WELKIN TELECOM INFRA PVT. LTD.,KOLKATA V. ACIT, CIRCLE 11(1), , KOLKATA

ITA 668/KOL/2025

AI Insights

The case involves Welkin Telecom Infra Pvt. Ltd., which appealed against the order of the Commissioner of Income Tax (Appeals) - NFAC, Delhi, concerning the assessment year 2014-15. The primary contention was the dismissal of their appeal by the CIT(A) on grounds of non-prosecution, despite the assessee having filed an adjournment petition. The Tribunal noted that the CIT(A) had not adjudicated the appeal on its merits and had dismissed it based solely on the non-compliance with procedural notices. The Tribunal highlighted the CIT(A)'s obligation to pass a reasoned order and not dismiss the appeal for non-prosecution, referencing several judicial precedents that support the need for a substantive examination of the appeal's merits.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 708397 (ITAT-KOLKATA)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-07-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Assessment Year: 2014-2015
• Other Referred Cases: UOI vs Rajeev Bansal, Union of India v. Ashish Agarwal, Pradeep Kumar Jhawar Kolkata vs. DCIT-CCXXI, Estate of Late Tukojirao Holkar vs. CWT, New Diwan Oil Mills vs. CIT, Ajji Basha Vs. CIT, Commissioner of Income-tax (Central) Nagpur v. Premkumar Arjundas Luthra (HUF)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Set aside; Opportunity of being heard; Revised return; Opportunity of cross examination
• Section: 147; 148; 143(3)

Judgement Text

"आयकर अपीलीय अधिकरण कोलकाता 'डी' पीठ, कोलकाता में IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA ‘D’ BENCH, KOLKATA श्री दुव्वुरु आरएल रेड्डी, उपाध्यक्ष (कोलकाता क्षेत्र) एवं श्री राक ेश धमश्रा, लेखा सदस्य क े समक्ष Before SHRI DUVVURU RL REDDY, VICE PRESIDENT (KZ) & SHRI RAKESH MISHRA, ACCOUNTANT MEMBER I.T.A. No.: 668/KOL/2025 Assessment Year: 2014-15 Welkin Telecom Infra Pvt. Ltd. Vs. ACIT, Circle-11(1), Kolkata (Appellant) (Respondent) PAN: AAJCS6622G Appearances: Assessee represented by : None. Department represented by : Sanat Kumar Raha, CIT(DR) and S. B. Chakraborty, Sr. DR. Date of concluding the hearing : 16-June-2025 Date of pronouncing the order : 16-July-2025 ORDER PER RAKESH MISHRA, ACCOUNTANT MEMBER: This appeal filed by the assessee is against the order of the Commissioner of Income Tax (Appeals)-NFAC, Delhi [hereinafter referred to as Ld. 'CIT(A)'] passed u/s 250 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) for AY 2014-15 dated 24.02.2025, which has been passed against the assessment order u/s 147 r.w.s. 144B of the Act, dated 29.05.2023. None appeared on behalf of the Page | 2 I.T.A. No.: 668/KOL/2025 Assessment Year: 2014-15 Welkin Telecom Infra Pvt. Ltd. Page 2 of 10 assessee, therefore, the appeal was heard with the assistance of the Ld. DR. 2. The assessee is in appeal before the Tribunal raising the following grounds of appeal: “1. That on facts and in the circumstances of the case, the impugned notice issued u/s 148 of the Act dated 31-07-2022 is barred by limitation by virtue of the judgment of the Hon'ble Supreme Court in the case of UOI vs Rajeev Bansal reported in [2024] 167 taxmann.com 70 (SC) and hence the entire proceedings-initiated u/s 147 of the Act is void ab-initio and liable to be quashed in limine. 2. That on facts and in the circumstances of the case, the learned CIT(A), NFAC erred in dismissing the appeal of the assessee on the ground of non- prosecution of the appeal by the assessee when in fact the order dated 24- 02-2025 dismissing the appeal of the assessee was passed in haste ignoring the adjournment petition filed by the assessee on 11-02-2025 seeking adjournment of 14 days till 25-02-2025. 3. That on facts and in circumstances of the case, the jurisdictional learned AO erred in passing the order u/s 148A(d) of the Act without disposing of the objections raised by the assessee in response to the notice issued u/s 148A(b) of the Act. 4. That on facts and in circumstances of the case, National Faceless Assessment Unit erred in placing reliance on the statements taken of third parties during survey at the premises of GRD securities without affording an opportunity of cross examination of these parties by the assessee. 5. That on facts and in circumstances of the case, National Faceless Assessment Unit erred in disallowing the loss of Rs.59,58,100/- from trading in derivatives when contract notes were duly submitted evidencing the genuineness of the transactions 6. That on facts and in circumstances of the case, National Faceless Assessment Unit erred in adding arbitrary commission expenses of Rs.1,14,050/- when no such expense was actually incurred by the assessee. 7. That, the appellant craves leave to amend, alter, modify, substitute, add to, abridge and/or rescind any or all of the above grounds.” Page | 3 I.T.A. No.: 668/KOL/2025 Assessment Year: 2014-15 Welkin Telecom Infra Pvt. Ltd. Page 3 of 10 3. Brief facts of the case are that the assessee is a private limited company and the original return of income for AY 2014-15 was filed on 26.11.2014 showing total income of ₹4,94,33,170/-. The assessee filed a revised return of income on 16.04.2015 showing total income of ₹4,23,15,150/-. Thereafter the case was selected for scrutiny and the assessment was made u/s 143(3) of the Act at the total assessed income of ₹8,18,63,250/-. Subsequently, a notice u/s 148 of the Act was issued and thereafter, notice 148A(b) of the Act was also issued to the assessee post direction of the Hon'ble Apex Court in the case of Union of India v. Ashish Agarwal [2022] 138 taxmann.com 64 (SC). Aggrieved with the assessment order, the assessee filed an appeal before the Ld. CIT(A) who dismissed the appeal of the assessee holding as under: “5. FINDINGS & DECISION 5.1 The assessee is on appeal before this office against the order passed under section 147 r.w.s. 144B of the Income Tax Act. 5.2 The assessee was provided multiple opportunities by this office to submit documents and make submissions in response to the appeal filed, However, the assessee has not exercised this option despite multiple reminders. The table below indicates the dates and the compliance status of the various notices issued … … The conduct of the Appellant, as inferred from the aforesaid table, evidences that the Appellant is not interested in pursuing the Appeal. 5.3. The law aids those who are vigilant, not those who sleep upon their rights. This principle is embodied in the well-known Latin dictum, \"VIGILANTIBUS ET NON DORMIENTIBUS JURA SUB VENIUNT\". The conduct of the Appellant, as inferred from the aforesaid table, evidences that the Appellant fails on this principle of equity. Even the Hon'ble Courts, in various pronouncements, have frowned upon the Appellants who file appeals but thereafter do not take any further interest in persuading those appeals. Page | 4 I.T.A. No.: 668/KOL/2025 Assessment Year: 2014-15 Welkin Telecom Infra Pvt. Ltd. Page 4 of 10 5.3.1. The Hon'ble Income Tax Appellate Tribunal Kolkata in the case of Pradeep Kumar Jhawar Kolkata vs. DCIT-CCXXI (15 March, 2016) (ITA Nos. 450/Kol/2013 for Asstt. Year: 2006-07) dismissed the appeal of the Appellant for non-prosecution. 5.3.2. The Hon'ble Madhya Pradesh High Court in the case of Estate of Late Tukojirao Holkar vs. CWT (223 ITR 480) held as under: \"If the party, at whose instance the reference is made, fails to appear at the hearing, or fails in taking steps for preparation of the paper books so as to enable hearing of the reference, the court is not bound to answer the reference.\" 5.3.3. Similarly, the Hon'ble Punjab & Punjab & Haryana High Court in the case of New Diwan Oil Mills vs. CIT [(2008) 296 ITR 495) returned the reference unanswered since the assessee remained absent and there was no assistance from the assessee. 5.4 In view of the above, it is clear that the Appellant is not aggrieved with the assessment order impugned herein and is not interested in persuading the same. Accordingly, the additions/disallowances as challenged in the Grounds of Appeal and in the Appeal Memo are hereby confirmed. 5.5 Based on the above it appears that the assessee is not keen on pursuing the appeal. Accordingly, given that this office has not received any information or document so as to make a judgment based on merits, this office is left with no option but to dismiss this appeal. Accordingly, the appeal of the assessee stands dismissed. 6. Accordingly, the appeal of the Appellant is dismissed.” 4. Rival contentions were heard and the submissions made have been examined. The Ld. CIT(A) issued three notices for hearing but no compliance was made to any of the notices issued. However, the Bench noticed that since proper compliance could not be made both before the Ld. AO as well as the Ld. CIT(A), the addition made was confirmed. The assessee contends in the grounds of appeal that the notice u/s 148 of the Act dated 31.07.2022 is barred by limitation by virtue of the judgment of the Hon'ble Supreme Court in the case of UOI vs Rajeev Bansal reported in [2024] 167 taxmann.com 70 (SC) and hence, the entire proceedings initiated u/s 147 of the Act is void ab initio and liable Page | 5 I.T.A. No.: 668/KOL/2025 Assessment Year: 2014-15 Welkin Telecom Infra Pvt. Ltd. Page 5 of 10 to be quashed in limine and the Ld. CIT(A) erred in dismissing the appeal of the assessee on the ground of non-prosecution when the order dated 24.02.2025 dismissing the appeal of the assessee was passed in haste ignoring the adjournment petition filed by the assessee on 11.02.2025 seeking adjournment of 14 days till 25.02.2025. The Ld. AO erred in placing reliance on the statements of third parties taken during survey at the premises of GRD Securities without affording an opportunity of cross examination of these parties by the assessee. 5. We have considered the submission made. The assessee had submitted the request for adjournment on 11.02.2025 before the Ld. CIT(A) stating that the assessee was in the process of making submissions and collating documents relevant for the case. However, the Ld. CIT(A) by relying upon the notices issued and non-furnishing of details inferred that the assessee was not interested in pursuing the appeal and relying upon the decisions in the cases of Pradeep Kumar Jhawar (supra), Estate of Late Tukojirao Holkar (supra) and New Diwan Oil Mills (supra) held that the assessee is not aggrieved with the assessment order and is not interested in pursuing the same, therefore, the additions/disallowances made were confirmed. 6. The Ld. DR vehemently argued that the order of the Ld. CIT(A) may be upheld. 7. We have considered the facts of the case. The assessee had sought adjournment; however, the Ld. CIT(A) decided the appeal. On perusal of the appellate order it is noticed that while the Ld. CIT(A) has discussed non-compliance on the part of the assessee as the notices sent by e- mail were not complied with but he has not adjudicated the appeal on Page | 6 I.T.A. No.: 668/KOL/2025 Assessment Year: 2014-15 Welkin Telecom Infra Pvt. Ltd. Page 6 of 10 merit. In this respect, it is relevant to examine the provisions of section 250(6) which are reproduced as under: “250(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.” 8. Thus, section 250(6) of the Act casts a duty on the Ld. CIT(A) to pass an order in appeal which should state the points for determination and the decision as well as the reason for arriving at such decision. In the present case before us, the Ld. CIT(A) has not mentioned the reasons after examining the records while disposing of the appeal. The Ld. CIT(A) has neither adjudicated upon various grounds of appeal nor has passed a reasoned order for arriving at the decision, as is required u/s 250(6) of the Act. We further note that in Ajji Basha Vs. CIT (2019) 111 taxmann.com 348 (Madras) it has been held that a speaking order on merits with reasons and findings is to be passed by Commissioner (Appeals) on basis of ground raised in assessee's appeal; he cannot dispose the assessee's appeal merely by holding that Assessing Officer's order is a self-speaking order which requires no interference. The relevant extract from the order is as under: “6. … The first respondent is the appellate authority. Needless to state that the Appellate Authority is also a fact finding authority and therefore, he has to consider the order of assessment on the grounds raised in the appeal and thereafter, pass a speaking order on merits and in accordance with law by giving his own reasons and findings as to whether the order of assessment can be sustained or not. In other words, the order passed by the Appellate Authority should explicitly exhibit his application of mind to the facts and circumstances and the objections raised in the grounds of appeal, also by expressing his reasons and findings in support of his conclusion. 7. In this case, the Appellate Authority, after extracting the order of the Assessing Officer in full, has not given any other reason or finding to dismiss the appeal except by stating that he is of the considered view that the Assessing Officer's order is a self speaking order and does not call for any Page | 7 I.T.A. No.: 668/KOL/2025 Assessment Year: 2014-15 Welkin Telecom Infra Pvt. Ltd. Page 7 of 10 interference. In my considered view, such single line finding of the Appellate Authority, cannot be sustained as a proper exercise of the Appellate Authority, while disposing the appeal. Therefore, it is apparent that the order impugned in this writ petition is an outcome of total non-application of mind. Consequently, the impugned order cannot be sustained. It is further contended that before passing the order, the petitioner was not heard.” 9. It has also been held in the case of Commissioner of Income-tax (Central) Nagpur v. Premkumar Arjundas Luthra (HUF) [2016] 69 taxmann.com 407 (Bombay) that the law does not empower the CIT(A) to dismiss the appeal for non-prosecution as is evident from the provisions of the Act. The relevant extract is as under: “7. An appeal is filed with the CIT(A) from appealable orders listed in Section 246A of the Act. We find that the procedure in appeal before the CIT(A) and the powers of the CIT(A) are governed by Sections 250 and 251 of the Act respectively. The relevant provisions for consideration are as under:— 'Procedure in appeal 250 (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). … (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. … Powers of the Commissioner (Appeals) \"Section 251(1) In disposing of an appeal, the Commissioner (Appeals) shall have the following powers — (a) in an appeal against an order of assessment, he may 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.\" … Page | 8 I.T.A. No.: 668/KOL/2025 Assessment Year: 2014-15 Welkin Telecom Infra Pvt. Ltd. Page 8 of 10 (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 the appellant.' 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 co-terminus 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.” Page | 9 I.T.A. No.: 668/KOL/2025 Assessment Year: 2014-15 Welkin Telecom Infra Pvt. Ltd. Page 9 of 10 10. After examining the facts of the case, we deem it appropriate to set aside the order of the Ld. CIT(A) and remit the matter back to the Ld. CIT(A) for disposal of the grounds taken by the assessee on merit, by passing a speaking order. Needless to say, the assessee shall be given a reasonable opportunity of being heard to make any further submission it wants to make in support of its grounds of appeal and shall not seek unnecessary adjournments and rule 46A of the I.T. Rules, 1962 shall also be followed, if required. Accordingly, the grounds taken by the assessee in his appeal are allowed for statistical purposes. 11. In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced in the open Court on 16th July, 2025. Sd/- Sd/- [Duvvuru RL Reddy] [Rakesh Mishra] Vice President (KZ) Accountant Member Dated: 16.07.2025 Bidhan (Sr. P.S.) Page | 10 I.T.A. No.: 668/KOL/2025 Assessment Year: 2014-15 Welkin Telecom Infra Pvt. Ltd. Page 10 of 10 Copy of the order forwarded to: 1. Welkin Telecom Infra Pvt. Ltd., 76/1, Golaghata Road, Golaghata,, Kolkata, West Bengal, 700048. 2. ACIT, Circle-11(1), Kolkata. 3. CIT(A)-NFAC, Delhi. 4. CIT- 5. CIT(DR), Kolkata Benches, Kolkata. 6. Guard File. //True copy // By order Assistant Registrar ITAT, Kolkata Benches Kolkata "