Manish Baxi , Gurgaon vs Assessee

Sh. Manish Baxi Vs. CIT(A)-2, D14/43, Ground Floor, New CGO Complex, NH IV, DLF, Exclusive Floors, Faridabad. DLF Phase-V, Gurgaon, Haryana.

(PAN AERPB 8961 N)

(Appellant) (Respondent)

Appellant by : Shri Amit Maheshwari, CA. Respondent by: Shri P. Dam Kaunjna, Sr. D.R.

ORDER

PER SHRI GEORGE GEORGE K, JM:

1. This appeal, at the instance of the assessee, is directed against the CIT(A)'s

order dated 19.02.2013. The relevant assessment year is 2007-08.

2. The solitary issue that arises for our consideration is whether the CIT(A) is

justified in confirming the penalty imposed by the AO u/s 271(1)(c) of the I.T. Act,

amounting to Rs.96,765/-.

ITA No.2735/Del /2013 2

3. Briefly stated the facts of the case are as follows.

The assessee is an individual. For the relevant assessment year, return of

income was filed on 30.07.2007, declaring an income of Rs.12,81,160/-. The

assessment was taken up for scrutiny by issuance of notice u/s 143(2) of the Act and

scrutiny assessment was completed on 18.12.2009, fixing the total income of

Rs.15,68,640/-. The AO is also initiated the penalty proceeding u/s 271(1)(c) of the

Act and penalty amounting to Rs.96,765/- was imposed by order dated 24.06.2010.

4. Against the penalty order, assessee preferred an appeal before the First

Appellate Authority. The CIT(A) dismissed the appeal of the assessee ex-parte.

According to CIT(A), assessee had filed the appeal belatedly and there was no

petition to condone the delay.

5. The assessee being aggrieved by order of CIT(A) is in appeal before us. The

Ld. Counsel for the assessee submitted that no hearing notices were serviced on the

assessee, which had resulted in an ex-parte order by the CIT(A). It was further

submitted that no notice was served on the assessee by the Assessing Officer before

imposing the penalty u/s 271(1)(c) of the Act. On merits, it was submitted that

imposition of penalty is unwarranted for the following reason:-

"1. The assessee has made a capital gain on sale of ESOP. The assessing officer has made the addition of Rs.2,26,337/- towards the net proceed due to sale of shares, which contains three receipts of Rs.1,35,057/-, Rs.58,808/- and Rs.32,472/- on 14th September 2006. Out of these three receipts, the amount of Rs.58,808/- is not ITA No.2735/Del /2013 3

related to ESOP. This is the proceeds from sale of other shares where the assessee has incurred a capital loss of Rs.22,265/-

2. An addition of Rs.61,123/- have been made towards interest receivable from Vatika Landbase (P) Limited. The assessee has booked the flat and had deposited a sum of Rs.5,82,120/- towards the booking amount. No interest has been earned on that amount."

6. The Ld. DR present was duly heard.

7. We have heard rival submissions and perused the material on record.

Admittedly, in this case, the CIT(A) has passed an ex-parte order. There is nothing

on record to suggest hearing notices before the CIT(A) were duly served on the

assessee. The CIT(A) has dismissed the appeal of the assessee without considering

the issue on merits. In the interest of justice and equity, we are of the view that one

more opportunity need to be granted to the assessee to explain the case before the

CIT(A). Hence, the case of the assessee is restored to the files of the first Appellate

Authority for fresh consideration. If there is delay in filing the appeal before the

CIT(A) the same shall be explained by the assessee by filing the necessary petition

to condone the delay. The CIT(A) after affording reasonable opportunity of being

heard to the assessee shall decide the matter, in accordance with law. The assessee

shall cooperate with revenue and shall not seek adjournment without valid reasons.

It is ordered accordingly.

ITA No.2735/Del /2013 4

8. In the result, appeal filed by the assessee is allowed for statistical purposes.

The decision was pronounced in the open Court on 25th February, 2015.

Sd/- Sd/- (B.C. MEENA) (GEORGE GEORGE K.) Accountant Member Judicial Member

Dated: 25th February, 2015. Aks/-

Copy forwarded to 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, New Delhi