2020 (5) TMI 352 - AT - Income Tax

Appeal decided ex parte - non-appearance on behalf of the assessee - HELD THAT - If an ex parte order is passed without hearing the respondent/assessee then if the assessee has explained the reason for non-appearance to the satisfaction of the Tribunal then the Tribunal should recall the order to give an opportunity of hearing to the assessee and decide the appeal afresh after considering the arguments and contention of the assessee In case in hand Tribunal has not given any finding on the merits of the issue and there is no allegation on the part of the assessee regarding non-consideration of any relevant and vital facts while passing the impugned order. Therefore, though the assessee has not explained any plausible reason for non-appearance before the Tribunal, however, even if the impugned order is recalled for giving an opportunity to the assessee, no purpose will be served and it will be only an empty exercise as certain crucial facts have not been brought on record which requires to be verified by conducting a proper enquiry at the level of the A.O. Hence, in the facts and circumstances of the case, we do not find any merit in this Misc. application of the assessee and the same is hereby dismissed.

Summary

Issues:
Recalling of ex parte order due to non-appearance of assessee despite notice.

Analysis:
The assessee filed a Misc. application seeking to recall the ex parte order passed by the Tribunal in ITA No. 1340/JP/2018 due to non-appearance, explaining it as inadvertent. The AR argued that the order should be recalled based on decisions of the Hon'ble Delhi High Court and Punjab & Haryana High Court, allowing recall if a valid reason for non-appearance is provided. The AR contended that the order should be recalled to grant the assessee a hearing opportunity.

The DR opposed the application, stating that the Tribunal's detailed order on merits cannot be reviewed under Section 254(2) of the Income Tax Act. The DR argued that the Tribunal had remanded the matter to the AO for proper inquiry, indicating a fair process, and objected to reviewing its own order, as it is impermissible under the Act.

The Tribunal noted that the appeal was taken up ex parte due to the assessee's consistent non-appearance despite notices. The Tribunal found that the AR's explanation of relying on the CA was not supported by evidence of authorization. The Tribunal had remanded the matter to the AO for further inquiry to verify the genuineness of the transaction, as substantial doubts existed regarding the property transfer. As the Tribunal had not made any findings on the merits of the issue, recalling the order for a hearing would not serve any purpose, as crucial facts requiring verification were not presented. Therefore, the Tribunal dismissed the assessee's Misc. application, finding no merit in recalling the ex parte order.

In conclusion, the Tribunal dismissed the assessee's Misc. application seeking to recall the ex parte order due to non-appearance, as the explanation provided was not supported by evidence, and recalling the order would not serve any purpose without crucial facts being verified through proper inquiry at the AO level.