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TMI Blog2024 (11) TMI 1364X X X X Extracts X X X X X X X X Extracts X X X X ..... cept the manner in which the appeal of the assessee had been disposed off by the CIT(Appeals). Once an appeal is preferred before the CIT(Appeals), it becomes obligatory on his part to dispose off the same on merit and it is not open for him to summarily dismiss the appeal on account of non-prosecution of the same by the assessee. In fact, a perusal of Sec.251(1)(a) and (b), as well as the Explanation to Sec.251(2) of the Act reveals that the CIT(A) remains under a statutory obligation to apply his mind to all the issues which arises from the impugned order before him. As per mandate of law the CIT(Appeals) is not vested with any power to summarily dismiss the appeal for non-prosecution. We, thus, not being able to persuade ourselves to subscribe to the dismissal of the appeal by the CIT(Appeals) for non-prosecution, therefore, set-aside his order with a direction to re-adjudicate the same afresh. Needless to say, the CIT(Appeals) in the course of the set-aside proceedings shall afford a reasonable opportunity of being heard to the assessee, and shall adjudicate the grounds of appeal/additional grounds of appeal as have been raised by the assessee before us. Appeal filed by the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CIT, reassessment made u/s. 147 by ITO-4(4) i.e., 'non-jurisdictional AO', would be invalid and is liable to be quashed. Additional Gr.No.3 3. On the facts and circumstances of the case and in law, addition made of Rs. 3,40,30,000 on disallowance of business expenditure i.e., purchases of goods, made u/s. 40A(3) is invalid, since reassessment made u/s. 144 i.e., 'best judgment assessment' and resultant GP would be 93.71% on sales of Rs. 3,72,37,332 (i.e., GP would increase by 91.39%) which is impossible in the line of business of the assessee; disallowance u/s. 40A(3) is not permissible in the eyes of law in 'best judgment assessment' made u/s 144; impugned addition is liable to be deleted. As the adjudication of the additional grounds involves purely a question of law which would not require looking any further beyond the facts available on record, therefore, we have no hesitation in admitting the same. Our aforesaid view that where an assessee, had raised, though for the first time an additional ground of appeal before the Tribunal, which involves purely a question of law and requires no further verification of facts, then, the same merits admission finds ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... k that was produced by the assessee, the A.O observed that the assessee had made huge cash payments to the following parties: S.No. Name of the persons Amount (Rs. In Lakhs) 1 Manohar 39.37 2 Mohan Lal 39.85 3 Raju Sahu 30.65 4 Ramprasad Sahu 36.22 5 Ram Singh 37.77 6 Shiv Lal 35.12 7 Sohan Sahu 39.61 8 Manmohan Sahu 39.34 9 Bhola Sahu 38.27 Total 336.2 The A.O further observed that the assessee had made huge cash withdrawals from his current account No.1470050001496 on different dates during the year, as under: S.No. Name of the persons Amount (Rs. In Lakhs) 1 17.11.09 9,00,000/- 2 18.11.09 7,00,000/- 3 18.11.09 7,00,000/- 4 19.11.09 1,00,000/- 5 09.11.09 11,50,000/- 6 24.11.09 60,000/- 7 25.11.09 8,00,000/- 8 27.11.09 50,00,000/- 9 30.11.09 10,00,000/- 10 30.11.09 15,00,000/- 11 30.11.09 20,00,000/- 12 01.12.09 7,00,000/- 13 01.12.09 70,000/- 14 01.12.09 26,00,000/- 15 03.12.09 8,00,000/- 16 04.12.09 5,00,000/- 17 07.12.09 20,00,000/- 18 09.12.09 20,00,000/- 19 10.12.09 10,00,000/- 20 12.12.09 17,00,000/- 21 15.12.09 7,00,000/- 22 17.12.09 17,00,000/- 23 18.12.09 8,00 000/- 24 22.12.09 16,00,000/- 25 24.12.09 7,50,000/- 26 29.12.09 8,50,000/- 27 07.01.10 5,00,000/- 28 08.01.10 3, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wal, Ld. Authorized Representative (for short AR ) for the assessee at the threshold assailed the validity of the jurisdiction that was assumed by the A.O for framing the assessment vide his order u/s. 147 r.w.s. 144 of the Act, dated 22.12.2017. Elaborating On his contention, the Ld. AR submitted that though the assessee in compliance to the notice u/s. 148 of the Act, dated 30.03.2017 had vide his reply dated 26.04.2017, Page 2 of APB had requested the A.O that his original return of income filed on 28.09.2010 may be treated as a return filed in response to notice u/s. 148 of the Act, but the A.O had thereafter, most arbitrarily proceeded with and without issuing notice u/s. 143(2) of the Act framed the assessment vide his order passed u/s. 147 r.w.s. 144 of the Act, dated 22.12.2017. It was submitted by the Ld. AR that as the A.O had grossly erred in law and facts of the case in not issuing notice u/s. 143(2) of the Act and framed the impugned assessment, therefore, the same being based on invalid assumption of jurisdiction could not sustained and was liable to be struck down on the said count itself. The Ld. AR in support of his contention that pursuant to the return of income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lenge thrown by the assessee to the validity of the assessment in absence of a notice u/s. 143(2) of the Act, which reads as under: 14. Rebutting the A.O s claim that the assessee in compliance to notice u/s. 148 of the Act had not filed his return of income in the prescribed form and verified in the prescribed manner, the Ld. AR had taken us through the copy of a letter dated 02.04.2024 a/w. copy of the original return of income filed on 29.08.2010, Page 2 to 4 of APB. 15. As the claim of the A.O vide his report dated, 15.04.2024 that the assessee had not filed his return of income in response to notice u/s. 148 of the Act, thus militated against the assessee s claim that he had as on 26.04.2017 requested the A.O i.e. ITO-2(2), Raipur to treat his original return of income filed on 28.09.2010 as a return filed in response to notice u/s. 148 of the Act, therefore, we had looked into the assessment record as was produced before us. On a perusal of the record, we find that the copy of the letter filed by the assessee before us, Page 2 to 4 of APB is available on the assessment record at Page No.22 to 35 of the said records. Also, we find that the fact that the assessee had in the cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the assessee before him. 19. As observed by us hereinabove, the CIT(Appeals) had disposed off the appeal for non-prosecution and had failed to apply his mind to the issues which did arise from the impugned order and was assailed by the assessee before him. We are unable to persuade ourselves to accept the manner in which the appeal of the assessee had been disposed off by the CIT(Appeals). In our considered view, once an appeal is preferred before the CIT(Appeals), it becomes obligatory on his part to dispose off the same on merit and it is not open for him to summarily dismiss the appeal on account of non-prosecution of the same by the assessee. In fact, a perusal of Sec.251(1)(a) and (b), as well as the Explanation to Sec.251(2) of the Act reveals that the CIT(A) remains under a statutory obligation to apply his mind to all the issues which arises from the impugned order before him. As per mandate of law the CIT(Appeals) is not vested with any power to summarily dismiss the appeal for non-prosecution. The aforesaid view is fortified by the judgment of the Hon'ble High Court of Bombay in the case of CIT Vs. Premkumar Arjundas Luthra (HUF) (2017) 297 CTR 614 (Bom). In the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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