RAMA PODETI,HYDERABAD vs. ITO, WARD -15(1), HYDERABAD

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ITA 557/HYD/2026Status: DisposedITAT Hyderabad24 July 2026AY 2014-155 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that while the assessee failed to comply with notices, matters should ordinarily be decided on merits. To advance substantial justice, the Tribunal decided to grant one more opportunity to the assessee.

What were the facts?

The assessee's appeal before the CIT(A) was dismissed for non-compliance with notices. The assessee contended that they were not given adequate opportunity to present their case. The Tribunal considered the rival submissions.

What were the issues?

Whether the CIT(A) erred in dismissing the appeal for non-prosecution without adjudicating on merits, and if the assessee should be granted another opportunity to present their case.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 147,Section 56(2)(vii)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, HYDERABAD BENCHES, HYDERABAD

Before: SHRI RAVISH SOOD & SHRI MADHUSUDAN SAWDIA

For Respondent: Mr. K Prasad, Sr.AR

PER MADHUSUDAN SAWDIA, ACCOUNTANT MEMBER:

This appeal is filed by Shri Rama Podeti (“the assessee”), feeling aggrieved

by the order passed by the Learned Commissioner of Income Tax (Appeals),

National Faceless Appeal Centre (NFAC) (“Ld. CIT(A)”) dated 20.10.2023 for

the A.Y. 2014-15.

2.

The assessee has raised the following grounds of appeal:

1.

The learned Commissioner of Income-tax (Appeals) order is erroneous in facts and law.

:: 2 :: ITA No.557/Hyd/2026 Rama Podeti

2.

The Learned Commissioner of Income tax appeals erred in dismissing the appeal for alleged non-prosecution without adjudicating the grounds raised on merits, which is contrary to law and settled judicial principles.

3.

The Learned Commissioner of Income tax appeals failed to appreciate that an appeal cannot be dismissed in limine for non-appearance and that he was duty- bound to decide the issues on merits based on material available on record.

4.

The Learned Commissioner of Income tax appeals erred in not considering the detailed facts, explanations, and documentary evidence already forming part of the assessment record while confirming the assessment order.

5.

The Learned Commissioner of Income tax appeals erred in upholding the additions made under Section 56(2)(vii) and treating an amount of Rs. 2,15,09,434/- same as income of the appellant without proper appreciation of facts and law.

6.

The Learned Commissioner of Income tax appeals erred in confirming additions towards alleged unexplained investments without establishing any failure on the part of the appellant to explain the sources, thereby violating principles of natural justice.

7.

The learned Commissioner of Income Tax (Appeals) erred in confirming the order of the Assessing Officer in determining the total income at Rs.2,19,96,554/- without proper justification, without appreciating the facts on record, and contrary to the facts and circumstances of the case.

8.

The order of the Learned Commissioner of Income tax appeals is vitiated due to non-application of mind and for mechanical reliance on alleged non- appearance, ignoring the merits of the case.

9.

The appellant craves leave to add, alter, amend, or withdraw any of the above grounds at the time of hearing.

3.

The brief facts of the case are that the assessee had filed an appeal before the

Ld. CIT(A) against the assessment order passed by the Learned Assessing Officer

(“Ld. AO”) under section 143(3) read with section 147 of the Income-tax Act, 1961

(“the Act”) dated 26.12.2017. However, during the appellate proceedings, the

assessee failed to comply with the notices issued by the Ld. CIT(A). Consequently,

the Ld. CIT(A) dismissed the appeal of the assessee.

4.

Aggrieved by the order of the Ld. CIT(A), the assessee is in appeal before this

Tribunal. The Learned Authorised Representative (“Ld. AR”) submitted that the Ld.

:: 3 :: ITA No.557/Hyd/2026 Rama Podeti CIT(A) dismissed the appeal without providing adequate opportunity of being heard

to the assessee. It was contended that due to the dismissal of the appeal, the assessee could not place the necessary submissions, evidences and explanations in support of

its claim before the first appellate authority. The Ld. AR further submitted that the

impugned order has been passed in violation of the principles of natural justice and

the assessee was deprived of a fair opportunity to prosecute its case on merits. He therefore prayed that, in the interest of substantial justice, the order of the Ld. CIT(A)

may be set aside and the matter may be restored to his file for fresh adjudication

after granting one more opportunity to the assessee.

5.

Per contra, the Learned Departmental Representative (“Ld. DR”) strongly

supported the order of the Ld. CIT(A). He submitted that adequate opportunities had

already been granted by the Ld. CIT(A) during the appellate proceedings. However,

despite such opportunities, the assessee failed to appear and prosecute the appeal.

The Ld. DR therefore submitted that the assessee cannot take advantage of its own

failure and no interference is called for in the order of the Ld. CIT(A).

6.

We have heard the rival submissions and perused the material available on

record. The solitary issue arising for our consideration is whether the appeal

dismissed by the Ld. CIT(A) for non-compliance deserves to be restored for fresh

adjudication. It is an undisputed fact that the appeal filed by the assessee before the Ld. CIT(A) came to be dismissed on account of non-compliance with the notices

:: 4 :: ITA No.557/Hyd/2026 Rama Podeti issued during the appellate proceedings. The contention of the assessee before us is

that adequate opportunity was not effectively availed and consequently the assessee could not place the relevant evidences and submissions in support of its case. It is a

fact that in spite of several opportunities provided by the Ld. CIT(A) the assessee

failed to comply to the said notices. However, it is equally settled that matters should

ordinarily be decided on merits rather than on technical considerations, unless the conduct of the litigant demonstrates deliberate and repeated disregard of the

proceedings. Considering the totality of facts and circumstances of the case and in

order to advance substantial justice, we are of the considered opinion that one more

opportunity deserves to be granted to the assessee to substantiate its claim before the Ld. CIT(A). Accordingly, in the interest of justice, we set aside the impugned order

of the Ld. CIT(A) and restore the matter to his file with a direction to adjudicate the

appeal afresh on merits after providing adequate opportunity of being heard to the

assessee. The assessee shall be at liberty to file all necessary evidences, documents

and submissions in support of its contentions before the Ld. CIT(A). The Ld. CIT(A)

shall consider the same and pass a speaking order in accordance with law after

affording reasonable opportunity to both parties. We also direct the assessee to extend full cooperation in the appellate proceedings and not to seek any unnecessary

adjournment. In the event of failure on the part of the assessee to avail the

opportunities so granted, the Ld. CIT(A) shall be at liberty to proceed in accordance

with law on the basis of material available on record.

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7.

In the result, the appeal of the assessee is allowed for statistical purposes.

Order pronounced in the open court on 24th July, 2026.

Sd/- Sd/- RAVISH SOOD MADHUSUDAN SAWDIA JUDICIAL MEMBER ACCOUNTANT MEMBER Hyderabad Dated: 24th July, 2026 TLN Copy to: 1 RAMA PODETI, H.NO-9-96-9/5, PLOT NO-70/P, BODUPPAL, HYDERABAD-500090, TELANGANA 2 ITO, WARD -15(1), O/O. ITO, WARD 15(1), IT TOWERS, AC GUARDS, MASAB TANK, HYDERABAD-500004, TELANGANA 3 THE PCIT / CIT, HYDERABAD 4 THE D.R., ITAT, HYDERABAD BENCH 5 GUARD FILE

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