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Facts
The assessee claimed a deduction under Section 80IA, which was denied by the Assessing Officer, leading to an addition of Rs. 26,20,56,890/-. The assessee filed an appeal before the CIT(A), which was dismissed for non-prosecution due to non-appearance and non-submission of required documents. The assessee then filed a second appeal before the Tribunal.
Held
The Tribunal found that the CIT(A) had dismissed the appeal on grounds of non-prosecution without deciding on merits. Considering the circumstances and the request of the Ld. DR, the Tribunal set aside the impugned order and remanded the case back to the CIT(A) for a decision on merits.
Key Issues
Whether the CIT(A) was justified in dismissing the appeal for non-prosecution without adjudicating the issues on merit, and if the matter should be remanded for fresh consideration.
Sections Cited
253, 143(3), 801A, 246A, 250, 143(2)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, INDORE BENCH, INDORE
the order bearing Number ITBA/APL/S/250/2024- 25/1071187169(1) dated 13.12.2024 passed by the Ld. CIT(A) u/s 250 of the Act which is hereinafter referred to as the “Impugned order”. The relevant Assessment Year is 2012-13
Page 1 of 10 and the corresponding previous year period is from 01.04.2011 to 31.03.2012.
FACTUAL MATRIX 2.1 That as and by way of an assessment order dated 20.03.205 passed u/s 143(3) of the Act, the assessee’s total income exigible to tax was computed at Rs.26,20,56,890/-.
The assessee had filed return of income for the Assessment Year 2012-13 on 07.09.2012 declaring total income at NIL. The assessee had claimed the benefit of Section 80IA of the Act which was denied by the Ld. A.O in the aforesaid order and an addition of Rs.26,20,56,890/- was made in the aforesaid assessment order which is hereinafter referred to as the “impugned assessment order”.
2.2 That the assessee is Madhya Pradesh Road Development Corporation Ltd which as a corporation is State Highway Authority engaged in the business of developing and maintaining of roads infrastructure in the state of Madhya Pradesh. Further the corporation is established with the sole object by the Government of Madhya Pradesh for development and Page 2 of 10 maintenance of roads in Madhya Pradesh. Therefore the corporation availed the deduction u/s 80IA of the Act.
2.3 That the assessee being aggrieved by the aforesaid “impugned assessment order” prefers the first appeal u/s 246A of the Act before the Ld. CIT(A) who by the “impugned order” has dismissed the 1st appeal of the assessee on the grounds and reasons stated therein. The core grounds and reasons for the dismissal of the 1st appeal was as under:-
“7. DECISION:- The Statement of Facts, Grounds of appeal and the material on record have been considered. 7.1 During the appellate proceedings, the appellant has not filed any written submission. In absence of the written submission and evidence, it remained to be unexplained as to how the AO's order is erroneous If the appellant claims that he is eligible for any claim he should have furnished supporting documents. Making claim in the grounds of appeal that the assessment made by the A.O. was bad in law does not make the assessment invalid unless the appellant proves so with support of evidence, legal citation and showing how such case laws is applicable in the appellant's case. The appellant has failed to do so in spite of issuing as many as notices. 7.2 The appellate proceedings are first line of remedy to those who think that the injustice has been done by the AO. However, the appellant failed to avail the same by non-complying. Therefore, it is assumed that the appellant is not interested in pursuing his own appeal. Moreover, the appellant failed to bring on records any facts or documents which can explain how the order of the AO is erroneous. 7.3 The appellant has challenged the addition made of Rs.26,20,56,890/- without submitting sufficient evidences or counter arguments in support of its claims. Mere claiming that the AO erred in making the additions does not give an edge to the appellant. Further, during appellate proceedings, no Page 3 of 10 response received from the appellant to substantiate its claim in support of grounds of appeal though enough opportunities of being heard were given to it, as tabulated in Para 4 above. Hence, keeping in view all the stated facts and discussions and in the absence of any corroborative evidence or material/submission on records, I find no reason in altering the additions made by the AO. In view of this, the grounds raised by the appellant are dismissed.
7.4 in the case of Anil Goel Vs CIT, (2008) 306 ITR 212 (Punjab & Haryana), the Hon'ble High Court held as under:
"4. It is thus obvious on the plain language of section 250 of the Act that date and place of hearing was duly fixed. The assessee was also given notice along with notice to the Assessing Officer. The assessee had ample opportunity to make his submissions by appearing in person or through authorized representative. Despite fixing the case for seventeen hearings, no one had put in appearance nor any justifiable reason for adjournment was given.
5. The Tribunal also found that non-recording of reasons in support of order passed by CIT(A) would not amount to committing any illegality because the CIT(A) has adopted the reasoning advanced by the Assessing Officer and has upheld his order. The judgment of this Court, in the case of Popular Engineering Co. v. ITAT [2001] 248 ITR 577, has been rightly relied upon wherein it has been observed that elaborate reasons need not be recorded by the CIT(A) as has been done by the Assessing Officer. The reasons are required to be clear and explicit indicating that the authority has considered the issue in controversy. If the appellate/revisional authority has to affirm such an order it is not required to give separate reasons which may be required in case the order is to be reversed by the appellate/revisional authority."
7.5 Hon'ble Supreme Court in the case of CIT vs. B.N. Bhattacharjee and Another, 118 ITR 461 (SC) observed that preferring an appeal means more than formally filing it but effectively prosecuting it. Hon'ble M.P. High Court in the case of Estate of Tukojirao Holkar Vs CWT (1997) (223 ITR 480) (M.P.) dismissed the reference in def and for not taking necessary steps. Similar view has been taken I.T.A.T. Delhi Bench in the case of CIT vs. Multiplan India (P)L(1991)(38 ITD 320). Considering the above, it appears that the appellant is not Page 4 of 10 interested in prosecuting his appeal. Therefore, the appeal filed by the appellant is dismissed for non- prosecution.
7.6 In view of the above, it appears that the non-appearance to notices is deliberate as all the notices have been duly served upon the "appellant on the registered email account. No response has been received from the appellant till date. It is reasonable to infer from the continued non-compliance that the appellant is not serious to pursue his appeal.
8.0 In the result, the appellant's appeal is dismissed”.
2.4 That the assessee being aggrieved by the “impugned order” has preferred the instant second appeal before this Tribunal and has raised following grounds of appeal in the Form No.36 against the “impugned order” which are as follows:-
“1 The Learned JCIT (Appeals) -1 Nashik, has grossly erred in dismissing the appeal filed by the Appellant on mere non prosecution without deciding the case on the basis of statement of facts and grounds of appeal.
2. The Learned AO grossly erred in making disallowance of deduction U/s. 801A of Rs. 26,20,56,890 and Learned JCIT (Appeals) has erred in confirming the disallowance made by Learned AO.
The Learned AO and JCIT (Appeals) have failed to appreciate that Appellant Corporation is engaged in business of (i) developing or (ii) operating and maintaining or (iii) developing operating and maintaining infrastructure facility.
4. The Learned AO and Learned JCIT (Appeals) failed to appreciate the contents of various Agreements entered into by MPRDC.
Ld JCIT (Appeals) failed to appreciate that observation of AO with regard to nomenclature of income being decisive for 801A elgibility is incorrect.
The Learned JCIT (A) failed to appreciate that non appearance / non submission of reply during appeal does not preclude Appellate Authority to adjudicate on the available information / document already placed on record. There is no electronic link or other medium is provided to appear, therefore allegation of non appearance before appellate authority is without any merit.
The Learned JCIT (A), Nashik failed to appreciate that absence of a Notice U/s. 143 (2) by AO passing the Order is fatal to the validity of the proceeding and Order passed in culmination of such proceeding is liable to be quashed.
Assessee most humbly crave leave to add, alter, amend, withdraw, modify the Grounds of Appeal and to submit such statement, documents and papers as may be considered necessary either before or during the hearing of the appeal”.
3. Record of Hearing 3.1 The hearing in the matter took place before this Tribunal on 24.09.2025 when the Ld. AR for and on behalf of the assessee appeared before us and interalia contended that the “impugned order” is illegal, bad and not proper. It is also in the violation of the principles of natural justice. The “impugned order” is thus ex-parte. Our attention was invited to internal page 12 of the “impugned order” wherein a table is prepared by the Ld. CIT(A) with regard to the opportunities given to the assessee corporation and the same is as under:-
S.No. Date of notices issued Date of hearing Remarks 1 02.08.2016 30.08.2016 No response 2 06.01.2021 21.01.2021 No response
Page 6 of 10 3 11.03.2021 22.03.2021 No response 4 08.08.2022 16.08.2022 No response 5 01.11.2024 18.11.2024 No response
With regard to the above table the Ld. AR for the assessee contended that the assessee’s corporation officials could only see notice(s) at serial No.2 & 3 of the above table. Rest of the notices at Serial No.1,4 & 5 could not be seen by them and an ex-parte order came to be issued. The Ld.AR for the assessee fairly stated that while it is true that the assessee corporation officials ought to have been vigilant but since the corporation is state controlled entity it has it’s own peculiar difficulties as several notice(s), tenders, documents, letters etc. comes to them in a routine manner and that an error might have happened and its possibility cannot be ruled out and further part period in table pertains to covid-19 period also and hence the “impugned order” should be set aside in order to meet the ends of justice as same is ex-parte in nature. Per contra the Ld. DR appearing for and on behalf of the revenue has no objection if the matter is relegated back to the file of Ld. CIT(A) for disposal on merits.
Observations,findings & conclusions.
4.1 We now have to decide the legality, validity and the proprietery of the “impugned order” basis records of the case and rival contentions canvassed before us.
4.2 We have carefully perused the records of the case as presented to this Tribunal by both the Ld. AR & the Ld. DR to determine the legality, validity of the “impugned order” basis law and by following the due process.
4.3 We basis records of the case and after hearing and upon examining the rival contentions are of the considered opinion that the “impugned order” in order to secure the ends of justice should be set aside. Accordingly the “impugned order” is set aside as and by way of remand back to the file of Ld. CIT(A) so that the issue could be decided on merits of the case. This tribunal desires meritorious disposal of the appeal by the Ld. CIT(A) but at the same time this tribunal expects the assessee including government entities to be extremely vigilant with regard to tax notice(s) and its compliances should be made promptly otherwise whole system gets clogged.
Page 8 of 10 4.4 In view of the aforesaid, we set aside the “impugned order” and remand the case back to the file of Ld. CIT(A) on denovo basis. The assessee Corporation to avail the facilities of opportunity which would be offered by the Ld. CIT(A). The assessee Corporation is directed not to seek any adjournment on flimsy grounds. The Ld. CIT(A) should pass a speaking order on merits so that income of the assessee is assessed and computed on real time basis exigible to tax according to law. Assessee to cooperate with the department by furnishing all relevant information and data promptly to the Ld. CIT(A).
5. Order 5.1 In view of the aforesaid the “impugned order” is set aside as and by way of remand back to the file of the Ld. CIT(A) on denovo basis with the directions as aforesaid.
5.2 In the result appeal of the assesse is allowed for statistical purpose. Order pronounced in open court on 30.09.2025.