Facts of the Case

The assessee, Smt. Uma Kesharwani, was originally assessed under Section 143(3) of the Income Tax Act for Assessment Year 2013-14 on 10.02.2016, determining total income at ₹4,69,460 as against returned income of ₹4,39,390, after making an addition of ₹30,063 on account of extra profit.

Subsequently, reassessment proceedings were initiated by issuance of notice under Section 148 on 25.03.2017. The reassessment was completed under Sections 143(3) read with 147, determining total income at ₹18,64,080.

Aggrieved, the assessee filed an appeal before the Commissioner of Income Tax (Appeals). However, the CIT(A) dismissed the appeal for non-prosecution without adjudicating the grounds of appeal on merits.

 Issues Involved

  1. Whether the Commissioner of Income Tax (Appeals) can dismiss an appeal for non-prosecution without deciding it on merits.
  2. Whether passing a non-speaking order violates the mandatory requirement under Section 250(6) of the Income Tax Act.
  3. Whether such dismissal warrants interference and remand by the ITAT.

 Petitioner’s (Assessee’s) Position

There was no representation from the assessee’s side at the time of hearing before the Tribunal.

 Respondent’s (Revenue’s) Arguments

The learned Departmental Representative relied upon the orders passed by the lower authorities. The Tribunal examined the matter on the basis of records available on file.

 Court Order / Findings

The ITAT observed that the CIT(A) dismissed the appeal for non-prosecution without deciding the issues on merits and without passing a speaking order. The Tribunal emphasized that under Section 250(6) of the Income Tax Act, the CIT(A) is statutorily obligated to pass a reasoned and speaking order addressing the grounds of appeal.

Holding that the impugned appellate order was not in accordance with law, the ITAT set aside the order dated 07.01.2025 and restored the matter to the file of the CIT(A) with a direction to pass a de novo order on merits after providing reasonable opportunity of being heard to the assessee.

 

Important Clarification / Legal Principle

Dismissal of an appeal for non-prosecution without adjudicating the grounds on merits and without passing a speaking order violates Section 250(6) of the Income Tax Act. The appellate authority is duty-bound to decide appeals on merits after granting reasonable opportunity, irrespective of the assessee’s appearance.

Link to download the order -  https://www.mytaxexpert.co.in/uploads/1770872126_UMAKESHARWANIALLAHABADVS.ITOWARD13ALLAHABAD.pdf  

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