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Income Tax Appellate Tribunal, PUNE BENCHES “A” :: PUNE
Before: SHRI PARTHA SARATHI CHAUDHURY & DR. DIPAK P. RIPOTE
ORDER
PER DR. DIPAK P. RIPOTE, AM:
This appeal filed by the assessee against the order of Ld.Commissioner of Income Tax(Appeals)[NFAC], passed under section 250 of the Income Tax Act, 1961 dated 25.05.2023. The assessee for A.Y.2019-20 has raised the following grounds of appeal : “1. The Ld CIT(A) erred in passing her order ex-parte without allowing appellant reasonable opportunity of being heard.
2. The Ld CIT(A) erred in upholding the disallowance of Rs.43,51,377/- under section 40(a)(ia) made by the Ld AO without
Govind Milk and Milk Products Pvt. Ltd., [A] appreciating that the appellant was not required to deduct tax on this expense because of section 194A(3)(iii)(a).
Without prejudice to Ground No.2, the Ld CIT(A) erred in not considering the provisions of section 201(1) because of which the appellant was not to be considered in default in respect of the amount of Rs.l,45,04,591/-.
The Ld CIT(A) erred in sustaining the disallowance of Rs. 13,08,300/- out of expenses made in adhoc manner though the appellant had maintained reasonable records of expenses and the books of account were audited.
The above grounds of appeal
are without prejudice to one another.
6. The appellant craves leave to furnish Additional Evidence which may be relevant to the above Grounds of Appeal in course of the appeal proceedings.
7. The appellant craves leave to amend or alter any of the above Grounds of Appeal or to add new Grounds of Appeal during the course of appeal proceedings.”
2. At the time of hearing, no one appeared on behalf of the assessee. No adjournment letter was found on record.
Submission of ld.Departmental Representative(ld.DR) : 3. The ld.DR for the Revenue relied on the order of Assessing Officer(AO) and ld.CIT(A)[NFAC]. Findings & Analysis : 4. We have heard ld.Departmental Representative for the Revenue and perused the records. On perusal of the order of the ld.CIT(A) it is observed that ld.CIT(A) has dismissed the appeal without discussing merits, as assessee failed to file submission in Govind Milk and Milk Products Pvt. Ltd., [A] response to notices issued by ld.CIT(A).The ld.CIT(A) has decided this case as under :
4.1 In this case, ld.CIT(A) has dismissed the appeal of the assessee for non-prosecution. The ld.CIT(A) has not adjudicated grounds raised by the assessee on merits.
4.2 The Hon’ble Bombay High Court has held in the case of Pr.CIT(Central) Vs. Premkumar Arjundas Luthra (HUF)(Bombay)/[2017] 297 CTR 614 (Bombay) as under : Quote, “8.From the aforesaid provisions, it is very clear once an appeal is preferred before the CIT(A), then in disposing of the appeal, he is obliged to make such further inquiry that he thinks fit or direct the Assessing Officer to make further inquiry and report the result of the same to him as found in Section 250(4) of the Act.
Further Section 250(6) of the Act obliges the CIT(A) to dispose of an appeal in writing after stating the points for determination and then
Govind Milk and Milk Products Pvt. Ltd., [A] render a decision on each of the points which arise for consideration with reasons in support. Section 251(1)(a) and (b) of the Act provide that while disposing of appeal the CIT(A) would have the power to confirm, reduce, enhance or annul an assessment and/or penalty. Besides Explanation to sub-section (2) of Section 251 of the Act also makes it clear that while considering the appeal, the CIT(A) would be entitled to consider and decide any issue arising in the proceedings before him in appeal filed for its consideration, even if the issue is not raised by the appellant in its appeal before the CIT(A). Thus once an assessee files an appeal under Section 246A of the Act, it is not open to him as of right to withdraw or not press the appeal. In fact the CIT(A) is obliged to dispose of the appeal on merits. In fact with effect from 1st June, 2001 the power of the CIT(A) to set aside the order of the Assessing Officer and restore it to the Assessing Officer for passing a fresh order stands withdrawn.
Therefore, it would be noticed that the powers of the CIT(A) is coterminous with that of the Assessing Officer i.e. he can do all that Assessing Officer could do. Therefore just as it is not open to the Assessing Officer to not complete the assessment by allowing the assessee to withdraw its return of income, it is not open to the assessee in appeal to withdraw and/or the CIT(A) to dismiss the appeal on account of non-prosecution of the appeal by the assessee. This is amply clear from the Section 251(1)(a) and (b) and Explanation to Section 251(2) of the Act which requires the CIT(A) to apply his mind to all the issues which arise from the impugned order before him whether or not the same has been raised by the appellant before him. Accordingly, the law does not empower the CIT(A) to dismiss the appeal for non-prosecution as is evident from the provisions of the Act.” Unquote.
Govind Milk and Milk Products Pvt. Ltd., [A] 5. Thus, the Hon’ble Bombay High Court has categorically held that CIT(A) has to decide the appeal on merit and CIT(A) does not have any power to dismiss appeal for non-prosecution.
In view of this, the order of the ld.CIT(A) is set-aside to ld.CIT(A) for denovo adjudication. The ld.CIT(A) shall provide opportunity of hearing to the assessee.
Accordingly, appeal of the assessee in is allowed for statistical purpose. Order pronounced in the open Court on 26th March, 2024.