Non-Service of Notice Through Opted Physical Mode: ITAT Restores Matter to CIT(A) for Fresh Adjudication [Read More]

  • Post author:
  • Post category:Tax Laws

The Raipur Bench of Income Tax Appellate Tribunal ( ITAT ) restored matter to the Commissioner of Income Tax(Appeals)[CIT(A)] for fresh adjudication after observing that notices were not served through the assessee’s opted physical mode.

Alok Buildtech Private Limited, appellant-assessee, engaged in civil construction, filed its return of income for AY 2019–20 declaring ₹5.49 crore. The case was selected for scrutiny based on a survey conducted on 20.02.2019. During the survey, the assessee had agreed to surrender ₹2.23 crore as additional income but declared only ₹1.48 crore under ‘other income’, leading to a difference of ₹75.33 lakh, which the Assessing Officer added back.

The assessee challenged the addition before the CIT(A), but the appeal was dismissed ex parte due to non-compliance. Despite three notices, the assessee failed to submit any supporting documents. As a result, the CIT(A) held that the assessee was not interested in pursuing the appeal.

The assessee then filed a second appeal before the tribunal.

Also Read:Invalid service of Income Tax Notice via ITBA portal: ITAT remands business expense disallowance matter [Read Order]

The assessee counsel explained that the appeal was dismissed ex parte because the assessee had opted not to receive notices by email. As a result, the assessee was unaware of the hearing notices issued by the CIT(A) and could not respond.

It was submitted that the non-compliance was unintentional and due to genuine reasons beyond the assessee’s control. The counsel requested that the matter be restored to the CIT(A) for one final opportunity to present the case.

Tax Rules Simplified, Practice Amplified – Click Here

The Departmental Representative supported the orders of the lower authorities but did not oppose the request for restoration.

The two member bench comprising Partha Sarathi Chaudhury (Judicial Member) and Arun Khodpia (Accountant Member) noted that the assessee had opted not to receive notices by email and expected physical communication. Since the Department could not show proof of service by any other mode, the tribunal accepted the assessee’s explanation.

With both parties agreeing, the appellate tribunal restored the matter to the CIT(A) for fresh consideration. It directed that the assessee be given a reasonable opportunity to present the case and instructed the assessee to cooperate in the proceedings. If not, the CIT(A) was free to decide the matter as per law.

Therefore,the appeal was allowed for statistical purposes.