Income Tax Appellate Tribunal - Mumbai
Jayakar Shetty,Mumbai vs Income Tax Officer, Circle 41(1)(1), ... on 9 September, 2025
IN THE INCOME TAX APPELLATE TRIBUNAL
MUMBAI BENCH "F" MUMBAI
BEFORE SHRI OM PRAKASH KANT (ACCOUNTANT MEMBER)
AND
MS. SUCHITRA RAGHUNATH KAMBLE (JUDICIAL MEMBER)
ITA No. 3528/MUM/2025
Assessment Year: 2017-18
Jayakar Shetty, ITO Circle 41(1)(1),
3rd floor, Sai Krupa Chandvarkar Kautilya Bhavan,
Cross Road, Kandivali West, Vs. Mumbai-400051.
Mumbai-400067.
PAN NO. AANPS 8452 K
Appellant Respondent
Assessee by : None
Revenue by : Ms. Kavitha Kaushik, Sr. DR
Date of He aring : 09/09/2025
Date of pronouncement : 09/09/2025
ORDER
PER OM PRAKASH KANT, AM
This appeal by the assessee is preferred against order dated 19.03.2025 passed by the Ld. Commissioner of Income-tax (Appeals) - National Faceless Appeal Centre, Delhi [in short 'the Ld. CIT(A)'] for assessment year 2017-18, raising following ground:
The Hon' CIT (A) has erred in confirming the additions made by the Learned AO in his assessment Order u/s 143 (3) of the Act of Rs. 75,55,552/- u/s 68 of the Act.
Jaykar Shetty 2 ITA No. 3528/MUM/2025
2. At the very threshold, we find that the impugned order passed by the Learned Commissioner of Income Income-tax tax (Appeals) ['Ld. CIT(A)'] suffers from a fundamental infirmity inasmuch as the issue in dispute has not been adjudicated on merits. It is well settled under un Income tax Act, 1961 (hereinafter referred to as section 250 of the Income-tax quasi judicial authority, is 'the Act') that the Ld. CIT(A), being a quasi-judicial statutorily enjoined to dispose of an appeal by a reasoned order in a situation where dealing with the merits of the controversy, even in the assessee chooses to remain absent or fails to file the requisite appearance of the assessee cannot be a ground, submissions. Non-appearance in itself, to dismiss an appeal in limine, nor can it absolve the first appellate authority of his statutory statutory obligation to adjudicate the dispute on merits.
2.1 From the record, it emerges that the Ld. CIT(A), after recording compliance on the part of the assessee to repeated notices, the non-compliance has mainly referred to section 68 of the Act and certain judicial precedents relating to dismissal for non non-prosecution, prosecution, and thereafter dismissed the appeal. The relevant extract of the Ld. CIT(A)'s order is reproduced as under:
"8: NON-COMPLIANCE COMPLIANCE TO THE APPEAL NOTICES It is seen that the appellant has been offered sufficient opportunities before disposal of the appeal since the appeal was instituted as on 24.01.2020, but the appellant did not furnish any documentary evidences on the dates posted for hearing in support of his claim the appellant failed to substantiate his grounds of appeal with evidences.
Jaykar Shetty 3 ITA No. 3528/MUM/2025 responses to the following notices/letters as There are no responses under;
1. Hearing notice u/s 250 dated; 08.01.2021.
2. Hearing notice u/s 250 dated; 21.01.2021
3. Hearing notice u/s 250 dated; 27.09.2023
4. Hearing letter dated; 26.09.2024
5. Hearing letter dated; 07.03.2025 appeal filed, the assessee remains unresponsive. The Since the appeal issue of noncompliance noncompliance of appeal proceedings are squarely covered vide following decisions as under;
As there is no response to appeal notices, the appeal is liable to be . dismissed in terms of verdicts of the Hon'ble Apex Court and the various High Courts. The Hon'ble Apex Court, in the case of CIT v. B.N.Bhattacharjee and another (10 CTR
354) held that an appeal means an effective appeal;
"Expression "prefers an appeal" would mean effectively prosecuting an Appeal"
Purposefully interpreted, preferring an appeal means more than formally filing it but effectively pursuing it. If a party retreats before the contest begins, it is as good as not having entered the fray.
The Hon'ble MP High Court in Estate of Late Lat TukojiRaoHolkar v. CIT, 223 ITR 48(MP) has held that if a party, at whose instance the reference is made, fails to appear at the hearing, or fails in taking steps for preparation of paper books so as to enable hearing of the reference, the court is not bound ound to answer the Similar view has also been taken in the case of CIT v. Multiplan (India) Pvt. Ltd., 38 1TD 320 (Del).Following the ratio of Multiplan (India) Ltd (supra), the Chennai Tribunal has also dismissed appeal for non-
non prosecution in the case of M/S Helios and Matheson Information Technology Ltd v ITO in ITA No. 134/Mds/2011 dated 5.7.2011 for A.Y.2006A.Y.2006-07.
07. It is pertinent to add here that the laws assist those who are vigilant and not those who sleep over their rights. This principle is embodied in the well-known well known maxim "Vigilantibus non dormientibusjurasubveniunt". It means equity comes to the aid of the vigilant and not the slumbering. In all actions, suits and other proceedings at law and in equity, the diligence and careful favoured to the prejudicial of him who is careless. plaintiff is favoured Jaykar Shetty 4 ITA No. 3528/MUM/2025 In case of: Sanjay ChandrakantGaonkarVs ITO (ITAT Mumbai) Appeal Number: ITA No. 364/MUM/2022 Date of Judgement/Order: 17/07/2023 (ITAT Mumbai) Held as under;
"5. We find that the Ld. CIT(A) has issued as much a as four notices and thereafter issues final opportunity but no effective compliance was made on the part of the assessee. Further on 28.02.2017 the Ld. Authorised Representative of the assessee filed reply, which was forwarded by the Ld. CIT(A) to the Assessing sing Officer calling for remand report. Consequently, the Assessing Officer called for the assessee for verification of the documents, but again no compliance was made on the part of the assessee and this fact was reported by the Assessing Ld. CIT(A). Once again, the assessee filed part Officer to the Ld. detail on 10.03.2017, which was forwarded to the Assessing Officer for verification but again no compliance was made by the assessee before the Assessing Officer. In view of the above facts and circumstance, iitt is evident the assessee has not cooperated before the lower authorities for verification of the its own documents and claims. Before us the Ld. Counsel of the assesses requested for restoring the matter back to the file of the Ld. CIT(A). In the interest of the substantial justice, we feel it appropriate to restore the issue back to the Ld. CIT(A), however looking to the non-compliant non compliant conduct of the assessee and total disregard of the proceedings before the Ld. CIT(A), impose cost of Rs. 20,000/-.
20,000/ The assesseeessee is directed to deposit the same into Prime Minister Relief Fund within seven days of receipt of this order.
Further, ITAT Mumbai in case of Jerry John Mendonca In ITA No/1197/Mum/2023 order held under;
"Jerry John MendoncaVs ITO (ITAT Mumbai) Introduction:
Introdu The Income Tax Appellate Tribunal (ITAT) Mumbai recently heard an appeal filed by Jerry John Mendonca against the order of the Ld. Commissioner of Income Income-tax tax (Appeals) for the assessment year 2011-12.12. The appeal raised grounds regarding non- non compliancece with income tax proceedings before lower authorities. Analysis: The ITAT considered the reasons cited by the assessee for the delay in filing the appeal and condoned the delay of 208 days. However, the ITAT observed that the assessee had failed to compl complyy with income tax proceedings before the Assessing Officer (AO) and the Ld. CIT(A). Despite various notices and opportunities, the assessee did not respond or participate in the proceedings. The ITAT noted that the appeal had been dismissed by the Ld. CIT(A) CIT(A) due to the lack of Jaykar Shetty 5 ITA No. 3528/MUM/2025 non participation by the assessee. However, compliance and non-participation the ITAT found it appropriate to impose a cost of Rs. 5,000 on the assessee for its non-compliant non compliant behaviour. The ITAT directed the assessee to deposit the cost into the Prime Minister Relief Fund within 30 days of the receipt of the order".
Further in landmark decision in the case of CIT Vs Shree Nirman Foundation Charitable Trust (Gujarat High Court) R/Tax Appeal No. 1335 of 2018 Date of Judgement/Order:
30/07/2019 while deciding ing the issue under consideration if Assessee remained absent on more than one occasions and appeal decided on merits then whether it will be called as Ex- Ex parte order. The Hon'ble High Court states that if an order is passed by the CIT (A) on merits despit despitee the fact that the assessee failed to appear before the CIT (A) at the time of the final hearing of the appeal, the order passed by the CIT(A) ex prate. An order having been passed by cannot be termed as ex-prate.
assessee, there is no the CIT (A) after service of notices on the assessee, question of failure of natural justice. It cannot be said that the assessee was not given an opportunity of hearing. The order of the CIT (A) is more than clear. On more than one occasion, the assessee remained absent before the CIT (A), and in such circumstances, the CIT had no option but to look into the records and decide the appeal on its own merit.
In view of the above the primary onus of complying to the notices and furnishing the evidence/documentary evidence are with that of the appellant. In view of the above non- compliance the appeal is dismissed.
8.1 To sum up appeal is dismissed on all grounds on merits as well as on non noncompliance accordingly."
2.2 While there can be no quarrel with the principle that the assessee is duty bound to diligently prosecute his appeal, it is equally trite that the dismissal of an appeal for default simpliciter is not contemplated by the statute. What is required is a disposal on merits, based upon the material available on record.
2.3 In the present ent case, what weighs with us is that the assessee has indeed remained unresponsive on multiple occasions, thereby Jaykar Shetty 6 ITA No. 3528/MUM/2025 displaying negligence in the conduct of the appellate proceedings. Nonetheless, the interest of substantial justice would be better served if one more opportunity is afforded to the assessee to present its case before the Ld. CIT(A), subject to the condition that the assessee diligently cooperates in the proceedings hereafter. At the same time, it is made clear that the assessee cannot be permitted permi to take the process of law for granted, and any further failure on its part shall entitle the Ld. CIT(A) to decide the appeal strictly on merits, on the basis of material available on record, in accordance with law.
discussion, we set aside the impugned
3.. In view of the foregoing discussion, order of the Ld. CIT(A) and restore the matter to his file for fresh adjudication on merits, after affording due opportunity to the assessee. The assessee is directed to cooperate in the proceedings without fail. The Ld. CIT( A), in turn, shall pass a reasoned and CIT(A), speaking order in accordance with law. The ground of appeal of the assessee is accordingly allowed for statistical purposes.
3. In the result, the appeal of the assessee is allowed for statistical purposes.
Order pronounced onounced in the open Court.
Sd/
Sd/- Sd/-
Sd/
(SUCHITRA RAGHUNATH KAMBLE
KAMBLE) OM PRAKASH KANT)
(OM KANT
JUDICIAL MEMBER ACCOUNTANT MEMBER
Jaykar Shetty 7
ITA No. 3528/MUM/2025
Mumbai;
Dated: 09/09/2025
Rahul Sharma, Sr. P.S.
Copy of the Order forwarded to :
1. The Appellant
2. The Respondent.
3. CIT
4. DR, ITAT, Mumbai
5. Guard file.
BY ORDER,
//True Copy//
(Assistant Registrar)
ITAT, Mumbai