2013 (12) TMI 825 - AT - Income Tax

Rejection of appeals - Held that - The ld. CIT(A) has committed an error in dismissing the appeals filed by assessee for more than one reasons - He did not provide reasonable opportunity to the Assessee of being heard - The order passed u/s. 263 cannot come into the way of ld. CIT(A) to dispose the appeal filed by assessee against impugned assessment orders as these proceedings are independent proceedings - If proceedings u/s. 263 are held to be invalid then the impugned assessment orders will stand and matter would be required to be adjudicated on merits - The ground on which ld. CIT has invoked section 263 is entirely different from the grounds raised in the impugned appeals - The ground on which section 263 is invoked is relating to non-initiation of concealment penalty which is not subject matter of appeal before the ld. CIT(A) - The issue was restored for fresh adjudication.

Summary

Issues:
Appeal against consolidated order dated 30.03.2012 passed by the ld. CIT(A) in respect of assessment years 1999-00 and 2000-01.

Analysis:
1. The appeals were filed by the assessee against the order passed by the CIT(A) for assessment years 1999-00 and 2000-01. The grounds of appeal were similar for both years, with differences in figures. The primary contentions included lack of opportunity to be heard, treating the appeal as infructuous, passing non-speaking orders, exceeding the limitation period, jurisdictional issues, and treatment of DEPB income for deduction u/s 80HHC.

2. The AO passed the impugned assessment orders under sections 254/147/143(3) after directions from ITAT to reassess. Subsequently, the CIT(A) scheduled a hearing but dismissed the appeals as infructuous based on a letter from the AO indicating initiation of proceedings u/s. 263. The CIT(A) did not provide a hearing to the assessee and relied solely on the AO's letters. The ITAT found errors in this approach as the grounds for invoking section 263 were different from those raised in the appeals before the CIT(A). The ITAT held that dismissing the appeals without a proper hearing was incorrect and directed the CIT(A) to re-adjudicate the appeals on all issues.

3. The ITAT concluded that the CIT(A) erred in dismissing the appeals without affording the assessee an opportunity to be heard. The ITAT directed the CIT(A) to reconsider the appeals on all grounds raised by the assessee. The ITAT did not express an opinion on other grounds as the appeals were to be re-adjudicated by the CIT(A) following their directions. The appeals were considered allowed for statistical purposes.

4. The ITAT pronounced the order on 21st October 2013, directing the CIT(A) to re-adjudicate the appeals filed by the assessee comprehensively, emphasizing the importance of providing a fair hearing and independent consideration of the issues raised.

This detailed analysis highlights the procedural errors in the original judgment and the corrective measures taken by the ITAT to ensure a fair adjudication of the appeals.