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Facts
The assessee, a primary agriculture credit co-operative society, did not file an income tax return for AY 2018-19. The AO initiated reassessment under section 147 upon discovering significant cash deposits. The assessee's first appeal before the CIT(A) was dismissed due to non-prosecution.
Held
The Tribunal found that the CIT(A) had dismissed the appeal without adjudicating the merits, violating the principles of natural justice and the mandate of Section 250(6). Considering the assessee's reasons for non-prosecution and the need for proper adjudication, the matter was remanded.
Key Issues
Whether the CIT(A) order dismissing the appeal for non-prosecution without considering merits is sustainable and whether the matter should be remanded to the AO for fresh assessment.
Sections Cited
147, 148, 144, 139, 250(6)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, INDORE BENCH, INDORE
Before: SHRI B.M. BIYANI & SHRI PARESH M. JOSHI
आदेश/ O R D E R
Per B.M. Biyani, A.M.:
The captioned two matters are being disposed of by this consolidated order since these matters are connected.
SA No. 2/Ind/2026:
Adim Jati Seva Sahakari Sanstha Maryadit, Betul SA No. 2/Ind/2026 & AY 2018-19 initial deliberations of the facts, the Ld. AR for assessee submitted that he would be satisfied if this stay-application is dismissed but at the same time the assessee’s is heard immediately. Ld. DR for revenue agreed. Hence, the stay-application is dismissed and the is immediately listed and heard.
This appeal by assessee is directed against order of first-appeal 3. dated 28.10.2024 passed by learned Commissioner of Income-Tax (Appeals)- NFAC, Delhi [“CIT(A)”], which in turn arises out of assessment-order dated 30.03.2023 passed by learned ITO, Betul [“AO”] u/s 147 r.w.s. 144 of Income-tax Act, 1961 [“the Act”] for Assessment-Year [“AY”] 2018-19.
The background facts leading to present appeal are such that the assessee is a primary agriculture credit co-operative society. For AY 2018-19, the assessee did not file any return u/s 139. The AO, from verification of Taxpayer Annual Summary (TAS), came to know that the assessee made transactions of cash deposits of Rs. 2,31,02,133/- in Zila Sahakari Kendriya Bank Ltd. during the previous year 2017-18 relevant to AY 2018-19. Accordingly, the AO completed preliminary proceeding of section 148A(b) and thereafter issued a notice dated 31.03.2022 u/s 148 so as to undertake assessment of assessee u/s 147. In response, the assessee filed return
Adim Jati Seva Sahakari Sanstha Maryadit, Betul SA No. 2/Ind/2026 & AY 2018-19 belatedly on 05.03.2023. Thereafter, the AO issued notices raising queries u/s 142(1). The assessee filed a reply dated 19.03.2023 which is re- produced by AO in Para 5 of assessment-order. In such reply, the assessee made pointwise submissions and also filed copies of P&L A/c, registration certificate, bye-laws, bank statement, computation of income, etc. The AO considered assessee’s submissions but ultimately made an addition of Rs.
2,31,02,133/- treating the entire amount of impugned deposits as unexplained money u/s 69A r.w.s. 115BBE. Aggrieved, the assessee matter in first-appeal whereupon the CIT(A) dismissed assessee’s appeal in limine without adjudicating merits of case due to non-prosecution. Still aggrieved, the assessee has come in next appeal before us.
Ld. AR for assessee at first submitted that the section 250(6) of the Income-tax Act, 1961 provides “The order of the Commissioner (Appeals) disposing of the appeal shall be in writing and shall state the points for determination, the decision thereon and the reason for the decision.”. He further submitted that in present case, the Ld. CIT(A) has dismissed assessee’s first appeal although due to non-prosecution by assessee on the dates of hearing but still without complying with the mandate of section 250(6). Therefore, the impugned first appeal-order passed by Ld. CIT(A) deserves to be set aside and the matter is fit for restoring to him for a proper adjudication. In so far as non-prosecution before CIT(A) is concerned, Ld. AR drew us to Para 4 of impugned order wherein the CIT(A) has mentioned that Page 3 of 5
Adim Jati Seva Sahakari Sanstha Maryadit, Betul SA No. 2/Ind/2026 & AY 2018-19 all notices were given to registered e-mail. Ld. AR submitted that the assessee is located in a rural area and having less skilled man power and the internet technologies are also not sound. Therefore, the assessee could not access the notices of hearing sent by CIT(A) which has only led to the non-prosecution.
Ld. AR next carried us to the assessment-order and demonstrated that the assessee has filed a reply dated 19.03.2023 giving all required details to the AO, however the AO has not properly appreciated the case or details of assessee. He acknowledged that the assessee is still ready and willing to make an effective representation for the satisfaction of AO if an opportunity is given and hence prays that the present matter should be remanded to the AO for a fresh consideration and assessment.
Ld. DR for revenue agrees with the prayer of Ld. AR but makes a request to direct the assessee to represent his case before AO and do not seek unnecessary adjournments.
In view of above submissions of parties; having regard to the principle of natural justice and also bearing in mind that no prejudice would be caused to revenue if the present matter is restored at the level of AO, we remand this matter back to the file of AO for adjudication afresh, at the risk and responsibility of assessee. The AO shall give necessary opportunity of hearing to assessee and pass an appropriate order uninfluenced by his earlier order. The assessee is also directed to remain vigilant and ensure
Adim Jati Seva Sahakari Sanstha Maryadit, Betul SA No. 2/Ind/2026 & AY 2018-19 participation in the hearings as may be fixed by AO and do not seek unnecessary adjournments failing which the AO shall be at liberty to pass appropriate order in accordance with law. Ordered accordingly.
Consequently, this appeal is allowed for statistical purpose.
Order pronounced in open court immediately after conclusion of hearing and subsequently reduced in writing on 13/02/2026