensuring that procedural technicalities do not undermine substantive justice.
This case highlights the critical role of judicial interpretations in tax proceedings and the necessity of following due process. The ITAT’s directive for a de novo adjudication by the CIT(A) aims to ensure that the case is evaluated fairly and justly, considering all relevant legal precedents and evidence.
Order pronounced in the open court on 21st September 2023.
Judicial Member: Ms. Astha Chandra
Accountant Member: Shri N.K. Billaiya
Date of Order: 21.09.2023
Copy forwarded to:
Assistant Registrar, ITAT, New Delhi
Technical Grounds in Revenue Appeal: ITO vs Ritesh Singh for AY 2014-15
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