Maruti Brokerage House Pvt. Ltd. Vs ITO (ITAT Ahmedabad)
CIT(A) Passed Ex-Parte Order Without Considering Facts – ITAT Restores Client Code Modification Case for Fresh Hearing
AO alleged that the Assessee booked contrived losses through client code modification (CCM) on the NMCE exchange platform & disallowed losses of ₹82,26,525 (AY 2010-11) & ₹22,71,615 (AY 2011-12). The addition was based solely on an investigation wing report, which was never confronted to Assessee.
Assessee did not appear before CIT(A), leading to an ex-parte dismissal of the appeal & confirmation of the additions.
Before ITAT, Assessee admitted non-appearance but argued that:
- The entire addition was based on surmises & conjectures.
- No direct evidence was brought against the Assessee.
- The investigation report was not confronted, violating natural justice.
- Assessee had submitted evidence of genuine trading.
Tribunal observed that the CIT(A) did not verify the facts or examine whether the investigation report was confronted, & simply upheld the addition without proper consideration. To ensure justice, the ITAT restored the matter to CIT(A) with directions to re-adjudicate after giving proper opportunity to Assessee. Assessee was cautioned not to misuse the opportunity & to actively participate in the proceedings.
FULL TEXT OF THE ORDER OF ITAT AHMEDABAD
