M/s Choudhari Construction Co. vs. Asst. CIT Circle-31(1), Mumbai

Parties Involved

Facts Summary

Briefly stated, facts of the case are that assessment in the case of the assessee has been passed u/s 144 of the Income-tax Act, i.e. ex-parte manner. On further appeal before the Ld. CIT(A), the assessee submitted that matter may be remitted back for considering the submission of the assessee. However, the Ld. CIT(A) has rejected this request of the assessee on the ground that Ld. CIT(A) does not have any power of restoring the matter back to the AO. The finding of the Ld. CIT(A) is reproduced as under: Decision: I have considered the submission of the appellant and gone through the AO's observation & decision and find that the appellant has been provided ample opportunity to make necessary compliance before the assessing officer but despite sending one adjournment letter to the AO never complied afterwards. The problem put up at appeal stage is purely unproved and personal one and the ground taken thereof accordingly is treated as un-entertainable. Moreover either remand back the case to the file of AO or to allow further opportunity of hearing after completion of assessment is beyond the purview of the CIT Appeal. We find that the Ld. CIT(A) under the provisions of the Act is required to decide the appeal on the ground raised by the assessee by way of reasoned order. Since the Ld. CIT(A) has not decided ground raised by the assessee on merit, therefore, the order of the Ld. CIT(A) on the issue in dispute is set aside and restored back to him for deciding afresh with libert…

Legal Issues

• 1. Failure of Natural Justice
• 2. Ad-hoc disallowance of direct and indirect expenses
• 3. Addition disallowance of unexplained cash credits
• 4. Interest on unsecured loans
• 5. Disallowance of Depreciation
• 6. Levy of penal interest

Judgment Outcome

Decided in favour of Assessee.

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