M/s. Pioneer Town Planners Pvt. Ltd., New Delhi V. DCIT, New Delhi

ITA 2069/DEL/2017

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 4134 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 6 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-10-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: F
• Assessment Year: 2012-2013
• Appeal Filed On: 06-04-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SURENDER PAL
• Assessee Lawyers: SAMEEP GUPTA
• Keywords: Opportunity of being heard; Principle of natural justice

Judgement Text

PAGE 1 OF 13 IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH: F : NEW DELHI) BEFORE SHRI AMIT SHUKLA, JUDICIAL MEMBER AND SHRI ANADEE NATH MISSHRA, ACCOUNTANT MEMBER ITA NO: - 2069/DEL/2017 ( ASSESSMENT YEAR: 2012 - 13 ) M/S PIONEER TOWN PLANNERS PVT. LTD., E - 104, GREATER KAILASH ENCLAVE - 1, NEW DELHI - 110019. VS. DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE - 19(1) & (2), NEW DELHI. PAN NO: AAECP 6502 F APPELLANT RESPONDENT ASSESSEE BY : SH. SAMEEP GUPTA, ADV. REVENUE BY : SH. SURENDER PAL, SR. DR ORDER PER: ANADEE NATH MISSHRA, AM THIS APPEAL BY THE ASSESSEE IS FILED AGAINST THE OR DER DATED 27.01.2017 OF L EARNED COMMISSIONER OF INCOME TAX (APPEALS ) - 36, NEW DELHI, FOR ASSESSMENT YEAR 2012 - 13. THE GROUNDS OF APPEAL ARE AS UNDER: - I. THAT THE IMPUGNED ORDER OF LD. COMMISSIONER OF INCOME TAX (APPEALS) [HEREINAFTER REFER TO LD. CIT(A)] DATED 27.01.2017 IS BAD IN LAW AND ON FACTS. ITA NO. - 2069/DEL/2017. M/S PIONEER TOWN PLANNERS PVT. LTD. PAGE 2 OF 13 II. THAT THE ORDER OF THE LD. CIT(A) DESERVE TO BE SET ASIDE AS THE ASSESSEE WAS NOT ALLOWED ADEQUATE OPPORTUNITY OF BEING HEARD. III. THAT THE ORDER PASSED BY THE LD. CIT (APPEALS) UNDER SECTION 250 OF THE INCOME TAX ACT, 1961 IS BAD IN LAW AND NOT JUSTIFIED BECAUSE LD. CIT(A) HAS DISMISSED THE APPEAL SIMPLY ON ACCOUNT O F NON PROSECUTION OF THE APPEAL BY THE APPELLANT WITHOUT APPRECIATING THE JUDGMENT OF HON BLE BOMBAY HIGH COURT IN CASE OF CIT (CENTRAL) NAGPUR VS. PREMKUMAR ARJUNDAS LUTHRA (HUF), [2016] 69 TAXMANN.COM 407 (BOMBAY), WHERE IT HAS BEEN HELD THAT LAW DOES NO T EMPOWER LD. CIT(A) TO DISMISS THE APPEAL FOR NON - PROSECUTION. IV. THAT THE ORDER PASSED BY THE LD. CIT(A) U/S 250 OF THE ACT IS PERVERSE TO THE PROVISIONS OF THE LAW AND TO THE FACTS OF THE CASE, BECAUSE OF NOT FOLLOWING THE PROVISION OF SECTION 250(6) O F THE INCOME TAX ACT, 1961 WHICH STATES THAT ORDER OF THE COMMISSIONER (APPEALS) DISPOSING OF THE APPEAL SHALL BE IN WRITING AND SHALL STATE THE POINTS FOR DETERMINATION, THE DECISION THEREON AND THE REASON FOR THE DECISION. V. THAT THE LD. CIT(A) HAS ERRED IN LAW IN SUSTAINING THE ADDITION OF RS. 1,33,68,445/ - MADE BY THE LD. ASSESSING OFFICER. V.I. THAT THE ABOVE SAID ADDITION HAS BEEN MADE BY THE LD. ASSESSING OFFICER AT THE TIME OF ASSESSMENT BY APPLYING PERCENTAGE OF COMPLETION METHOD WHEREIN THE L D. AO HAS ADDED THE VALUE OF COST OF LAND WHILE CALCULATING THE TOTAL AND ESTIMATED COST. VI. THAT THE APPELLANT CRAVES LEAVE TO ADD, ALTER, AMEND, SUBSTITUTE, DELETE AND MODIFY ANY OF ALL THE GROUNDS OF APPEAL, WHICH ARE WITHOUT PREJUDICE TO ONE ANOTHER, BEFORE OR AT THE TIME OF HEARING OF THE APPEAL. ( 1 . 1 ) THE GROUNDS OF APPEAL FILED BY ASSESSEE IN APPEAL BEFORE LEARNED COMMISSIONER OF INCOME TAX (APPEALS ) WERE AS UNDER: I . ASSESSING OFFICER HAS ERRED IN APPLYING PERCENTAGE OF COMPLETION METHOD AS PRESCRIBED BY ICAI VIDE GUIDANCE NOTE FOR RECOGNITION OF REVENUE BY REAL ESTATE DEVELOPERS. II. ASSESSING OFFICER HAS ERRED IN APPLYING ESTIMATED COST OF DEVELOPMENT AND COST OF LAND IN RECOGNIZING THE COST OF LAND AND COST OF DEVELOPMENT FOR THE YEAR ASSESSMENT YEAR 2011 - 13. III. ANY OTHER GROUND WHICH MAY ARISE DURING THE PROCEEDINGS. ITA NO. - 2069/DEL/2017. M/S PIONEER TOWN PLANNERS PVT. LTD. PAGE 3 OF 13 ( 1 . 2 ) IN THIS ORDER, THE FOLLOWING ABBREVIATIONS HAVE BEEN USED: ASSESSING OFFICER AS AO COMMISSIONER OF INCOME TAX ( APPEAL S) AS CIT(A) DEPARTMENTAL REPRESENTATIVE AS DR DATED AS DTD. INCOME TAX ACT AS I.T. ACT INCOME TAX APPELLATE TRIBUNAL AS ITAT LEARNED AS LD. UNDER SECTION AS U/S (1.3 ) THE A SSESSEE IS A REAL ESTATE DEVELOPER AND REGULAR METHOD OF ACCOUNTING FOLLOWED BY THE ASSESSEE IS PERCENTAGE OF COMPLETION METHOD (POCM). RETURN OF INCOME WAS FILED SHOWING INCOME OF RS. 1,13,98,210/ - . IN THE A SSESSMENT O RDER U/S 143(3), DATED 17.02.2015 TH E AO HELD THAT THE METHOD OF ACCOUNTING EMPLOYED BY THE ASSESSEE DID NOT REFLECT THE CORRECT INCOME; AND AN ADDITION OF RS. 1,33,68,445/ - WAS MADE ON THIS GROUND, IN THE ASSESSMENT ORDER. AGGRIEVED, THE A SSESSEE FILED AN APPEAL BEFORE LD. CIT(A), WHO, VID E AFORESAID ORDER DTD. 27.01.2017 DISMISSED THE ASSESSEE S APPEAL, ON THE GROUND THAT NO COMPLIANCE WAS MADE TO NOTICES OF HEARINGS ISSUED BY THE LD. CIT(A). THE LD. CIT(A) PRESUMED THAT THE ASSESSEE DID NOT WISH TO PURSUE THE APPEAL, AND PASSED AN EX PAR TE ORDER DISMISSING THE APPEAL. RELEVANT PORTION OF THE ORDER OF LD. CIT(A) IS REPRODUCED AS UNDER: 6. IT IS APPARENT THAT THE ASSESSEE IS NO T INTERESTED IN PURSUING THE APPEAL. THERE IS NO POINT IN KEEPING THE APPEAL PENDING INDEFINITELY. THE APPELLANT HAS GIVEN NO EVIDENCE OR ARGUMENTS WHATSOEVER TO DISPROVE THE ADDITION MADE. I HAVE NO OTHER ALTERNATIVE BUT TO DISMISS THE APPEAL DUE TO TOTAL LACK OF INTEREST FRO M ASSESSEE TO PRESS ANY GROUND. THE ASSESSEE WAS GRANTED ADJOURNMENT AS SOUGHT BY IT BUT EVEN THAT WAS NOT COMPLIED TO. THE LAWS OF NATURAL JUSTICE ARE THEREFORE ADEQUATELY FOLLOWED. THE ASSUMPTION IS THAT THE ASSESSEE HAS NOTHING TO SAY OR EXPLAIN & A PPEAL IS FILED JUST ROUTINELY. ON THE MERITS ALSO, I FEEL THAT THE AO HAS RIGHTLY POINTED OU T THAT DEALING IN LAND/PLOT IS THE MAINSTAY OF THE ASSESSEE & ITA NO. - 2069/DEL/2017. M/S PIONEER TOWN PLANNERS PVT. LTD. PAGE 4 OF 13 THEREFORE CANNOT BE OVERLOOKED WHILE CALCULATING THE PERCENTAGE OF COMPLETION. THE ADDITION IS THEREFORE CONFIRMED. (1.4 ) IN EFFECT, THE LD. CIT(A) DISMISSED THE APPEAL OF ASSESSEE ON TWO CO UNTS. FIRSTLY , FOR THE REASON OF NON - PROSECUTION OF APPEAL BY ASSESSEE , AND SE CONDLY, ON MERITS . T HE ORDER OF THE LD. CIT(A) CONTAINS MERELY ONE SENTENCE ON MERITS OF THE DISPUTED ADDITION : . I FEEL THAT THE AO HAS RIGHTLY POINTED OUT THAT DEA LING IN LAND/PLOT IS THE MAINSTA Y OF THE ASSESSEE I THEREFORE CANNOT BE OV ERLOOKED WHILE CALCULATING THE PERCENTAGE OF CO MPLETION : IT IS OBVIOUS FROM THE PERUSAL OF THIS SENTENCE THAT THE ORDER OF LD. CIT(A) ON MERITS OF THE DISPUTED ADDITION IS A SUMMARY ORDER, AND NOT A SPEAKING ORDER. (1.5 ) AGGRIEVED AGAIN, THE ASSESSEE IS NOW IN APPEAL IN ITAT. AT THE TIME OF HEARING BEFORE US, THE LD. COUNSEL FOR ASSESSEE SUBMITTED THAT THE ASSESSEE WAS NOT ALLOWED ADEQUATE OPPORTUNITY OF BEING HEARD BY THE LD. CIT(A) . HE F URTHER SUBMITTED THAT THE LD. CIT(A) FAILED TO FULFILL THE STATUTORY REQUIREMENT OF PASSING A SPEAKING ORDER ON MERITS OF THE DISPUTED ADDITION; AND DISMISSED THE APPEAL IN A SUMMARY MANNER ON MERITS BY USE OF A SINGLE SENTENCE . HE ALSO DREW OUR A TTENTION TO SECTION 250(6) OF I .T. ACT WHEREIN THE LD. CIT(A) IS REQUIRED TO STATE THE POINTS FOR DETERMINATION, THE DECISION THEREON, AND REASON F OR THE DECISION; AND CONTENDED THAT THESE REQUIREMENTS ARE NOT FULFILLED. HE SUBMITTED THAT THE MATTER SHOULD BE RES TORED BACK TO LD. CIT(A) FOR FRESH ORDER WITH THE DIRECTION TO PASS A SPEAKING ORDER ON MERITS OF THE DISPUTED ADDITION. HE SUBMITTED THAT THE ASSESSEE WISHES TO PREFER APPEAL BEFORE LD. CIT(A) AGAINST THE ASSESSMENT ORDER , IF OPPORTUNITY IS PROVIDED. ITA NO. - 2069/DEL/2017. M/S PIONEER TOWN PLANNERS PVT. LTD. PAGE 5 OF 13 (1. 6 ) T HE LD. DR DID NOT EXPRESS ANY OBJECTION TO THE PLEA OF THE LD. COUNSEL FOR THE ASSESSEE THAT DISPUTED ISSUES SHOULD BE SET ASIDE TO THE FILE OF LD. CIT(A) FOR FRESH ORDER ON M ERITS THROUGH A SPEAKING ORDER; AND WAS IN AGREEMENT THAT THE ORDER OF LD. CI T(A) MAY BE SET ASIDE FOR FRESH ORDER , A SPEAKING ORDER, BY LD. CIT(A), ON MERITS OF THE DISPUTED ADDITION. (2) WE HAVE HEARD BOTH SIDES ATTENTIVELY AND PATIENTLY. WE HAVE ALSO CAREFULLY PERUSED THE MATERIALS ON THE RECORD. WE FIND THAT THE LD. CIT(A) HA S NOT PASSED SPEAKING ORDER ON MERITS OF THE DISPUTED ADDITION MADE BY THE AO, AND SHE DISPOSED OFF THE MERITS OF DISPUTED ADDITION IN A SUMMARY MANNER, USING JUST ONE SENTENCE, WITHOUT GIVING DETAILED REASONS FOR HER DECISION. THIS HAS ALREADY BEEN NOTED BY US IN THE FOREGOING PARAGRAPH (1.3) OF THIS ORDER. EVEN IF THERE WAS NON - PROSECUTION OF THE APPEAL BY THE ASSESSEE IN APPELLATE PROCEEDINGS BEFORE LD. CIT(A) , WHICH LED THE LD. CIT(A) TO THE PRESUMPTION THAT THE ASSESSEE HAD NOTHING TO SAY OR APPEAL, AND THAT THE APPEAL WAS FILED JUST ROUTINELY; EVEN THEN; WHILE WE EXPRESS NO OPINION PRESENTLY ON THE MERITS OF THE ASSUMPTIONS MADE BY THE ASSESSEE; WE ARE OF THE VIEW THAT THE LD. CIT(A) WAS UNDER STATUTORY OBLIGATION TO PASS A SPEAKING ORDER ON MERITS O F THE DISPUTED ADDITION. N ON - PROSECUTION OF APPEAL BY ASSESSEE DOES NOT ENTITLE THE LD. CIT(A) TO PASS A NON - SPEAKING ORDER ON THE MERITS OF THE DISPUTED ADDITION. THE RELEVANT PROVISIONS UNDER I.T. ACT REGARDING PROCEDURE IN APPEAL, AND POWERS OF THE COMM ISSIONER [APPEALS] ARE CONTAINED IN SECTIONS 250 AND 251 OF I.T. ACT, WHICH ARE REPRODUCED BELOW FOR READY REFERENCE: ITA NO. - 2069/DEL/2017. M/S PIONEER TOWN PLANNERS PVT. LTD. PAGE 6 OF 13 250. (1) THE COMMISSIONER (APPEALS) SHALL FIX A DAY AND PLACE FOR THE HEARING OF THE APPEAL, AND SHALL GIVE NOTICE OF THE SAME TO THE APPELLANT AND TO THE ASSESSING OFFICER AGAINST WHOSE ORDER THE APPEAL IS PREFERRED. (2) THE FOLLOWING SHALL HAVE THE RIGHT TO BE HEARD AT THE HEARING OF THE APPEAL (A) THE APPELLANT EITHER IN PERSON OR BY AN AUTHORIZED REPRESENTATIVE; (B) THE ASSESSING OFFICER, EITHER IN PERSON OR BY A REPRESENTATIVE. (3) THE COMMISSIONER (APPEALS) SHALL HAVE THE POWER TO ADJOURN THE HEARING OF THE APPEAL FROM TIME TO TIME. (4) THE COMMISSIONER (APPEALS) MAY, BEFORE DISPOSING OF ANY APPEAL, MAKE SUCH FURTHER INQUIRY AS HE THINKS FIT, OR MAY DIRECT THE ASSESSING OFFICER TO MAKE FURTHER INQUIRY AND REPORT THE RESULT OF THE SAME TO THE COMMISSIONER (APPEALS). (5) THE COMMISSION ER (APPEALS) MAY, AT THE HEARING OF AN APPEAL, ALLOW THE APPELLANT TO GO INTO ANY GROUND OF APPEAL NOT SPECIFIED IN THE GROUNDS OF APPEAL, IF THE COMMISSIONER (APPEALS) IS SATISFIED THAT THE OMISSION OF THAT GROUND FROM THE FORM OF APPEAL WAS NOT WILFUL OR UNREASONABLE. (6) THE ORDER OF THE COMMISSIONER (APPEALS) DISPOSING OF THE APPEAL SHALL BE IN WRITING AND SHALL STATE THE POINTS FOR DETERMINATION, THE DECISION THEREON AND THE REASON FOR THE DECISION. [(6A) IN EVERY APPEAL, THE COMMISSIONER (APPEALS), WH ERE IT IS POSSIBLE, MAY HEAR AND DECIDE SUCH APPEAL WITHIN A PERIOD OF ONE YEAR FROM THE END OF THE FINANCIAL YEAR IN WHICH SUCH APPEAL IS FILED BEFORE HIM UNDER SUB - SECTION (1) OF SECTION 246A (7) ON THE DISPOSAL OF THE APPEAL, THE COMMISSIONER (APPEALS) SHALL COMMUNICATE THE ORDER PASSED BY HIM TO THE ASSESSEE AND TO THE PRINCIPAL CHIEF COMMISSIONER OR CHIEF COMMISSIONER OR PRINCIPAL COMMISSIONER OR COMMISSIONER. 251. ( 1) IN DISPOSING OF AN APPEAL, THE COMMISSIONER (APPEALS) SHALL HAVE THE FOLLOWING POWERS ( A ) IN APPEAL AGAINST AN ORDER OF ASSESSMENT, MAY CONFIRM, REDUCE, ENHANCE OR ANNUAL THE ASSESSMENT (AA) IN APPEAL AGAINST THE ORDER OF ASSESSMENT IN RESPECT OF WHICH THE PROCEEDING BEFORE THE SETTLEMENT COMMISSION ABATES UNDER SECTION 245HA, HE MAY, AFTER TAKING INTO CONSIDERATION ALL THE MATERIAL AND OTHER INFORMATION PRODUCED BY THE ASSESSEE BEFORE, OR THE RESULTS OF THE INQUIRY HELD OR EVIDENCE RECORDED BY, THE SETTLEMENT COMMISSION, IN THE COURSE OF THE PROCEEDING BEFORE IT AND SUCH OTHER MATERIAL AS MAY BE BROUGHT ON HIS RECORD, CONFIRM, REDUCE, ENHANCE OR ANNUL THE ASSESSMENT; (B) IN AN APPEAL AGAINST AN ORDER IMPOSING A PENALTY, HE MAY CONFIRM OR CANCEL SUCH ORDER OR VARY IT SO AS EITHER TO ENHANCE OR TO REDUCE THE PENALTY; ITA NO. - 2069/DEL/2017. M/S PIONEER TOWN PLANNERS PVT. LTD. PAGE 7 OF 13 (C) IN ANY OTHER CASE , HE MAY PASS SUCH ORDERS IN THE APPEAL AS HE THINKS FIT. (2) THE COMMISSIONER (APPEALS) SHALL NOT ENHANCE AN ASSESSMENT OR A PENALTY OR REDUCE THE AMOUNT OF REFUND UNLESS THE APPELLANT HAS HAD A REASONABLE OPPORTUNITY OF SHOWING CAUSE AGAINST SUCH ENHANCEMENT OR REDUCTION. EXPLANATION . IN DISPOSING OF AN APPEAL, THE COMMISSIONER (APPEALS) MAY CONSIDER AND DECIDE ANY MATTER ARISING OUT OF THE PROCEEDINGS IN WHICH THE ORDER APPEALED AGAINST WAS PASSED, NOTWITHSTANDING THAT SUCH MATTER WAS NOT RAISED BEFORE THE COMMISSIONER (APPEALS) BY T HE APPELLANT. SE MORE (2.1) A PERUSAL OF THE ABOVE PROVISIONS OF LAW SHOWS THAT U/S 250(6) OF I.T. ACT THE LD. CIT(A) WAS OBLIGED TO DISPOSE OF THE APPEAL IN WRITING AFTER STATING THE POINTS FOR DETERMINATION AND TO THEN PASS AN ORDER ON EACH OF THE POINT S WHICH AROSE FOR CONSIDERATION; AND THE LD. CIT(A) WAS FURTHER OBL IGED TO STATE THE REASONS FOR HER DECISION ON EACH SUCH POINTS WHICH AROSE FOR DETERMINATION. CONSEQUENTLY, IN THIS CASE, LD. CIT(A) WAS DUTY BOUND TO DISPOSE OF THE APPEAL THROUGH A SPEAKING ORDER ON POINTS WHICH AROSE FOR CONSIDERATION, SUCH AS MERITS OF THE DISPUTED ADDITION. MOREOVER, THE PERUSAL OF SECTION 251(1)(A) AND (B) OF I.T. ACT AND THE FURTHER PERUSAL OF EXPLANATION OF SECTION 251(2) OF I.T. ACT SHOWS THAT THE LD . CIT(A) WAS REQUIRED TO APPLY HER MIND TO ALL THE ISSUES WHICH AROSE FR OM THE IMPUGNED ORDER BEFORE HER , WHETHER OR NOT THESE ISSUES HAD BEEN RAISED BY THE ASSESSEE BEFORE HER . ALSO, SECTION 251(1)(A) OF I.T. ACT PROVIDES THAT WHILE DISPOSING OF AN APPEAL AGAINST ASSESSMENT ORDER, COMMISSIONER (APPEALS) SHALL HAVE THE POWER TO CONFIRM, REDUCE, ENHANCE OR ANNUL T HE ASSESSMENT. SIMILARLY, THE S ECTION 251(1) (B) PROVIDES THAT IN DISPOSING OF AN APPEAL AGAINST AN ORDER IMPOSING A PENALTY, COMMISSIONER (APPEAL S) MAY CONFIRM OR CANCEL SUCH ORDERS OR VARY IT SO AS TO EITHER TO ENHANCE OR TO REDUCE THE PENALTY. ON ITA NO. - 2069/DEL/2017. M/S PIONEER TOWN PLANNERS PVT. LTD. PAGE 8 OF 13 CUMULATIVE CONSIDERATION THE PROVISIONS U/S 250(6) READ WITH S ECTIONS 250(4), 250(5), 251(1)(A), 251(1)(B) AND EXPLANATION OF SECTION 251(2) OF I.T. AC T , WE COME TO THE CONCLUSION THAT THE CIT(A) IS NOT EMPOWERED TO DISMISS THE APPEAL FOR NON - PROSECUTION OF APPEAL AND IS OBLIGED TO DISPOSE OF THE APPEAL ON POINTS WHICH AROSE FOR DETERMINATION, SUCH AS ON MERITS OF DISPUTED ADDITIONS IN THIS CASE , THROUG H A SPEAKING ORDER IN WRITING . ONCE THE ASSESSEE FILES AN APPEAL U/S 246A OF I.T. ACT, THE ASSESSEE SETS IN MOTION THE MACHINERY DESIGNED FOR DISPOSAL OF THE APPEAL UNDER SECTIONS 250 AND 251 OF I.T. ACT. IF THE APPEAL FILED BY THE ASSESSEE FULFILS THE R EQUIREMENTS OF MAINTAINABILITY AND ADMISSIBILITY PRESCRIBED UNDER SECTIONS 246, 246A, 248 AND 249 OF I.T. ACT; NEITHER THE ASSESSEE CAN STOP THE FURTHER WORKING OF THAT MACHINERY AS A MATTER OF RIGHT BY WITHDRAWING THE APPEAL, OR BY NOT PRESSING THE APPEAL , OR BY NON - PROSECUTION OF THE APPEAL; NOR THE FIRST APPELLATE AUTHORITY, CIT(A) IN THIS CASE, CAN HALT THIS MACHINERY BY IGNORING EITHER THE PROCEDURE IN APPEAL PRESCRIBED U/S 250 OF I.T. ACT OR POWERS OF COMMISSIONER (APPEALS) PRESCRIBED U/S 251 OF I.T A CT. CIT(A), THE FIRST APPELLATE AUTHORITY, CANNOT DISMISS ASSESSEE S APPEAL FOR NON - PROSECUTION WITHOUT DECIDING THE APPEAL ON MERITS OF THE DISPUTED ADDITION THROUGH A SPEAKING ORDER IN WRITING, STATING THE POINTS OF DETERMINATION IN THE APPEAL, THE DECISION THEREON AND THE REASON FOR THE DECISION . IT IS WELL - SETTLED THAT POWERS OF LD. CIT(A) ARE CO - TERMINUS WITH POWERS OF THE ASSESSING OFFICER. USEFUL REFERENCE MAY BE MADE TO ORDER OF APEX COURT DECISION IN CIT VS. KANPUR COAL SYNDICATE 53 ITR 225 (SC) IN WHICH ITA NO. - 2069/DEL/2017. M/S PIONEER TOWN PLANNERS PVT. LTD. PAGE 9 OF 13 IT WAS HELD THAT AAC HAS PLENARY POWERS IN DISPOSING OFF AN APPEAL; THAT THE SCOPE OF HIS POWER IS CO - TERMINUS WITH THAT OF THE ITO, THAT HE CAN DO WHAT THE ITO CAN DO A ND ALSO DIRECT HIM TO DO WHAT HE FAILED TO DO. IN THIS CONTEXT, USEFUL REFERENCE MAY ALSO BE MADE TO APEX COURT S DECISIONS IN THE CASES OF CIT VS. RA I BAHADUR HARDUTROY MOTILAL CHAMARIA 66 ITR 443 AND CIT VS. B.N. BHATTACHARGEE 118 ITR 461 (SC) FOR THE P ROPOSITION THAT AN ASSESSEE HAVING ONCE FILED AN APPEAL, CANNOT WITHDRAW IT AND EVEN IF THE ASSESSEE REFUSES TO APPEAR AT THE HEARING, THE FIRST APPELLATE AUTHORITY CAN PROCEED WITH THE ENQUIRY AND IF HE FINDS THAT THERE HAS BEEN AN UNDER - ASSESSMENT, HE CA N ENHANCE THE ASSESSMENT. JUST AS, ONCE THE ASSESSMENT PROCEEDINGS ARE SET IN MOTION, IT IS NOT OPEN TO THE AO TO NOT COMPLETE THE ASSESSMENT PROCEEDINGS BY ALLOWING THE ASSESSEE TO WITHDRAW RETURN OF INCOME; IT IS SIMILARLY, BY ANALOGY, NOT OPEN FOR LD. CIT(A) TO NOT PASS A SPEAKING ORDER ON MERITS OF DISPUTED ADDITION BY DISMISSING THE APPEAL WHETHER ON ACCOUNT OF NON - PROSECUTION OF APPEAL BY THE ASSESSEE OR IF THE ASSESSEE SEEKS TO WITHDRAW THE APPEAL OR IF THE ASSESSEE DOES NOT PRESS THE APPEAL. WHEN T HE COMMISSIONER (APPEALS) DISMISSES THE APPEAL OF ASSESSEE FOR NON - PROSECUTION OF APPEAL BY THE ASSESSEE; IN EFFECT, INDIRECTLY IT LEADS TO SAME RESULTS AS WITHDRAWAL OF APPEAL BY ASSESSEE. WHEN THE ASSESSEE IS NOT PERMITTED TO WITHDRAW THE APPEAL FILED B EFORE THE FIRST APPELLATE AUTHORITY, THE FIRST APPELLATE AUTHORITY IS DUTY BOUND TO NOT ALLOW A SITUATION TO ARISE, THROUGH DISMISSAL OF APPEAL IN LIMINE FOR NON - PROSECUTION OF APPEAL BEFORE THE FIRST APPELLATE AUTHORITY; IN WHICH , IN EFFECT, INDIRECTLY T HE SAME RESULT S ARE OBTAINED AS ARISE FROM WITHDRAWAL ITA NO. - 2069/DEL/2017. M/S PIONEER TOWN PLANNERS PVT. LTD. PAGE 10 OF 13 OF APPEAL BY THE ASSESSEE. WHAT CANNOT BE PERMITTED IN LAW TO BE DONE DIRECTLY, CANNOT BE PERMITTED TO BE DONE INDIRECTLY EITHER , AS IS WELL SETTLED. IN VIEW OF THE FOREGOING DISCUSSION; AND ON CAREFU L PERUSAL OF SECTION 250(6) R.W.S. 250(4), 250(5), 251(1)(A), 251(1)(B) AND EXPLANATION TO SECTION 251(2) OF I.T. ACT; IT IS AMPLY CLEAR THAT LD. CIT(A) HAS NO POWER TO DISMISS APPEAL FOR NON - PROSECUTION OF APPEAL BY THE ASSESSEE. WE DRAW SUPPORT FROM ORD ER OF HON BLE BOM BAY HIGH COURT IN THE CASE OF CIT VS. PREMKUMAR ARJUNDAS LUTHRA (HUF) [2016] 240 TAXMAN 133 CITED BY A PPELLANT IN THE GROUNDS OF APPEAL FILED IN ITAT, FOR THE PROPOSITIONS THAT LD. CIT(A) IS REQUIRED TO APPLY HIS MIND TO ALL ISSUES WHICH ARISE FROM IMPUGNED ORDER BEFORE HIM WHETHER OR NOT SAME HAD BEEN RAISED BY APPELLANT BEFORE HIM; AND THAT CIT(A) IS OBLIGED TO DISPOSE OF THE APPEAL ON MERITS. IN THIS CASE, IT WAS HELD AS UNDER: 8 IT IS VERY CLEAR ONCE AN APPEAL IS PREFERRED BEFORE T HE CIT(A), THEN IN DISPOSING OF THE APPEAL, HE IS OBLIGED TO MAKE SUCH FURTHER INQUIRY THAT HE THINKS FIT OR DIRECT THE ASSESSING OFFICER TO MAKE FURTHER INQUIRY AND REPORT THE RESULT OF THE SAME TO HIM AS FOUND IN SECTION 250(4) OF THE ACT. FURTHER SECTIO N 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. SECTION 251(1)(A) AND (B) OF THE AC T 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 - SECTION (2) OF SECTION 251 OF THE ACT ALSO MAKES IT CLEAR THAT WHILE CONSIDERING THE APPE AL, 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 SECTION 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 WITH EFFECT FROM 1ST JUNE, 2001 THE POWER OF THE CIT(A) TO SET ASIDE THE ORDER OF THE ASSESSING OFFICER AND RESTORE IT TO THE ASSESSING OFFICER FOR PASSING A FRESH ORDER STANDS WITHDRAWN. THEREFORE, IT WOULD BE NOTICED THAT THE POWERS OF THE CIT(A) IS CO - TERMINUS WITH THAT OF THE ASSESSING OFFICER I.E. HE CAN DO ALL THAT ASSESS ING OFFICER COULD DO. THEREFORE JUST AS IT IS NOT OPEN TO THE ASSESSING OFFICER 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 ITA NO. - 2069/DEL/2017. M/S PIONEER TOWN PLANNERS PVT. LTD. PAGE 11 OF 13 DISMISS THE APPEAL ON ACCOUNT OF NON - PROSECUTION OF THE APPEAL BY THE ASSESSEE. THIS IS AMPLY CLEAR FROM THE SECTION 251(1)(A) AND (B) AND EXPLANATION TO SECTION 251(2) OF THE ACT WHICH REQUIRES THE CIT(A) TO APPLY HIS MIND TO ALL THE ISSUES WHICH ARISE FROM THE IMPUG NED 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. (2.2) THE LD. CIT(A) DISMIS SED THE APPEAL ON TWO COUNTS; FIRSTLY, SHE DISMISSED THE ASSESSEE S APPEAL FOR NON - PROSECUTION OF THE APPEAL BY THE ASSESSEE IN THE APPELLATE PROCEEDINGS BEFORE LD. CIT(A). SECONDLY, ON MERITS SHE PASSED A SUMMARY ORDER, INSTEAD OF A SPEAKING ORDER. BY NOT PASSING A SPEAKING ORDER ON MERITS OF DISPUTED ADDITION, THE LD. CIT(A) FAILED TO COMPLY WITH REQUIREMENTS OF SECTION 250(6) OF I.T. ACT WHICH REQUIRED THE LD. CIT(A) TO STATE THE P OINTS FOR DETERMINATION AND THE REASONS FOR HER DECISION. WE HAVE ALREADY HELD THAT CIT(A) IS NOT EMPOWERED TO DISMISS THE APPEAL FO R NON - PROSECUTION OF APPEAL. WE HAVE ALSO READY HELD THAT CIT(A) IS OBLIGED TO DISPOSE OF THE APPEAL ON POINTS WHICH AROSE FOR DETERMINATION, SUCH AS ON MERITS OF DISPUTED ADDITIONS IN THIS CASE, THROUGH A SPEAKING ORDER IN WRITING. THUS, LD. CIT(A) EXCEEDED HER POWERS AND FAILED TO DISCHARGE THE DUTY PRESCRIBED U/S 250(6) OF I.T. ACT. THUS, THE LD. CIT(A) WAS IN ERROR OF LA W ON BOTH THE COUNTS ON WHICH SHE DISMISSED THE APPEAL OF THE ASSESSEE. (2.3) AS MENTIONED IN FOREGOING PARAGRAPHS (1.4) AND (1.5) OF THIS ORDER, BOTH S IDES ARE IN AGREEMENT THAT THE ORDER OF LD. CIT(A) BE SET ASIDE TO THE FILE OF THE LD. CIT(A) FOR FRESH ORDER , A SPEAKING ORDER, ON MERITS OF THE DISPUTED ADDITIONS. ITA NO. - 2069/DEL/2017. M/S PIONEER TOWN PLANNERS PVT. LTD. PAGE 12 OF 13 (2.4 ) IN VIEW OF THE FOREGOING , WE HOLD THAT THE LD. CIT(A) ERRED IN DISMISSING THE APPEAL OF THE ASSESSEE . WE SET ASIDE THE IMPUGNED ORDER OF THE LD. CIT( A) AND WE DIRECT THE LD. CIT(A) TO PASS DENOVO ORDER AS PER LAW, A SPEAKING ORDER, IN ACCORDANCE WITH SECTIONS 250 AND 251 OF I.T. ACT; FOR FRESH DISPOSAL OF APPEAL FILED BY THE ASSESSEE BEFORE LD. CIT(A) AGAINST THE AFORESAID ASSESSMENT ORDER . WE FURTHER DIRECT THE LD. CIT(A) TO PASS A SPEAKING ORDER ON MERITS OF THE DISPUTED ADDITION. BY WAY OF ABUNDANT CAUTION, WE CLARIFY THAT WE ARE NOT EXPRESSING ANY OPINION ON MERITS OF THE DISPUTED ADDITIONS. ALL ISSUES ON MERITS OF THE DISPUTED ADDITIONS ARE LEFT OPEN. IN THE RESULT, APPEAL OF THE ASSESSEE IS TREATED AS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 30 /10/2018 SD/ - SD/ - (AMIT SHUKLA) (ANADEE NATH MISSHRA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 30 .10.2018 (POOJA) COPY FORWARDED TO: 1 . APPELLANT 2 . RESPONDENT 3 . CIT 4 . CIT(APPEALS) 5 . DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI ITA NO. - 2069/DEL/2017. M/S PIONEER TOWN PLANNERS PVT. LTD. PAGE 13 OF 13 DATE OF DICTATION .10.2018. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER .10.2018 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. PS/PS DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT .10.18 DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. PS/PS .10.18 DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WEBSITE OF ITAT DATE ON WHICH THE FILE GOES TO THE BENCH CLERK DATE ON WHICH THE FILE GOES TO THE HEAD CLERK THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER