PALLAVIBEN SHAHSHIKANT KAPADIA,AHMEDABAD vs. ITO, WARD-1(2)(5), AHMEDABAD

None appeared on behalf of the assessee. Therefore, I proceed to dispose of the appeal after hearing the ld.DR and considering the material available on record.

Registry has pointed out that appeal filed by the assessee is barred by 29 days. In order to explain the delay, the assessee has filed condonation application as well as affidavit. In that affidavit she deposed that order of ld.CIT(A) dated 20.11.2018 passed under section - 2 – 250 of the Income Tax Act, 1961 was received only on 25.11.2018. The reason for delay in filing appeal before the Tribunal narrated in the affidavit was that her husband had suffered brain stroke, and there were some subsequent complications thereafter; her husband is currently under medical treatment. The impugned order of the CIT(A) was got misplaced in between and now the assessee was able to recover the same. The delay caused by the assessee in filing the appeal before the Tribunal is not deliberate and beyond her control. It is thus prayed for condonation of the delay. On the other hand, the ld.DR opposed prayer of the assessee.

On due consideration of the above facts and circumstances, I am convinced that the assessee was prevented by sufficient reasons for not filing appeal before the Tribunal in time. There is no deliberate attempt at the end of the assessee to make her appeal time barred because by making an appeal time bared, the assessee was not going to gain anything. Therefore, I condone the delay in filing the appeal and decide the same on merit.

In the grounds of appeal, the assessee has raised as many as five grounds including sub-grounds. In ground no.2, 3 and 4 the assessee challenges certain additions. However, in ground no.1 and 2 the assessee has raised a preliminary issue that the ld.CIT(A) has erred in passing an ex parte order without adjudicating the issue on merit, as well as for not providing proper opportunity of hearing to the assessee.

We take a brief fact of the case from the orders of the Revenue authorities. The assessee is an individual. The assessee did not file original return of income for the Asstt.Year 2010-11. On the basis of information received, the AO noticed that the assessee has entered into share transaction of Rs.13,64,75,686/- during the F.Y.2009-10. The assessee has not complied with the query letter issued to her. The ld.AO has construed that since the share transactions might have resulted profit/gain, which remained unexplained, and therefore, it has reason to believe that the income chargeable to tax has escaped assessment. Accordingly, after recording reasons, notice under section 148 was issued to the assessee on 30.3.2017. Notices issued to the assessee remained unanswered. The scrutiny assessment was accordingly culminated into addition of Rs.5,64,640/-. In appeal before the first appellate authority, the ld.CIT(A) dismissed appeal of the assessee for want of prosecution. Dissatisfied with order of the ld.CIT(A), the assessee is now before the Tribunal.

With the assistance of the ld.DR, I have gone through the record carefully. A perusal of the CIT(A)’s order would indicate that the ld.CIT(A) has issued notices to the assessee for arguing the appeal on two occasions as mentioned by the ld.CIT(A) in his impugned order, but the assessee did not appear nor filed details/explanation during the appellate proceedings, accordingly, the ld.CIT(A) after putting reliance upon some case laws held that since the assessee has not interested in prosecuting her appeal, therefore, the ld.AO has justified in making impugned additions. He dismissed appeal of the assessee summarily for - 4 – want of prosecution. In this connection, it is pertinent to take note of sub-section (6) of section 250 of the Income Tax Act, 1961 which reads as under: “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.”

On perusal of section would indicate that the ld.CIT(A) was required to formulate points in dispute, and thereafter record reasons on such points. No doubt the ld.CIT(A) has given opportunities to the assessee to attend the hearing and to defend his case, but the assessee did not avail and remained absent. But this very fact would not empower the ld.CIT(A) to pass an ex parte order without going to the merit of the cases and without making a speaking order, because, rationale for passing a speaking order based on the material available on record is that, such order is subject to further appeal, and such order would enable not only the litigant and the appellate authority to know the exact point of dispute for adjudication. The fact that opportunity is not availed of in a particular case, will not entitle the CIT(A) not to decide the case on merit on the basis of the material available on record. In the instant case, even if the assessee did not participate, the ld.CIT(A) ought to have gone through the assessment record and thereafter formed the point in dispute, and should have recorded reasons in support of his conclusions on those points. The ld.CIT(A) failed to adhere the mandatory procedure, hence his order is not sustainable. I allow this preliminary ground of appeal and set aside the impugned order of the ld.CIT(A) for fresh adjudication on merit.

In the result, appeal of the assessee is partly allowed for statistical purpose. Pronounced in the Open Court on 8th November, 2021.