SHRIKANT GAJANAN VYAVAHARE, KAMATWADE V. INCOME TAX OFFICER, NASHIK

ITA 893/PUN/2023

• Counselvise Citation: [2024] 100 COUNSELVISE.COM (IT) 3875 (ITAT-PUNE)
• Duration Of Justice: 6 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-02-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 13-02-2024
• Assessment Year: 2016-2017
• Appeal Filed On: 11-08-2023
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: MISS ABHILASHA SANJAY PAWAR
• Keywords: Set aside
• Section: 250; 251; 246A

Judgement Text

।आयकर अपीलीय अिधकरण ”बी” Ɋायपीठ पुणेमŐ। IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES “B” :: PUNE BEFORE SHRI S.S.GODARA, JUDICIAL MEMBER AND DR. DIPAK P. RIPOTE, ACCOUNTANT MEMBER आयकर अपील सं. / ITA No.893/PUN/2023 िनधाᭅरण वषᭅ / Assessment Year : 2016-17 Shrikant Gajanan Vyavahare, Plot No.06, S.No.16/3/1, Samarth Bungla, Near Modakeshwar Mandir, Modakeshwar Nagar, Kamatwade, Nashik – 422010. PAN: AAKPV1138N V s The Income Tax Officer, Nashik. Appellant/ Assessee Respondent /Revenue Assessee by Miss Abhilasha Sanjay Pawar – AR Revenue by Shri Sourabh Nayak – Addl.CIT-DR Date of hearing 14/02/2024 Date of pronouncement 14/02/2024 आदेश/ ORDER PER DR. DIPAK P. RIPOTE, AM: This is an appeal filed by the assessee against the order of Ld.Commissioner of Income Tax(Appeals)[NFAC], passed under section 250 of the Income Tax Act, 1961 dated 29.09.2022. The assessee has raised the following grounds of appeal : “1. The learned CIT is not justified in levying penalty u/s 271(l)(c) of Rs.82,093/- on the ground that the assesses has furnish inaccurate particulars of Income without appreciating that the said levy of penalty was not justified in law. ITA No.893/PUN/2023 Shrikant Gajanan Vyavahare [A] 2 2. The learned CIT failed to appreciate that before the CIT, the assesses had duly explained that reporting of income in his case was attributable to wrong action of tax consultant and all the material facts relating thereto along with substantiating evidences in form of complaint filed against Tax Consultant before Economic Wing of Police Department etc. were also furnished by the assesses and therefore, the levy of penalty u/s 271(l)(c) without rebutting the explanation offered by the assesses was not justified in view of provisions of the said Act. 3. The learned CIT ought to have appreciated that the bona fides of the explanation offered by assesses were established from the fact that the assesses, being salaried employee from technical background, was totally dependent upon the tax consultant for filing income tax return and no such incorrect claim was ever made by the assesses either in past years or in subsequent years and therefore, the levy of penalty u/s 271 (l)(c) was not justified in view of the explanation offered by the assesses.” Submission of ld.AR : 2. The ld.Authorised Representative(ld.AR) of the assessee submitted that there was no under reporting. Submission of ld.DR : 3. The ld.DR relied on the order of the Assessing Officer. Findings &Analysis : 4. We have heard both the parties and perused the records. The ld.CIT(A) has decided this case as under : “3.1 From the above, it is apparent that the appellant has deliberately not complied with the notices issued by this office and kept on asking for time without any valid reason. Hence, it is ITA No.893/PUN/2023 Shrikant Gajanan Vyavahare [A] 3 apparent that appellant is not interested in pursuing this appeal. Hon'bie Supreme Court has also observed in the case of CIT vs. B.N. Bhattacharya (118 ITR 461) that "preferring an appeal means more than formally filing it but effectively pursuing it". It means, if the appellant is not pursuing the appeal without any reasonable cause, it may be presumed that he may not be interest in taking the issue seriously before the appellate authority or he may not be able to substantiate the grounds taken in the appeals. 3.2 The appeal of the appellant is against penalty order u/s 271 of the Income Tax Act, 1961. Though the appellant had appealed against the additions made by the Assessing Officer he did not comply with the notices of hearings of the appeals from the undersigned. Under the circumstances I am compelled to believe that the appellant has nothing to submit against the penalty made by the Assessing Officer. The same therefore is confirmed.” 4.1 In this case, ld.CIT(A) has dismissed the appeal of the assessee for non-prosecution. The ld.CIT(A) has not adjudicated grounds raised by the assessee on merits. 4.2 The Hon’ble Bombay High Court has held in the case of Pr.CIT(Central) Vs. Premkumar Arjundas Luthra (HUF)(Bombay)/[2017] 297 CTR 614 (Bombay) as under : Quote, “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 Assessing Officer to make further inquiry and report the result of the same to him as found in Section 250(4) of the Act. ITA No.893/PUN/2023 Shrikant Gajanan Vyavahare [A] 4 Further Section 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 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-section (2) of Section 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 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 coterminous with that of the Assessing Officer i.e. he can do all that Assessing 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 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 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.” Unquote. ITA No.893/PUN/2023 Shrikant Gajanan Vyavahare [A] 5 5. Thus, Hon’ble Bombay High Court has categorically held that CIT(A) has to decide the appeal on merit and CIT(A) does not have any power to dismiss appeal for non-prosecution. 6. In view of this, the order of the ld.CIT(A)[NFAC] is set-aside to ld.CIT(A) for denovo adjudication. The ld.CIT(A) shall provide opportunity of hearing to the assessee. 7. Accordingly, appeal of the assessee is allowed for statistical purpose. Order pronounced in the open Court on 14 th February, 2024. Sd/- Sd/- (S.S.GODARA) (DR. DIPAK P. RIPOTE) JUDICIAL MEMBER ACCOUNTANT MEMBER पुणे / Pune; ᳰदनांक / Dated : 14 th Feb, 2024/ SGR* आदेशकᳱᮧितिलिपअᮕेिषत / Copy of the Order forwarded to : 1. अपीलाथᱮ / The Appellant. 2. ᮧ᭜यथᱮ / The Respondent. 3. The CIT(A), concerned. 4. The Pr. CIT, concerned. 5. िवभागीयᮧितिनिध, आयकर अपीलीय अिधकरण, “बी” बᱶच, पुणे / DR, ITAT, “B” Bench, Pune. 6. गाडᭅफ़ाइल / Guard File. आदेशानुसार / BY ORDER, // TRUE COPY // Senior Private Secretary आयकर अपीलीय अिधकरण, पुणे/ITAT, Pune.