2024 (7) TMI 963 - AT - Income Tax

Validity of order u/s 250 by CIT without deciding the issues pending in appeal - also issue decided in the Appellate Order does not pertain to the issue against which appeal was filed before Ld. C. . .(A) - HELD THAT - While disposing of the appeal filed by the assessee against the order passed by the ACIT, Range-1, Lucknow under section 143(3) of the Act, challenging the disallowance of Commission Expenses while CIT(A) has dealt with the issue relating to Late Fee under section 234E of the Act levied by the Assessing Officer, CPC-TDS passed under section 154 r.w.s. 200A. Since the ld. CIT(A) has dealt with altogether a different issue than what has been raised by the assessee before him, there is a mistake crept in the order of the ld. CIT(A). We, therefore, in the interest of justice, set aside the impugned order of the ld. CIT(A) dated 3.1.2023 and restore the matter to his file with a direction to decide the issue raised by the assessee relating to disallowance of Commission Expenses made by the ACIT, Range-1, Lucknow vide order passed under section 143(3) of the Act, on affording due and adequate opportunity of hearing to the assessee. Assessee appeal allowed for statistical purposes.

Summary

Issues:
1. Incorrect order passed by the CIT(A) without deciding the pending issues.
2. Discrepancy in deciding the issue of disallowance of Commission Expenses and Late Fee under different appeals.
3. Failure to address a Separate Appeal of Levy of Late Fee.
4. Disallowance of Commission Expenses without considering explanations.

Analysis:
1. The appellant challenged the order passed by the CIT(A) under section 250 of the Income Tax Act, claiming that the order did not address the pending issues and decided a different matter. The appellant argued that the order was erroneous and should be canceled. The Tribunal acknowledged the delay in filing the appeal, which was condoned, and proceeded to hear the case.

2. The Tribunal noted that the CIT(A) had erroneously addressed the issue of Late Fee under section 234E of the Act in a different appeal, instead of focusing on the disallowance of Commission Expenses as raised by the appellant. As a result, the Tribunal set aside the CIT(A)'s order and directed a reevaluation of the disallowance issue, providing the appellant with a fair hearing opportunity.

3. Furthermore, the Tribunal highlighted that a Separate Appeal of Levy of Late Fee was not considered by the CIT(A) in the quantum appeal proceedings, leading to a failure in addressing all relevant issues. The Tribunal emphasized the importance of addressing all appeals comprehensively and ensuring that each issue is appropriately dealt with to avoid discrepancies.

4. Lastly, the Tribunal addressed the disallowance of Commission Expenses by the Assessing Officer, noting that the explanations provided by the appellant regarding the genuineness of the expenditure were not adequately considered. The Tribunal emphasized the need for a thorough examination of all relevant details and explanations before making any disallowances, highlighting the importance of due diligence in such matters.

In conclusion, the Tribunal allowed the appeal in ITA No.386/LKW/2023 for statistical purposes, directing a reevaluation of the disallowance issue, while dismissing the appeal in ITA No.387/LKW/2023 due to becoming infructuous after setting aside the previous order.