2024 (6) TMI 1227 - AT - Income Tax

Validity of order passed by CIT(A) (NFAC) dismissing the appeal of the appellant - Difference of Points for determination considered by CIT(A) from the points for determination and the grounds of appeal taken up by the assessee. HELD THAT - It is seen from the order that the appeal decided by the Ld. CIT(A) does not pertain to the case of the assessee. It is clear from the facts mentioned in the appellate order that the appeal decided by the Ld. CIT(A) pertains to the assessment order of ITO Ward-2 Vapi for AY.2016-17; however the impugned assessment order was passed u/s 143(3) r.w.s. 147 of the Act by the ITO Ward-1(3)(1) Surat for AY.2014-15. CIT(A) has decided the appeal against a partnership firm who had filed return of income for the AY.2016-17 on 23.07.2016 declaring total income of Rs. 4, 57, 260/-. However in case of the appellant the original return for AY.2014-15 was filed on 30.07.2014 declaring total income of Rs. 8, 61, 350/-. We also found that the grounds of appeal raised by the assessee as evident from Form 35 is totally different from the grounds of appeal adjudicated by the Ld. CIT(A) which is mentioned at para 3 of the appellate order. Hence the Ld. CIT(A) has dismissed the appeal of the appellant on the facts and grounds of appeal of some other case and not on the facts and grounds of appellant s case. Therefore the order of Ld. CIT(A) is liable to be set aside at the threshold because it has not been passed as per the mandate of section 250(6) of the Act. Points for determination considered by him are totally different from the points for determination and the grounds of appeal taken up by the assessee. Since the appeal has been decided not on the facts and ground of the appellant but on some other case we set-aside the order of the Ld. CIT(A) and remit the matter back to the file of the Ld. CIT(A) for passing fresh order in accordance with law after giving reasonable opportunity of hearing to the assessee. The list of the appealable orders is provided in section 253 of the Act and an order u/s 250 passed by the Ld. CIT(A) is an appealable order. In the present case the order passed by the Ld. CIT(A) does not deal with the facts and grounds of appeal raised by the assessee in his appeal. In substance it is not an appellate order in case of the assessee. As stated earlier it is also not as per the mandate provided u/s 250(6) of the Act. All the facts are not available before the Bench including the points for determination decision thereon and the reasons for the decision. Moreover the valuation report subsequently received by the Assessing Officer was also not considered either by the Assessing Officer or by the Ld. CIT(A). Similarly the addition of credit entries has also not been considered by the Ld. CIT(A). In view of these peculiar facts the ratio of the decision relied upon by the Ld. AR cannot be applied to the facts of the assessee. We have already set aside the order of Ld. CIT(A) and remitted the matter back to him. We make it clear that we are not making any view on the merits of claim made by the assessee including adoption of valuation report and direction for consequential relief under section 49(4) of the Act as it is for the appellate authority to consider and decide. For statistical purposes the appeal of the assessee is allowed.

Summary

Issues:
1. Appeal against orders passed under section 250 of the Income-tax Act, 1961 for assessment year 2014-15.

Analysis:
The appeal by the assessee was against the orders passed under section 250 of the Income-tax Act, 1961 for assessment year 2014-15. The grounds of appeal raised by the assessee included challenges to the dismissal of the appeal, sustaining the validity of proceedings under sections 147/148 of the Act, addition of deemed income under section 56(2)(vii)(b), treatment of deposits in the bank account as unexplained, and charging of interest under section 234B of the Act. The facts of the case involved the purchase of two immovable properties, treatment of the difference between stamp duty value and consideration as income from other sources, and addition of unexplained deposits in the bank account. The Assessing Officer initiated penalty proceedings under section 271(1)(c) of the Act, resulting in a total income determination different from the returned income.

The Ld. CIT(A) passed an order on 29.12.2023, which was found to pertain to a different case than that of the appellant. The Ld. CIT(A) dismissed the appeal based on the facts and grounds of another case, not the appellant's case. This was against the mandate of section 250(6) of the Act, which requires the appellate order to be in writing, stating the points for determination, decision thereon, and reasons for the decision. As the appeal was decided on different grounds, the order was set aside, and the matter was remitted back for a fresh order with a reasonable opportunity of hearing for the assessee.

The Ld. AR relied on a Supreme Court decision, but it was deemed inapplicable to the present case due to the unique circumstances. The valuation report and the addition of credit entries were not considered by the authorities, leading to the setting aside of the Ld. CIT(A) order for a fresh adjudication. As a result, the appeal of the assessee was allowed for statistical purposes, with other grounds becoming academic due to the remittance of the matter back to the Ld. CIT(A.

In conclusion, the judgment highlighted procedural errors in the appellate order, leading to the setting aside of the decision and remittance for a fresh adjudication in accordance with the law. The unique circumstances of the case necessitated a reevaluation by the Ld. CIT(A) to consider all materials and provide a reasoned decision.