AUGUST CINEMA,TRIVANDRUM vs. ACIT, CIRCLE-1, TRIVANDRUM

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ITA 111/COCH/2024Status: DisposedITAT Cochin11 February 2025Bench: SHRI INTURI RAMA RAO (Accountant Member), SHRI PRAKASH CHAND YADAV (Judicial Member)3 pages

AI SummaryRemanded

Facts

The assessee, engaged in film business, filed an appeal against additions made under Section 69 (unsecured loan) and Section 40(a)(ia) for AY 2012-13 by the AO. The CIT(A) dismissed the assessee's appeal ex-parte due to non-prosecution, which led the assessee to appeal before the Tribunal.

Held

The Tribunal held that a CIT(A) is obligated to dispose of an appeal on its merits, even in an ex-parte situation, citing legal precedent. Consequently, the Tribunal remanded the case back to the CIT(A) for a de novo hearing and decision on merits, granting the assessee a reasonable opportunity of being heard.

Key Issues

Whether the CIT(A) can dismiss an appeal ex-parte for non-prosecution without adjudicating on its merits, and if so, what is the proper course of action for a higher appellate authority.

Sections Cited

143(3), 148, 69, 40(a)(ia)

AI-generated summary — verify with the full judgment below

Cases cited in this judgment

Detected automatically from the text. The count shows how many other judgments on BharatTax rely on the same authority.

CIT v. B.N. Bhattacharya & Another
118 ITR 461 · 1997 · SC
1,656 citing
PCIT v. Premkumar Arjundas Luthra
279 CTR 614 · HC
132 citing

Income Tax Appellate Tribunal, COCHIN BENCH

Before: SHRI INTURI RAMA RAO, AM & SHRI PRAKASH CHAND YADAV, JM

For Appellant: Shri Aravind Nair, Advocate

For Respondent: Smt. Leena Lal, Sr. D.R

Hearing: 09.01.2025Pronounced: 11.02.2025

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 16.10.2023 for Assessment Year (AY) 2012-13.

Brief facts of the case are that the assessee is a company engaged in the business of production and distribution of films. The appellant filed the return of income for AY 2012-13 on 09.03.2015 declaring total income of Rs. 71,70,660/-. Against the said return of August Cinema (India) Pvt. Ltd. income, the assessment was completed by the ACIT, Circle- 1(1), Trivandrum (hereinafter called "the AO") vide order dated 26.03.2015 passed u/s. 143(3) r.w.s. 148 of the Income Tax Act, 1961 (the Act) at a total income of Rs. 3,23,05,256/-. While doing so, the AO additions of Rs.35,00,000/- u/s. 69 on account of unsecured loan and Rs. 20,75,935/- u/s. 40(a)(ia) of the Act.

Being aggrieved, an appeal was filed before the CIT(A), who vide the impugned order dismissed the appeal exparte for non prosecution placing on the decision of the Hon'ble Supreme Court in the case of CIT v. B.N. Bhattacharjee and Anr [1977] 118 ITR 461 (SC) and a few other orders.

Being aggrieved, the assessee is in appeal before the Tribunal in the present appeal.

We have heard the rival 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. 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 direction to dispose of