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Facts
The assessee filed an appeal with a delay of 294 days, attributing it to the death of his previous counsel. The CIT(A)/NFAC had dismissed the assessee's appeal ex-parte for non-compliance with hearing notices, without addressing the merits of the case.
Held
The Tribunal condoned the delay, finding no malafide intent. Citing a Bombay High Court judgment, it ruled that the CIT(A) is statutorily bound to dispose of appeals on merits and cannot summarily dismiss them for non-prosecution. The case was remanded to the CIT(A)/NFAC for de novo adjudication on merits, with the assessee granted one final opportunity to represent their case.
Key Issues
1. Condonation of delay in filing the appeal. 2. The power of CIT(A) to dismiss an appeal for non-prosecution without deciding on merits.
Sections Cited
Income Tax Act: Section 250, Income Tax Act: Section 250(4), Income Tax Act: Section 250(6), Income Tax Act: Section 251(1)(a), Income Tax Act: Section 251(1)(b), Income Tax Act: Section 251(2) (Explanation), Income Tax Act: Section 246A
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Income Tax Appellate Tribunal, RAIPUR BENCH “SMC”, RAIPUR
Before: SHRI PARTHA SARATHI CHAUDHURY
आदेश / ORDER
PER PARTHA SARATHI CHAUDHURY, JM
This appeal preferred by the assessee emanates from the order of the Ld.ADDL/JCIT(A)/NFAC, dated 22.04.2024 for the assessment year 2017-18 as per the grounds of appeal on record.
At the very outset, it has been pointed out by the Ld. Counsel for the assessee that there is a delay of 294 days in filing of the present appeal. In response thereto, condonation petition a/w. affidavit has been filed by the Ld. Counsel for the assessee. The Ld. Sr. DR also filed counter affidavit. I have considered the contents in both the affidavits filed by the assessee and the revenue. It is contended by the Ld. Counsel for the assessee that delay had occasioned due to demise of the erstwhile counsel and evidencing the same he had placed on record copy of death certificate. In the counter affidavit filed by the department plea taken is that all the hearing notices in the case of the assessee starting from assessment stage has been sent to the email id that was provided by the assessee and in the same email id appellate order was also sent. However, the fact is that during that time erstwhile counsel was alive and he was able to respond to the same whereas, at the time of filing appeal within a period of limitation prescribed before the Tribunal the erstwhile counsel had expired. Therefore, there was no probability to file appeal on time and as practical aspect, the assessee needs to find another counsel to file the appeal before the Tribunal. Having said that the Ld. Sr. DR also fairly agreed to the facts on record and conceded that a judicial approach needs to be taken for the fact that there is no malafide conduct of the assessee as on record regarding filing of the present appeal. Accordingly, the said delay of 294 days is condoned.
On merits, the Ld. Counsel for the assessee submitted that as evident from Para 4 of the impugned order, the Ld.CIT(Appeals) /NFAC vide an ex-parte order had dismissed the appeal of the assessee due to non-compliance by the assessee. For the sake of clarity, the Para 4 of the Ld.CIT(Appeals)’s order are culled out as follows:
“4. The appellant was issued various issued notices u/s. 250 of the Act, however the appellant has not made any response against the notices issued which indicates that the appellant is not interested in pursuing the appeal before the appellate authority. The details of such notices issued are given as below: Sr. Date of Notice Date of Mode of Remarks No. issued hearing service 1. 27.01.2021 03.02.2021 Online No compliance through ITBA 2. 24.09.2021 29.09.2021 Online No compliance through ITBA 3. 19.03.2024 26.03.2024 Online No compliance through ITBA 4. 37.03.2024 11.04.2024 Online No compliance through ITBA
5. 12.04.2024 19.04.2024 Online No compliance through ITBA
As on date of finagling the appeal, the appellant has not made any response nor did file any submission.”.”
The Ld. Sr. DR has fairly conceded that the matter may be adjudicated denovo on merits before the first appellate authority providing one final opportunity to the assessee.
I have carefully considered the contents in the documents/material available on record, submissions of both the parties. As per the aforesaid examination of the entire spectrum of the matter in the interest of natural justice, I deem it fit and proper to provide one final opportunity to the assessee to represent his case on merits before the Ld. CIT(Appeals)/NFAC.
On a perusal of the order of the Ld.CIT(Appeals)/NFAC, it is observed that the Ld.CIT(Appeals)/NFAC dismissed the appeal of the assessee in limine for non-compliance without dealing with the merits of the case. In my considered view, once an appeal is preferred before the CIT(Appeals), it becomes obligatory on his part to dispose off the same on merit and it is not open for him to summarily dismiss the appeal on account of non-prosecution of the same by the assessee. In fact, a perusal of Sec.251(1)(a) and (b), as well as the “Explanation” to Sec.251(2) of the Act reveals that the CIT(Appeals) remains under a statutory obligation to apply his mind to all the issues which arises from the impugned order before him. As per the mandate of law the CIT(Appeals) is not vested with any power to summarily dismiss the appeal for non-prosecution. The aforesaid view is fortified by the judgment of the Hon'ble High Court of Bombay in the case of CIT Vs. Premkumar Arjundas Luthra (HUF) (2017) 297 CTR 614 (Bom). In the aforementioned case the Hon’ble High Court had observed as under:
"8. From the aforesaid provisions, it is very clear once an appeal is preferred before the CIT(A), then in disposing of the appeal, he is obliged to make such further inquiry that he thinks fit or direct the AO to make further inquiry and report the result of the same to him as found in Sec. 250 of the Act. Further, Sec. 250(6) of the Act obliges the CIT(A) to dispose of an appeal in writing after stating the points for determination and then render a decision on each of the points which arise for consideration with reasons in support. Sec. 251(1)(a) and (h) of the Act provide that while disposing of appeal the CIT(A) would have the power to confirm, reduce, enhance or annul an assessment and/or penalty. Besides Explanation to sub- s. (2) of s. 251 of the Act also makes it clear that while considering the appeal, the CIT(A) would be entitled to consider and decide any issue arising in the proceedings before him in appeal filed for its consideration, even if the issue is not raised by the appellant in its appeal before the CIT(A). Thus once an assessee files an appeal under s. 246A of the Act, it is not open to him as of right to withdraw or not press the appeal. In fact the CIT(A) is obliged to dispose of the appeal on merits. In fact w.e.f. 1st June, 2001 the power of the CIT(A) to set aside the order of the AO and restore it to the AO for passing a fresh order stands withdrawn. Therefore, it would be noticed that the powers of the CIT(A) are co-terminus with that of the AO i.e. he can do all that A.O could do. Therefore, just as it is not open to the AO to not complete the assessment by allowing the assessee to withdraw its return of income, it is not open to the assessee in appeal to withdraw and/or the CIT(A) to dismiss the appeal on account of non-prosecution of the appeal by the assessee. This is amply clear from the s. 251(1)(a) and (b) and Explanation to Sec. 251(2) of the Act which requires the CIT(A) to apply his mind to all the issues which arise from the impugned order before him whether or not the same has been raised by the appellant before him. Accordingly, the law does not empower the CIT(A) to dismiss the appeal for non-prosecution as is evident from the provisions of the Act.”
Respectfully following the aforesaid order, I set-aside the order of the Ld. CIT(Appeals)/NFAC and remand the matter back to its file for denovo adjudication while complying with the principles of natural justice. At the same time, it is directed that this being the final opportunity, the assessee shall duly comply with the hearing notices from the Ld.CIT(Appeals)/NFAC. The Ld.CIT(Appeal)/NFAC shall accordingly pass order in terms with Section 250(4) & (6) of the Act within three months from receipt of this order.
As per the aforesaid terms, the grounds of appeal raised by the assessee stands allowed for statistical purposes.
In the result, appeal of the assessee is allowed for statistical purposes.
Order pronounced in open court on 22nd day of July, 2025.