2018 (9) TMI 349 - AT - Income Tax

Qualification of person for filling appeal - qualification of person who is the Managing Director of the assessee company - Held that - An appeal u/s 253 to the Tribunal is required to be filed in prescribed Form No. 36 and the same is to be signed by the persons specified in Sub-rule (2) of Rule 45. As per Sub-rule (2) of Rule 45, the prescribed form of Appeal, the Grounds of Appeal and the Form of Verification appended thereto, are required to be signed and verified by the person who is authorized to sign the return of income under Section 140 of the Income Tax Act,1961. As per Section 140 the return of income under Section 139 has to be signed and verified, in the case of a company, resident in India, by the Managing Director thereof, or where for any inevitable reason such Managing Director is not able to sign and verify the return or where there is no Managing Director, by any Director thereof. A combined reading of these relevant provisions makes it abundantly clear that the person who is the Managing Director of the assessee company, or its Director in certain circumstances, on the date of the filing of the return only can sign and verify the return in the case of a company, It therefore, follows that a person who is Managing Director or Director, as the case may be, of the company, on the date of filing of the appeal before the Tribunal is only authorized to sign and verify the appeal filed before the Tribunal in the case of a company. In the present case, nothing on record suggest that the person filing the instant appeal was so qualified. Therefore, the instant appeal, not signed and verified as per statutory mandate, is not maintainable in law and hence, liable to be dismissed at the very threshold - appeal stands dismissed.

Summary

Issues:
Validity of appeal signed by an unauthorized person.

Analysis:
The appeal for Assessment Year 2012-13 contested the order of the Ld. Commissioner of Income-Tax (Appeals) regarding certain additions to the income. The bench noted that the appeal was filed, signed, and verified by an ex-director of the company, which raised concerns about the validity of the appeal. The Authorized Representative (AR) was directed to substantiate the validity of the appeal and provide details about the company's current status and compliance under the Companies Act. However, on multiple hearing dates, nobody appeared for the assessee, and no valid adjournment application was submitted.

Upon examination of the appeal documents, it was found that the appeal form, verification, statement of facts, and grounds of appeal were all signed by the ex-director. The AR representing the assessee did not have a Letter of Authority from the assessee, which is required to make submissions before the bench. The provisions of Rule 47(1) and 45(2) of the Income Tax Rules, 1962, along with Section 140 of the Income Tax Act, 1961, specify that appeals must be signed by the person authorized to sign the return of income under Section 140. In the case of a company, the managing director or a director, under certain circumstances, is authorized to sign and verify the return.

Since the appeal was not signed and verified by the authorized person as per the statutory requirements, it was deemed not maintainable in law. Therefore, the appeal was dismissed without delving into the merits of the additions. The judgment emphasized that only the person who was the managing director or director of the company at the time of filing the appeal is authorized to sign and verify the appeal in the case of a company. As the appeal did not meet this requirement, it was dismissed, making any further discussion on the merits of the case unnecessary.

In conclusion, the appeal was dismissed due to being signed by an unauthorized person, highlighting the importance of compliance with statutory provisions regarding the signing and verification of appeals before the Tribunal.