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Facts
The assessee's appeal was dismissed by the CIT(A) for non-prosecution. The assessment order was for the assessment year 2021-22. The assessee had filed an adjournment request on 27.12.2023, which was the day before the hearing scheduled for 28.12.2023, but the CIT(A) dismissed the appeal on 11.01.2024 without clearly communicating the rejection of the adjournment request or proceeding with the hearing.
Held
The Tribunal held that the CIT(A) failed to follow proper procedure by dismissing the appeal for non-prosecution without properly communicating the rejection of the adjournment request or providing a reasonable opportunity to be heard. The dismissal order was not passed on the date of hearing, indicating a procedural lapse.
Key Issues
Whether the dismissal of the appeal for non-prosecution by the CIT(A) was justified without providing a reasonable opportunity of being heard, especially when an adjournment request was made and not properly addressed.
Sections Cited
143(2), 142(1), 144, 133(6), 250(2)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, JAIPUR BENCHES,” A”-Bench” JAIPUR
Before: SHRI RATHOD KAMLESH JAYANTBHAI, AM & SHRI NARINDER KUMAR, JM vk;dj vihy la-@ITA. No. 287/JPR/2024
vkns'k@ORDER PER: NARINDER KUMAR, J.M.
Assessee-appellant is proprietor of M/s Girraj Prasad Kailash Chand. He is feeling aggrieved by order dated 11.01.2024 passed by Learned CIT(A), whereby, while dismissing his appeal for non prosecution, the assessment order relating to assessment year 2021-22, has been upheld.
Sh. Ramavatar Singhal vs. ITO 2. On 11.03.2022, assessee filed return showing his income as Rs. 5,37,890/-. Said return was selected for scrutiny through CASS for following reasons :- “Assessee has made substantial purchases from suppliers who are either Non-Filer(s) or have filed non-business ITR (ITR1,2) or reflected a substantially lower turnover in ITR.”
Thereafter, notice u/s 143(2) of the Income Tax Act, 1961 Act (hereinafter referred to as the “Act”) came to be issued. The assessee was required to comply with the directions on or before 13th July, 2022. However, the assessee did not furnish any reply.
Notices u/s 142(1) of the Act followed, alongwith questionnaires, to furnish requisite details as regards purchases and the sellers, along with books of account and statements. But, the assessee again did not submit any reply.
That is how, show cause notice u/s 144 of the Act came to be issued. Even then the assessee did not furnish any reply. 5 Thereafter, notices u/s 133(6) of the Act were issued to the suppliers, as gathered from the record available with the department. Only 2 of the suppliers appeared before Learned Assessing Officer.
Sh. Ramavatar Singhal vs. ITO Having regard to all this and the material available, total income of the assessee was determined as Rs. 11,07,56,130/-.
Feeling dissatisfied by the assessment order, the assessee filed an appeal on 31.12.2022, but, as noticed above, Learned CIT(A), vide order dated 11.01.2024 dismissed the appeal for non prosecution.
Hence, this appeal before this Appellate Tribunal.
Arguments heard. File perused.
It may be mentioned here that during pendency of this appeal, on 11.06.2024, Ld. AR for the assessee presented a paper book, with a certificate appended to the Index thereof, to the effect that papers from Serial No. 3 to 32 were being submitted before this Appellate Tribunal for the first time. In other words, papers available only at serial No. 1 and 2 were submitted before Learned CIT(A).
Today, in the course of arguments, on being pointed out by this Bench that the assessee has not filed any application seeking permission to lead additional evidence in the form of 30 documents i.e. from Sr. No. 3 to 32, as shown in the index of the Paper Book, Ld. AR for the assessee has an presented an application seeking permission to place on record only one document i.e. copy of response dated 27.12.2023 to the notice issued by the Learned CIT(A), on 19.12.2023.
Sh. Ramavatar Singhal vs. ITO 11. Copy of the application has been supplied to Learned DR for the Revenue.
As regards relevancy of the above the said reply dated 27.12.2023 from the assessee to Learned CIT(A), Ld. AR for the assessee has submitted that the same was submitted on the portal of the department on 27.12.2023, thereby seeking adjournment in the appeal pending there. The contention is that the appeal was listed before Learned CIT(A) for hearing on 28.12.2023 and since the request for adjournment was submitted on 27.12.2023, Learned CIT(A) should have dealt with the same in accordance with law, and in case of its rejection, he should have adjourned the appeal so as to provide reasonable opportunity to the assessee of being heard on merits, but, the appeal was subsequently dismissed for non prosecution. Therefore, Ld. AR for the assessee has urged that the impugned order deserves to be set aside, and that the matter be remanded to Learned CIT(A) for decision afresh after providing reasonable opportunity to the assessee-appellant.
Learned DR for the Department does not dispute the submission put forth on behalf of the assessee as regards submission of request to Ld. CIT(A0 for adjournment of the appeal, sent by the assessee on 27.12.2023.
Sh. Ramavatar Singhal vs. ITO Learned DR also admits that in the impugned order. there is no mention that any such request for adjournment was never received by the office of the Learned CIT(A) on 27.12.2023, what to say of reasons for its rejection. In the given situation, having regard to the relevancy of the only document, we deem it a fit case to allow the assessee to place on record copy of request dated 27.12.2023 stated to have been uploaded online on the portal of the department.
As regards procedure to be followed by Appellate Authorities, it is of fundamental importance that the parties to litigation are allowed to exercise right to be heard, which is one of the essential characteristics of what is often called “natural justice”. In the Income Tax Act, this right to be heard has been enshrined in the form of sub-section (2) of section 250 of the Act, which provides procedure in an appeal before Learned First Appellate Authority.
It is true that before issuance of the last mentioned notice dated 19.12.2023, Learned CIT(A) had issued three notices dated 03.08.2023 for 09.08.2023; notice dated 28.11.2023 for 07.12.2023 and notice dated 08.12.2023 for 18.12.2023.
Sh. Ramavatar Singhal vs. ITO Of course, the assessee should have responded to the said three notices dated 03.08.2023, 28.11.2023 and 07.12.2023. No justification has been shown for no response on behalf of the assessee to any of the said three notices.
As noticed above, Learned CIT(A) had listed the matter for 28.12.2023, as per notice dated 19.12.2023. It is not being disputed on behalf of the department that the assessee had sent request dated 27.12.2023 seeking adjournment instead of arguing the matter on 28.12.2023. Even in case of rejection of such a request seeking adjournment, while the appeal was coming up on the next day, Learned CIT(A) should have informed the assessee or his Ld. AR about the factum of rejection of the request, and further that the appeal was going to be taken up on such and such date, which could be a very short date. There is nothing to suggest that Learned CIT(A) apprised the assessee of rejection of the request dated 27.12.2023. Learned AR for the assessee states at Bar that there was no such communication from Learned CIT(A) to him or the assessee. So, we find that the assessee did not get reasonable opportunity of being heard on 28.12.2023 i.e. the date of hearing in the appeal.