PRINCIPAL COMMISSIONER OF INCOME TAX 3 vs. NEELU GUPTA

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TAXAP/1234/2018HC GujaratGJHC24061208201809 October 2018Author: HONOURABLE MR. JUSTICE AKIL KURESHI,HONOURABLE MR. JUSTICE B.N. KARIA2 pages

AI SummaryDismissed

What did the High Court hold?

The High Court dismissed the Revenue's appeal, noting that a similar issue had come up in Tax Appeal No. 1192 of 2018, which was also dismissed. In that prior case, the High Court observed that while the Tribunal remanding proceedings for consideration by the CIT(A) on the ground that the appeal order was ex-parte was permissible, the Tribunal could have imposed a cost on the assessee to ensure seriousness in proceedings. However, the High Court stated that solely for that purpose, it was not inclined to entertain the appeal, as it did not find any question of law arising. The Court expressed hope that the Tribunal would bear these observations in mind in the future. Therefore, following the precedent of the dismissed Tax Appeal No. 1192 of 2018, the present appeal was also dismissed.

What were the facts?

The Revenue is in appeal against an order of the Income Tax Appellate Tribunal (ITAT) dated April 5, 2018. The ITAT had set aside an order passed by the Commissioner of Income Tax (Appeals) [CIT(A)]. The Revenue's grievance is that the CIT(A) had not decided the matter on merits due to the assessee's non-compliance, despite opportunities granted. The Revenue also questions the ITAT's decision to take up the matter directly for adjudication on merits and to set aside the matter to the CIT(A) for fresh adjudication without considering the justification for the assessee's non-compliance before the lower authorities. The present appeal is similar to Tax Appeal No. 1192 of 2018, which was dismissed by the High Court.

What were the issues?

1. Whether the Appellate Tribunal erred in setting aside the order passed by the CIT(A) on the ground that the CIT(A) had not rendered any decision on merits, without appreciating that this was due to the assessee's total non-compliance despite sufficient opportunities? (Question of law and fact, concerning procedural compliance and merits). 2. Whether the Appellate Tribunal erred in law and on facts by holding that there were no reasons for an appellate forum to be bypassed and for the matter to be taken up directly before it for adjudication on merits? (Question of law and fact, concerning jurisdiction and procedure). 3. Whether the Appellate Tribunal erred in setting aside the matter to the CIT(A) for fresh adjudication without considering whether there were justifiable grounds for the assessee's total non-compliance before the CIT(A) as well as the Assessing Officer? (Question of law and fact, concerning procedural fairness and justification for non-compliance). Assessee's contentions: Not recorded in the judgment. Revenue's contentions: The Revenue argued that the CIT(A) did not decide on merits due to the assessee's non-compliance, and the ITAT erred in bypassing the CIT(A)'s order and taking up the matter directly. The Revenue contended that the ITAT should have considered the justification for the assessee's non-compliance before remanding the matter.

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances

C/TAXAP/1234/2018 ORDER IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/TAX APPEAL NO. 1234 of 2018 ========================================================== PRINCIPAL COMMISSIONER OF INCOME TAX 3 Versus NEELU GUPTA ========================================================== Appearance: MRS MAUNA M BHATT(174) for the PETITIONER(s) No. 1 for the RESPONDENT(s) No. 1 ========================================================== CORAM: HONOURABLE MR.JUSTICE AKIL KURESHI and HONOURABLE MR.JUSTICE B.N. KARIA Date : 09/10/2018

ORAL ORDER (PER : HONOURABLE MR.JUSTICE AKIL KURESHI)

Revenue is in appeal against the judgement of the Income Tax Appellate Tribunal dated 05.04.2018 raising following questions for our consideration: “A. A. Whether the Appellate Tribunal erred in setting aside the order passed by the CIT(A) on the ground that CIT(A) had not rendered any decision on merits without appreciating the fact that due to total non-compliance on part of the assessee despite granting sufficient opportunities? B. Whether the Appellate Tribunal erred in law and on facts while holing that there is no reasons for an appellate Forum being by passed and the matter being taken up directly before it for adjudication on merits? C. Whether the Appellate Tribunal erred in setting aside the matter to CIT(A) for fresh adjudication without taking into C/TAXAP/1234/2018 ORDER consideration whether there were justifiable grounds for making total non-compliance by the assessee before the CIT(A) as well as the Assessing Officer?

Similar issue came up before us in Tax Appeal No. 1192 of 2018. This Tax Appeal was dismissed by making following observations. “1. Revenue is in appeal against judgment of the Incometax Appellate Tribunal dated 28.3.2018. Tribunal remanded the proceedings for consideration of CIT (Appeals) on the ground that the appeal order was exparte. Learned counsel for the appellant is justified in making a grievance that the Tribunal did not put some check or restriction on the assessee so that sense of seriousness is brought about in the proceedings. In our prima facie view, even if the Tribunal was inclined to grant opportunity to participate in the proceedings, at least imposition of fair amount of cost could have been considered. This would bring in a level of seriousness required on the part of the assessee while facing assessment proceedings. However, only for such purpose, we are not inclined to entertain this appeal, since otherwise we do not find any question of law arising. In future assure the Tribunal would bear in mind these observations.” In the result, this Tax Appeal is also dismissed. (AKIL KURESHI, J) (B.N. KARIA, J) JYOTI V. JANI

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