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Income Tax Appellate Tribunal, “F” BENCH, MUMBAI
Before: SHRI ABY T. VARKEY & SHRI AMARJIT SINGH
IN THE INCOME TAX APPELLATE TRIBUNAL “F” BENCH, MUMBAI BEFORE SHRI ABY T. VARKEY, JUDICIAL MEMBER AND SHRI AMARJIT SINGH, ACCOUNTANT MEMBER ITA No.2111/Mum/2023 Assessment Year: 2005-06 v. M/s.U.S.Roofs Ltd., The ITO-10(3), 115/116, JK Chambers, Mumbai. Sec-17, Vashi, Navi Mumbai-400 703. [PAN: AAACU 3633 L] (Appellant) (Respondent) Appellant by : Shri Fenil Bhatt Respondent by : Shri Vithal Machindra Bhosale, Sr.DR Date of Hearing : 05.10.2023 Date of Pronouncement : 17.10.2023
O R D E R PER ABY T. VARKEY, JM: This appeal has been preferred by the assessee against the order of the Commissioner of Income-Tax (Appeal)/NFAC dated 04.01.2023 for AY 2005- 06.
At the outset, the Ld.AR of the assessee Shri Fenil Bhatt, brought to our notice that the impugned order passed by the Ld.CIT(A)/NFAC, is an ex parte order without hearing the assessee; and he also brought to our notice that the appeal filed by the assessee is delayed by 92 days and cause for the delay was due to the fact that the Ld.AR who was entrusted with the case (filing of appeal before the Tribunal) had to urgently leave for his home town Jaunpur, Uttar Pradesh, since his sister-in-law and mother became sick and both of them expired on 25.03.2023 & 20.04.2023 respectively. According to the Ld.AR, due to aforesaid unfortunate incident which was beyond the control of the Ld.AR, he could not file the appeal within the prescribed time and the delay caused of 92 days for filing of the appeal was not deliberate. In order to buttress the aforesaid
ITA No.2111/Mum/2023 AY.2005-06 M/s. U. S. Roofs Ltd :: 2 :: facts, have filed duly sworn /notarized affidavit of Shri Tarun Tripathi, CA. In light of aforesaid facts brought on record by an affidavit (supra), we find that the AR who was entrusted with the appeal papers couldn’t file the same due to the unfortunate incidents at Varanasi and had to stay there for performing last rites as noted (supra); and therefore, the delay caused in filing of appeal stands condoned.
Further, it is noticed that the Ld.CIT(A)/NFAC has passed the impugned order ex parte qua assessee. According to the Ld.CIT(A), the assessee had been granted ‘4’ opportunities and since, the assessee did not respond to the notices issued by him, he was pleased to dismiss the grounds raised by the assessee without going into the merits of the case. According to the Ld.AR, the assessee did not receive any notice of hearing [and the Ld.CIT(A) has not given any details of service of notice] therefore Ld. AR couldn’t appear/file written submission along with documents before the Ld. NFAC. Taking into consideration, the fact that the change from Physical Appellate proceedings to Faceless proceedings has taken place recently and there has been several instances of technical glitches brought to our notice which might have happened in the case of the assessee also the assessee couldn’t file written submission/file relevant documents during the hearing before Ld. CIT(A). Be that as it may, even if it is assumed that the assessee was served the copy of notice but did not appear before the Ld.CIT(A), the appeal was required to be disposed off on merits as already ordered by the Hon’ble Bombay High Court in the case of CIT v. Premkumar Arjundas Luthra HUF reported in (2017) 291 CTR 614 (Bom.), wherein, it was observed as under:
“1. This Appeal under Section 260A of the Income Tax Act, 1961 (the Act) challenges the order dated 9th May, 2013 passed by the Income Tax Appellate Tribunal (the Tribunal). The impugned order is in respect of Assessment Year 2006-07.
ITA No.2111/Mum/2023 AY.2005-06 M/s. U. S. Roofs Ltd :: 3 :: 2. This appeal raises the following question of law for our consideration :— "Whether on the facts and in the circumstances of the case and in law, the Tribunal was justified in holding that the CIT(A) does not have the power under the Income Tax Act, 1961 to dismiss the appeal of the assessee for non-prosecution of the appeal?" 3. For the Assessment year 2006-07, the Assessing Officer by order dated 8th March, 2010 imposed a penalty upon the respondent- assessee under Section 271(1)(c) of the Act. 4. Being aggrieved, the respondent-assessee challenged the order dated 8th March, 2010 before the Commissioner of Income Tax (Appeals) (CIT(A)). At the hearing before the CIT(A), as none appeared for hearing in support the CIT(A) dismissed the respondent- assessee's appeal for non -prosecution. 5. On further appeal, the Tribunal by the impugned order dated 9th May, 2013 held that in view of Section 250(6) of the Act the CIT(A) has no power to dismiss an appeal on account of non-prosecution. The section mandates that the order of the CIT(A) shall be in writing and shall state the points for determination and render a decision thereon. The impugned order records that this exercise has not been carried out by the CIT(A) and therefore the order dated 8th March, 2010 of the CIT(A) is unsustainable. Thus the impugned order dated 9th May, 2013 was quashed and set aside and appeal restored to CIT(A) for fresh disposal. 6. Mr. Suresh Kumar, the learned counsel for the Revenue in support reiterates the findings of CIT(A) in support of his submissions. 7. An appeal is filed with the CIT(A) from appealable orders listed in Section 246A of the Act. We find that the procedure in appeal before the CIT(A) and the powers of the CIT(A) are governed by Sections 250 and 251 of the Act respectively. The relevant provisions for consideration are as under:— 'Procedure in appeal. 250 (1) . . . . . . . . . . . . ..
ITA No.2111/Mum/2023 AY.2005-06 M/s. U. S. Roofs Ltd :: 4 :: (2) . . . . . . . . . . . . . . . . . (3) . . . . . . . . . . . . . . . . . (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). (5) . . . . . . . . . . . . . . . . . . (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) . . . . . . . . . . . . . . . . . . (7) . . . . . . . . . . . . . . . . . . Powers of the [Commissioner (Appeals)] "Section 251(1) In disposing of an appeal, the Commissioner (Appeals) shall have the following powers — (a) in an appeal against an order of assessment, he may confirm, reduce, enhance or annul the assessment. (aa) . . . . . . . . . . . . . . . . . . (b) in an appeal against an order imposing a penalty, he may confirm or cancel such order or vary it so as either to enhance or to reduce the penalty." (c) . . . . . . . . . . . . . . . . . . (2) The Commissioner (Appeals) shall not enhance an assessment or a penalty or reduce the amount of refund unless the appellant has had a reasonable opportunity of showing cause against such enhancement or reduction. Explanation. - In disposing of an appeal, the Commissioner (Appeals) may consider and decide any matter arising out of the proceedings in which the order appealed against was passed, notwithstanding that such matter was not raised before the Commissioner (Appeals) by the appellant.'
ITA No.2111/Mum/2023 AY.2005-06 M/s. U. S. Roofs Ltd :: 5 :: 8. From the aforesaid provisions, it is very clear once an appeal is preferred before the CIT(A), then in disposing of the appeal, he is obliged to make such further inquiry that he thinks fit or direct the Assessing Officer to make further inquiry and report the result of the same to him as found in Section 250(4) of the Act. Further Section 250(6) of the Act obliges the CIT(A) to dispose of an appeal in writing after stating the points for determination and then render a decision on each of the points which arise for consideration with reasons in support. Section 251(1)(a) and (b) of the Act provide that while disposing of appeal the CIT(A) would have the power to confirm, reduce, enhance or annul an assessment and/or penalty. Besides Explanation to sub-section (2) of Section 251 of the Act also makes it clear that while considering the appeal, the CIT(A) would be entitled to consider and decide any issue arising in the proceedings before him in appeal filed for its consideration, even if the issue is not raised by the appellant in its appeal before the CIT(A). Thus once an assessee files an appeal under Section 246A of the Act, it is not open to him as of right to withdraw or not press the appeal. In fact the CIT(A) is obliged to dispose of the appeal on merits. In fact with effect from 1st June, 2001 the power of the CIT(A) to set aside the order of the Assessing Officer and restore it to the Assessing Officer for passing a fresh order stands withdrawn. Therefore, it would be noticed that the powers of the CIT(A) is co-terminus with that of the Assessing Officer i.e. he can do all that Assessing Officer could do. Therefore just as it is not open to the Assessing Officer to not complete the assessment by allowing the assessee to withdraw its return of income, it is not open to the assessee in appeal to withdraw and/or the CIT(A) to dismiss the appeal on account of non-prosecution of the appeal by the assessee. This is amply clear from the Section 251(1)(a) and (b) and Explanation to Section 251(2) of the Act which requires the CIT(A) to apply his mind to all the issues which arise from the impugned order before him whether or not the same has been raised by the appellant before him. Accordingly, the law does not
ITA No.2111/Mum/2023 AY.2005-06 M/s. U. S. Roofs Ltd :: 6 :: empower the CIT(A) to dismiss the appeal for non-prosecution as is evident from the provisions of the Act. 9. In the above view, the question as raised does not give rise to any substantial question of law. Thus, not entertained. 10. Accordingly, Appeal dismissed. No order as to costs.”
Respectfully following the order of the Hon’ble Bombay High Court (supra), since we find that the impugned order passed by the Ld.CIT(A)/NFAC is an ex parte order and not in accordance with s.250(6) of the Income Tax Act, 1961 (hereinafter “the Act”), we set aside the impugned order and restore the appeal to the file of the Ld.CIT(A)/NFAC with a direction to adjudicate the grounds of appeal raised by the assessee in accordance with sub-sec.(6) to s.250 of the Act. The assessee is directed to file written submissions/relevant documents in support of his grounds of appeal and request for hearing if it desires in accordance with Rules.
In the result, the appeal filed by the assessee is allowed for statistical purposes.
Order pronounced in the open court on this 17/10/2023.
Sd/- Sd/- (AMARJIT SINGH) (ABY T. VARKEY) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai, Dated: 17/10/2023. TLN, Sr.PS (on Tour)
ITA No.2111/Mum/2023 AY.2005-06 M/s. U. S. Roofs Ltd :: 7 :: Copy to: 1. The Appellant 2. The Respondent 3. The CIT 4. The DR, ITAT, Mumbai 5. Guard File // True Copy // By Order
Dy./Asst. Registrar, ITAT, Mumbai