Prosim Research and Development Pvt. Ltd. Vs ITO (ITAT Bengaluru)
The assessee appealed against the order of the Commissioner of Income Tax (Appeals)-5, Bengaluru for Assessment Year 2014-15. The dispute related to an addition of Rs. 1,13,59,703 under Section 40(a)(ia) of the Income-tax Act, 1961.
The assessee had filed its return declaring total income of Rs. 60,68,280. The Assessing Officer completed the assessment at Rs. 1,74,27,983 after making the addition of Rs. 1,13,59,703 on the ground that the assessee had failed to deduct tax at source under Section 195 of the Act.
The assessee appealed before the CIT(A), who disposed of the appeal ex parte by following the decision in CIT v. Multiplan India Ltd., 38 ITD 320, without considering the merits of the case.
After hearing the parties and examining the record, the Tribunal observed that the CIT(A) had not decided the appeal on merits. It held that under the provisions of the Act, the CIT(A) is required to pass an order on merits even where there is no response from the assessee.
Accordingly, in the interest of justice, the Tribunal remanded the matter to the file of the CIT(A) with a direction to provide the assessee an opportunity of hearing and decide the appeal on merits. The Departmental Representative assured the Tribunal that all necessary information would be furnished for disposal of the appeal.
