2022 (6) TMI 569 - AT - Income Tax

Validity of Ex-parte order dismissing the appeal without considering the merit of the case - principles of natural justice - Assessment u/s 153A - Assessee has declared an additional income in response to the notice u/s. 153A - addition as undisclosed income and as unexplained u/s. 68 - HELD THAT - On examining the facts of the case, we find that the Ld. CIT(A) had posted the case on several occasions. However, there was no representation on behalf of the assessee before the Ld. CIT (A). Therefore, the Ld. CIT (A) was left with no other option except to adjudicate the appeal based on the material available on record. In this situation, we are of the considered view that the when there is no representation on behalf of the assessee, the First Appellate Authority ought to have decided the issues on merits and in accordance with law instead of simply dismissing the appeal in limine. Therefore, following the principles of natural justice as well as considering the prayer of the Ld. AR and also the issues involved in the appeal, in the interest of justice, we hereby remit the matter back to the file of Ld. CIT (A) in order to consider the appeal afresh on merits by providing one more opportunity to the assessee of being heard. At the same breath, we also hereby caution the assessee to promptly co-operate before the Ld. CIT(A) in the proceedings failing which the Ld. CIT(A) shall be at liberty to pass appropriate order in accordance with law and merits based on the materials on record.

Summary

Issues:
1. Appeal against orders of Ld. CIT(A) for AY 2016-17.
2. Appeal against orders of Ld. CIT(A) for AY 2017-18 and 2018-19.
3. Appeal against orders of Ld. CIT(A) for AY 2013-14.
4. Representation and opportunity for being heard before Ld. CIT(A).

Analysis:

Issue 1 - Appeal against orders of Ld. CIT(A) for AY 2016-17:
The assessee challenged the order of the Ld. CIT(A) dismissing the appeal due to non-appearance. The Ld. AR argued for a remand to provide another opportunity for the assessee to be heard. The Tribunal found that the CIT(A) should have decided on merits despite non-appearance. Therefore, the matter was remitted back to the CIT(A) for a fresh consideration with a caution to the assessee to cooperate. The appeal was allowed for statistical purposes.

Issue 2 - Appeal against orders of Ld. CIT(A) for AY 2017-18 and 2018-19:
The Tribunal applied the decision from the AY 2016-17 appeal to these two appeals as the circumstances were similar. Consequently, both appeals were allowed for statistical purposes.

Issue 3 - Appeal against orders of Ld. CIT(A) for AY 2013-14:
Similar to the first issue, the assessee contested the order of the Ld. CIT(A) for non-appearance. The Tribunal remitted the matter back to the CIT(A) for a fresh consideration, emphasizing the importance of deciding on merits. The appeal was allowed for statistical purposes.

Issue 4 - Representation and opportunity for being heard before Ld. CIT(A):
The Tribunal stressed the principle of natural justice, highlighting the importance of providing the assessee with a fair opportunity to be heard. Non-appearance should not lead to a mere dismissal of the appeal but a decision on merits. Failure to cooperate may result in appropriate action by the CIT(A).

In conclusion, all six appeals by the two assessees were allowed for statistical purposes, emphasizing the significance of fair representation and consideration of merits in appellate proceedings.