ANEEMONI NAGA RAJU,HYDERABAD vs. ITO, WARD- 8(1), HYDERABAD

2. As per provisions of Section 249(4)(b) of the Act, where no return\nhas been filed by the assessee, the assessee has to pay an amount\nequal to the amount of advance tax which was payable by him\notherwise appeal shall not be admitted. The provisions of Section 249\n(4) of the Act are reproduced as under:\nSection 249(4)\n\"No appeal under this Chapter shall be admitted unless at the time of\nfiling of the appeal.\n(a) where a return has been filed by the assessee, the assessee has\npaid the tax due on the Income returned by him; or\n(b) where no return has been filed by the assessee, the assessee has\npaid an amount equal to the amount of advance tax which was payable\nby him:\nProvided that, in a case falling under clause (b) and on an application\nmade by the appellant in this behalf, the [Joint Commissioner\n(Appeals) or, as the case may be, the Commissioner\n(Appeals)] may, for any good and sufficient reason to be\nrecorded in writing, exempt him from the operation\nof the provisions of 5 that clause]]\n3.

3. In Form-35, the appellant has offered 'Not applicable' comments\nat sl. No. 9 of Form-35 whereas it was supposed to make payment of\ntax equal to the amount of advance tax payable on its income which in\nthe present case is the income assessed by the AO as no ITR was\nfiled by it. It is, therefore, clear that information, given at sl. no. 9 of\nForm-35 is not correct and the appellant has not made payment of\namount equal to the advance tax which was due on its income. A plain\nreading of provisions of Section 249(4)(b) of the Act makes it clear that\nthe appellants are required to pay an amount equal to the advance tax\nwhich was due on their income irrespective of the situation whether\nthe addition(s) was/were disputed in appeal or not. The statute has\ndifferentiated between the assessee who filed ITR and paid taxes on\nadmitted income and the assessee who though failed to ITR but have\npaid an amount equal to the advance tax which was due on their\nincome. In the former situation, provisions of Section 249(4)(b) of the\nAct are not applicable and those assessees are in advantageous\nposition. In the latter situation, since the assessees had failed to file\nITR, the amount of tax equal to the advance tax which was due on\ntheir income would mean the income assessed by the AO. Those\nassessees cannot claim later on that they are not liable to pay an\namount of tax equal to the advance tax which was due on their income\nas they are challenging the additions in appeal and that their income\nwas below taxable limit. The appellant has also not requested for\nexemption from operation of the provisions of clause (b) of sub-section\n(4) of Section 249 of the Act.\n4. Since the appellant has not filed ITR as well as not paid an amount\nequal to the amount of advance tax which was payable by it, present\nappeal is not liable to be admitted. The appeal is infructuous and is,\ntherefore, dismissed.\n5. The appeal is dismissed.\"\nThe assessee, aggrieved with the order of the CIT(A) has carried\nthe matter in appeal before us.\n7. We have heard the Learned Authorized Representatives of both\nparties, perused the orders of the lower authorities and the material\navailable on record.\n8. Shri Bhupal Goud M, CA, Learned Authorized Representative (for\nshort, “Ld.AR\") for the assessee, at the threshold of hearing of the\nappeal, submitted that the CIT(A) had grossly erred in law and facts of\nthe case in dismissing the appeal filed by the assessee by treating it as\ninfructuous. Elaborating on his contention, the Ld. AR submitted that\nthough the assessee in his Memorandum of Appeal, i.e., “Form-35\" had\nagainst the “Column No.9” wherein information was sought as to\nwhether the amount equal to the amount of advance tax as per section\n249(4)(b) had been paid, specifically stated that the same was “not\napplicable\", but the CIT(A) had summarily brushed aside the same and\nwrongly observed that the assessee had failed to comply with the\nmandate of Section 249(4)(b) of the Act. The Ld. AR submitted that the\nCIT(A) ought to have called for an explanation from the assessee\ninstead of summarily treating him as being in default of the aforesaid\nstatutory compliance and dismissing the appeal by treating the same as\ninfructuous. However, the Ld. AR on a specific query by the Bench as to\nwhether the assessee as required per the “proviso” to Section 249(4)(b)\nof the Act had filed any application before the CIT(A) explaining as to\nwhy it be exempted from the operation of the said statutory provision,\nanswered in the negative. The Ld. AR submitted that as the assessee\nhad no taxable income for the subject year, therefore, no obligation was\ncast upon him for either estimating the advance tax much the less\npayment of the said amount. The Ld. AR submitted that now when the\nassessee had specifically stated that obligation to pay any amount of\nadvance tax as per Section 249(4)(b) of the Act was not applicable in his\ncase, then, there was no reason for the CIT(A) to have summarily\ndiscarded his said claim and dismiss the appeal as not maintainable for\nnon-compliance of the said statutory provision. The Ld. AR submitted\nthat the matter in all fairness be set aside to the file of the CIT(A) with a\ndirection to admit the appeal and adjudicate the same on merits.\n9. Per contra, Dr. Sachin Kumar, Learned Senior Departmental\nRepresentative (for short, “Ld. Sr-DR”), submitted that as the assessee\nhad failed to file any application based on which he had sought for an\nexemption from the operation of the provisions of Section 249(4)(b) of\nthe Act as was mandatorily required by the “proviso” to Section 249(4) of\nthe Act, therefore, the CIT(A) had rightly dismissed the appeal as not\nmaintainable.\n10. We have given thoughtful consideration to the contentions\nadvanced by the Learned Authorized Representatives of both parties in\nthe backdrop of the orders of the authorities below.\n11. Before proceeding further, we deem it apposite to cull out the\nprovisions of Section 249(4) of the Act, as under:\n“249. (1) to (3).........\n(4) No appeal under this Chapter shall be admitted unless at the time\nof filing of the appeal, —\n(a) where a return has been filed by the assessee, the assessee has\npaid the tax due on the income returned by him; or\n(b) where no return has been filed by the assessee, the assessee has\npaid an amount equal to the amount of advance tax which was payable\nby him:\nProvided that, in a case falling under clause (b) and on an application\nmade by the appellant in this behalf, the [Joint Commissioner\n(Appeals) or the] Commissioner (Appeals) may, for any good and\nsufficient reason to be recorded in writing, exempt him from the\noperation of the provisions of that clause.\"\n12. Ostensibly, Section 249(4) of the Act contemplates the conditions\nwhich are statutorily required to be satisfied failing which the appeal filed\nby an assessee before the CIT(A) shall not be admitted, viz., (a) where\nthe assessee has filed a return of income, the tax due on the income\nreturned by him has been paid; or (b) where the assessee has not filed\nany return of income, then an amount equal to the amount of advance\ntax which was payable by him has been paid. At this stage, we may\nherein observe that the second situation contemplated under clause (b)\nof Section 249, i.e., a case where the assessee has not filed the return of\nincome comes with a concession as per which on an application made\nby the assessee/appellant, the Commissioner (Appeals), for any good\nand sufficient reason to be recorded in writing, exempt him from the\noperation of the provisions of that clause. Accordingly, in a case where\nthe assessee has not filed any return of income, then he though remains\nunder an obligation to pay an amount equal to the amount of advance\ntax which was payable by him, but, the CIT(A) may, for any good and\nsufficient reason given by an assessee by filing an application, dispense\nwith the satisfaction of the pre-condition. However, the said concession\nis available only for cases falling within the meaning of clause (b) only.\n13. As in the case before us, the assessee had failed to file his return\nof income, therefore, his case is regulated by clause (b) of Section\n249(4) of the Act.\n14. Controversy involved in the present case lies in a narrow\ncompass, i.e., as to whether or not the CIT(A) is right in law and facts of\nthe case in observing that the assessee/appellant was required to pay\nan amount equal to the advance tax which was due on his assessed\nincome irrespective of the fact that the impugned additions made by the\nAO were assailed by the assessee in the appeal filed before him?\n15. In our view, the answer to the aforesaid issue would require\nadverting to Section 209 of the Act which contemplates the “computation\nof advance tax”. We find that Section 209(1) of the Act envisages the\ndetermination of the amount of advance tax payable by the assessee.\nWe find on a careful perusal of Section 209(1) of the Act, that the same\nencompasses two situations, viz., (i) where the computation of the\nadvance tax is based on the estimation of the current income and the\nincome tax by the assessee; and (ii) where the calculation of the\nadvance tax is made by the AO. Admittedly, in the case before us there\nhas been no calculation of the advance tax by the AO as provided in\nSection 209(1)(b) of the Act. Also, we find there has been no calculation\nmade by the assessee for the purpose of payment of advance tax as\ncontemplated in Section 209(1)(a) of the Act.\n16. Considering the aforesaid facts, i.e., there has been no calculation\nof the advance tax payable either by the assessee or by the AO, we are\nof the view that the claim of the assessee that in absence of any income\nchargeable to tax for the subject year he was not liable for any advance\ntax liability could not have been summarily discarded by the CIT(A). In\nour view, the CIT(A) instead of calling for an explanation from the\nassessee as to why the obligation to pay an amount equal to the amount\nof advance tax as per Section 249(4)(b) of the Act was not applicable in\nhis case, had, however, wrongly summarily discarded the same. At the\nsame time, we cannot also remain oblivion of the fact that the assessee\nhad failed to comply with the obligation that was cast upon him as per\nthe \"proviso” to Section 249(4) of the Act, where he ought to have filed\nan application before the CIT(A) based on which he had claimed that the\nobligation under Section 249(4)(b) of the Act was not applicable in his\ncase.\n17. Be that as it may, we are of a firm conviction that in the totality of\nthe facts involved in the present case, the matter requires to be set\naside to the file of the CIT(A) who is directed to readjudicate the appeal\ntaking cognizance of the fact that the assessee had specifically claimed\nbefore him that in absence of any taxable income no obligation was cast\nupon him to estimate the amount of advance tax and pay the same per\nthe mandate of Section 249(4)(b) of the Act. Needless to say, the CIT(A)\nshall in the course of the set-aside proceedings afford an opportunity of\nbeing heard to the assessee regarding his claim that the provisions of\nSection 249(4)(b) of the Act were not applicable to his case. In case, the\nCIT(A) finds favour with the claim of the assessee that the provisions of\nSection 249(4)(b) were not applicable in his case; or an application filed\nby the assessee exempts him from the operation of Section 249(4)(b),\nthen he shall dispose of the appeal on merits. We thus, in terms of our\naforesaid observations, set aside the matter to the file of the CIT(A) in\nterms of our aforesaid observations.\n18. In the result, appeal filed by the assessee is allowed for statistical\npurposes in terms of our aforesaid observations.\nOrder pronounced in the open court on 20th March, 2026.\nSd/-\n(मधुसूदन सावडिया)\n(MADHUSUDAN SAWDIA)\nलेखासदस्य/ACCOUNTANT MEMBER\nSd/-\n(रवीश सूद)\n(RAVISH SOOD)\nन्यायिकसदस्य/JUDICIAL MEMBER\nHyderabad, dated 20.03.2026.\nOKK/sps\nआदेशकीप्रतिलिपिअग्रेषित/