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Income Tax Appellate Tribunal, DELHI BENCH ‘SMC’, NEW DELHI
Before: Sh. N. K. Saini
ORDER These two appeals by the assessee are directed against the separate orders each dated 26.08.2016 of ld. CIT(A)-23, New Delhi.
These appeals belonging to the same assessees were heard together so these are being disposed off by this consolidated order for the sake of convenience and brevity.
The identical issues are involved in these appeal which relate to the sustenance of penalty u/s 271(1)(c) of the Income Tax Act, 1961 (hereinafter referred to as the Act). Common & 5615/Del/2016 2 Ganpati Sugar Ltd. grounds have been raised in these appeals, the only difference is in the figure of penalty sustained by the ld. CIT(A). The Grounds raised
in read as under: “1. That the impugned order passed by the learned Commissioner of Income tax (Appeals) u/s 271(1)(c) r.w.s. 274 of the Income Tax Act, 1961 dated 26.08.2016 is bad in law and on facts.
2. That on facts and in the circumstances of the case the Ld. Commissioner of Income tax (Appeals) is not justified in confirming penalty imposed by the Id. AO u/s 271(1)(c) of the Act amounting to Rs.44,38,850/- for concealment of income.
3. That the Ld. Commissioner of Income tax (Appeals) has erred in law while passing the order u/s 250 of the Act without following the principles of natural justice.
4. That the order passed by the Ld. CIT (A) u/s 250 of the Income Tax Act,1961 is bad in law and not justified because the Id. CIT (A) has dismissed the appeal simply on account of non prosecution of the appeal by the appellant without appreciating the judgment of the Hon'ble Bombay High Court in case of CIT (Central) Nagpur vs. Premkumar Arjundas Luthra (HUF), [2016] 69 taxmann.com 407 (Bombay), whereby it has been held that law does not empower the CIT(A) to dismiss appeals for non- prosecution.
5. That the order passed by the Id. CIT (A) u/s 250 of the Act is perverse to the provisions of the law and to ITA Nos. 5614 & 5615/Del/2016 3 Ganpati Sugar Ltd. the facts of the case, because of not following the provision of section 250(6) of the Income Tax Act, 1961 which states that 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.
6. That the appellant craves leave to add, alter, amend, substitute, delete and modify any or all the grounds of appeal, which are without prejudice to one another, before or at the time of hearing of the appeal.”
4. From the aforesaid ground Nos. 3 to 5, it would be clear that the grievance of the assessee relates to the dismissal of appeal by the ld. CIT(A) for non-prosecution.
The facts of the case in brief are that the penalty of Rs.44,34,850/- was levied by the AO u/s 271(1)(c) of the Act by considering the share capital received by the assessee as income from undisclosed sources and by holding that the assessee concealed the particulars of income and also filed inaccurate particulars of its income.
The assessee carried the matter to the ld. CIT(A) who passed the ex-parte order by observing that there was no compliance by the assessee to the notices issued for hearing, therefore, the assessee is not interested to prosecute the matter. Accordingly, the appeals were dismissed in limine. & 5615/Del/2016 4 Ganpati Sugar Ltd.
Now the assessee is in appeal. The ld. Counsel for the assessee submitted that a due and reasonable opportunity of being heard to the assessee was not provided by the ld. CIT(A). It was further stated that the notice of hearing was not served upon the assessee. He requested to delete the penalty sustained by the ld. CIT(A).
In his rival submissions the ld. DR supported the orders of the authorities below.
I have considered the submissions of both the parties and carefully gone through the material available on the record. In the present case, it is noticed that the ld. CIT(A) although sustained the penalty levied by the AO u/s 271(1)(c) of the Act. However, no finding has been given on the merit of the case and the appeals were dismissed in limine. It is noticed that the ld. CIT(A) neither discussed nor adjudicated the issues on merit. Therefore, the impugned order is a non-speaking order in the eyes of law. It is also noticed that the ld. CIT(A) in the impugned order had mentioned at page no. 2 that the notice and letter had been delivered on 15.07.2016 and 10.08.2016 as per the status of delivery track of the Postal Department. However, it is not clear as to whether the notices/letters were received by the assessee, particularly when, nothing is mentioned in the impugned order that the notices were served upon any authorized person of the assessee. The provisions contained in Section 250(6) of the Act read as under: & 5615/Del/2016 5 Ganpati Sugar Ltd. “(6) 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.”
From the above provisions contained in Sub-section 6 of Section 250 of the Act, it is clear that the ld. CIT(A) while disposing of the appeal shall pass an order in writing by stating the points for determination, the decision thereon and the reason for the decision. However, in the present case, the ld. CIT(A) simply dismissed the appeals for non-prosecution. He has not stated the points for determination nor the decision thereon and the reason for the said decision. Therefore, the impugned order passed by the ld. CIT(A) is not a speaking order in the eyes of law and deserves to be set aside. At the same time, from the observation of the ld. CIT(A), it appears that the assessee did not cooperate. I, therefore, considering the totality of the facts and by keeping in view the principle of nature justice, deem it appropriate to set aside this case back to the file of the ld. CIT(A) to be adjudicated afresh in accordance with law after providing due and reasonable opportunity of being heard to the assessee. I also direct the assessee to cooperate and not to seek undue or unwarranted adjournments.
In the facts are similar as were involved in . The only difference is in the amount of ITA Nos. 5614 & 5615/Del/2016 6 Ganpati Sugar Ltd. penalty sustained by the ld. CIT(A). Therefore, the findings given in former part of this order for the assessment year 2003-04 shall apply mutatis mutandis for the assessment year 2004-05 in ITA No. 5615/Del/2016.
In the result, the appeals of the assessee are allowed for statistical purposes. (Order Pronounced in the Court on 27/02/2017)