Case Law Details
DCIT (Exemptions) Vs Sri Saraswathi Educational Society (ITAT Visakhapatnam)
Without calling for Remand Report by the CIT(A), the Order of the CIT(A) is not valid – held by Vizag ITAT in the case of Deputy Commissioner of Income Tax (Exe) Vs. Keshava Reddy Educational Society (ITA No.96, 95, & 283 / Viz / 2018) dated 30.04.2014
The facts of the case are that the assessee is a Society filed its return of income claiming exemption U/s. 11 of the Act. The case was subsequently selected for scrutiny. During the course of scrutiny proceedings, the assessee has not responded to the notices issued by the assessing officer. Finally, the assessing officer issued the show cause notice to the assessee as to why the assessment cannot be completed ex-parte u/s.144 of the Act. In response, the assessee filed a letter stating that the promoter Sri N. Kesava Reddy is in Police custody because of unforeseen contingencies and not available for the last six months. Considering the fact that the assessee is not able to furnish the information called for and also not provided the books of account before the Ld. AO, the Ld.AO passed the assessment order ex-parte u/s. 144 of the Act by disallowing the exemption claimed by the assessee U/s. 11 of the Act. Further, the Ld. AO also disallowed the expenditure to the extent of 10% claimed by the assessee on estimation basis and added to the total income of the assessee. Aggrieved by the order of the Ld. AO, the assessee preferred an appeal before the Ld. CIT(A). On appeal, the Ld. CIT(A) by relying on the decision of the Apex Court in the case of Brij Bhushan Lal Paraduman Kumar vs. CIT [1978] 115 ITR 524 (SC) and other judicial pronouncements, allowed the appeal of the assessee without calling for the remand report. On appeal by the revenue before the Hon’ble ITAT, Vizag it has held that the Ld. CIT(A) has grossly erred in not calling for the remand report from the Ld. AO by following the Rule prescribed under Rule-46A of the Income Tax Rules, 1962 and also following the procedure laid down U/s. 250 of the Act while disposing of the appeals. Under these circumstances, we deem it fit to remit the matter back to the file of the Ld. CIT(A). Accordingly, we hereby remit the matter back to the Ld. CIT(A) with a direction to call for a remand report from the Ld. AO on the books of account of the assessee / records / bills / vouchers submitted by the assessee and decide the case de-novo and in accordance with law by passing a speaking order as per the provisions of the Act.
On behalf of the Income Tax Department, Dr. Aparna Villuri Sr.AR appeared and on behalf of the assessee CA. Chandramouleswara Rao appeared.
FULL TEXT OF THE ORDER OF ITAT VISAKHAPATNAM
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