Facts of the Case

The assessee filed an appeal against the order of the Commissioner of Income Tax (Appeals), NFAC, which had confirmed the assessment order ex-parte. The assessee submitted that notices were issued during the Covid-19 pandemic period marked by lockdowns and technical glitches, resulting in non-receipt of subsequent notices after an initial adjournment request. Consequently, the assessee could not participate in appellate proceedings. The assessee also contended that the CIT(A) merely reproduced the assessment order and confirmed it without independent reasoning.

Issues Involved

Whether an ex-parte appellate order passed by CIT(A) without adjudicating grounds of appeal and without giving reasons is valid under Section 250(6) of the Income-tax Act, 1961.

Petitioner’s (Assessee’s) Arguments

The assessee argued that non-appearance was due to circumstances beyond control during the pandemic and lack of receipt of notices. It was further submitted that the CIT(A) failed to pass a reasoned order and did not adjudicate the specific grounds raised, thereby violating Section 250(6) and principles of natural justice. On merits, the assessee contended that additions made by the Assessing Officer, including ₹4,50,000 received through banking channels from Ranjana Traders and ₹1,50,650 reflected in the ledger of Chuni Chokar, were erroneous and could be explained if an opportunity were granted.

 Respondent’s (Revenue’s) Arguments

The Revenue submitted that multiple opportunities had been provided by the CIT(A) and since the assessee failed to participate in the proceedings, no further opportunity should be granted.

Court Order / Findings

The Tribunal observed that the impugned order of the CIT(A) was ex-parte and did not adjudicate the grounds of appeal in accordance with Section 250(6). Since the appellate authority failed to pass a reasoned order stating points for determination and reasons for decision, the order was unsustainable. Accordingly, the Tribunal set aside the order and restored the matter to the file of the CIT(A) with directions to decide the appeal afresh after providing adequate opportunity of hearing and considering the assessee’s submissions and evidence. The appeal was allowed for statistical purposes.

 Important Clarification

The ruling reiterates that appellate orders must be speaking and reasoned orders. Confirmation of an assessment without independent analysis violates statutory requirements under Section 250(6) and principles of natural justice. Even in cases of non-appearance, the appellate authority must adjudicate issues on merits with proper reasoning.

Link to download the order -

https://itat.gov.in/public/files/upload/1698736080-32%20of%202023%20Hanuman%20Prasad%20and%20Sons%20(Assessee%20Appeal)%20uder%20section%20143(3)%20of%20the%20Act%20SMC%20%20250(6)%20of%20the%20Act%20(Corrected).pdf

Disclaimer

This content is shared strictly for general information and knowledge purposes only. Readers should independently verify the information from reliable sources. It is not intended to provide legal, professional, or advisory guidance. The author and the organisation disclaim all liability arising from the use of this content. The material has been prepared with the assistance of AI tools.