PRINCIPAL COMMISSIONER OF INCOME TAX vs. GUJARAT SYSCOM TECHNOLOGIES (P) LTD
What did the High Court hold?
The High Court dismissed the Revenue's appeal, finding it similar to a previously decided Tax Appeal No. 1192 of 2018. In that prior case, the Revenue was in appeal against an ITAT order remanding proceedings to the CIT(A) because the appeal order was ex-parte. While the Court acknowledged the appellant's grievance that the Tribunal did not impose restrictions or costs on the assessee to ensure seriousness, it held that solely for this reason, it was not inclined to entertain the appeal, as it did not find any question of law arising. The Court noted that the Tribunal would bear these observations in mind for future cases. Therefore, applying the same reasoning, 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 18, 2018. The ITAT had set aside the order of the Commissioner of Income Tax (Appeals) [CIT(A)] and directed a de novo adjudication. The Revenue's grievance is that the ITAT erred in doing so without considering the assessee's total non-compliance and lack of material before the CIT(A), which compelled the CIT(A) to pass an order based on the Assessing Officer's findings. The Revenue also questions whether the ITAT should have considered justifiable grounds for the assessee's non-compliance before remanding the matter.
What were the issues?
1. Whether, on the facts and in the circumstances of the case and in law, the Appellate Tribunal erred in setting aside the order passed by the CIT(A) with the direction to adjudicate de novo, without appreciating that due to total non-compliance by the assessee and despite sufficient opportunities, the CIT(A) had no material to proceed further and had to frame an order based on the Assessing Officer's findings? (Question of law and fact, concerning the powers of the ITAT to remand). 2. Whether, on the facts and in the circumstances of the case and in law, the Appellate Tribunal erred in setting aside the matter to CIT(A) for fresh adjudication without taking into consideration whether there were justifiable grounds for the assessee's total non-compliance before the CIT(A)? (Question of law and fact, concerning the conditions for remand). Assessee's contentions: Not recorded. Revenue's contentions: The ITAT erred in remanding the matter de novo without considering the assessee's complete non-compliance and the lack of material before the CIT(A), which left the CIT(A) with no option but to rely on the Assessing Officer's findings. The Revenue argued that the ITAT should have considered whether the assessee had justifiable grounds for such non-compliance.
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Cause title — parties, addresses and appearances
ORAL ORDER (PER : HONOURABLE MR.JUSTICE AKIL KURESHI)
Revenue is in appeal against the judgement of the Income Tax Appellate Tribunal dated 18.04.2018 raising following questions for our consideration: “A. Whether on the facts and in the circumstances of the case and in law, the Appellate Tribunal erred in setting aside the order passed by the CIT(A) with the direction to adjudicate de novo without appreciating the fact that due to total non- compliance on the part of the assessee and despite providing sufficient opportunities, CIT(A) did not have any material to further dwelt upon the issue and had no choice but to frame an order based on the findings, given in the order passed by the Assessing Officer? B. Whether on the facts and in the circumstances of the case and in law, the Appellate Tribunal erred in setting aside the matter to CIT(A) for fresh adjudication without taking into consideration whether there were justifiable grounds for making total non-compliance by the assessee before CIT(A)?” C/TAXAP/1219/2018 ORDER
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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