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Facts
The assessee's appeal against an ex-parte assessment order was dismissed by the First Appellate Authority on the grounds of non-prosecution, without providing a reasonable opportunity for being heard. The assessment itself was reopened under Section 147 for alleged failure to comply with statutory notices.
Held
The Tribunal held that the First Appellate Authority cannot dismiss an appeal solely on the ground of non-prosecution. The authority must decide the appeal on merits based on available records, providing a speaking order after giving a reasonable opportunity of being heard to the assessee.
Key Issues
Whether the First Appellate Authority erred in dismissing the appeal on non-prosecution without providing a reasonable opportunity for hearing or passing a speaking order on merits.
Sections Cited
147, 144, 144A
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Income Tax Appellate Tribunal, “B” BENCH, MUMBAI
Before: SHRI SAKTIJIT DEY, V.P. & MS. PADMAVATHY S., AM
O R D E R Per Saktijit Dey, VP:
This is an appeal by the assessee against order dated 12.07.2024 passed by National Faceless Appeal Centre (NFAC), Delhi for the Assessment Year (AY) 2018-19.
There is a small delay of eleven days in filing the appeal. After considering the submissions of the parties, we are of the view that the delay was due to reasonable cause. Hence, we condone the delay and admit the appeal for adjudication.
AY 2018-19 Basilia Coop. Housing Society Vs. CIT(A) Thane 3. We have heard the parties and perused the materials on record. Basic grievance of the assessee is against ex-parte disposal of its appeal without providing reasonable opportunity of being heard that too through a non- speaking order.
Facts on record reveal that the assessee is a Cooperative Society. For the assessment year under dispute, assessment was reopened under Section (u/s.) 147 of the Income Tax Act, 1961 (in short the ‘Act’). As alleged by the Assessing Officer (AO), there was failure on the part of the assessee to effectively comply with various statutory notices. Whatever reply filed by the assessee, were vague and sketchy. Thus, ultimately the Assessing Officer completed the assessment u/s. 147 r.w.s. 144 and 144A of the Act determining the total income at Rs.1,06,39,029/-. Against the assessment order so passed assessee preferred an appeal before learned First Appellate Authority. However, by the impugned order, learned First Appellate Authority dismissed the appeal.
As could be seen from the observations of learned First Appellate Authority in the body of the appellate order, more specifically, in Paragraph 6.6 and 6.7, the appeal of the assessee basically was dismissed on the charge of non-prosecution.
In our view, as per the statutory mandate, learned First Appellate Authority has no power to dismiss an appeal filed by the assessee merely on the ground of non- prosecution. Even if the assessee does not comply with the hearing notices, the learned First Appellate Authority is supposed to decide the appeal on merits based on the materials available on record through a speaking order. The aforesaid statutory mandate has not been carried out by learned First Appellate Authority in the present case.
In view of the aforesaid, we set aside the impugned order of learned First Appellate Authority and restore the issue back to his file for de-novo adjudication after providing reasonable opportunity of being heard to the assessee. It is made AY 2018-19 Basilia Coop. Housing Society Vs. CIT(A) Thane clear, learned First Appellate Authority must decide the appeal on merits through a speaking order. Grounds are allowed for statistical purposes.
In the result, appeal is allowed for statistical purposes .
Order pronounced in the open court on 23.04.2025 Sd/- Sd/- (Padmavathy S.) (Saktijit Dey) Accountant Member Vice President Mumbai; Dated : 23.04.2025 Aks/- Copy of the Order forwarded to : 1. The Applicant 2. The Respondent 3. The CIT(A) 4. CIT - concerned 5. DR, ITAT, Mumbai 6. Guard File BY ORDER,