Mrs. Jaspali Chauhan vs The DCIT

PER RAMIT KOCHAR, AM:

This appeal in ITA No. 8206/Del/2025 for Assessment Year: 2020-21 has arisen from the learned CIT(A)’s appellate order u/s 250 dated 19.11.2025 in DIN & Order No: ITBA/NFAC/S/250/2025-26/1082772602(1), which in turn has arisen from the penalty order dated 24.07.2025 passed by the AO u/s 270A of the Income Tax Act, 1961 (hereinafter called “the Act”), for Assessment Year 2020-21 in DIN ITBA/PNL/F/270A/ 2025-26/1078876632(1).

Brief facts of the case are that the penalty u/s 270A of the 1961 Act was imposed by the AO against the assessee to the tune of Rs. 3,24,512/-. The assessee filed first appeal with ld. CIT(A) , who dismissed the appeal of the assessee ex-parte , and upheld the penalty imposed by the AO. The ld. CIT(A) issued as many as 4 notices to the assessee, but there was no compliance by the assessee to aforesaid notices.

Still Aggrieved , the assessee has filed second appeal with the Tribunal. At the outset, the Ld. Counsel for the assessee submitted that the Ld. CIT(A) has passed an ex-parte appellate order without discussing the issues in hands on merits.It was submitted that notices issued by ld. CIT(A) were not seen by the assessee, as the same were received in spam/junk email box. It was submitted that moreover husband of the assessee Shri Virender Singh Ruhella also underwent Cardiac bye pass surgery at BLK Max Hospital and was discharged on 15.10.2025. The Hospital documents are filed and placed on record in file. It was submitted that ld. CIT(A) passed order on 19.11.2025. The husband of the assessee was unwell , and this was the main reasons for non filing of submissions before ld. CIT(A). It was submitted that the assessee has good case on merits as well on legal grounds , and no penalty u/s 270A is leviable . It was prayed that if one more opportunity is provided, the assessee will comply with the notices and submit necessary replies/response.

We have considered rival contentions and perused the material on record. We have observed that the AO has imposed penalty of Rs.3,24,512/- u/s 270A of the 1961 Act. The assessee did not participated in the first appellate proceedings before ld. CIT(A). The assessee has submitted that notices were received in spam/junk email folders which the assessee could not see , as well the husband of the assessee was not well and underwent Cardiac Surgery , which was the main reasons for non compliance of the notices issued by ld. CIT(A) . The ld. CIT(A) dismissed the appeal of the assessee ex-parte in limine without deciding the issues arising in the appeal on merits. The ld. CIT(A) issued as many four notices as stated in appellate order but there was no compliance by the assessee. The ld. CIT(A) simply dismissed the appeal of the assessee ex-parte by affirming the penalty order passed by the AO , without deciding the issues arising in the appeal on merits, mainly on account of non compliance by the assessee to the four notices issued by ld. CIT(A). We have observed that the ld. CIT(Appeals) has not decided the appeal on merits, and the appeal of the assessee was dismissed ex-parte in limine without deciding the issues arising in the first appeal on merit, by simply upholding the penalty order u/s 270A, mainly on the grounds of non-compliance by the assessee to the notices issued by ld. CIT(A). The appellate order passed by ld. CIT(A) is a non speaking order passed ex-parte in limine without deciding the issue arising in the appeal on merits. The ld. CIT(A) is required and obligated to pass appellate order in compliance with the provisions of section 250(6), as ld. CIT(A) is required to pass reasoned and speaking order on merits in accordance with law. Reference is drawn to provisions of Section 250(6), wherein ld. CIT(A) has to state point for determination, his decision and reasons thereof. The ld. CIT(A) even did not made any enquiry, and not even assessment/penalty records were called for by ld. CIT(A). The appellate order passed by ld. CIT(A) is subject to further appeal with ITAT u/s 253. The appellate order passed by ITAT is subject to further appeal before Hon’ble High Court u/s 260A. The judgment and order passed by Hon’ble High Court is also subject to challenge before Hon’ble Supreme Court. Thus, the appellate order passed by ld. CIT(A) is not a final order, as it is subject to challenge before higher appellate authority. Thus, Reasons which weighed in the minds of the adjudicating authority while adjudicating appeal on merits of the issues are cardinal as the higher appellate authority can then adjudicate appeal on the issues arising in appeal before them, based on decision and reasoning of ld. CIT(A) in deciding the issues. If the ld. CIT(A) simply dismiss the appeal merely because the assessee did not comply with the notices issued by ld. CIT(A) in limine without adjudicating issues arising in the appeal on merits , such order is not sustainable in the eyes of law keeping in view provisions of Section 250(6) , and also higher appellate authorities will be deprived to see what weighed in the mind of the ld. CIT(A) while adjudicating appeal as it will be an order passed without reasoning on the issues on merits . The appellate order of the CIT(A) is clearly in violation of section 250(6) of the Act and liable to be set aside. Merely stating the penalty order passed by AO is upheld, and that the assessee has not submitted details/documents/evidences before ld. CIT(A) is not sufficient. The ld. CIT(A) is not toothless as his powers are co-terminus with the powers of the AO, which even includes power of enhancement. It is equally true that the assessee also did not complied with the notices issued by ld. CIT(A) and did not file the requisite details/documents to support his contentions. Thus, the assessee is equally responsible for its woes as the assessee did not comply with the notices issued by the AO as well ld. CIT(A). The ld. Counsel for the assessee has made statement before the Bench that if one more opportunity is provided, the assessee will come forward and submit all the details. It is stated that due to illhealth of the husband of the assessee as well the notices were received in spam/junk folder and were not seen by the appellant, , the assessee could not file the details/replies earlier before the ld. CIT(A) . Keeping in view the entire factual matrix as culled out above in the preceding para’s of this order, it will be fair to both the parties as well in the interest of justice, that the appellate order of ld. CIT(Appeals) be set aside and the matter be remanded back to the file of ld. CIT(Appeals) for fresh adjudication after giving proper opportunity of being heard to both the parties w.r.t. the issues arising in the appeal .The assessee is directed to comply with the notice issued by ld. CIT(Appeals) during the appellate proceedings in set aside remand proceedings, otherwise ld. CIT(A) shall be free to decide the appeal ex-parte on merits in accordance with law, after complying with provisions of Section 250(6). We clarify that we have not commented on merits of the issues. Thus, the appellate order passed by ld. CIT(A) is set aside and matter is restored back to the file of ld. CIT(A) for fresh adjudication. The appeal of the assessee is allowed for statistical purposes. We order accordingly.

In the result, the appeal filed by the assessee is allowed for statistical purposes.