SHRI PRABAL ROY CHOUDHURY,SILCHAR vs. INCOME TAX OFFICER, WARD-2, SILCHAR

Before adverting to the grounds of appeal taken by the assessee, we deem it appropriate to take note of the brief history, which reads as under:- The assessee has filed his return of income electronically on 21.11.2012 declaring total income of Rs.5,88,154/-. This return was originally processed under section 143(1) and thereafter taken for scrutiny by issuing a notice under section 143(2) of the Income Tax Act. The ld. Assessing Officer has passed an assessment order on 27.03.2015 under section 144 of the Income Tax Act. This was an ex-parte assessment order according to the best judgment of the ld. Assessing Officer. The ld. Assessing Officer has determined the taxable income of the assessee at Rs.18,96,150/-.

The ld. Commissioner took cognizance under section 263 of the Income Tax Act on the ground that assessment order is erroneous and prejudicial to the interest of revenue. Accordingly a notice under section 263 of the Income Tax Act was issued on 30th December, 2016. Ultimately ld. Commissioner has passed an order under section 263 on 14.02.2017. He set aside the assessment order directing the ld. Assessing Officer to pass a fresh assessment order.

Dissatisfied with this assessment order, the assessee carried the matter in appeal before the ld. CIT(Appeals). It emerges out that in the grounds of appeal, the assessee has taken all those pleas, which ought to have been taken in an appeal before the ITAT for challenging order under section 263. The ld. CIT(Appeals) has dismissed the appeal of the assessee by observing that order of ld. Commissioner cannot be challenged before the ld. CIT(Appeals). The brief order reads as under:- “APPELLATE ORDER AND GROUNDS OF DECISION Instant appeal was filed on 16.11.2017 and is directed against order u/s 143(3)/263 of I.T. Act, 1961 passed by the ITO, Ward-2, Silchar on 12.10.2017. The appeal was filed with CIT(A)-1, Guwahati. The same was transferred to this jurisdiction vide letter T-1/Off-line Transfer/CIT(A)-I/GHY/2018-19/868 ated 04.12.2018. It was received on 10.12.2018. 2. Ground taken for adjudication is shown below:- (i) Seeking your natural justification for the selection of revision under section 263 as the notice is filled with malpractice facts and figures

While impugning this order before the Tribunal, at Form No. 36, the assessee has narrated the details correctly but again repeated the mistake committed before the ld. 1st Appellate Authority while raising the grounds of appeal. It may be due to at the end of the assessee for not having complete procedural knowledge. The ld. CIT(DR) submitted that appeal is not maintainable in the present forum because impugned order passed under section 263 was on 14.02.2017 and

We have duly considered the rival contentions and gone through the record carefully. Brief point is, that basically appeal is being filed against the order of ld. CIT(Appeals) vide which assessment order passed under section 143(3) read with section 263 was upheld. Due to some misconception of procedural aspect, assessee has taken all those pleas, which can enable it to challenge 263 Order. Sub-section (6) of section 250 provides that ld. 1st Appellate Authority is required to bring the points in dispute from the record and thereafter decide the appeal after giving reasons on those points. In the present case, ld. CIT(Appeals) failed to follow that procedure, rather dismissed the appeal for the reasons that assessee has wrongly raised the grounds challenging the order under section 263. Apart from the above, if there is some inherent irregularity in raising the pleas in the grounds of appeal, then ld. CIT(Appeals) ought to have directed the assessee to amend those grounds instead of dismissing the appeal. Accordingly we allow this appeal of the assessee and remit the issues before the ld. CIT(Appeals) with a directions that ld. 1st Appellate Authority re-adjudicate the issues emerging out from the assessment order after providing due opportunity of hearing to the assessee.

In the result, the appeal of the assessee is allowed for statistical purposes.