Facts of the Case

The assessee filed an appeal before the CIT(A) against the assessment order. The CIT(A) dismissed the appeal ex-parte without hearing the assessee and without examining the merits of the grounds raised.

The assessee challenged this action before the Tribunal, contending that the appellate authority failed to consider the issues and passed the order without proper reasoning.

Issues Involved

  1. Whether the CIT(A) can dismiss an appeal ex-parte without examining the merits.
  2. Whether an appellate order without reasons violates Section 250(6).
  3. Whether such a non-speaking order is sustainable in law.

Petitioner’s Arguments (Assessee)

  • The appeal was dismissed without granting an opportunity of hearing.
  • The CIT(A) did not examine the facts or legal issues involved.
  • The order lacked reasoning and proper consideration of grounds.
  • Such disposal violates statutory requirements and principles of natural justice.

Respondent’s Arguments (Revenue)

  • The assessee did not appear during appellate proceedings.
  • Therefore, the CIT(A) proceeded to decide the appeal ex-parte.

Court Order / Findings (ITAT Allahabad)

The Tribunal observed that although the CIT(A) stated that the order was passed on merits, the order did not discuss relevant facts, evidence, or legal reasoning. It amounted to a non-speaking order showing non-application of mind.

The Tribunal held that Section 250(6) requires the CIT(A) to pass a reasoned and speaking order addressing the issues raised in appeal. Failure to do so renders the order unsustainable.

Accordingly, the Tribunal:

  • Set aside the impugned order of the CIT(A)
  • Restored the appeal for fresh adjudication
  • Directed the CIT(A) to pass a speaking order after hearing the assessee
  • Allowed the appeal for statistical purposes

 Important Clarification

  • Appellate authorities must decide appeals on merits even in absence of the appellant.
  • Orders must contain reasons, findings, and conclusions as mandated by Section 250(6).
  • Non-speaking orders violate principles of natural justice.
  • The Tribunal did not adjudicate the substantive tax issues.
  • The assessee must cooperate and submit documents during fresh proceedings.

Link to download the order -  https://itat.gov.in/public/files/upload/1694578087-56%20of%202023%20Sant%20Sharan%20Upadhyaya(Assessee%20Appeal)%20uder%20section%20143(3)%20of%20the%20Act%20SMC%20(Corrected).pdf

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