Case Law Details
Benit & Co. Electronics Pvt. Ltd Vs ITO (ITAT Chennai)
ncome Tax Appellate Tribunal (ITAT) Chennai, in a recent ruling, has set aside an ex-parte order passed by the Commissioner of Income Tax (Appeals)/NFAC against Benit & Co. – Electronics Pvt. Ltd. for the Assessment Year 2017-18. The Tribunal’s decision, pronounced on May 26, 2025, hinged on the assessee’s claim that notices from the CIT(A) were diverted to the email spam folder, preventing timely responses.
The assessee had appealed the CIT(A)’s order, dated January 12, 2024, with a delay of 313 days. The ITAT condoned this delay after reviewing an affidavit explaining the cause, deeming it a “reasonable cause.”
The core of the assessee’s argument was that the CIT(A) had passed an ex-parte order because the assessee failed to respond to four notices. However, the assessee contended that these notices were inadvertently directed to the “SPAM” folder of their email account, making them unaware of the communications. Consequently, the assessee was unable to submit responses, leading to a dismissal of their appeal without a merits-based hearing. The assessee sought another opportunity to present their case before the CIT(A).
The Departmental Representative opposed granting further opportunity to the assessee.
Upon review, the ITAT acknowledged that the CIT(A) had indeed passed an ex-parte order due to non-response to notices. However, accepting the assessee’s explanation regarding the technical glitch of emails landing in the spam folder, the Tribunal concluded that there was a “violation of natural justice.”
Citing this violation, the ITAT set aside the CIT(A)’s order and restored the appeal to the CIT(A) for fresh adjudication on merits, as per Section 250(6) of the Income Tax Act, 1961. The assessee’s representative undertook to file all necessary documents, written submissions, and case laws before the CIT(A), who was directed to pass a speaking order after hearing the assessee. The ITAT also noted a specific email ID for future correspondence.
The appeal was allowed for statistical purposes, indicating that the core issue remains to be decided by the lower appellate authority. No specific judicial precedents were explicitly cited by the ITAT in this decision, but the concept of “natural justice” is a fundamental principle of administrative law, requiring that parties be given a fair hearing before decisions affecting them are made.
FULL TEXT OF THE ORDER OF ITAT CHENNAI
This is an appeal preferred by the assessee against the order of the Learned Commissioner of Income Tax (Appeals)/NFAC, (hereinafter referred to as “the Ld.CIT(A)”), Delhi, dated 12.01.2024 for the Assessment Year (hereinafter referred to as “AY”) 2017-18.
2. At the outset, it is noted that there is a delay of ‘313’ days in filing of this appeal. The assessee has filed an affidavit explaining the cause of delay. Having gone through the affidavit filed for condonation of delay, we find that there is reasonable cause for delay and therefore, we are inclined to condone the same and proceed to hear the appeal on merits.
3. The Ld.AR of the assessee brought to our notice that the impugned order of the Ld.CIT(A) is an ex parte order qua assessee because the assessee didn’t respond to his four (4) notices and hence, dismissed the appeal without going into the merits of the appeal. According to the Ld.AR, notices issued by the Ld.CIT(A) went to the ‘SPAM’ account of the assessee, therefore, the assessee wasn’t aware about such notices and hence, couldn’t respond to the notices and therefore, the Ld.AR pleaded for one more opportunity before the Ld.CIT(A).
4. Per contra, the Ld.DR doesn’t want us to give one more innings to the assessee.
5. Having heard both the parties and after perusal of the records, we note that the Ld.CIT(A) has passed ex parte order qua assessee, since he found that four (4) notices issued to the assessee hasn’t been responded to. So, the Ld.CIT(A) was of the view that in the absence of relevant documents to support the contentions against the impugned action of the AO was not sustainable. Therefore, he upheld the assessment order. Be that as it may, we find that the main plea of the assessee is that the notices issued by the Ld.CIT(A) went to the ‘SPAM’ account of e-mail ID of the assessee and therefore, the assessee was not aware of such notices and therefore couldn’t respond and therefore, assessee can’t be faulted for the technical glitches. In the aforesaid circumstances, we are of the view that there is violation of natural justice and hence, we are inclined to set aside the impugned order of the Ld.CIT(A) and restore the appeal back to the file of the Ld.CIT(A) with a direction to adjudicate the grounds of appeal raised by the assessee on merits as contemplated by sub section (6) of section 250 of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act‘). The Ld.AR before us has undertaken to file requisite/relevant documents/written submissions along with case laws to substantiate its grounds of appeal before the Ld.CIT(A). The Ld.CIT(A) to pass speaking order in accordance to law after hearing the assessee. The Ld AR brought to our notice the e-mail ID for correspondence i.e.,: v.ramachandranoffice@gmail.com. This id may also be considered by Ld CIT(A) while issuing notices to assessee.
6. In the result, appeal filed by the assessee is allowed for statistical purposes.
Order pronounced on the 26th day of May, 2025, in Chennai.
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