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Facts
The assessee filed an income tax return for AY 2017-18. The case was selected for scrutiny, and various notices were issued by the AO. The assessee failed to fully comply with the notices. The AO made additions to income, and penalty proceedings were initiated. The CIT(A) dismissed the assessee's appeal ex-parte.
Held
The Tribunal held that the CIT(A) did not provide an effective opportunity of hearing to the assessee, which violates the principle of natural justice. The ex-parte dismissal of the appeal was deemed illegal.
Key Issues
Whether the CIT(A) erred in dismissing the appeal ex-parte without providing an effective opportunity of hearing to the assessee, thereby violating principles of natural justice.
Sections Cited
250, 143(1), 143(2), 142(1), 129, 69A
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, MUMBAI BENCH “SMC”, MUMBAI
Before: SHRI OM PRAKASH KANT & SHRI RAJ KUMAR CHAUHAN
O R D E R PER RAJ KUMAR CHAUHAN (J.M.): 1. This appeal is filed by the appellant/assessee against the orderof Ld. Commissioner of Income Tax (Appeals) / Addl/ JCIT(A), Mysore [hereinafter referred to as the “CIT(A)”],passed under section 250 of the Income Tax Act, 1961 [hereinafter referred to as “the Act”] dated
28.10.2024for the A.Y. 2017-18 wherein the appeal of the assessee was dismissed ex-parte for non prosecution of the case by the assessee as the assessee has failed to respond to the notices issued on various dates as mentioned in para 4 of the impugned order.
The brief facts as culled out from the proceedings of authorities below are thatthe assessee filed the return of income for A.Y.2017-18 on 29/07/2017 declaring total income of Rs. 2,30,840/- The return of income was processed u/s. 143(1) of the Act and subsequently, the case was selected for 'Scrutiny' under CASS by issuing notice u/s. 143(2) of the Act dated 21/09/2018. Further, notice u/s 142(1) dated 19/06/2019 was also issued for submitting the details by the assessee. Further, a notice u/s 142(1) r.w.s 129 of the Act was issued and served electronically on 28/10/2019 in which necessary details related to cash deposited during demonetization period were called for. The assessee failed to comply with the said notice. However the assessee submitted only the part details, so another notice u/s 142(1) of the Act was issued on 23/11/2019 which the assessee failed to comply. Thereafter, a show cause notice dated 07/12/2019 was issued by the AO and in response, the assessee submitted the details. Further, the AO was not satisfied with the submission of the assessee and proceeded to make addition to the total income of Rs. 4,19,500/- u/s 69A of the Act. Penalty proceedings were also initiated.
3. Being aggrieved, the assessee preferred the appeal before Ld. CIT(A)who dismissed the appeal of the assessee ex-parteon the ground that assessee has failed to pursue the case despite multiple opportunities given and no documentary or written submissions were filed before him.
4. Aggrieved by the impugned order, the assessee preferred the appeal before us.The main grievance of the assessee is that no notice was received by the assessee and the Ld. CIT(A) has dismissed the appeal in limini.
5. We have heard Ld. AR and Ld. DR and examined the record. At the very outset, Ld. AR submitted on behalf of the assessee that the impugned order has been passed ex-parte and the Ld. CIT(A) has failed to offer effective opportunity of hearing to the assessee and has dismissed the appeal and as such the assessee was prevented from presenting its case before the Ld. CIT(A). Ld. AR further submitted that after filing of the appeal before the Ld. CIT(A), no notice has been received by the assesseeand only 2 occasion when the notice was received, the assessee has sought time for adjournment to submit the details as he was suffering from various ailments and was not medically fit for a long time and by this reasons, the assessee could not pursue its case before the Ld. CIT(A). Ld. CIT(A) has dismissed the appeal only for non prosecutionof the case where there is no proof of notices of various dates were served upon the assessee, decided the appeal ex-parte and dismissed the appeal without deciding the issue on meritwithout giving opportunity of hearing to the assessee. Hence, the impugned order suffers from illegality and miscarriage of justice and liable to be set aside. Ld. AR further submitted that the assessee be given proper opportunity of hearing and the matter be restored to the file of Ld. CIT(A) for fresh adjudication of the case. In support of his arguments, an affidavit has been filed and the contents of the affidavit are extracted below:-
“1. I am the appellant in the matter concerning the filing of an appeal before the Income tax Appellate Tribunal, e.g., Commissioner of Income Tax (Appeals)], against the order passed by the ADD/JCIT(A) Mysore for the Assessment Year 2017-18, and I am fully conversant with the facts of the case.
2. That the impugned order under Section 250 of the Income Tax Act, 1961, was passed on 28/10/2024, and I was required to file the appeal within the Page | 4
statutory period of limitation i.e., within 30 days from the receipt of the order.
That due to severe medical illness, I was unable to file the appeal within the prescribed time limit. I was under continuous medical treatment from, which rendered me physically unfit and incapacitated to attend to legal matters.
That the delay in filing the appeal is neither intentional nor deliberate, but purely due to the unavoidable medical circumstances beyond my control.
That I humbly request the Hon'ble Commissioner (Income tax appellate Tribunal) to kindly condone the delay in filing the appeal and admit the same in the interest of justice.
That I undertake to prosecute the appeal diligently and abide by all directions of the Hon'ble Authority.
Whatever stated hereinabove is true and correct to the best of my knowledge and belief.”
6. Ld. DR on the other hand supported the judgment of the Ld. CIT(A) and submitted that effective opportunity of hearing was given to the assessee and there is no justification for non-appearance, hencethere is no merit in the appeal and same is liable to be dismissed.
We have considered the rival submissions and examined the record. On perusal of the finding and decision of Ld. CIT(A), it is noticed that various notices were issued to the assessee, but no response was filed by the assessee. However, the assessee has sought time for adjournment to submit the details as he was suffering from various ailments and was not medically fit for a long time and by this reasons, the assessee could not pursue its case before the Ld. CIT(A).We are of the considered opinion that Ld. CIT(A) has not given effective opportunity of hearing to the assessee which is against the principle of natural justice. Section 250 sub section 2(a) of "the Act"which provides as under:
Section 250 (2) The following shall have the right to be heard at the hearing of the appeal: - a. The appellant, either in person or by an authorised representative;
It is evident from the provision that the hearing to be given is not a formality but an effective hearing is sine qua non for the purpose of upholding the principal of natural justice. It is thus evident from the contents of the impugned order that no effective opportunity of hearing has been given by the Ld. CIT(A) while passing the impugned order.
For these reasons, we are of the considered opinion that matter needs to be restored to the file of the Ld. CIT (A) for giving effective hearing to the assessee who shall present its case before the Ld. CIT(A) within 60 days.
The impugned order is accordingly set aside and appeal filed by the assessee is allowed in above terms.
In the result, appeal filed by the assessee is allowed for statistical purposes.
Order pronounced in the open court on 21.08.2025.