MR. GIRISH KISANDAS MEHTA,PUNE vs. ITO WARD 9 (3), PUNE

6. It is humbly prayed that the Appellant be kindly allowed to file any additional evidences in the interest of justice, if any.

7. The appellant prays to be allowed to add, amend, modify, rectify, delete, raise any grounds of appeal

at the time of hearing.”

3. Facts of the case, in brief, are that the assessee is an individual deriving income from rent, interest income on fixed deposits and agricultural income and has not furnished return of income u/s 139 of the IT Act. On the basis of information of financial transactions of the assessee available with the Department that he has sold two immovable properties, one for Rs.5,75,000/- & another for Rs.52,25,000/- respectively, and has not furnished his return of income, so has not offered any income for taxation with regard to above transactions during the period under consideration. Therefore, the case of the assessee was reopened u/s 147 of the IT Act and notices u/s 148 and 142(1) and 143(2) of the IT Act and final show cause notices respectively were issued to the assessee. In response to notice u/s 148 of the IT Act the assessee furnished return of income declaring income of Rs.2,18,270/- & subsequently also furnished reply stating that both the property sold were agricultural land and not capital asset as per section 2(14) of the IT Act, therefore does not attract any capital gain liable to income tax. Not being satisfied with the reply of the assessee, the Assessing Officer completed the assessment proceedings u/s 147 r.w.s. 144B of the IT Act and vide assessment order dated 29-02-2024 determined income at Rs.61,10,925/- as against the income returned by the assessee at Rs.2,18,270/-. The above assessed income includes additions on account of short term capital gain of Rs.58,00,000/- on sale of two immovable property and addition of Rs.92,665/- towards disallowance of deduction claimed u/s 80C of the IT Act.

Being aggrieved with the above assessment order, the assessee preferred an appeal before Ld. CIT(A)/NFAC raising only grounds on merits. Since the assessee remained absent, Ld. CIT(A)/NFAC dismissed the appeal filed by the assessee.

5. It is the above ex-parte order passed by Ld. CIT(A)/NFAC against which the assessee is in appeal before the Tribunal challenging the addition on merit. The assessee has also raised legal grounds challenging the reopening of the assessment before the Tribunal for the first time.

From the aforesaid provisions, it is very clear once an appeal is preferred before the CIT(A), then in disposing of the appeal, he is obliged to make such further inquiry that he thinks fit or direct the Assessing Officer to make further inquiry and report the result of the same to him as found in Section 250(4) of the Act. Further Section 250(6) of the Act obliges the CIT(A) to dispose of an appeal in writing after stating the points for determination and then render a decision on each of the points which arise for consideration with reasons in support. Section 251(1)(a) and (b) of the Act provide that while disposing of appeal the CIT(A) would have the power to confirm, reduce, enhance or annul an assessment and/or penalty. Besides Explanation to sub-section (2) of Section 251 of the Act also makes it clear that while considering the appeal, the CIT(A) would be entitled to consider and decide any issue arising in the proceedings before him in appeal filed for its consideration, even if the issue is not raised by the appellant in its appeal before the CIT(A). Thus once an assessee files an appeal under Section 246A of the Act, it is not open to him as of right to withdraw or not press the appeal. In fact the CIT(A) is obliged to dispose of the appeal on merits. In fact with effect from 1st June, 2001 the power of the CIT(A) to set aside the order of the Assessing Officer and restore it to the Assessing Officer for passing a fresh order stands withdrawn. Therefore, it would be noticed that the powers of the CIT(A) is co-terminus with that of the Assessing Officer i.e. he can do all that Assessing Officer could do. Therefore just as it is not open to the Assessing Officer to not complete the assessment by allowing the assessee to withdraw its return of income, it is not open to the assessee in appeal to withdraw and/or the CIT(A) to dismiss the appeal on account of non-prosecution of the appeal by the assessee. This is amply clear from the Section 251(1)(a) and (b) and Explanation to Section 251(2) of the Act which requires the CIT(A) to apply his mind to all the issues which arise from the impugned order before him whether or not the same has been raised by the appellant before him. Accordingly, the law does not empower the CIT(A) to dismiss the appeal for non-prosecution as is evident from the provisions of the Act.