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Facts
The assessee appealed an order by the National Faceless Appeal Center (NFAC) for AY 2017-18. The Assessing Officer had made disallowances totaling Rs. 37,03,841 under Section 40(a)(ia) of the Income Tax Act. The assessee failed to appear or file submissions before both the Ld. Commissioner and the Tribunal.
Held
The Tribunal noted the assessee's lack of diligence in pursuing the appeal. However, since the Ld. Commissioner decided the appeal in limine without going into the merits, the Tribunal remanded the case back to the Ld. Commissioner for a fresh decision.
Key Issues
Whether the appeal filed by the assessee should be dismissed due to non-appearance and lack of submissions, or if it should be remanded for a decision on merits.
Sections Cited
250, 143(3), 40(a)(ia)
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Income Tax Appellate Tribunal, MUMBAI BENCH “G”, MUMBAI
Before: SHRI NARENDER KUMAR CHOUDHRY & SHRI RATNESH NANDAN SAHAY
Per : Narender Kumar Choudhry, Judicial Member:
This appeal has been preferred by the assessee against the order dated 21.08.2023, impugned herein, passed by the National Faceless Appeal Center (NFAC)/ Ld. Commissioner of Income Tax (Appeals) (in short Ld. Commissioner) under section 250 of the Income Tax Act, 1961 (in short ‘the Act’) for the A.Y. 2017-18.
At the outset, we observe that the Assessing Officer (AO), vide order dated 24.12.2019 under section 143(3) of the Act, made various disallowances under section 40(a)(ia) of the Act amounting to Rs.37,03,841/- in total, against which the assessee has preferred first appeal before the Ld. Commissioner, who though afforded various opportunities to the assessee, however, the assessee 2 M/s. Sunshine Planet Realty LLP neither filed any written submissions nor sought any adjournment and therefore the Ld. Commissioner in the constrained circumstances, assumed that the assessee is not interested in prosecuting the present appeal and consequently in absence of any rebuttal of the assessment order, he consequently confirmed the assessment order and accordingly dismissed the appeal of the assessee.
The assessee, being aggrieved, is in appeal before us. In spite of sending notice for the date of hearing today, the assessee neither appeared nor filed any adjournment application, therefore, in the constrained circumstances, we are inclined to decide this appeal by perusing the orders passed by the authorities below and hearing the Ld. D.R., who vehemently supported the orders passed by the authorities below and claimed that the impugned order does not suffer from any perversity, impropriety and/or illegality, hence, the appeal filed by the assessee may be dismissed in limine.
We observe that prima-facie there seems to be laches on the part of the assessee, as in spite of sending notices, the assessee neither appeared before the Ld. Commissioner and also not acted diligently. Before us also remained absent and therefore we are inclined not to take lenient view. However, considering the peculiar facts and circumstances of the case in totality, as the Ld. Commissioner decided the appeal of the assessee in limine but not on merits of the case and therefore for the just decision of the case and for substantial justice, we are inclined to remand the instant case to the file of the Ld. Commissioner for decision afresh, suffice to say by affording reasonable opportunity to the assessee to substantiate its case. 3 M/s. Sunshine Planet Realty LLP
We also direct the assessee to cooperate with the appellate proceedings and file the relevant documents/information/reply which would be essential and to be needed by the Ld. Commissioner for proper adjudication of the assessee. We clarify that in case of further default, the assessee shall not be entitled for any leniency. The case is remanded accordingly.
In the result, the appeal filed by the assessee stands allowed for statistical purposes.
Order pronounced in the open court on 30.04.2024.