KULWINDER KAUR,CHANDIGARH vs. INCOME TAX OFFICER WARD 5(5), CHANDIGARH

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ITA 595/CHANDI/2025Status: DisposedITAT Chandigarh20 August 2025AY 2017-18Bench: the Ld. CIT(A), no effective compliance was made in response to the statutory notices issued in the appellate proceedings. The Ld. CIT(A), therefore, proceeded to dismiss the appeal on the ground of non-prosecution, while also observing that in the absence of any written submissions or evidences filed, the grounds raised by the assessee could not be entertained on merits.3.1 The Ld. AR submitted that the assessee was prevented by sufficient cause from producing the necessary documents and e3 pages

AI SummaryRemanded

Facts

The assessee challenged the Assessing Officer's action of treating the gain from compulsory acquisition of immovable property as Short-Term Capital Gain instead of Long-Term Capital Gain. The Ld. CIT(A) dismissed the assessee's appeal for non-prosecution due to non-compliance with statutory notices, without adjudicating on the merits of the case.

Held

The Tribunal held that the first appellate authority is duty-bound to decide appeals on merits, even if there is non-appearance by the assessee. It set aside the CIT(A)'s order and restored the matter for fresh adjudication, directing the CIT(A) to provide adequate opportunity of hearing to the assessee.

Key Issues

Whether the first appellate authority can dismiss an appeal solely for non-prosecution without deciding it on merits.

Sections Cited

AI-generated summary — verify with the full judgment below

Order PER LALIET KUMAR, J.M: This is an appeal filed by the Assessee against the order of the Ld. CIT Appeal, Addl/JCIT(A)-3, Mumbai dt. 25/02/2025 pertaining to Assessment Year 2017-18.

In the present appeal the assessee has challenged the action of the Assessing Officer in treating the gain arising on compulsory acquisition of immovable property as Short-Term Capital Gain amounting to Rs.12,67,605/-, whereas according to the assessee the same ought to have been treated as Long-Term Capital Gain.

On perusal of the impugned order, it is noticed that though the assessee had filed the appeal before the Ld. CIT(A), no effective compliance was made in response to the statutory notices issued in the appellate proceedings. The Ld. CIT(A), therefore, proceeded to dismiss the appeal on the ground of non-prosecution, while also observing that in the absence of any written submissions or evidences filed, the grounds raised by the assessee could not be entertained on merits.

3.1 The Ld. AR submitted that the assessee was prevented by sufficient cause from producing the necessary documents and explanations before the lower authorities, and therefore, in the interest of justice, an opportunity may be granted so that the matter may be examined afresh at the end of the Assessing Officer. It was contended that no prejudice would be caused to the Revenue if the matter is remanded back, whereas irreparable loss would be suffered by the assessee if such an opportunity is denied.

3.2 On the other hand, the Ld. DR opposed the request for remand by submitting that sufficient opportunities had already been afforded during the course of the assessment as well as the appellate proceedings and yet the assessee failed to avail the same. It was accordingly argued that the assessee cannot be permitted to fill in the lacunae at this stage and that the order of the lower authorities deserves to be upheld.

We have carefully considered the matter. It is a settled proposition of law that the first appellate authority is duty-bound to dispose of the appeal on merits even in the event of non-appearance or default on the part of the assessee. We noticed that the lower authorities have dismissed the appeal without deciding the appeal on merits. In our considered opinion the authorities below are duty bound to examine the issues in detail before rendering its decision.