NAHID KHATOON,HYDERABAD vs. ACIT., CIRCLE-14(1),, HYDERABAD

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ITA 1135/HYD/2025Status: DisposedITAT Hyderabad08 September 2025AY 2016-17Bench: SHRI VIJAY PAL RAO (Vice President), SHRI MADHUSUDAN SAWDIA (Accountant Member)1 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The CIT(A)'s order dismissing the appeal without providing adequate opportunity to the assessee violates the principles of natural justice. The Tribunal set aside the impugned order and restored the matter to the CIT(A) for a fresh hearing.

What were the facts?

The assessee filed an appeal against a penalty order. During appellate proceedings, the assessee expressed willingness to opt for the Vivad Se Vishwas Scheme (VSVS) and requested the matter be kept in abeyance. However, the CIT(A) dismissed the appeal without verifying if VSVS was availed and without giving the assessee further opportunity.

What were the issues?

Whether the CIT(A) erred in dismissing the appeal without providing the assessee an adequate opportunity to be heard, especially after expressing willingness to opt for VSVS?

Which sections of the Income-tax Act were involved?

Section 271(1)(c)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, Hyderabad ‘B’ Bench, Hyderabad

Before: SHRI VIJAY PAL RAO & SHRI MADHUSUDAN SAWDIA

Hearing: 08/09/2025

आदेश/ORDER PER MADHUSUDAN SAWDIA, A.M. : This appeal is filed by Ms. Nahid Khatoon (“the assessee”), feeling aggrieved by the order passed by the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi (“Ld. CIT(A)”), dated 27.05.2025 for the A.Y. 2016-17. 2. The assessee has raised the following grounds of appeal :

1.

1. “ 1. On the facts and in the circumstances of the case, the order of the Ld. CIT(A) is erroneous and unsustainable in law apart from being passed in violation of principles of natural justice.

2. Without prejudice to the above, the Ld. CIT(A) erred in dismissing the appeal on the alleged ground that the appellant filed written submission expressing the view for opting VSVS.

3. The Ld. CIT(A) failed to appreciate that the appellant expressed such view on 25.08.2020, but could not opt for the scheme and that the Ld. CIT(A) proceeded to dismiss the appeal on 27.05.2025, without verifying about whether the appellant had opted for VSVS or not and further erred in dismissing the appeal without giving any opportunity to the appellant.

4.

Any other ground that may be urged at the time of hearing.”

3.

The brief facts of the case are that, the assessee had filed an appeal before the Ld. CIT(A) against the penalty order passed by the Learned Assessing Officer (“Ld. AO”) under section 271(1)(c) of the Income Tax Act, 1961 (“the Act”) dated 28.06.2019 for the assessment year 2016-17. During the appellate proceedings, on 25.08.2020, the assessee submitted before the Ld. CIT(A) that he would be opting for the Vivad Se Vishwas Scheme (“VSVS”) and accordingly requested that the matter be kept in abeyance. However, the Ld. CIT(A) dismissed the appeal of the assessee holding that since the assessee had filed a written submission expressing willingness to opt for VSVS, nothing further survived in the appeal. Aggrieved by the order of Ld.CIT(A), the assessee has filed the present appeal before the Tribunal.

4. The Learned Authorised Representative (“Ld. AR”) submitted that when the appeal was pending before the Ld. CIT(A), the assessee had made a categorical request dated 25.08.2020 stating that he was willing to opt for VSVS, and accordingly requested the Ld. CIT(A) to keep the matter in abeyance. However, the assessee later did not avail the VSVS. He further submitted that the Ld. CIT(A) dismissed the appeal on 27.05.2025, i.e., almost five years after the assessee’s submission regarding VSVS. The last notice issued by the Ld. CIT(A) was dated 06.01.2021, and since then no further opportunity of hearing was afforded to the assessee. It was argued that the impugned order suffers from violation of the principles of natural justice as no effective opportunity was given to the assessee to put forth his case. Accordingly, the Ld. AR prayed that the matter may be restored to the file of the Ld. CIT(A) with a direction to grant one more opportunity to the assessee to file documentary evidence and explanation in support of his claim and decide the appeal on merits.

5.

Per contra, the Learned Departmental Representative (“Ld. DR”) relied on the order of the Ld. CIT(A).

6.

We have considered the rival submissions and gone through the material available on record. It is undisputed that the assessee had filed a written submission dated 25.08.2020 before the Ld. CIT(A) expressing willingness to opt for VSVS. However, it is also a matter of record that no further notice was issued to the assessee after 06.01.2021, and the appeal was eventually dismissed on 27.05.2025, after a gap of almost four years. On perusal of the impugned order, we find that the Ld. CIT(A) has dismissed the appeal solely on the ground that the assessee had expressed willingness to opt for VSVS, without examining whether the assessee had actually availed the said scheme or not. In our considered view, dismissal of the appeal without affording adequate opportunity to the assessee amounts to violation of the principles of natural justice. Therefore, in the interest of justice, we set aside the impugned order and restore the matter to the file of the Ld. CIT(A) with a direction to grant one more opportunity of being heard to the assessee. The assessee is also directed to cooperate with the appellate proceedings and not to seek unnecessary adjournments.

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