Case Law Details
R.M. Chemicals Private Limited Vs DCIT (ITAT Indore)
Introduction: The Income Tax Appellate Tribunal (ITAT) Indore has recently ruled in favor of R.M. Chemicals Private Limited in its appeal against the DCIT. The case revolved around the issue of an assessment order passed without providing sufficient opportunity to the assessee. The ITAT Indore directed for a re-adjudication of the case.
Analysis: The verdict given by the ITAT emphasizes the importance of providing a fair chance for representation in tax adjudication. The tribunal acknowledged the serious medical condition of the director of R.M. Chemicals, which hindered the company’s active participation in the initial hearings. The ITAT pointed out that a proper adjudication could only be realized if the assessee is given a reasonable opportunity to present its case. Therefore, the tribunal ruled that the matter be remanded back to the CIT(A) for re-adjudication. It also instructed the assessee to adequately represent its case and avoid unnecessary adjournments.
Conclusion: The verdict of ITAT Indore in R.M. Chemicals Private Limited vs DCIT underscores the importance of the principles of natural justice and fair play in tax litigation. It indicates that the assessee’s right to be heard and to present relevant evidence is fundamental to the process. This ruling emphasizes the necessity of providing sufficient opportunities to the assessee and the principle of natural justice in tax proceedings, potentially guiding future similar cases.
FULL TEXT OF THE ORDER OF ITAT INDORE
Feeling aggrieved by appeal-order dated 08.07.2022passed by learned Commissioner of Income-Tax, National Faceless Appeal Centre,Delhi [“Ld. CIT(A)”], which in turn arises out of assessment-order dated 10.03.2021 passed by learned National E-Assessment Centre, Delhi [“Ld. AO”] u/s 143(3) of Income-tax Act, 1961 [“the Act”] for Assessment-Year [“AY”] 201819, the assessee has filed this appeal.
2. Heard the learned Representatives of both sides and case-records perused.
3. AR representing the assessee moves an application under Rule 29 of Income-tax Appellate Tribunal Rules, 1963 for admission of certain evidences, namely (i) Form No. 10CCB filed by assessee on 06.03.2021, (ii) Form No. 67 filed by assessee on 06.03.2021, (iii) Copy of medical report of assessee-company’s director Shri Mahendra Kumar Jain, and (iv) Copy of Computation of Income for AY 2018-19.
4. Then, Ld. AR also drew our attention to the order of first-appeal and very humbly submitted that the assessee could not attend the hearings fixed by CIT(A) since its director Shri Mahendra Kumar Jain was diagnosed with cancer and later on succumbed to it. Ld. AR has placed on record the medical reports. Ld. AR submitted that due to the critical nature of disease, there was a complete blackout in the life and family of director leading to disruption of all matters relating to the assessee-company since it is a family run company and Shri Mahendra Kumar Jain was the main functionary. Ld. AR submitted that the present case involves meritorious grounds to be contested by assessee; therefore the assessee-company should be given a fair chance to represent its case before Ld. CIT(A). Ld. AR prayed that the matter may be remanded to the file of CIT(A) for a proper adjudication on merit after giving due opportunity of hearing to the assessee; this would enable the CIT(A) to take an apt decision in accordance with law without any harm to revenue.
5. DR showed a sympathetic view and fairly agreed to the prayer of AR for remanding case to CIT(A) but, however, requested us to direct the assessee to represent its case before Ld. CIT(A) adequately and do not seek unnecessary adjournments.
6. In view of fair consent of Ld. DR to the prayer of Ld. AR and also having regard to the principle of natural justice and fair play, we deem it fit and appropriate to remand this matter back to the file of CIT(A) for a proper adjudication after giving opportunity of hearing to the assessee, uninfluenced by his earlier decision. We also direct the CIT(A) to consider the evidences moved before us, as narrated in foregoing paragraph, in accordance with law. The assessee is also directed to ensure participation in the hearings fixed by CIT(A) and do not seek unnecessary adjournments.
7. Resultantly, this appeal of assessee is allowed for statistical purpose.
