MEDHAVI SPORTS PRIVATE LIMITED,LUCKNOW vs. DEPUTY COMMISSIONER OF INCOME TAX, KANPUR

PER ANADEE NATH MISSHRA, A.M.: The present appeal has been filed by the assessee challenging the impugned order dated 19/12/2023 passed by the learned Commissioner of Income Tax (Appeals)-4, Kanpur, [“learned CIT(A)”] for the assessment year 2016-17.

3. That the assessment proceeding initiated and order passed u/s 153C of the Income Tax Act,1961 is without jurisdiction.

4. That the Ld. AO as well as Ld. CIT(A) has erred in confirming addition of Rs.2,04,00,000/- on account of unsecured loan u/s 68 of the Income Tax Act, 1961.

Page 2 of 4 5. That the Ld. AO as well as Ld. CIT(A) has erred in confirming addition of Rs.6,12,000/- on account of commission on unsecured loan u/s 69C of the Income Tax Act, 1961.

7. That the Ld. AO as well as Ld. CIT(A) has erred in confirming addition without cross examination of the person whose statement has been relied upon for making addition violating the principle of audi alteram partem.

with your honours kind permission.”

3. In this case, the assessment order dated 30/12/2021 was passed u/s 153C of the Income Tax Act, 1961 (hereinafter “the Act”) whereby the assessee’s total income was determined of Rs.2,10,12,000/-. The assessee had not filed any return of income. The aforesaid additions made in the assessment order included an amount of Rs.2,04,00,000/- on account of unsecured loan u/s 68 of the Act and an amount of Rs.6,12,000/- on account of commission on unsecured loan u/s 69C of the Act. The assessee filed an appeal in the office of the Ld. CIT(A). Vide impugned appellate order dated 19/12/2023, the Ld. CIT(A) dismissed the assessee’s appeal. The present appeal before us has been filed by the assessee against the aforesaid impugned appellate order dated 19/12/2023 of the Ld. CIT(A).

4. At the time of hearing before us, the Ld. Counsel for the assessee submitted that the Ld. CIT(A) has not passed a speaking order on merits of the additions made. He further submitted that Page 3 of 4 the assessee’s appeal was dismissed in limine for want of prosecution without any discussion on the merits of the additions. He submitted that the issues in dispute should be restored back to the file of the Ld. CIT(A) with a direction to pass a speaking order on merits of the case after providing reasonable opportunity to the assessee. The Ld. CIT-DR for Revenue expressed no objection to this.

5. On perusal of the impugned appellate order dated 19/12/2023 of the Ld. CIT(A), we find that the Ld. CIT(A) had issued notices, which however, were not complied with by the assessee. Taking adverse view of non-compliance from assessee’s side the Ld. CIT(A) dismissed the assessee’s appeal for want of prosecution. However, the Ld. CIT(A) has statutory duty, prescribed u/s 250(6) of the Act to pass a speaking order on the merits of the case whether or not there was any representation from the assessee’s side. The order of the Ld. CIT(A) in disposing of the assessee’s appeal, is required to be in writing, and it is and the order is further required to contain the point for determination, the decision thereon and the reason for the decision. Thus, it is the statutory duty of the Ld. CIT(A) to pass a speaking order on merits of the case. Thus, dismissing the assessee’s appeal in limine, for want of prosecution, without going into the merits of the case was erroneous on the part of the Ld. CIT(A).

6. In view of the foregoing and as representatives of both sides are in agreement, we set aside the impugned appellate order dated 19/12/2023 of the Ld. CIT(A) and we restore the issues in dispute to the file of the Ld. CIT(A) with a direction to pass denovo order in accordance with law, after providing reasonable opportunity to the assessee, in conformity with section 250(6) of

Order pronounced in the open Court on 19/09/2024.