Facts of the Case

The assessee filed an appeal before the CIT(A) against the assessment order. The CIT(A) issued notices on several occasions; however, due to absence of response from the assessee, the appeal was dismissed ex-parte.

The assessee challenged this action before the Tribunal, contending that the appellate authority failed to adjudicate the grounds of appeal on merits and passed the order without assigning reasons.

Issues Involved

  1. Whether the CIT(A) can dismiss an appeal ex-parte without deciding issues on merits.
  2. Whether an order lacking reasons violates Section 250(6).
  3. Whether such an order is sustainable under law.

Petitioner’s Arguments (Assessee)

  • The appeal was dismissed without proper consideration of grounds.
  • No findings or reasoning were provided in support of the decision.
  • The order violated statutory requirements for appellate orders.
  • Fresh adjudication on merits should be directed.

Respondent’s Arguments (Revenue)

  • The assessee failed to respond to multiple notices issued by the CIT(A).
  • Therefore, dismissal of the appeal ex-parte was justified.

Court Order / Findings (ITAT Allahabad)

The Tribunal observed that although the CIT(A) recorded issuance of multiple notices, he failed to adjudicate the grounds of appeal on merits and did not provide reasons for confirming the assessment order.

Section 250(6) mandates that the appellate authority must pass a reasoned order addressing the issues raised. The impugned order lacked discussion of facts and law and therefore constituted a non-speaking order.

Accordingly, the Tribunal:

  • Set aside the order of the CIT(A)
  • Restored the appeal for fresh adjudication on merits
  • Directed the CIT(A) to pass a speaking order in accordance with law
  • Allowed the appeal for statistical purposes

Important Clarification

  • CIT(A) must decide appeals on merits even in absence of the appellant.
  • Orders must contain reasons and findings as required by Section 250(6).
  • Non-speaking orders violate principles of natural justice.
  • The Tribunal did not adjudicate the substantive tax dispute.
  • The assessee must cooperate in the fresh appellate proceedings.

Link to download the order -  https://itat.gov.in/public/files/upload/1694424714-59%20of%202023%20Pankaj%20Gaur(Assessee%20Appeal)%20uder%20section%20143(3)%20of%20the%20Act%20SMC%20(Corrected).pdf

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