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Facts
The assessee, an employee, did not file an Income Tax Return for AY 2018-19. Based on information about cash deposits aggregating to Rs. 59,97,500/-, the AO issued a notice under Section 148. The assessee filed a return, but the assessment was completed by adding Rs. 50,97,500/- as unexplained money under Section 69A. The CIT(A) subsequently dismissed the assessee's appeal ex parte for non-prosecution.
Held
The Tribunal held that a CIT(A) is obligated to dispose of an appeal on merits, even if dismissed ex parte for non-prosecution. Citing a High Court decision, the Tribunal remanded the case to the CIT(A) to decide the appeal de novo on merits, ensuring a reasonable opportunity of hearing for the assessee.
Key Issues
Whether the CIT(A) can dismiss an appeal ex parte for non-prosecution without adjudicating it on merits.
Sections Cited
148, 147, 144, 144B, 69A
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Income Tax Appellate Tribunal, COCHIN BENCH
Before: SHRI INTURI RAMA RAO, AM & SHRI PRAKASH CHAND YADAV, JM
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 08.08.2024 for Assessment Year (AY) 2018-19.
Brief facts of the case are that the assessee was an employee of M/s. Chamiyar Fuels, Kottayi. The appellant has not filed his return of income for AY 2018-19. On receipt of information that the Shaju Krishnan appellant had made cash deposits aggregating to Rs. 59,97,500/- the Income Tax Officer, Ward -2, Palakkad (hereafter “the AO”) issued notice u/s. 148 of the Income Tax Act, 1961 (the Act) on 07.04.2022 directing the appellant to file return of income of the year under consideration. In response the appellant filed the return of income on 26.04.2022declring total income at Rs. 4,35,000/-. Against the said return of income, the assessment was completed by the assessment vide order dated 12.03.2024 passed u/s. 147 r.w.s. 144 r.w.s. 144B of the Act by adding Rs. 50,97,500/- as unexplained money u/s. 69A of the ct.
Being aggrieved, an appeal was filed before the CIT(A), who vide the impugned order dismissed the appeal exparte for non prosecution.
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 Shaju Krishnan 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 the appeal de novo on merits after affording reasonable opportunity of hearing to the assessee.
In the result, the appeal filed by the assessee is allowed for statistical purposes