M/s Medway Educational Consultant Private Limited vs AO Ward17(1) Delhi

PER SUDHIR KUMAR, JUDICIAL MEMBER:

This appeal by the assessee is directed against the order of the National Faceless Appeal Centre (NFAC) Delhi [hereinafter referred to as “Ld. NFAC)”] vide order dated 31-12-2024 pertaining to A.Y. 2020-21 arising out the assessment order dated 21-09-2022 u/s.143(3) r.w.s. 144 B of the Income-tax Act, 1961, (in short ‘the Act’)

The brief facts of the case are that the assessee a company filed its return of income on 22-01-2021 declaring income at Rs6,83,670/- for the A.Y.2020-21. The case of the assessee was selected for scrutiny to verify the business expenses as the net profit shown in the ROI was merely 0.33%. Accordingly, notice u/s 143(2) of the Act was issued to the assessee on 29-06-2021. Subsequently, the AO issued the statutory notices on various dates. The AO completed the assessment after considering the submission furnished by the assessee by dis-allowancing and making the following additions as under:

Aggrieved the order of the ld. AO the assessee preferred the appeal before the Ld. NFAC who vide his order dated 31-12-2024 dismissed the appeal. Being aggrieved the order of the Ld. NFAC the assessee is in appeal before the Tribunal.

The Ld. AR of the assessee submitted that the opportunity of being heard was not provided by the lower authorities. The Learned authorized representative for Department of Revenue submitted that departmental authorities have passed reasoned orders. He also submitted that the assessee has not taken part in the proceedings before the Ld. NFAC.The appeal was rightly rejected by the Ld. NFAC.

We have heard the Ld. DR and perused the material available on record. It is an admitted fact that despite opportunities granted by Ld. NFAC, the assessee did not file his submissions, for which the appeal was dismissed ex-parte, by the Ld. NFAC.

Since in the instant case the assesse has failed to file his submission after availing the various opportunity. The assessee did not appear before appellate authority and the Ld. NFAC dismissed the appeal ex-parte. The appeal should have been decided on merit as per the provision of the section 250 of the Act. The appeal was decided ex-parte without giving the opportunity of being heard to the assessee. Therefore, considering the totality of the facts and circumstances of the case and in the interest of justice, we deem it proper to restore the issue to the file of the Ld. NFAC with a direction to grant one final opportunity to the assessee to substantiate its claim and decide the issue as per fact and law. The assessee is also directed to appear before the Ld. Assessing officer and co-operate in the proceedings. The grounds raised by the assessee are accordingly allowed for statistical purposes.

In the result, the appeal of the assessee is allowed for statistical purposes.