2024 (5) TMI 1293 - AT - Income Tax

Disallowance of relief u/s. 89 - Validity of assessment order passed u/s. 143(3) - difference between the returned income and assessed income - as per DR in view of the proviso to Section 89 no such relief can be granted in respect of any amount received by the assessee on his voluntary retirement or termination of the service - HELD THAT - Paper book contains the particulars of assessee s income for the relevant assessment year 2017 18 in form no. 10E as provided under rule 21AA of the income tax rules 1962, where in details of advance of salary arrears have been descripted. Paper book has the submissions of assessee in detail. However assessment order passed u/s. 143(3) of the Act, does not speak even in respect of any defect in the particulars submitted by the assessee. CIT(A) has surprisingly passed the impugned order without adjudicating on the main issue involved, with the excuse that no finding was given by Assessing Officer with regard to the disallowance of relief Under Section 89. It is well settled legal position that a quasi judicial authority is required to pass reasoned orders. The reasoned orders are the soul and one of the important component of the principles of natural Justice. We, therefore quash the non speaking impugned order dated 18.10.23 passed by learned CIT(A) and non speaking assessment order passed u/s. 143(3) of the Act by Assessing Officer. The case is restored to the file of assessing officer for making the reasoned assessment order afresh, after affording an opportunity of hearing to the appellant assessee. Assessee appeal allowed.

Summary

Issues Involved: Appeal against dismissal of relief u/s 89 of the Income-tax Act, 1961 by CIT(A) without adjudication.

Summary:
The appeal was filed against the order of the Ld. Commissioner of Income-tax (Appeals) dismissing the assessee's appeal without adjudicating on the disallowance of relief u/s. 89 of the Act made in the assessment order. The appellant had challenged the action of the Assessing Officer in allowing relief u/s 89 at a lower amount than claimed.

The appellant approached the tribunal on the ground that the CIT(A) erred in dismissing the appeal without considering the variance between the relief claimed by the assessee and the relief allowed by the Assessing Officer.

During the hearing, the representative for the assessee argued that neither the Assessing Officer nor the CIT(A) discussed the assessee's submissions regarding the relief u/s 89. The Assessing Officer had granted relief at a lower amount than claimed by the assessee.

The learned DR contended that as per the proviso to Section 89 of the Act, no relief can be granted for amounts received on voluntary retirement or termination of service. However, it was acknowledged that neither the Assessing Officer nor the CIT(A) provided a reasoned order for denying the relief.

Upon reviewing the submissions and documents, the tribunal found that the assessment order and the CIT(A) order did not address the main issue of relief u/s 89. It was emphasized that quasi-judicial authorities are required to pass reasoned orders as per principles of natural justice.

Consequently, the tribunal set aside the non-speaking orders of the CIT(A) and the Assessing Officer, directing the case to be returned to the Assessing Officer for a fresh reasoned assessment order after providing the appellant an opportunity to be heard.

In conclusion, the appeal was allowed, and the order was pronounced on the specified date.