TMI Blog2020 (3) TMI 120X X X X Extracts X X X X X X X X Extracts X X X X ..... y the assessee are neither signed by the Auditor nor by the Director and, therefore, the same are not reliable. The assessee has failed to produce any confirmation to the effect that the assessee received payment from M/s. Omax as interest free unsecured loan. The assessee has neither filed any agreement for obtaining unsecured loan from said party. In the facts and circumstances of the case and in the substantial interest of the justice, we feel it appropriate to restore this matter to the file of the Assessing Officer with the direction to the assessee to produce following documents and direction to the Assessing Officer to carry out enquiries deemed fit and then decide whether the remission of the liability in question is liable to be income under Section 41(1) Since the assessee has not cooperated before the learned First Appellate Authority it is its responsibility to produce all the documents required by the Assessing Officer and cooperate in the proceedings. Thus, ground no. 4 of the assessee is allowed for statistical purposes. - ITA No.679/Del./2017 - - - Dated:- 28-2-2020 - Shri Amit Shukla, Judicial Member And Shri O.P. Kant, Accountant Member For the Appella ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /- under section 41(1) of the Act as liability of Trade Payables written off. On further appeal, the Ld. CIT(A) rejected the contention of the assessee and confirmed the addition in dispute. Aggrieved, the assessee is in appeal before the Tribunal raising the grounds as reproduced above. 3. In ground No. 1 the assessee has challenged the impugned order as passed ex-party, in violation of the principle of the natural justice. 3.1 The learned Counsel supported the grounds raised by the assessee, whereas the learned DR referred to para 2 of the impugned order, wherein the Ld. CIT(A) has mentioned the opportunities provided to the assessee, but not availed by the assessee. According to learned DR, the Learned CIT(A) cannot faulted for non-appearance or representation, despite so many opportunities provided. 3.2 We have heard the rival submission of the parties on the issue in dispute. The relevant para of the Ld. CIT(A) is reproduced as under : 2. First notice was issued on 19.08.2014 scheduling date of hearing on 09.09.2014 On this date, adjournment was sought and case was adjourned to 13.10.2014. On this date, none attended. On 28.10.2014 another notice was i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... came back un-served. No communication is on record regarding any change on address from the appellant. Given history of non compliance, it is evident that the appellant has chosen not to accept the latest notice for reasons best known to it. 3.3 It is evident from the above paragraph of the impugned order, that numerous opportunities have been provided by the Learned CIT(A) to the assessee, however, the assessee has avoided the hearings and did not avail the opportunities to represent before the Ld. CIT(A). In such circumstances, the action of the Ld. CIT(A) in passing the order on the basis of the material on record, cannot be said to be unjustified or in violation of the principle of the natural justice. Accordingly, this ground of the appeal of the assessee is dismissed. 4. In ground No. 2, the assessee has challenged that impugned order is non-speaking and unreasoned. 4.1 We have heard both parties on this issue. We do not agree with the grounds raised by the assessee. We find that the CIT(A) has decided the issue in para 4.2 of the impugned order and supported his finding with the reasoning, which we will be referring while deciding the ground on merit of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Omaxe, which now has been transferred to general reserve. 6.5 The Ld. CIT(A) upheld the addition of observing that in independent verification under section 133(6), the Assessing Officer found that M/s Omaxe had already written off the amount, which was due from the assessee and the assessee failed to lead any evidence to substantiate that impugned amount was an unsecured loan and not part of the trade payables as disclosed in the balance-sheet. 6.6 Before us, the learned Counsel of the assessee has filed a paper-book containing pages 1 to 75 and referred to various pages to support the case of the assessee. In the paper-book, the assessee filed balance-sheet of the assessee company as on 31/03/2004; 31/03/2005; 31/03/2006; 31/03/2007; 31/03/2008; 31/03/2009; 31/03/2010. All these balances are unsigned, i.e., not signed either by the Auditor or by the Director of the company. The assessee has also filed financial statement for financial year 2010-11 relevant to assessment at 2011-12 but the notes to accounts has not been appended. 6.7 Before us, the learned Counsel of the assessee, referred to page 24 of the paper-book which contains scheduled of the balance-sheet a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... td. [2019] 101 taxmann.com 400 (SC); 4. Luxor Writing Instruments (P.) Ltd., Vs. Dy. Commissioner of Income-tax, Circle 4(1), New Delhi, [2013] 31 taxmann.com 408 (Delhi Trib.); 5. CIT Vs. ICC India P. ltd., ITA No. 396/2012 (Dated: 20th November, 2012) (Delh-HC) 6. Logitronics (P.) Ltd. Vs. Commissioner of Income Tax, [2011] 197 TAXMAN 394 (Delhi); 7. Sutlej Cotton Mills Ltd. Vs. Commissioner of Income Tax, [1979] 116 ITR 1 (SC); 8. Tuticorin Alkali Chemicals Fertilizers Ltd. Vs. Commissioner of Income Tax, [1997] 93 Taxman 502 (SC) 6.11 On the other hand, learned DR relied on the order of the lower authorities and submitted that even during the appellate proceedings, the assessee has failed to file any confirmation from M/s. Omax to substantiate the claim of the assessee that the liability in dispute was an interest free unsecured loan not related to any trading liability. Further, he submitted that the balancesheet filed by the assessee for various years are not signed either by the Auditors or by the Directors and, therefore, the same were not reliable. He further submitted that the assessee did not avail the opportunity granted by the learned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as on 31.03.2004 to 31.03.2010 and also the copy of the Ledger account of M/s. Omax in the books of account of the assessee form 01.04.2004 to 31.03.2011. In the Ledger account, it is shown that the assessee has out of liability of ₹ 5,83,52,950/-, has paid various amounts through bank leaving closing balance of ₹ 2,47,27,914/- as on 31.03.2010 and in the year under consideration this amount has been remitted back. The contention of the learned counsel is that such amount being in the nature of the loan it does not amount to cessation of the trading liability. The findings of the Coordinate Bench of Tribunal in the case of Wasan Exports (P.) Ltd. (supra), relied upon by the assessee, is reproduced as under: 14. We have considered the rival submission and perused the material available on record. Section 41(1) of the Income Tax Act, 1961 provides where an allowance or deduction has been made in the assessment for any year in respect of loss expenditure or trading liability incurred by assessee and subsequently during any previous year (-) the (a) The first mentioned person has obtained, whether in cash or in any other manner whatsoever, any amount in respect of suc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see, therefore, rightly contended that matter may be remitted back to the file of assessing officer for reconsideration of the issue as per Law. In view of the above discussion, we set aside the orders of the authorities below and restore the matter in issue to the file of assessing officer with a direction to re-decide the issue strictly in accordance with Law, by giving reasonable, sufficient opportunity of being heard to the assessee. In the result, this ground of appeal of assessee is allowed for statistical purposes. 6.14 We find that various balance-sheets filed by the assessee are neither signed by the Auditor nor by the Director and, therefore, the same are not reliable. The assessee has failed to produce any confirmation to the effect that the assessee received payment from M/s. Omax as interest free unsecured loan. The assessee has neither filed any agreement for obtaining unsecured loan from said party. In the facts and circumstances of the case and in the substantial interest of the justice, we feel it appropriate to restore this matter to the file of the Assessing Officer with the direction to the assessee to produce following documents and direction to the Asse ..... X X X X Extracts X X X X X X X X Extracts X X X X
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