Facts of the Case

The assessee, Viral Malaybhai Bhow, an individual, filed an appeal against the ex parte appellate order dated 27.08.2025 passed by the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, arising out of reassessment proceedings completed under Section 147 read with Section 144B for Assessment Year 2018-19. The reassessment resulted in additions of ₹38,25,661 and ₹50,00,000. During appellate proceedings, the assessee had sought adjournments on earlier hearing dates but could not appear on the final hearing fixed on 08.08.2025. The CIT(A), however, dismissed the appeal ex parte stating that no adjournment had been sought and without adjudicating the legal grounds challenging the validity of reopening or the additions on merits.

Issues Involved

Whether the CIT(A) was justified in dismissing the appeal ex parte without adjudicating the grounds on merits, whether failure to decide the jurisdictional challenge to reassessment under Section 147 violated Section 250(6), and whether the matter required restoration for fresh adjudication in accordance with principles of natural justice.

Petitioner’s Arguments

The assessee contended that the CIT(A) passed the order on an incorrect factual premise that no adjournments were sought during appellate proceedings, whereas adjournment requests had been made for earlier hearings. It was submitted that the CIT(A) failed to adjudicate both the legal grounds challenging the validity of reopening under Section 147 and the substantive grounds relating to additions of ₹38,25,661 and ₹50,00,000, despite detailed statements of facts and supporting documents being available on the portal. The assessee requested one final opportunity of hearing.

Respondent’s Arguments

The Revenue, represented by the Senior Departmental Representative, fairly stated that it had no serious objection if the matter was set aside and restored to the file of the CIT(A) for adjudication on merits after granting opportunity to the assessee.

Court Order / Findings

The ITAT Ahmedabad observed that the CIT(A) dismissed the appeal ex parte without deciding the grounds on merits and without adjudicating the jurisdictional challenge to reassessment under Section 147. The Tribunal held that such an approach is contrary to the mandate of Section 250(6), which requires the appellate authority to pass a reasoned and speaking order dealing with each ground of appeal. Considering the submissions of both sides, the Tribunal set aside the ex parte appellate order and restored the matter to the file of the CIT(A) with a direction to adjudicate all grounds, including the validity of reopening and additions on merits, after granting one more opportunity of hearing to the assessee. The Tribunal cautioned that the assessee must cooperate and avoid seeking unnecessary adjournments.

Important Clarification

The Tribunal clarified that dismissal of an appeal for non-prosecution without adjudicating jurisdictional and substantive grounds is impermissible in law. Appellate authorities must decide appeals on merits and comply with the statutory requirement of passing reasoned orders under Section 250(6), especially in cases involving reassessment proceedings.

Final Outcome

The appeal filed by the assessee was allowed for statistical purposes. The ex parte order passed by the CIT(A), NFAC was set aside and the matter was restored to the file of the CIT(A) for fresh adjudication on merits in accordance with law after granting adequate opportunity of being heard to the assessee.

Link to download order https://www.mytaxexpert.co.in/uploads/1769064244_VIRALMALAYBHAIBHOWAHMEDABADVS.THEITOWARD721AHMEDABAD.pdf

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