Facts of the
Case
The assessee, Sudisa Foundry Private Limited,
filed appeals before the ITAT against the orders passed by the CIT(A),
Patna-3, Patna, dated 28 April 2023, for Assessment Years 2014-15,
2015-16 and 2016-17. The CIT(A) had dismissed the appeals filed by the
assessee after granting only a single opportunity of hearing.
It was submitted before the Tribunal that the
appeals were fixed for hearing on 26 April 2023, but the assessee could
not appear on that date due to unavoidable reasons. Consequently, the appeals
were dismissed ex parte, without adjudication on merits. The assessee
approached the Tribunal seeking restoration of the appeals.
Issues Involved
Whether dismissal of appeals by the CIT(A) after
granting only one opportunity of hearing is in accordance with principles of
natural justice, and whether the appeals deserve to be restored for fresh
adjudication.
Petitioner’s
(Assessee’s) Arguments
The assessee contended that the CIT(A) granted only
one opportunity of hearing and dismissed the appeals for non-appearance, which
caused serious prejudice. It was argued that such dismissal violated the
principles of natural justice, as the assessee was denied reasonable
opportunity to present its case.
The assessee undertook before the Tribunal that it
would fully cooperate in the appellate proceedings if the matters were restored
and agreed to bear costs as directed by the Tribunal.
Respondent’s
(Revenue’s) Arguments
The Revenue, represented by the Senior Departmental
Representative, did not raise any serious objection to the request of the
assessee for restoration of the appeals and left the matter to the discretion
of the Tribunal.
Court Order
/ Findings
The ITAT Ranchi Bench examined the submissions and
records. The Tribunal noted that the CIT(A) had granted only one opportunity
of hearing before dismissing the appeals. The Tribunal observed that denial
of adequate opportunity of being heard is contrary to the fundamental
principles of natural justice.
In the interest of justice, the Tribunal held that
the issues involved in the appeals should be restored to the file of the CIT(A)
for fresh adjudication after granting adequate opportunity of hearing to
the assessee. The Tribunal directed that restoration would be subject to the
assessee depositing a cost of ₹5,000 per appeal with the Jharkhand
Income Tax Bar Association, payable within 60 days from the date of
issue of the order.
Important
Clarification
The Tribunal clarified that appellate
proceedings should not be disposed of ex parte without granting reasonable and
effective opportunity of hearing, and that even in cases of default,
adjudication on merits should ordinarily be preferred over dismissal for
non-prosecution.
Final
Outcome
The ITAT Ranchi Bench partly allowed the appeals
for statistical purposes, set aside the ex parte orders passed by the
CIT(A), and restored the matters to the file of the CIT(A) for fresh
adjudication, subject to payment of ₹5,000 per appeal as cost.
The appeals for Assessment Years 2014-15 to
2016-17 were disposed of by a common order dated 05 January 2026.
Link to download the order
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