THE MYNAGAPPALLY SERVICE CO-OPERATIVE BANK LIMITED,KOLLAM vs. THE DEPARTMENTAL REPRESENTATIVE, KOCHI

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ITA 800/COCH/2024Status: DisposedITAT Cochin18 March 2025AY 2020-21Bench: SHRI INTURI RAMA RAO (Accountant Member), SHRI KESHAV DUBEY (Judicial Member)3 pages
AI SummaryAllowed (for statistical purposes)

What did the Tribunal hold?

The Income Tax Appellate Tribunal held that the CIT(A) is mandated by Section 250(6) of the Act and settled legal principles to dispose of an appeal on its merits, even if heard *ex parte*. Consequently, the tribunal remanded the case back to the CIT(A) for a *de novo* decision on merits, ensuring a reasonable opportunity of hearing for the assessee.

What were the facts?

Mynagappally Service Co-op. Bank Ltd. claimed a deduction under Section 80P of the Income Tax Act for AY 2020-21, declaring nil income, which was disallowed by the AO, leading to an assessment of Rs. 2,56,86,947/-. The assessee's subsequent appeal before the CIT(A) was dismissed *ex parte* for non-prosecution.

What were the issues?

Whether the CIT(A) can dismiss an appeal *ex parte* for non-prosecution without deciding on its merits, and if such a dismissal is in contravention of legal requirements and established judicial precedents.

Which sections of the Income-tax Act were involved?

Section 80P,Section 143(3),Section 144B,Section 250(6)

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Income Tax Appellate Tribunal, COCHIN BENCH

Before: SHRI INTURI RAMA RAO, AM & SHRI KESHAV DUBEY, JM

For Appellant: Shri R. Krishnan, CA
For Respondent: Smt. Leena Lal, Sr. D.R
Hearing: 19.02.2025Pronounced: 18.03.2025

O R D E R Per: Inturi Rama Rao, AM This appeal filed by the assessee is directed against the order of the National Faceless Appeal Centre, Delhi [CIT(A)], dated 29.04.2024 for Assessment Year (AY) 2020-21.

2.

Brief facts of the case are that the appellant is a co-operative society registered under the Kerala State Co-operative Societies Act, 1969. It is engaged in the business of banking or providing credit facilities to its members for agricultural and allied activities. The return of income for AY 2020-21 was filed on 15.02.2021 declaring Mynagappally Service Co-op. Bank Ltd. Nil income after claiming deduction of Rs. 2,56,86,947/- u/s. 80P of the Income Tax Act, 1961 (the Act). Against the said return of income, the assessment was completed by the Income Tax Officer, Kollam (hereinafter called "the AO") vide order dated 26.08.2022 passed u/s. 143(3) r.w.s. 144B of the Act at a total income of Rs. 2,56,86,947/-. While doing so, the AO disallowed the claim of the assessee for deduction u/s. 80P of the Act.

3.

Being aggrieved, an appeal was filed before the CIT(A), who vide the impugned order dismissed the appeal exparte for non prosecution.

4.

Being aggrieved, the appellant is in appeal before us in the present appeal.

5.

We have heard the contentions of both the parties and perused the material available on record. We find that the learned CIT(A) dismissed the appeal in limine for non prosecution. As contemplated u/s. 250(6) of the Act the CIT(A) is required to frame points of determination followed by a detailed discussion thereupon before passing the order. It is the settled position of law that the CIT(A), even while disposing of the appeal exparte, is duty bound to dispose of the appeal on merits. Reliance in this regard can be placed on the decision of the Hon'ble Bombay High Court in the case of PCIT vs. Premkumar Arjundas Luthra 279 CTR 614. Therefore, in the light of the above legal position we are of the considered view that the matter requires to be remanded to the file of the CIT(A) with the

6.

In the result, the appeal filed by the assessee is allowed for statistical purposes Order pronounced in the open court on 18th March, 2025.

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