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Income Tax Appellate Tribunal, DELHI BENCH ‘E’: NEW DELHI
ORDER PER ANADEE NATH MISSHRA, AM: (A) This appeal by Assessee is filed against the order of Learned
Commissioner of Income Tax (Appeals)-37, New Delhi [“Ld. CIT(A)”, for short], dated 29/03/2019 for Assessment Year 2015-16.
Grounds taken in this appeal are as under:
Nuray Realtech Private Limited vs. ITO “1. That on the facts & in the circumstances of the case and in law, the order passed by the Ld. Commissioner of Income Tax (Appeals) [CIT(A)] and Ld. AO is wrong and bad in law.
That having regards to the facts and circumstances of the case and in law the Assessing Officer has erred on facts and law in making addition of Rs.5,90,25,000/- under section 68 by treating the inter corporate deposits taken by company as unexplained cash credits. The additions has been made on surmises and conjectures rejecting documentary evidences and explanations filed before Ld. AO and Ld. CIT(A). Thus, the additions made by AO are erroneous and bad in law.
That the Ld. CIT(A) and Ld. AO erred both on facts and circumstances of the case and in law in initiating penalty proceedings under section 271(1)(c) on account of above disallowance treating the same as concealment of income is unwarranted and must be quashed.
That the above grounds of appeal are without prejudice to each other.
That the appellant reserves its right to add, alter, amend or withdraw any ground of appeal before or at the time of hearing of this appeal.”
(B) The assessee filed return of income on 22.09.2015 declaring income of Rs.588/-. Vide assessment order dated 27.12.2017 passed u/s 143(3) of the Income Tax Act, 1961; an addition of Rs.5,90,25,000/- was made by the Assessing Officer u/s 68 of Income Tax Act and the total income was assessed at Rs.5,90,25,588/-. The assessee filed appeal before the Ld. CIT(A).
Vide impugned appellate order dated 29/03/2017; the Ld. CIT(A) dismissed the assessee’s appeal. The present appeal before us was Nuray Realtech Private Limited vs. ITO filed by the assessee against the aforesaid impugned appellate order dated 29/09/2019.
(B.2) At the time of hearing before us, the Ld. Authorized Representative (“AR) for assessee submitted that the impugned appellate order passed by Ld. CIT(A) was not a speaking order in respect of points for determination before the Ld. CIT(A), having regard to the grounds of appeal filed by the appellant assessee in the office of Ld. CIT(A). He further submitted that the Ld. CIT(A) erred in dismissing the assessee’s appeal in limine; and also, that Ld. CIT(A) was duty bound to pass a speaking order on merits. He further submitted that the impugned appellate order should be set aside and Ld. CIT(A) should be directed to pass a fresh order. The Ld. Sr. DR for Revenue did not dispute the submissions made by Ld. AR for assessee; and was in agreement with the submissions of the Ld. AR for assessee. We have perused the materials on record.
We have heard the representatives of both sides. We find from the perusal of the impugned appellate order dated 29/03/2019 of Ld. CIT(A) that the Ld. CIT(A) dismissed the assessee’s appeal in limine , taking adverse view of non-compliance with notices of hearing Page 3 of 6
Nuray Realtech Private Limited vs. ITO issued by office of the Ld. CIT(A). The Ld. CIT(A) dismissed the assessee’s appeal in a summary manner, for non-compliance with the notices of hearing, under the presumption that the assessee was not interested in pursuing the appeal. The Ld. CIT(A) did not decide the assessee’s appeal on merits, and dismissed the appeal in limine. The relevant provisions under I.T. Act regarding procedure in appeal, and powers of the Commissioner [Appeals] are contained in Sections 250 and 251 of I.T. Act, which are reproduced below for ready reference:
“250. (1) The Commissioner (Appeals) shall fix a day and place for the hearing of the appeal, and shall give notice of the same to the appellant and to the Assessing Officer against whose order the appeal is preferred.
(2) The following shall have the right to be heard at the hearing of the appeal— the appellant either in person or by an authorized (a) representative; the Assessing Officer, either in person or by a (b) representative.
(3) The Commissioner (Appeals) shall have the power to adjourn the hearing of the appeal from time to time.
(4) The Commissioner (Appeals) may, before disposing of any appeal, make such further inquiry as he thinks fit, or may direct the Assessing Officer to make further inquiry and report the result of the same to the Commissioner (Appeals).
Nuray Realtech Private Limited vs. ITO (5) The Commissioner (Appeals) may, at the hearing of an appeal, allow the appellant to go into any ground of appeal not specified in the grounds of appeal, if the Commissioner (Appeals) is satisfied that the omission of that ground from the form of appeal was not willful or unreasonable.
(6) The order of the Commissioner (Appeals) disposing of the appeal shall be in writing and shall state the points for determination, the decision thereon and the reason for the decision.
[(6A) In every appeal, the Commissioner (Appeals), where it is possible, may hear and decide such appeal within a period of one year from the end of the financial year in which such appeal is filed before him under sub-section (1) of section 246A
(7) On the disposal of the appeal, the Commissioner (Appeals) shall communicate the order passed by him to the assessee and to the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner.”
(C) A perusal of the above provisions of law shows that U/s 250(6) of I.T. Act, the Ld. CIT(A) was obliged to dispose off the appeal in writing after stating the points for determination and to then pass an order on “each of the points which arose for consideration”; and the Ld. CIT(A) was further obliged to state the reasons for his decision on each such points which arose for determination.
(D) In view of the foregoing, and in the specific facts and circumstances of the present appeal before us, and as both sides
Nuray Realtech Private Limited vs. ITO are in agreement with this, we hold that the Ld. CIT(A) erred in dismissing the appeal of the Assessee in limine in a summary manner and accordingly; we set aside the impugned order of the Ld. CIT(A); and further, we direct the Ld. CIT(A) to pass denovo order as per law after providing reasonable opportunity to the appellant assessee, ensuring proper adherence with section 250(6) of I.T. Act.
(E) In the result, the assessee’s appeal is partly allowed for statistical purposes.
Order pronounced in the open Court on 28/02/2023.