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Facts
The assessee's appeals before the Commissioner of Income Tax (Appeals) [CIT(A)] were dismissed in limine due to non-prosecution and non-appearance, leading to cryptic orders without discussing the merits. The assessee contended that these first appellate orders were passed without proper opportunity or communication, thereby violating principles of natural justice and without addressing the grounds challenging additions/disallowances by the AO.
Held
The Tribunal held that the CIT(A) cannot dismiss an appeal for non-prosecution as it is statutorily obligated under Section 250(6) of the Income Tax Act to state points for determination and provide reasoned decisions, even in ex-parte cases. Citing High Court precedent, the Tribunal set aside the CIT(A)'s orders and restored all issues to the file of the CIT(A) for fresh adjudication on merits, ensuring the assessee receives a reasonable opportunity of hearing.
Key Issues
Whether the CIT(A) can dismiss an appeal in limine for non-prosecution without addressing the merits, and if such dismissal violates Section 250(6) of the Income Tax Act and principles of natural justice.
Sections Cited
143(3), 147, 143(3A), 143(3B), 250(6)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCH “E” DELHI
Before: SHRI CHALLA NAGENDRA PRASAD & SHRI PRADIP KUMAR KEDIA
The captioned appeals arise from the order of the Commissioner of Income Tax (Appeals)-29, New Delhi in respective assessment orders passed by the Assessing Officer tabulated hereunder:
Sr. ITA/CO Nos. CIT(A) Order dated Assessment Order passed under Nos. Order date and Sections Assessment Year 1. CIT(A)-29, New Assessment Assessment Order under Delhi order dated order dated section 143(3) of the 05.09.2022 29.12.2019; Income Tax Act, 1961. A.Y. 2017-18 2 ITA No.2731/Del/2022 CIT(A)-29, New Assessment Assessment Order under Delhi order dated order dated section 147 of the Income 30.08.2022 26.12.2016; Tax Act, 1961. A.Y. 2011-12 3. CIT(A)-29, New Assessment Assessment Order under Delhi order dated order dated section 143(3) of the 30.08.2022 27.12.2016; Income Tax Act, 1961. A.Y. 2014-15 4. ITA No.2733/Del/2022 CIT(A)-29, New Assessment Assessment Order under Delhi order dated order dated section 143(3) of the 30.08.2022 24.12.2018; Income Tax Act, 1961. A.Y. 2016-17 5. ITA No.2734/Del/2022 CIT(A)-29, New Assessment Assessment Order under Delhi order dated order dated section 143(3) of the I.T.A. No.2730 to 2735/Del/2022 2
30.08.2022 29.12.2019; Income Tax Act, 1961. A.Y. 2017-18 6. CIT(A)-29, New Assessment Assessment Order under Delhi order dated order dated section 143(3) r.w. Section 30.08.2022 13.02.2021; 143(3A) & 143(3B) of the A.Y. 2018-19 Income Tax Act, 1961.
It is seen from the record that notice of hearing was duly served upon the assessee. As per the case records, none appeared from the assessee despite service of notice on several occasions. Accordingly, the matter was proceeded ex-parte.
As per the grounds of appeal, the assessee has taken various grounds seeking to assail the additions/disallowances of expenses made by the AO. As per the grounds of appeal, the assessee contends that the first appellate order has been passed without any opportunity to the assessee based on un-communicated notice to the assessee and therefore, passed in breach of principles of natural justice.
4. On perusal of the respective first appellate orders, we notice that the CIT(A) has dismissed the appeal in limine on the grounds of non-prosecution of appeal by the assessee before him. The CIT(A) has passed a cryptic order without any cogent discussion on merit.
5. We straightway refer to Section 250(6) of the Act which enjoins that the CIT(A) shall state the points for determination before it and the decision shall be rendered on such points along with reasons for the decision. Thus, it is incumbent upon the CIT(A) to deal with the grounds on merits even in ex parte order. In view of Section 250(6) of the Act, the CIT(A) has no power to dismiss an appeal on account of non-prosecution. This view is also taken by the Hon'ble Bombay High Court in case of CIT vs. Premkumar Arjundas Luthra HUF, (2017) 291 CTR 614 (Bom.). A bare glance of the order of the CIT(A) shows that CIT(A) has not addressed itself on various points placed for its determination at all and dismissed the appeal of assessee for default in non appearance. Needless to say, the CIT(A) plays role of both adjudicating authority as well as appellate authority. Thus, the CIT(A) could not have shunned the appeal for non- compliance without addressing the issue on merits.
6. In the totality of the circumstances, we consider it just and expedient to restore the matter back to the CIT(A) in the larger interest of justice with a view to enable the assessee to avail proper opportunity for disposal of appeal by the CIT(A) on various
I.T.A. No.2730 to 2735/Del/2022 3 points. The assessee is cautioned to extend full co-operation to the CIT(A) without any demur, failing which, the CIT(A) shall be at liberty to conclude the appellate proceedings in accordance with law. Hence, the order of the CIT(A) appealed against, is set aside and all the issues raised in the impugned appeal are restored back to the file of the CIT(A) for fresh adjudication in accordance with law after giving reasonable opportunity of hearing to the assessee.