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2019 (4) TMI 89 - AT - Income TaxDismissal of appeal ex parte - statutory provisions for disposal of appeal u/s 250(6) - violation of principles of natural justice - HELD THAT - In which the assessee neither attended the hearings before the Ld. CIT(A) nor filed written submissions before the CIT(A) and showed indifferent approach, leading the Ld. CIT(A) to pass ex-parte order on the ground of nonappearance of the appellant. CIT(A) erred in dismissing Assessee s appeal on merits in a summary manner, without giving detailed reasons for her order, on various grounds of appeal before her. We further hold that the CIT(A) erred in passing a non-speaking order on each of the points which arose for her consideration and she failed in discharging the statutory obligation to state the reasons for her decision on each such points, which arose for determination in assessee s appeal before the CIT(A). If CIT(A) passes a summary order on merits; it amounts to contraventions of statutory role of CIT(A) as prescribed U/s 250(6) and Section 251. Therefore, we set aside the impugned order dated 31.03.2016 of CIT(A); and we direct the Ld. CIT(A) to pass denovo order as per law, in accordance with Sections 250 and 251 of I.T. Act, for fresh disposal of appeal filed by the Assessee before the Ld. CIT(A) against the aforesaid Assessment Order dated 28.03.2013.
Issues Involved:
1. Non-speaking order and violation of principles of natural justice by CIT(A). 2. Ex parte dismissal of appeal by CIT(A). 3. Legality of additions made by the Assessing Officer (AO) under Section 153A. 4. Assessment based on retracted statement and alleged unaccounted advance for purchase of paddy. 5. Levy of interest under Sections 234A and 234B. 6. Initiation of penalty proceedings under Section 271(1)(c). Detailed Analysis: 1. Non-speaking order and violation of principles of natural justice by CIT(A): The Assessee argued that the CIT(A) erred in law and on facts by passing a non-speaking order in violation of Section 250(6) of the Income Tax Act, 1961 (I.T. Act), without affording a proper opportunity of being heard, thus violating the principles of natural justice. The Tribunal observed that the CIT(A) failed to state the points for determination, the decision thereon, and the reasons for the decision, which is a statutory obligation under Section 250(6). The Tribunal emphasized that the CIT(A) must dispose of the appeal through a speaking order on all points which arose for determination. 2. Ex parte dismissal of appeal by CIT(A): The CIT(A) dismissed the appeal ex parte, presuming that the Assessee had nothing to appeal against the additions made by the AO due to non-appearance and non-compliance with hearing notices. The Tribunal held that the CIT(A) is not empowered to dismiss the appeal for non-prosecution and is obliged to dispose of the appeal on merits, even if the Assessee does not appear or comply with notices. The Tribunal cited judicial precedents, including the Bombay High Court's decision in CIT vs. Premkumar Arjundas Luthra (HUF), to support this view. 3. Legality of additions made by the AO under Section 153A: The Assessee contended that the addition of ?12,00,00,000 on account of unaccounted advance for purchase of paddy was beyond the scope of Section 153A, as it was not based on any document/material found during the search. The Tribunal noted that the CIT(A) did not address this issue on merits in her order. The Tribunal directed the CIT(A) to pass a denovo order, considering the legality of the additions under Section 153A. 4. Assessment based on retracted statement and alleged unaccounted advance for purchase of paddy: The Assessee argued that the addition of ?12,00,00,000 was based on a statement recorded during the search, which was retracted later, and the document (page 17 of Annexure A-7) was written under duress. The Tribunal observed that the CIT(A) failed to consider the Assessee's submissions and the retraction of the statement. The Tribunal directed the CIT(A) to re-examine the issue and provide a reasoned order on the addition based on the retracted statement and alleged unaccounted advance. 5. Levy of interest under Sections 234A and 234B: The Assessee contested the levy of interest under Sections 234A and 234B. The Tribunal noted that the CIT(A) did not address this issue in her order. The Tribunal directed the CIT(A) to consider the Assessee's arguments regarding the levy of interest and pass a reasoned order. 6. Initiation of penalty proceedings under Section 271(1)(c): The Assessee challenged the initiation of penalty proceedings under Section 271(1)(c). The Tribunal observed that the CIT(A) did not address this issue in her order. The Tribunal directed the CIT(A) to consider the Assessee's submissions on the initiation of penalty proceedings and provide a reasoned order. Conclusion: The Tribunal set aside the impugned order of the CIT(A) and directed the CIT(A) to pass a denovo order in accordance with Sections 250 and 251 of the I.T. Act, addressing all the points raised by the Assessee and providing detailed reasons for the decision on each point. The Assessee's appeal was treated as partly allowed for statistical purposes.
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