JETHALAL GOPALJI BHANUSHALI,NAVI MUMBAI vs. INCOME TAX OFFICER 28(1)(4), NAVI MUMBAI

ITA 5349/MUM/2024Status: DisposedITAT Mumbai06 January 2025AY 2017-20184 pages

AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that the hearing provided under Section 250(2)(a) of the Income Tax Act, 1961, is not a mere formality but an essential requirement for upholding the principles of natural justice. Upon examining the impugned order, the Tribunal observed that the tabulated opportunities of hearing provided by the Learned CIT(A) did not demonstrate that the notices were duly served or brought to the assessee's notice. Therefore, an effective opportunity of hearing was not granted. Consequently, the Tribunal set aside the impugned order and restored the matter to the file of the Learned CIT(A) for providing an effective hearing to the assessee. The assessee was directed to present its case before the Learned CIT(A) within 60 days. The appeal was allowed for statistical purposes.

What were the facts?

The assessee, Jethalal Gopalji Bhanushali, filed an appeal before the Income Tax Appellate Tribunal (ITAT), Mumbai Bench, challenging an order passed by the Learned Commissioner of Income Tax (Appeals) / Addl. JCIT(A)-1, Chandigarh. The assessment year in question is 2017-18. The Learned CIT(A) had dismissed the assessee's appeal ex parte, stating that despite notices, the assessee failed to appear. The assessee contended that the notices were never received, preventing them from presenting their case and thus violating principles of natural justice. The Department supported the CIT(A)'s order.

What were the issues?

1. Whether the Learned CIT(A) erred in dismissing the appeal ex parte without providing an effective opportunity of hearing to the assessee, thereby violating the principles of natural justice, as contemplated under Section 250(2)(a) of the Income Tax Act, 1961? Assessee's Contention: The assessee argued that the notices issued by the Learned CIT(A) were never received. Consequently, they were unable to present their case, leading to an ex parte decision without an effective hearing. This renders the impugned order illegal and liable to be set aside. Revenue's Contention: The Learned Departmental Representative (DR) supported the order of the Learned CIT(A), stating that the appeal has no merit and should be dismissed.

Which sections of the Income-tax Act were involved?

Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI BENCH “F”, 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 order of Learned Commissioner of Income Tax (Appeals) /Addl. JCIT(A)-1, Chandigarh [hereinafter referred to as the “CIT(A)”], passed under Page | 1 section 250 of the Income Tax Act, 1961 [hereinafter referred to as “the Act”] dated 21.08.2024 for the A.Y. 2017-18, wherein the Ld. CIT(A) has dismissed the appeal ex parte as despite services of notice, the assessee failed to present its case before the Ld. CIT(A).

It was argued on behalf of the appellant/assessee that the notice issued by the Ld. CIT(A) were never received or served upon the assessee and as such they could not present its case before the Ld. CIT(A) who proceeded ex parte and decided the appeal on merit without giving effective opportunity of hearing to the assessee and as such the assessee was prevented from present its case before the Ld. CIT(A). Therefore, the impugned order suffers from illegality and liable to be set aside. The Ld. DR on the other hand supporting the judgment of the Ld. CIT(A) stating that there is no merit in the appeal and same is liable to be dismissed.

We have considered the rival submissions. Section 250 sub section 2(a) of "the Act" 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;” 4. 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. We have examined the impugned order of the Ld. CIT(A) observed as under: -

“The details of opportunities of being heard provided to the assessee are tabulated below for ready reference: Sr.No. Date of notice issued Date of hearing 1 31.10.2023 15.11.2023 2 14.02.2024 22.02.2024 3 23.02.2024 04.03.2024 4 12.03.2024 20.03.2024 5 05.08.2024 13.08.2024

It is thus evident from the contents of the impugned order extracted above that no effective opportunity of hearing has been given and there is no proof that the notice sent on various dates were duly served or brought to the notice of the appellant/assessee.

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 06.01.2025.

Recent GST High Court judgments

Search GST case law →