No power with CIT (A) to dismiss the appeal for non-prosecution

The Mumbai Bench of Income Tax Appellate Tribunal (ITAT), in the case of Bipin Amratlal Sharma Vs ACIT held that section of Income Tax Act (The Act) does not empower CIT (A) to dismiss the appeal for non-prosecution.

In this matter, the assessment order u/s 143(3) of the Act was passed by AO wherein The AO made certain disallowances and additions as under:

Disallowance u/s. 14A Rs. 11,14,309/-

Disallowance of interest on car loans Rs. 1,93,267/-

Disallowances of expenses Rs. 1,23,535/-

Addition from capital gain Rs. 6,20,564/-.

Against the above order, assessee appealed before the ld.CIT(A). Appeal was filed on 23.04.2016. The ld.CIT(A) fixed the case for haring on 22.03.2019. Thereafter, noting that assessee sought adjournment, ld. CIT (A) proceeded to hold that assessee had not made any submission in respect of the grounds of appeal till date being 27.05.2019. Hence, he held that “in these facts, the grounds of appeal were dismissed off without providing any further opportunity”. Thereafter, ld.CIT(A) repeated that AO’s order and held that since assessee has not filed any submissions/evidence in support of the ground, the grounds raised by the assessee are dismissed.

Against the order passed by CIT(A), assesse filed appeal before ITAT. ITAT in its order stated that ld.CIT(A) had taken up the appeal after three years of filing of the appeal and within a very short span of time had dismissed the appeal for non-persecution. The only reason to uphold the order of AO mentioned by the ld.CIT(A) was that no submission was made before him by the assessee. We find that the above was a non speaking, non reasoned and cryptic order, not sustainable in law. As a matter of facts, the income tax Act in section 251 of the I.T. Act dealing with the power of ld.CIT(A) did not provide for any power to the ld.CIT(A) to dismis the appeal for non-prosecution. In these facts,

ITAT was of the considered opinion that the matter needs to be remitted to the file of ld.CIT(A) to give the assessee, an opportunity of being heard and thereafter, decide the appeal as per law by a speaking order.

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