2020 (5) TMI 511 - AT - Income Tax

Appeal to the appellate tribunal - Valid power of attorney from company to verify the return of income of the assessee as provided u/s 140(c) - verification by the person who is authorised to verify the return of income u/s 140 of the act as applicable to the assessee - HELD THAT - According to the provisions of section 253 (6) of the act, appeal to the appellate tribunal shall be filed in the prescribed form and shall be verified in the prescribed manner. According to rule 47 (1) of The Income Tax Rules 1962, the appeal shall be signed by the persons specified in sub rule 3 of rule 45. According to that sub rule, the form of appeal shall be verified by the person who is authorised to verify the return of income under section 140 of the act as applicable to the assessee. According to the provisions of section 140(c) of the act, the first proviso says that where company is not a resident in India, the return may be verified by a person who holds a valid power of attorney from such company to do so. According to page number 225 of the appeal set filed before us, Mr. Alan wells is only authorised to sign and verify the documents for filing of appeal before the coordinate bench. Therefore , it is not clear whether Mr. Alan Wells was holding a valid power of attorney from such company to verify the return of income of the assessee as provided us 140(c) of the Act or not. As this information is not available on record, we dismiss this appeal in limine. The assessee is also granted liberty to file the proper authorization for signing form number 36 in the present case and then request for recall of the above order.

Summary

Issues:
1. Validity of the impugned assessment order
2. Jurisdiction of the Dispute Resolution Panel (DRP)
3. Assessment of income discrepancy
4. Compliance with verification requirements for filing an appeal

Analysis:
1. The appellant challenged the assessment order for the Assessment Year 2013-14, alleging it was bad in law due to being a non-speaking order that ignored factual details and submissions. The appellant argued that the DRP's direction for further verification was beyond its jurisdiction under section 144C. The Tribunal noted the contentions but dismissed the appeal due to lack of proper authorization for filing the appeal, as the authorized signatory, Mr. Alan Wells, did not demonstrate valid power of attorney to verify the return of income, as required by section 140(c) of the Act. Consequently, the appeal was dismissed for non-compliance.

2. The appellant also contended that the directions issued by the DRP were ultra vires the Act. However, the Tribunal did not delve into the merits of this argument due to the procedural non-compliance regarding the verification of the appeal. The Tribunal emphasized the importance of adhering to the prescribed verification requirements under the Income Tax Rules to maintain the validity of the appeal process.

3. Regarding the discrepancy in the assessment of income, the appellant disputed the assessment of Long Term Capital Gain by the assessing officer, which significantly differed from the Long Term Capital Loss declared by the appellant. However, the Tribunal did not address the substance of this issue due to the dismissal of the appeal on procedural grounds related to the lack of proper authorization for filing the appeal.

4. The Tribunal highlighted the necessity of complying with the prescribed verification procedures for filing an appeal before the appellate tribunal. In this case, the appellant, a company registered in the United Kingdom, failed to provide sufficient evidence of the authorized signatory's valid power of attorney to verify the return of income. The Tribunal granted the appellant the opportunity to rectify this deficiency by submitting the proper authorization for signing the appeal form, with the option to request a recall of the dismissal order upon compliance with the verification requirements.

In conclusion, the dismissal of the appeal by the ITAT DELHI was primarily based on the procedural non-compliance related to the verification of the appeal by the authorized signatory. The Tribunal emphasized the significance of adhering to the prescribed verification procedures to ensure the validity of the appeal process before addressing the substantive issues raised by the appellant.