MOBITE TECHNOLOGIES PVT. LTD.,PUNE vs. ITO, WARD, 7(1), PUNE, PUNE

8. The CIT(A) has erred in dismissing the appeal of Assessee without affording adequate opportunity of being heard and also without being heard on merits. Prayer is to direct the JAO to check the applicable provisions and allow concessional rate of income tax 9. The assessee prays before your honour to allow it an opportunity of being heard on merits before the lower authorities 10. The Assessee prays for any other relief that may be deemed fit in law and on facts 11. The Appellant craves leave to add, alter, delete, or amend any of the above grounds at the time of hearing.” Submission of ld.AR : 2. The ld.Authorised Representative(ld.AR) for the Assessee submitted that assessee’s appeal was dismissed by the ld.CIT(A) without discussing each and every ground and merits of the case and merely dismissed for non-compliance. Hence, ld.AR requested for one more opportunity of being heard to the assessee.

Submission of ld.Departmental Representative(ld.DR) : 3. The ld.DR for the Revenue relied on the order of Assessing Officer(AO) and ld.CIT(A)[NFAC].

Findings & Analysis : 4. We have heard both the parties and perused the records. It is observed from the order of the ld.CIT(A) that the ld.CIT(A) did not decide the grounds of appeal on merit but merely dismissed the appeal of the assessee for non-compliance. The ld.CIT(A) has not adjudicated grounds raised by the assessee on merits.

4.1 We have studied the Form No.35 which is the Form for filing appeal before ld.CIT(Appeal). The assessee has raised following grounds of appeal before the ld.CIT(A) : “The intimation under Section 143(1) of the Income tax Act 1961 has been issued without considering provision of the said section and adjustment is beyond the AO s power. The CPC has erred in rejecting concessional/special rate of income tax adopted by assessee for calculation of tax liability as per ITR u/s 115BAA. The CPC has erred in computing income tax liability of assessee as per intimation on a higher side by ignoring concessional rate adopted by it in ITR.

Without prejudice to ground no. 4 and 5, your honour is requested to consider and allow to adopt the normal slab rate of 25%, since turnover of the Company in financial year 18-19 and in the current financial year is less than 400 Crores. Alternatively, if at all MAT provisions become applicable, it is prayed to your honour to allow MAT credit as per relevant provisions of the Act The CPC has erred in applying provisions of section 115JB and computing the MAT for the year. The Assessee Company may be granted any other relief as is available in the facts and circumstances of the case and in law. The CPC has erred in levying additional interest under section 234B, 234C in the intimation. The intimation has made certain adjustments which are not permissible under section 143(1) of the Act, therefore intimation passed under section 143(1) is bad in law. The intimation issued under section 143(1) of -the Income Tax Act 1961, dated July 07, 2022 is not in keeping with the provisions of law and need to be cancelled. The appellant craves leave to add, amend or alter any of the grounds of appeal.” 4.2 The ld.CIT(A) has not adjudicated any of the grounds. Assessee had raised legal grounds which could have been adjudicated by obtaining necessary details from the Assessing Officer. However, ld.CIT(Appeal) merely dismissed the appeal without adjudicating any of the grounds 5. The Hon’ble Bombay High Court has held in the case of Pr.CIT(Central) Vs. Premkumar Arjundas Luthra (HUF) (Bombay)/[2017] 297 CTR 614 (Bombay) as under : Quote, “8. 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 coterminous 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.” Unquote.

5.1 Thus, the Hon’ble Bombay High Court has categorically held that ld.CIT(A) has to decide the appeal on merit and ld.CIT(A) does not have any power to dismiss appeal for non-prosecution.

5.2 The above referred decision of Hon'ble Jurisdictional High Court was pronounced in 2017. It is binding on ld.CIT(A). However, ld.CIT(A) blatantly violates it. This leads to harassment of the Assessee.

5.3 In view of the above, in the interest of justice, we set-aside the order of the ld.CIT(A) to ld.CIT(A) for denovo adjudication. Ld.CIT(A) shall provide opportunity to the assessee. Assessee shall file all the necessary documents before the ld.CIT(A). Accordingly, grounds of appeal raised by the assessee are allowed for statistical purpose.