Facts of the Case

The assessee, an individual, was subjected to assessment proceedings for Assessment Year 2017-18. The Assessing Officer passed an ex-parte assessment order dated 19.12.2019 under section 144 of the Income Tax Act, 1961, making an addition of ₹64,35,252.

Aggrieved, the assessee filed an appeal before the Commissioner of Income Tax (Appeals). The learned CIT(A), vide order dated 24.04.2025, dismissed the appeal ex-parte without adjudicating the issues on merits. The assessee thereafter preferred an appeal before the Income Tax Appellate Tribunal.

Issues Involved

  1. Whether dismissal of appeal ex-parte by the CIT(A) without adjudication on merits is sustainable in law.
  2. Whether failure to pass a speaking order violates the mandatory requirement of section 250(6) of the Income Tax Act.
  3. Whether the matter requires restoration for fresh assessment after granting reasonable opportunity.

 Petitioner’s Arguments

The assessee submitted that the assessment as well as the appellate proceedings were concluded ex-parte without granting reasonable opportunity of being heard. It was contended that the issues in dispute were never examined on merits and therefore the matter deserved to be restored for fresh adjudication in accordance with law.

Respondent’s Arguments

The learned Departmental Representative did not raise any objection to the request for restoration and left the matter to the discretion of the Tribunal.

Court Order / Findings

The Tribunal observed that the learned CIT(A) had a statutory duty under section 250(6) of the Income Tax Act to pass a reasoned and speaking order dealing with the grounds of appeal on merits. The impugned appellate order failed to discharge this obligation.

Considering the submissions of the parties and the absence of objection from the Revenue, the Tribunal set aside the appellate order and restored the issues in dispute to the file of the Assessing Officer with a direction to pass a de novo assessment order in accordance with law after providing reasonable opportunity of being heard to the assessee.

Important Clarification

The Tribunal reiterated that compliance with section 250(6) is mandatory and not a mere procedural formality. Appellate authorities are required to adjudicate appeals on merits by passing speaking orders. Ex-parte disposal without reasoned findings vitiates the proceedings and necessitates restoration for fresh adjudication.

Link to download the order - https://www.mytaxexpert.co.in/uploads/1770632713_RAMANANDGUPTAMAHARAJGANJVS.ITO14MAHARAJGANJMAHARAJGANJ.pdf

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