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Facts
The assessee filed a return declaring income of Rs. 5,00,830/-. The Assessing Officer completed the assessment at Rs. 26,24,142/-, making additions for unexplained cash investments. The CIT(A) dismissed the assessee's appeal for non-prosecution.
Held
The Tribunal held that the CIT(A) is duty-bound to dispose of an appeal on merits, even if ex-parte, after providing a reasonable opportunity of hearing. The matter was remanded to the CIT(A) for de novo adjudication.
Key Issues
Whether the CIT(A) was justified in dismissing the appeal for non-prosecution without adjudicating on merits. Whether the matter should be remanded for fresh consideration.
Sections Cited
143(3), 250(6)
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Income Tax Appellate Tribunal, Hyderabad ‘SMC’ Bench, Hyderabad
Before: SHRI INTURI RAMA RAO
ORDER PER INTURI RAMA RAO : This appeal filed by the assessee is directed against the order of the Commissioner of Income Tax (Appeals)-11, Hyderabad dated 07.03.2025 for Assessment Year (AY) 2021-22.
Brief facts of the case are that the assessee is an individual. The Return of Income for the A.Y. 2021-22 was filed on 23.03.2022 declaring total income of Rs.5,00,830/-. The Assessing Officer completed the assessment vide order dated 22.12.2022 passed u/s.143(3) of the Income Tax Act, 1961 (“the Act”)
assessing the total income at Rs.26,24,142/-. While doing so, the Assessing Officer made addition on account of cash investment in chit and cash investment in immovable property to the tune of Rs.26,24,142/- as unexplained money as the assessee failed to explain the sources of cash deposits with supporting evidences.
Being aggrieved by the order of Assessing Officer, the assessee filed an appeal before the Ld. CIT(A), who vide the impugned order, dismissed the appeal for non-prosecution in limine.
Being aggrieved by the order of Ld. CIT(A), the assessee is in appeal before the Tribunal.
I heard the rival contentions of both the parties and perused the material available on record. I find that the learned CIT(A) dismissed the appeal in limine for non-prosecution. As contemplated u/s. 250(6) of the Act the CIT(A), is required to frame points of determination followed by a detailed discussion thereupon before passing the order. It is the settled position of law that the CIT(A), even while disposing of the appeal exparte, is duty bound to dispose of the appeal on merits. Reliance in this regard can be placed on the decision of the Hon'ble Bombay High Court in the case of PCIT Vs. Premkumar Arjundas Luthra 279 CTR 614. Therefore, in the light of the above legal position I am of the considered view that the matter requires to be remanded to the file of the CIT(A) with the direction to dispose of the appeal de novo on merits after affording reasonable opportunity of hearing to the assessee.
In the result, the appeal of the assessee is allowed.
Order pronounced in the open Court on 10th Oct., 2025.