RAJESH GAJANAN SHARMA,JALGAON V. ITO WARD 2(3), JALGAON

ITA 2820/PUN/2025

AI Insights

The case involves an appeal by Rajesh Gajanan Sharma, the proprietor of Shiv Kela Agency, against the order of the Commissioner of Income Tax (Appeals) [NFAC], which was passed under section 250 of the Income Tax Act, 1961. The appeal was initially dismissed by the CIT(A) due to non-compliance by the assessee in responding to notices. The assessee contested the addition of Rs. 40,89,000 under section 68 of the Income Tax Act, which was confirmed by the CIT(A). The Tribunal found that the CIT(A) had not adjudicated the grounds on merit and relied on the precedent set by the Bombay High Court, which mandates that appeals should not be dismissed for non-prosecution and must be decided on merits.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 840380 (ITAT-PUNE)
• Duration Of Justice: 2 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-02-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2017-2018
• Appeal Filed On: 25-11-2025
• Other Referred Cases: Pr.CIT(Central) Vs. Premkumar Arjundas Luthra (HUF)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJESH HALADKAR THROUGH VIRTUAL
• Assessee Lawyers: NIKHIL S PATHAK
• Keywords: Set aside; Reasonable cause; Principle of natural justice; Non compliance
• Section: 143(3)

Judgement Text

" आयकर अपीलीय अधिकरण ”एस एम सी” न्यायपीठ पुणे में। IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES “SMC” :: PUNE BEFORE DR.DIPAK P. RIPOTE, ACCOUNTANT MEMBER AND SHRI VINAY BHAMORE, JUDICIAL MEMBER आयकर अपऩल सं. / ITA No.2820/PUN/2025 निर्धारण वषा / Assessment Year: 2017-18 Rajesh Gajanan Sharma, Prop. of Shiv Kela Agency, Main Road Chopda, Jalgaon – 425107. V s Income Tax Officer, Ward-2(3), Jalgaon. PAN: ACNPS1927K Appellant/ Assessee Respondent /Revenue Assessee by Shri Nikhil S Pathak Revenue by Shri Rajesh Haladkar (through virtual) Date of hearing 19/02/2026 Date of pronouncement 23/02/2026 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(Appeal)[NFAC], passed under section 250 of the Income Tax Act, 1961 for the A.Y.2017-18 dated 30.09.2025 emanating from the Assessment Order passed under section 143(3) of the I.T.Act, dated 30.12.2019. The Assessee has raised the following grounds of appeal : Printed from counselvise.com ITA No.2820/PUN/2025 [A] 2 “1] The learned CIT(A) erred in dismissing the appeal of the assessee ex-parte on the ground that there was non compliance on the part of the assessee to the various notices issued by him and thereby erred in confirming the various additions made by the learned A.O. 2] The assessee submits that there was a reasonable cause on its part for the non compliance to the notices issued by the learned CIT(A) and accordingly, request for one more opportunity to present its case before the learned CIT(A). 3] The assessee submits that the addition made of Rs.40,89,000/- u/s 68 is not justified and the same may kindly be deleted. 4] The appellant craves leave to add, alter, amend or delete any of the above grounds of appeal.” Submission of ld.AR : 2. The ld.Authorised Representative(ld.AR) for the Assessee submitted that assessee’s appeal was dismissed by the ld.CIT(A) without discussing each and every ground and merits of the case and merely dismissed for non-compliance. Ld.AR submitted that Assessee may be provided one more opportunity to file details before the ld.CIT(A). Submission of ld.Departmental Representative(ld.DR) : 3. The ld.DR for the Revenue relied on the order of Assessing Officer(AO) and ld.CIT(A)[NFAC]. Printed from counselvise.com ITA No.2820/PUN/2025 [A] 3 Findings & Analysis : 4. We have heard both the parties and perused the records. In this case, ld.CIT(A) has dismissed the appeal of the assessee as assessee failed to file any reply to notices issued by ld.CIT(A). Ld.CIT(A) has not adjudicated the grounds raised by the Assessee. Ld.AR submitted that one more opportunity may be provided to the Assessee. 4.1 Ld.CIT(A) held as under : “6.5 In light of the above, the appellant’s failure to respond, furnish evidence, or substantiate their grounds demonstrates a lack of bona fide effort to prosecute the appeal. The appellant's neglect to cooperate and substantiate their case undermines the principles of natural justice and fair adjudication. Accordingly, in the absence of any substantive response or evidence, and considering the appellant's apparent disinterest in pursuing the appeal, the same is deemed devoid of merit and is hereby *dismissed*.” 5. It is observed from the order of the ld.CIT(A) that the ld.CIT(A) did not decide the grounds of appeal on merit but merely dismissed the appeal of the assessee for non-compliance. The ld.CIT(A) has not adjudicated grounds raised by the assessee on merits. Printed from counselvise.com ITA No.2820/PUN/2025 [A] 4 6. 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. 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 Printed from counselvise.com ITA No.2820/PUN/2025 [A] 5 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. 6.1 Thus, the Hon’ble Bombay High Court has categorically held that ld.CIT(A) has to decide the appeal on merit and ld.CIT(A) does not have any power to dismiss appeal for non-prosecution. 7. In view of the above, in the interest of justice, we set-aside the order of the ld.CIT(A) to ld.CIT(A) for denovo adjudication. Ld.CIT(A) shall provide opportunity to the assessee. Assessee shall file all the necessary documents before the ld.CIT(A). Accordingly, grounds of appeal raised by the assessee are allowed for statistical purpose. 8. In the result, appeal of the assessee is allowed for statistical purpose. Order pronounced in the open Court on 23 February, 2026. Sd/- Sd/- VINAY BHAMORE Dr.DIPAK P. RIPOTE JUDICIAL MEMBER ACCOUNTANT MEMBER पपणे / Pune; ददिधंक / Dated : 23 Feb, 2025/ SGR Printed from counselvise.com ITA No.2820/PUN/2025 [A] 6 आदेशकीप्रनिनलनपअग्रेनषि / Copy of the Order forwarded to : 1. अपऩलधर्थी / The Appellant. 2. प्रत्यर्थी / The Respondent. 3. The CIT(A), concerned. 4. The Pr. CIT, concerned. 5. नवभधगऩयप्रनिनिनर्, आयकर अपऩलऩय अनर्करण, “एस एम सऩ” बेंच, पपणे / DR, ITAT, “SMC” Bench, Pune. 6. गधर्ाफ़धइल / Guard File. आदेशधिपसधर / BY ORDER, / / TRUE COPY / / सहधयक रनिस्ट्रधर /Assistant Registrar आयकर अपऩलऩय अनर्करण, पपणे/ITAT, Pune. Printed from counselvise.com "