The Tax Publishers2021 TaxPub(DT) 0766 (Kol-Trib)

INCOME TAX ACT, 1961

Section 68

Where CIT(A) passed an ex-parte order, but it was found that the notice of hearing was not served on the assessee; so, there was violation of principles of natural justice and accordingly, the order passed by the CIT(A) confirming addition under section 68, was set aside and the matter was remanded to the AO for fresh adjudication.

Income from undisclosed sources - Addition under section 68 - Assessee failed to prove genuineness of credit - CIT(A) passed an ex-parte order

Assessee-company raised share capital including share premium. AO made an addition under section 68 due to non-appearance of directors of the share applicant companies and the directors of the assessee-company, in response to notices under section 131. Hence, he held that the genuineness of the credit could not be proved. Aggrieved, the assessee carried the matter in appeal before CIT (A) and the CIT (A) dismissed the appeal of the assessee ex-parte. Held: AO stated that the notices were issued under section 131; however, there was no record to show that those summons/notices were served. Therefore, the AO concluded, on the basis of surmises and conjectures that the transactions were not genuine. Further, the CIT(A) passed an ex-parte order, but it was found that the notice of hearing was not served on the assessee. So, there was violation of principles of natural justice and accordingly, the order passed by the CIT(A) confirming addition under section 68, was set aside and the matter was remanded to the AO for fresh adjudication in accordance with law.

REFERRED :

FAVOUR : Matter remanded.

A.Y. : 2012-13



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