The Pune Bench of the Income Tax Appellate Tribunal ( ITAT ) directed fresh adjudication because the Commissioner of Income Tax (Appeals) [CIT(A)] failed to provide a reasoned order under Section 250(6) of the Income Tax Act, 1961.
Kasi Viswanath Gupta Chalamcharla, the assessee, had not filed his return of income for the Assessment Year 2014-15. The Income Tax Department obtained information that he had sold an immovable property valued at Rs. 53 lakhs but had not disclosed this transaction.
The case was reopened under Section 147, and a notice under Section 148 was issued on 28.03.2018. The assessee failed to comply with multiple notices under Section 142(1), leading to an ex-parte assessment by the Assessing Officer (AO).
The AO determined the assessee’s total taxable income at Rs. 62,90,141. This included Rs. 53 lakhs as short-term capital gain under Section 50C since no cost of acquisition details were provided, Rs. 1,82,000 as unexplained cash deposits, Rs. 7,56,000 as salary income from Thakur Infraprojects Pvt. Ltd., and Rs. 52,141 as deemed profit from commodity exchange transactions amounting to Rs. 1,04,28,300.
Comprehensive Guide of Law and Procedure for Filing of Income Tax Appeals, Click Here
On appeal, the CIT(A) dismissed the case ex-parte due to the assessee’s non-appearance. The order did not adhere to Section 250(6) of the Income Tax Act, which mandates that an appellate order should include reasons for the decision.
Before the ITAT, the assessee argued that the dismissal violated the principles of natural justice. He argued that the CIT(A) had not examined the issues on merit and requested a fair opportunity to present his case.
The two-member bench comprising R.K. Panda ( Vice President ) and Astha Chandra ( Judicial Member ) reviewed the arguments and observed that the CIT(A)/NFAC had merely dismissed the appeal for non-appearance without analyzing the substantive issues.
Comprehensive Guide of Law and Procedure for Filing of Income Tax Appeals, Click Here
The tribunal directed the CIT(A) to grant the assessee a final opportunity to submit his case with supporting evidence and decide the matter by law. The tribunal also directed the assessee to ensure timely compliance, warning that failure to appear again would allow the CIT(A) to proceed as per the existing records. The appeal was allowed.
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