This article discusses ITA No. 1898/DEL/2020, involving Anamika Dwivedi, New Delhi, and the Income Tax Officer (ITO), Ward 35(2), New Delhi. The case pertains to the Assessment Year (AY) 2012-13 and was filed on November 24, 2020, with the final order pronounced on August 16, 2022. The main issue in this case revolves around the penalty order passed under Section 271(1)(c) of the Income Tax Act.
Anamika Dwivedi, the appellant, contested the penalty order passed by ITO Ward 35(2), New Delhi. The penalty was imposed for AY 2012-13, and the appellant challenged the order under Section 250 of the Income Tax Act. The case was initially dismissed by the Commissioner of Income Tax (Appeals) [CIT(A)] – 12, New Delhi, without addressing the merits due to the non-appearance of the assessee.
The assessee’s main contention was that the CIT(A) dismissed the appeal summarily without considering the merits of the case. The CIT(A) relied on judgments from the Punjab & Haryana High Court in Shahbad Cooperative Sugar Mills Ltd., 38 taxmann.com 204 (P&H), and the Supreme Court in CIT vs. B.N. Bhattacharya (1977) 118 ITR 461 (SC), to justify the dismissal.
The Senior Departmental Representative (DR), Shri Kanv Bali, argued that the CIT(A)’s decision was correct and there was no error in the findings. However, it was noted that the CIT(A) did not provide an adjudication on the merits of the case.
The Income Tax Appellate Tribunal (ITAT) reviewed the case, led by Shri N.K. Billaiya, Accountant Member, and Shri Anubhav Sharma, Judicial Member. The tribunal emphasized the statutory obligation of the CIT(A) to dispose of an appeal on merits, regardless of the appellant’s appearance.
The tribunal referred to the Mumbai Tribunal order dated July 19, 2022, in the case of Marvel Industries Ltd. vs. DCIT, Circle 2(2)(2), where it was held:
“Whether an appellant appears before the CIT(A) or not, it is the statutory obligation of the CIT(A) to dispose of an appeal on merits. The scheme of section 250 does not visualize any situation in which an appeal can be summarily dismissed disregarding the material on record. Section 250(6) lays down that the CIT(A)’s order ‘disposing of the appeal shall be in writing and shall state the points for determination, the decision thereon and the reason for the decision’. As for the points of determination, in our considered view, it cannot be open to the learned CIT(A) to disregard what the assessee has placed before him by way of a statement of facts and the grounds of appeal.”
In light of this precedent, the ITAT remitted the matter back to the CIT(A) for a fresh adjudication on merits, providing the assessee with a fair and reasonable opportunity of being heard. The appeal was allowed for statistical purposes.
The ITAT’s decision underscores the importance of addressing the merits of a case, regardless of the appellant’s appearance, ensuring a fair and just process. This case highlights the necessity for appellate authorities to adhere to statutory obligations and provide reasoned decisions based on the material on record.
The final order, pronounced on August 16, 2022, reads:
In the light of aforesaid, the matter is remitted to the file of Ld. CIT(A) with direction to provide the assessee a fair and reasonable opportunity of hearing and thereafter decide the issue on merits. The appeal is allowed for statistical purposes.
Signed by:
(N.K. BILLAIYA) Accountant Member
(ANUBHAV SHARMA) Judicial Member
Dated: 16th August, 2022
This judgment reinforces the principle that appeals must be decided on their merits, ensuring transparency and fairness in tax administration.
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