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Facts
The assessee failed to file his return of income and did not reply to a notice. Subsequently, an ex-parte assessment order was passed, and a penalty of Rs.1,42,04,570/- was levied under Section 271(1)(c) of the Income Tax Act. The assessee's appeal before the CIT(A)/NFAC was dismissed for want of prosecution.
Held
The Tribunal held that the CIT(A)/NFAC had not decided the appeal on merit but had dismissed it for want of prosecution, which is contrary to Section 250(6) of the Act. Therefore, the matter was restored to the CIT(A)/NFAC for a fresh decision on merit.
Key Issues
Whether the CIT(A)/NFAC was justified in dismissing the appeal for want of prosecution without deciding the appeal on merit, and if not, should the matter be restored to the CIT(A)/NFAC for a decision on merits?
Sections Cited
271(1)(c), 147, 148A, 148, 144B, 250(6)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, PUNE BENCH “B”, PUNE
Before: SHRI R. K. PANDA & SHRI VINAY BHAMORE
This appeal filed by the assessee is directed against the order dated 10.11.2025 of the Ld. CIT(A) / NFAC, Delhi relating to assessment year 2015-16.
Although a number of grounds have been raised by the assessee, however, these all relate to the ex-parte order of the Ld. CIT(A) / NFAC in confirming the penalty of Rs.1,42,04,570/- levied by the Assessing Officer u/s 271(1)(c) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’).
Facts of the case, in brief, are that the assessee is an individual and has not filed his return of income. On the basis of information in the possession of the department that the assessee has (i) paid credit card bills in Kotak Mahindra Bank Limited of Rs.2,59,883/-, (ii) made cash deposits in Baramati Sahkari Bank Limited of Rs.1,36,80,000/-, (iii) made cash deposits in Kotak Mahindra Bank Limited of Rs.1,86,81,640/-, (iv) received salary from Harihant Developers of Rs.14,90,000/-, (v) sold immovable property for Rs.65,00,000/- (vi) made payments against credit card bills in SBI Cards & Payment Services Limited of Rs.3,61,590/-, (vii) received salary from Harihant Developers Edifice Pvt Ltd of Rs.6,00,000/-, (viii) made cash deposits in IDBI Bank Limited of Rs.29,28,800/-, (ix) made payments against credit card bills in Standard Chartered Bank of Rs.2,47,385/- and (x) received salary from Harihant Developers of Rs.7,10,900/-, a notice u/s 148A(b) of the Act was issued to the assessee calling for information. Since the assessee did not furnish any reply, therefore, the case of the assessee was reopened u/s 147 of the Act and after passing an order u/s 148A(d) of the Act, a notice u/s 148 of the Act was issued to the assessee on 11.04.2022. In response to the notice u/s 148 of the Act, the assessee filed his return of income on 12.05.2022 declaring total income of Rs.55,65,830/-. The Assessing Officer completed the assessment u/s 147 r.w.s. 144B of the Act on 14.02.2024 determining the total income of the assessee at Rs.4,98,72,378/- by making various additions. The Assessing Officer thereafter initiated penalty proceedings u/s 271(1)(c) of the Act. Rejecting the various explanations given by the assessee the Assessing Officer levied penalty of Rs.1,42,04,570/- being the penalty @ 100% of the tax sought to be evaded.
Despite number of opportunities granted by the office of the Ld. CIT(A) / NFAC, the assessee did not make any submission for which the Ld. CIT(A) / NFAC dismissed the appeal filed by the assessee for want of prosecution.
Aggrieved with such order of the Ld. CIT(A) / NFAC the assessee is in appeal before the Tribunal.
The Ld. Counsel for the assessee referring to the order of the Ld. CIT(A) / NFAC drew the attention of the Bench to the same and submitted that on the last two occasions the assessee requested for adjournment, however, the Ld. CIT(A) / NFAC without granting any adjustment, dismissed the appeal for want of prosecution. Further, he has not decided the appeal on merit as per provisions of section 250(6) of the Act. He accordingly submitted that in the interest of justice, the matter may be restored to the file of the Ld. CIT(A) / NFAC with a direction to grant one more opportunity to the assessee to substantiate his case by filing the requisite details and decide the appeal on merit.
The Ld. DR on the other hand heavily relied on the order of the Ld. CIT(A) / NFAC.
We have heard the rival arguments made by both the sides, perused the orders of the Assessing Officer and the Ld. CIT(A) / NFAC and the paper book filed on behalf of the assessee. It is an admitted fact that the Ld. CIT(A) / NFAC dismissed the appeal for want of prosecution. It is also an admitted fact that the Ld. CIT(A) / NFAC has not decided the appeal on merit as per provisions of section 250(6) of the Act. It is the submission of the Ld. Counsel for the assessee that given an opportunity, the assessee is in a position to substantiate his case by filing the requisite details.
A perusal of the order of the Ld. CIT(A) / NFAC shows that the Ld. CIT(A)/ NFAC has not decided the appeal on merit but has simply dismissed the same for want of prosecution. We find the provisions of section 250(6) of the Act which read as under:
“250(1). … (6) The order of the [Joint Commissioner (Appeals) or the] Commissioner (Appeals) disposing of the appeal shall be in writing and shall state the points for determination, the decision thereon and the reason for the decision.”
Since it is the submission of the Ld. Counsel for the assessee that given an opportunity the assessee is in a position to substantiate his case by filing the requisite details, therefore, considering the totality of the facts of the case and in the interest of justice, we deem it proper to restore the issue to the file of the Ld. CIT(A) / NFAC with a direction to grant one final opportunity to the assessee to substantiate his case by filing the requisite details and decide the issue as per fact and law by passing a speaking order. The assessee is also hereby directed to submit the requisite details before the Ld. CIT(A) / NFAC on the appointed date without seeking any adjournment under any pretext, failing which the Ld. CIT(A) / NFAC is at liberty to pass appropriate order as per law. We hold and direct accordingly. The grounds raised by the assessee are accordingly allowed for statistical purposes.
In the result, the appeal filed by the assessee is allowed for statistical purposes.
Order pronounced in the open Court on 12th March, 2026.
Sd/- Sd/- (VINAY BHAMORE) (R. K. PANDA) JUDICIAL MEMBER VICE PRESIDENT पुणे Pune; दिन ांक Dated : 12th March, 2026 GCVSR आदेश की प्रतितिति अग्रेतिि/Copy of the Order is forwarded to: अपील र्थी / The Appellant; 1. 2. प्रत्यर्थी / The Respondent 3. The concerned Pr.CIT, Pune 4. DR, ITAT, ‘B’ Bench, Pune 5. ग र्ड फ ईल / Guard file. आदेशानुसार/ BY ORDER, // True Copy // Assistant Registrar आयकर अपीलीय अदिकरण ,पुणे / ITAT, Pune
S.No. Details Date Initials Designation 1 Draft dictated on 12.03.2026 Sr. PS/PS 2 Draft placed before author 12.03.2026 Sr. PS/PS Draft proposed & placed before the 3 JM/AM Second Member Draft discussed/approved by Second 4 AM/AM Member 5 Approved Draft comes to the Sr. PS/PS Sr. PS/PS 6 Kept for pronouncement on Sr. PS/PS 7 Date of uploading of Order Sr. PS/PS 8 File sent to Bench Clerk Sr. PS/PS Date on which the file goes to the Office 9 Superintendent 10 Date on which file goes to the A.R. 11 Date of Dispatch of order