2022 (11) TMI 1535 - HC - Income Tax

Dismissing of petitioner s income tax appeal ex-parte - no adequate opportunity of hearings given to petitioner - HELD THAT - As the assessee should have been more diligent in prosecuting the matter nevertheless the appellate remedy being a very valuable right, that too before the learned Tribunal, which is the last fact finding forum. We are of the view that one more opportunity can be granted to the appellant, more particularly, when the appellant/assessee is an individual. However, at this juncture we are not inclined to interfere with the order passed by the learned Tribunal but would restore the miscellaneous application to the file of the learned Tribunal for being considered afresh taking note of the fact that the assessee is an individual and as of now it is stated that he does not have any business activity.

Summary

Issues:
Delay in filing appeal under Section 260A of the Income Tax Act, 1961; Dismissal of appeal by the Income Tax Appellate Tribunal due to non-appearance of the appellant; Dismissal of restoration application by the Tribunal; Compliance with Rule 24 of the Income Tax (Appellate Tribunal) Rules, 1963.

Analysis:
The High Court of Calcutta addressed an appeal filed under Section 260A of the Income Tax Act, 1961, challenging the order of the Income Tax Appellate Tribunal dated March 30, 2022, for the assessment year 2012-2013. The Court noted a delay of 106 days in filing the appeal, which was condoned after reviewing the reasons provided in the affidavit supporting the condonation of delay petition.

The appellant raised substantial questions of law related to the Tribunal's dismissal of the income tax appeal and the legality of the order dismissing the restoration application, citing Rule 24 of the Income Tax (Appellate Tribunal) Rules, 1963. The Tribunal had dismissed the appellant's appeal due to non-appearance and also addressed the merits of the case in the order. Subsequently, the appellant filed a restoration application, which was also dismissed by the Tribunal, leading to the appeal before the High Court.

Upon reviewing the order of the Commissioner of Income Tax (Appeals), the Court observed that the appellant had not appeared despite multiple notices, resulting in the dismissal of the appeal on merits. The Court acknowledged the appellant's lack of diligence in prosecuting the matter but considered the value of appellate remedy, especially before the Tribunal, as significant. Despite declining to interfere with the Tribunal's order dated March 30, 2022, the Court decided to restore the miscellaneous application to the Tribunal's file for reconsideration, taking into account the appellant's individual status and lack of current business activity.

The Court emphasized the importance of diligence in pursuing legal matters while granting the appellant another opportunity to have the miscellaneous application heard afresh by the Tribunal. Consequently, the Court partly allowed the appeal, setting aside the order of June 10, 2022, and restoring the miscellaneous application for further consideration on merits and in compliance with the law.