2020 (1) TMI 46 - AT - Income Tax

Due taxes were not paid before filing of an appeal u/s 249(4)(b) - payment of Tax as per ITR filed - reopening of assessment - HELD THAT - Acknowledgment reflects payment of taxes at ₹ 550/- only. Further, the assessee sought certain information under RTI, copy of the application is placed at page 12 with regard to the proceedings u/s 148, service of notice u/s 148 and also under section 142(1) of the Act. The assessee received certain information vide reply dated 26/02/2018, placed at paper book page 13, against which appeal was filed before the Addl. CIT and then appeal was also filed before the Chief Information Officer. We are not entering into field of whether notice under section148/142(1) of the Act was issued to the assessee, at present. We are deciding the preliminary issue that where the assessee had furnished the return of income and paid taxes due thereon, then the order of the CIT(A) suffers from infirmity in applying the provisions of section 249(4)(b) of the Act. The case of the assessee falls within the provisions of section 249(4)(a) of the Act, hence it was incumbent upon the CIT(A) to decide the issue on merits and not dismiss the appeal in limine . Accordingly, it is deem fit to remit the issue back to the CIT(A) to decide the issue raised on merits after allowing reasonable opportunity of hearing to the assessee. The assessee is also directed to comply with the notices issued by the CIT(A). We decide the present appeal on preliminary issue itself and remit the matter back to the file of CIT(A) with our directions. - Decided in favour of assessee.

Summary

Issues:
- Appeal against the order of CIT(A) for Assessment Year 2010-11 under section 147 r.w.s. 144 of the Income Tax Act, 1961.
- Admissibility of appeal under section 249(4)(b) of the Act.
- Dismissal of appeal by CIT(A) for failure to fulfill conditions of section 249(4)(b).

Analysis:

1. Admissibility of Appeal under Section 249(4)(b):
- The appeal was filed against the order of CIT(A) for Assessment Year 2010-11 under section 147 r.w.s. 144 of the Income Tax Act, 1961. The primary issue raised by the assessee was regarding the CIT(A) not admitting the appeal due to non-payment of due taxes under section 249(4)(b) of the Act.
- The CIT(A) based the decision on the fact that the assessee had not filed a return of income or paid taxes in response to the notices under the Act. The CIT(A) held that the appeal was not admissible under section 249(4)(b) as the assessee did not meet the conditions specified.
- The CIT(A) emphasized that the provisions of section 249(4)(b) applied as the assessee had not filed any return of income, either voluntarily or in response to notices, as required by the Act. Consequently, the appeal was not admitted based on this provision.
- The CIT(A) further stated that if the assessee had valid reasons for exemption from section 249(4)(b), it could have been considered. However, as the tax equal to the advance tax was not paid, the appeal was dismissed in limine due to the provisions of section 249(4)(b).

2. Assessee's Contentions and Decision:
- The assessee contended that the return of income was filed along with tax payment, making section 249(4)(b) inapplicable. The AR argued that the CIT(A) overlooked the facts presented in the form no.35 and made unnecessary observations in the appellate order.
- The Revenue's representative agreed to verify the assessee's claim of filing the return of income.
- Upon review, it was observed that the acknowledgment reflected a tax payment of &8377; 550 only. The assessee had also sought information under RTI regarding the proceedings, which was provided in the paper book.
- The Tribunal found that the assessee had filed the return of income and paid the taxes due, falling under section 249(4)(a) rather than (b). As a result, the CIT(A) was directed to reconsider the issue on merits after providing a fair hearing to the assessee and ensuring compliance with notices.

3. Conclusion:
- The Tribunal allowed the appeal, remitting the matter back to the CIT(A) for a fresh decision on the merits. The assessee was instructed to comply with the issued notices. The decision was made based on the preliminary issue, emphasizing the importance of fulfilling statutory conditions for appeal admissibility.

This detailed analysis highlights the key legal aspects, arguments presented, and the Tribunal's decision regarding the admissibility of the appeal under section 249(4)(b) of the Income Tax Act, 1961.