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Facts
The assessee's appeal was dismissed by the CIT(A) in default for non-appearance. The assessee contended that they were not afforded sufficient opportunity of hearing. The CIT(A) dismissed the appeal without adjudicating on merits. The Tribunal noted that while the assessee did not appear, the CIT(A) did not follow proper procedure for ex-parte orders.
Held
The Tribunal held that the CIT(A) was expected to state the points for determination, the decision, and the reasons, as per Section 250(6) of the Act. Even though the assessee was absent, principles of natural justice should be observed. Therefore, the matter was remitted back to the CIT(A) for de novo adjudication on merit.
Key Issues
Whether the CIT(A) erred in dismissing the appeal in default without affording sufficient opportunity of hearing and without proper adjudication as per legal requirements.
Sections Cited
143(1), 143(2), 142(1), 14A, 115JB, 250, 250(6)
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Income Tax Appellate Tribunal, ‘H (SMC
Before: SHRI OM PRAKASH KANT & SHRI SUNIL KUMAR SINGH
O R D E R PER SUNIL KUMAR SINGH (J.M): 1. This appeal has been preferred against the impugned order dated 21.03.2024 passed in Appeal no. CIT(A) 10, Mumbai/10185/2017–18 by the Ld. Commissioner of Income– tax(Appeals)/ National Faceless Appeal Centre (NFAC) [hereinafter referred to as the “CIT(A)”] u/s. 250 of the Income- tax Act, 1961 [hereinafter referred to as "Act"] for the Assessment year [A.Y.] 2015-16, wherein learned CIT(A) has dismissed assessee’s first appeal in default of assessee.
2 Harsora Hotels Pvt. Ltd.
Briefly stating the facts, that the return filed by the assessee on 29.10.2015 was processed u/s. 143(1) of the Act. Thereafter the case was selected for limited scrutiny. After issuing statutory notices u/s. 143(2) and 142(1) of the Act and considering the response of the assessee, learned assessing officer disallowed the deduction of Rs. 42,53,662/– u/s. 14A r/w section 115JB of the Act. Aggrieved by the assessement order, assessee filed an appeal before learned CIT(A), who dismissed assessee’s appeal in absentia.
Assessee filed this appeal on the ground that learned CIT(A) has passed ex–parte impugned order without affording sufficient opportunity of hearing to the appellant assessee and erred in confirming the above said addition made by assessing officer.
In response to the notice issued by the tribunal, learned DR appeared and participated in the hearing.
We have perused the records and heard learned DR as none argued for the absentee appellant assessee.
Learned DR has submitted that assessee was provided sufficient opportunity of hearing by issuance of notices on four occasions by learned CIT(A) but for no avail. Learned DR has supported impugned order passed by the first appellate authority.
Perusal of the impugned order shows that learned CIT(A) has mentioned in the concluding para 7.3 of the impugned order that the appellant has not pursued the appeal. No details, documents or submissions have been provided by the 3 Harsora Hotels Pvt. Ltd. appellant to substantiate the grounds. He concluded that mere facts mentioned in form no. 35 cannot be considered. This conclusion led him to dismiss assessee’s first appeal.
Learned CIT(A) was expected to state the points for determination, the decision there on and the reasons for the decision as provided u/s. 250(6) of the Act. We are conscious of the fact, that assessee has not turned up before the first appellate authority in response to the notices issued on four different occasions. However, in the interest of justice and fair play, we deem it appropriate to remit the matter back to the file of learned CIT(A) for denovo adjudication on merit. We further direct the assessee to be diligent and cooperative in attending the hearings and making submissions before the first appellate authority for the expeditious and effective disposal of the appeal. Assessee should refrain from seeking any adjournment but for compelling and unavoidable reasons. Needless to say that learned CIT(A) shall ensure the observance of the principles of natural justice. It is made clear that we have not made any observation on the merits of the case. The appeal is thus liable to be allowed.
In the result, the appeal is allowed. Impugned order dated 21.03.2024 is set aside. The case is restored back to the file of the learned CIT(A) for statistical purposes. Order pronounced on 31.07.2024. Sd/– Sd/– (OM PRAKASH KANT) (SUNIL KUMAR SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai; Dated 31/07/2024 Anandi Nambi, Steno