AGHORPEETH JAN SEWA ABHED ASHRAM, AKALTARA,JANJGIR-CHAMPA V. ASSITANT DIRCTOR OF INCOME TAX, CPC, BENGALURU, BENGALURU

ITA 248/RPR/2022

AI Insights

The case involves Aghorpeeth Jan Sewa Abhed Ashram, which appealed against the order of the Commissioner of Income-Tax (Appeals), National Faceless Appeal Center, Delhi. The appeal was initially dismissed by the CIT(Appeals) due to the assessee's non-response to multiple hearing notices. The assessee had claimed exemption under sections 11 and 12 of the Income-tax Act, 1961 for the assessment year 2020-21, which was denied by the Centralized Processing Centre (CPC), resulting in the taxation of receipts amounting to Rs.88,25,083. The Tribunal found that the CIT(Appeals) erred in summarily dismissing the appeal without addressing the substantive issues raised.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 35682 (ITAT-RAIPUR)
• Duration Of Justice: 1 year(s) 10 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-10-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 21-10-2024
• Assessment Year: 2020-2021
• Appeal Filed On: 08-12-2022
• Other Referred Cases: CIT Vs. Premkumar Arjundas Luthra (HUF)
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PRIYANKA PATEL
• Assessee Lawyers: R.B DOSHI
• Keywords: Set aside; Opportunity of being heard
• Section: 250; 12AA; 246A

Judgement Text

"आयकर अपीलȣय अͬधकरण Ûयायपीठ रायपुर मɅ। IN THE INCOME TAX APPELLATE TRIBUNAL, RAIPUR BENCH, RAIPUR BEFORE SHRI RAVISH SOOD, JUDICIAL MEMBER AND SHRI ARUN KHODPIA, ACCOUNTANT MEMBER आयकर अपील सं. / ITA No. 248/RPR/2022 Ǔनधा[रण वष[ / Assessment Year : 2020-21 Aghorpeeth Jan Sewa Abhed Ashram Pondidiha, Akaltara, Janjgir, Champa (C.G.)-495 549 PAN : AAFTA1866R .......अपीलाथȸ / Appellant बनाम / V/s. The Assistant Director of Income Tax, (CPC), Bengaluru ……Ĥ×यथȸ / Respondent Assessee by : Shri R.B Doshi, CA Revenue by : Dr. Priyanka Patel, Sr. DR सुनवाई कȧ तारȣख / Date of Hearing : 21.10.2024 घोषणा कȧ तारȣख / Date of Pronouncement : 23.10.2024 2 Aghorpeeth Jan Sewa Abhed Ashram Vs. ADIT, CPC, Bengaluru ITA No. 248/RPR/2022 आदेश / ORDER PER RAVISH SOOD, JM: The present appeal filed by the assessee is directed against the order passed by the Commissioner of Income-Tax (Appeals), National Faceless Appeal Center (NFAC), Delhi, dated 26.10.2022, which in turn arises from the order passed by the Centralized Processing Centre (CPC)/A.O under Sec.143(1) of the Income-tax Act, 1961 (in short ‘the Act’) dated 30.11.2021 for the assessment year 2020-21. The assessee has assailed the impugned order on the following grounds of appeal before us: “1. Ld. CIT(A) erred in upholding the action of CPC in denying exemption u/s.11/12 claimed by the appellant. The addition of Rs.88,25,083/- made by CPC and sustained by ld. CIT(A) is illegal and not justified. The appellant is eligible for exemption u/s. 11. 2. The appellant reserves the right to add, amend or modify any of the ground/s of appeal.” 2. Succinctly stated, the assessee which is registered u/s. 12AA of the Act from A.Y.2020-21, had filed its return of income for the year under consideration, i.e. A.Y.2020-21, claiming exemption u/ss. 11/12 of the Act. However, the assessee’s claim for exemption u/ss. 11/12 of the Act was declined by the CPC, Bengaluru which, thereafter, brought the entire amount of receipts of Rs.88,25,083/- to tax. 3 Aghorpeeth Jan Sewa Abhed Ashram Vs. ADIT, CPC, Bengaluru ITA No. 248/RPR/2022 3. Aggrieved, the assessee carried the matter in appeal before the CIT(Appeals). As the assessee despite having been afforded four opportunities had failed to participate in the appellate proceedings, i.e. on 04.04.2022, 31.05.2022, 23.06.2022, and 13.10.2022, therefore, the CIT(Appeals) holding a firm conviction that the assessee was not interested in prosecuting the appeal dismissed the same on the said count itself. For the sake of clarity, the observations of the CIT(Appeals) are culled out as under: “4. PROCEEDINGS: The appellant was provided four opportunities of being heard by way of issue of hearing notices dated 4th April 2022, 31st May 2022, 23rd June 2022 and 13th October 2022.The appellant has not responded to any of the notices. Grounds of Appeal and Statement of Facts and the order of the Learned Assessing Officer have been carefully considered. Grounds of Appeal of the Appellant as reproduced above are adjudicated as under: 5. FINDINGS & DECISION: In view of the above and the records available on file, there has been consistent lack of response from the appellant, despite repeated notices. Though the appellant was provided reasonable opportunities of being heard by following the principles of natural justice according to rule of law, it appears that it is not inclined to pursue the appeal 6. Accordingly, the appeal of the Appellant for AY 2020-21 is dismissed.” 4. The assessee being aggrieved with the order of the CIT(Appeals) has carried the matter in appeal before us. 4 Aghorpeeth Jan Sewa Abhed Ashram Vs. ADIT, CPC, Bengaluru ITA No. 248/RPR/2022 5. We have heard the Ld. Authorized Representatives of both the parties, perused the orders of the lower authorities and the material available on record. 6. Ostensibly, it is a matter of fact borne from the record that the assessee despite having been afforded sufficient opportunities had failed to put up an appearance/participate in the proceedings before the CIT(Appeals). Although we are principally in agreement with the CIT(Appeals), that the failure of the assessee to respond to the notices intimating the fixation of its appeal revealed its disinterest in prosecuting the matter, but at the same time, we are unable to persuade ourselves to accept the manner in which the appeal had been summarily disposed off by the CIT(Appeals). In our considered view, once an appeal is preferred before the CIT(Appeals), it becomes obligatory on his part to dispose off the same after addressing the issues based on which the assessment order is assailed before him, and it is not open for him to summarily dismiss the appeal on the basis of his general observations regarding the non-prosecution of the matter by the assessee appellant before him. In fact, a perusal of Sec. 251(1)(a) and (b), as well as the “Explanation” to Sec.251(2) of the Act, reveals that the CIT(A) remains under a statutory obligation to apply his mind to all the issues which arise from the impugned order before him. As per the mandate of the law the CIT(Appeals) is not vested with any power to summarily dismiss the appeal for non-prosecution. The aforesaid view is 5 Aghorpeeth Jan Sewa Abhed Ashram Vs. ADIT, CPC, Bengaluru ITA No. 248/RPR/2022 fortified by the judgment of the Hon'ble High Court of Bombay in the case of CIT Vs. Premkumar Arjundas Luthra (HUF) (2017) 297 CTR 614 (Bom). In the aforementioned case the Hon’ble High Court, had observed as under: \"8. From the aforesaid provisions, it is very clear once an appeal is preferred before the CIT(A), then in disposing of the appeal, he is obliged to make such further inquiry that he thinks fit or direct the AO to make further inquiry and report the result of the same to him as found in Sec. 250 of the Act. Further, Sec. 250(6) of the Act obliges the CIT(A) to dispose of an appeal in writing after stating the points for determination and then render a decision on each of the points which arise for consideration with reasons in support. Sec. 251(1)(a) and (h) of the Act provide that while disposing of appeal the CIT(A) would have the power to confirm, reduce, enhance or annul an assessment and/or penalty. Besides Explanation to sub-s. (2) of s. 251 of the Act also makes it clear that while considering the appeal, the CIT(A) would be entitled to consider and decide any issue arising in the proceedings before him in appeal filed for its consideration, even if the issue is not raised by the appellant in its appeal before the CIT(A). Thus once an assessee files an appeal under s. 246A of the Act, it is not open to him as of right to withdraw or not press the appeal. In fact the CIT(A) is obliged to dispose of the appeal on merits. In fact w.e.f. 1st June, 2001 the power of the CIT(A) to set aside the order of the AO and restore it to the AO for passing a fresh order stands withdrawn. Therefore, it would be noticed that the powers of the CIT(A) are co-terminus with that of the AO i.e. he can do all that A.O could do. Therefore, just as it is not open to the AO to not complete the assessment by allowing the assessee to withdraw its return of income, it is not open to the assessee in appeal to withdraw and/or the CIT(A) to dismiss the appeal on account of non- prosecution of the appeal by the assessee. This is amply clear from the s. 251(1)(a) and (b) and Explanation to Sec. 251(2) of the Act which requires the CIT(A) to apply his mind to all the issues which arise from the impugned order before him whether or not the same has been raised by the appellant before him. Accordingly, the law does not empower the CIT(A) to dismiss the appeal for non-prosecution as is evident from the provisions of the Act.” 7. We, thus, not being able to persuade ourselves to subscribe to the summary dismissal of the appeal by the CIT(Appeals) for non-prosecution, 6 Aghorpeeth Jan Sewa Abhed Ashram Vs. ADIT, CPC, Bengaluru ITA No. 248/RPR/2022 therefore, set-aside his order with a direction to dispose off the same after addressing the specific issues on which the impugned assessment order has been assailed before him. Needless to say, the CIT(Appeals), in all fairness, shall in the course of the set-aside proceedings afford a reasonable opportunity of being heard to the assessee. The grounds of appeal raised by the assessee are disposed off in terms of our aforesaid observations. 8. In the result, the appeal filed by the assessee is allowed for statistical purposes in terms of our aforesaid observations. Order pronounced in open court on 23rd day of October, 2024. Sd/- Sd/- ARUN KHODPIA RAVISH SOOD (ACCOUNTANT MEMBER) (JUDICIAL MEMBER) रायपुर/ RAIPUR ; Ǒदनांक / Dated : 23rd October, 2024. **#SB, Sr. PS आदेश कȧ ĤǓतͧलͪप अĒेͪषत / Copy of the Order forwarded to : 1. अपीलाथȸ / The Appellant. 2. Ĥ×यथȸ / The Respondent. 3. The CIT(Appeals)-1, Raipur (C.G.) 4. The Pr. CIT, Raipur-1 (C.G) 5. ͪवभागीय ĤǓतǓनͬध, आयकर अपीलȣय अͬधकरण, रायपुर बɅच, रायपुर / DR, ITAT, Raipur Bench, Raipur. 6. गाड[ फ़ाइल / Guard File. आदेशानुसार / BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलȣय अͬधकरण, रायपुर / ITAT, Raipur. "