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Facts
The assessee filed a return declaring NIL income for AY 2017-18. The case was reopened under Section 147/148 based on Bill of Entry for Import, though the assessee claimed the firm was dissolved prior to the period under consideration. The assessee alleged lack of proper opportunity and non-service of notices.
Held
The Tribunal held that the CIT(A) erred in dismissing the appeal ex-parte without providing adequate opportunity. The Tribunal emphasized the principle of substantial justice and decided to remit the matter back to the AO for fresh adjudication after affording reasonable opportunity.
Key Issues
Whether the CIT(A) was justified in dismissing the appeal ex-parte due to non-compliance by the assessee, and whether proper opportunity was provided.
Sections Cited
148, 147, 69C, 115BBE, 250
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िनधा"रती की ओर से/Assessee by : Shri Parikshit Aggarwal, C.A राज" की ओर से/ Revenue by : Shri Vivek Vardhan, Addl. CIT, Sr. DR सुनवाई की तारीख/Date of Hearing : 19/03/2025 उदघोषणा की तारीख/Date of Pronouncement : 26/03/2025 आदेश/Order PER LALIET KUMAR, J.M: This is an appeal filed by the Assessee against the order of the Ld. CIT(A)/NFAC, Delhi dt. 11/01/2024 pertaining to Assessment Year 2017-18.
Briefly the facts of the case are that That the assessee has filed return of Income declaring NIL Income for compliance of notice Issued u/s 148 of the Income Tax Act, 1961 for the Assessment Year 2017-18. The case of the assessee was reopened u/s 147/148 of the Income Tax Act, 1961 on 31/03/2021 on the basis of reasons Assessee Bill of Entry for Import. That the assessee firm was not doing any business activities during the year under consideration as the partnership firm was dissolved on 31/03/2016. 2.1 That the details as required by the Learned Assessing Officer were submitted by the assessee from time to time and assessee compliance with the each and every statutory notices issued by the Learned Assessing Officer.
That the Learned Assessing Officer had not any definite information. That the case of the assessee re-opened on the basis of the assessee made the imports of Rs. 2,58,00,487/-, whereas the assessee firm has not made any imports during the year under consideration. That the submissions and other relevant documents to support the claims of the assessee firm were submitted during the course of assessment. That the Learned Assessing Officer did not consider the submissions and supporting evidences and addition of Rs. 2,58,00,487/-u/s 69C r.w.s. 115BBE of the Act.
2.2 That the assessee requested the Learned Assessing Officer to supply the details of Imports amounting to Rs. 2,58,00,487/-for cross examination and cross verification of imports to Rs. 2,58,00,487/-. However inspite of repeated requests to the Learned Assessing Officer, no information or details of Imports amounting to Rs. 2,58,00,487/-has been provided to the assessee and no proper opportunity of cross examination and opportunity for being heard was allowed to the assessee.
Against the order of the Ld. AO the assessee went in appeal before the Ld. CIT(A) who has since the sustained the order of the Ld. AO on account of assessee’s non compliance during appeal proceedings.
Being aggrieved, the assessee is in appeal before us.
During the course of hearing, the Ld. AR submitted that the Ld. CIT(A) has passed an ex-parte order without providing adequate opportunity to the assessee. It was submitted that the notices so issued by him has not been served on the assessee and therefore, the assessee was prevented by sufficient cause for not attending to the proceedings before CIT(A). It was submitted that assessee be allowed one last opportunity and the matter may be remitted to the file of the Ld. CIT(A) to decide the same afresh and it was submitted that the assessee shall attend to the proceedings before the Ld. CIT(A) and file the necessary information/documentation.
Per contra, the Ld. DR submitted that notices have been issued to the assessee and there have been sufficient opportunity given to the assessee. The Ld. DR had drawn our attention the following findings of the Ld.CIT(A) which read as under: During the reassessment proceedings, the assessee raised objections for the reopening and the AO duly disposed off the objections. The submissions made by the assessee were considered by the AO but were not fully found acceptable. During the appeal proceedings, various notices u/s 250 were issued and as per office record, the following are the dates of notices/ communication with the status of their compliance or otherwise: Date of notice Outcome Deadline of hearing/submission fixed as per the notice 28/12/2023 03/01/2024 No compliance nor any request for adjournment 04/01/2024 10/01/2024 No compliance nor any request for adjournment The conduct of the Appellant, as inferred from the last column of the aforesaid table/evidences that the Appellant is not interested in pursuing the Appeal: the law aids those who are vigilant, not those who sleep upon their rights. This principle is embodied in the well-known latin dictum, "VIGILANTIBUS ET NON DORMIENTIBUS JURA SUB VENIUNT". The conduct of the Appellant, as inferred from the aforesaid table, evidences that the Appellant fails on this principle of equity. Even the Hon'ble Courts, in various pronouncements, have frowned upon the Appellants who file appeals but thereafter do not take any further interest in prosecuting those appeals. 1. The Hon'ble Income Tax Appellate Tribunal - Kolkata in the case of Pradeep Kumar Jhawar, Kolkata vs. D.C..T., C.C.-XX| (15 March, 2016) (ITA Nos. 450/Kol/2013 for Asst. Year: 2006-07) dismissed the appeal of the Appellant for non-prosecution. 2. The Hon be Madhya Pradesh High Court in the case of Estate of Late Tukojirao Holkar vs. CWT (223 I|R 480) held as under: "If the party, at whose instance the reference is made, fails to appear at the hearing, or fails in taking steps for preparation of the paper books so as to enable hearing of the reference, the court is not bound to answer the reference." 1. Similarly, the Hon'ble Punjab & Haryana High Court in the case of New Diwan Oil Mills vs. CIT (2008) 296 IT 495) returned the reference unanswered since the assessee remained absent and there was no assistance from the assessee.
2. Their Lordships of Hon'ble Supreme Court in the case of CIT vs. B.Bhattacharjee& Another (118 IT 461 at page 477-478) held that appeal does not mean, mere filing of the memo of appeal but effectively pursuing the same. In the judgment, their Lordships averred as follows: “ This turns on the meaning of the words "preferred an appeal"."Preferred" is a word of dual import. Its semantics depend on the scheme and the context; its import must help, not hamper, the object of the enactment even if liberty with language may be necessary. There is good ground to think that an appeal means an effective appeal. An appeal withdrawn is an appeal non est as judicial thinking suggests. Black's Law Dictionary gives the following meaning: 'PREFER: To bring before; to prosecute; to try to proceed with'. Thus, preferring an indictment signifies prosecuting or trying an indictment. It means to give advantage, priority, or privilege; to select for/first payment, as to prefer one creditor over others. Thus, it may mean prosecute or effectively pursue a proceeding or merely institute it. Purposefully interpreted, preferring an appeal means more than formally filing it but effectively pursuing it” In view of the above, it is clear that the Appellant is not aggrieved with the reassessment order impugned herein and is not interested in pursuing the same. Accordingly, the additions/disallowance as challenged in the Grounds of Appeal
and in the Appeal Memo are hereby confirmed. The Last ground of appeal is always reserved for adding/altering/amending and/or substituting any or all grounds of appeal before the taking place of actual hearing or even in course of the hearing , if the situation so warrants. Since the appellant has nothing to say on this, This ground of appeal is dismissed as “not pressed”. In view of the appellant’s total non-compliance during appeal proceedings, I find it extremely difficult to adjudicate on the appeal for want of adequate submission and clarification, counter-clarification. In the result, the appeal is dismissed.
7. We have heard the rival contention and perused the material available on the records. In the present case the Ld. CIT(A) has given the two short date namely 28/12/2023 and 04/01/2024 to the assessee to present the appeal and thereafter had decided the appeal by applying decision in the case of Multiplan (supra). In our considered opinion it is the duty of the Ld. CIT(A) to decide the issue on merits even if the assessee failed to appear in the appellate proceedings. The ld. CIT(A) cannot dismiss the appeal of the assesse merely because the assessee failed to participate in the appellate proceedings. In view of the above we find that the assessee deserves one last opportunity and cannot be condemned unheard and therefore, keeping in view principles of substantial justice, the matter is remitted to the file of the Ld. AO to decide the same afresh after providing reasonable opportunity to the assessee.