In High Court of Judicature at Madras Dated : 19.8.2019 Coram : Honourable Mr.Justice T.S.SIVAGNANAM and Honourable Mrs.Justice V.BHAVANI SUBBAROYAN Tax Case Appeal Nos.607 & 608 of 2019 & CMP.No.17652 of 2019 Government Telecommunication Employees Cooperative Society Ltd., Chennai-1 ...Appellant Vs Income Tax Officer, Non Corporate Ward 12(3), Chennai-34. ...Respondent APPEALS under Section 260-A of Income Tax Act, 1961, against common order of Income Tax Appellate Tribunal Chennai 'A' Bench, Chennai dated 15.3.2017 in I.T.A.Nos.2898 and 2899/Mds/2016 respectively for assessment years 2012-13 and 2013-14. For Appellant : Mr. A.S.Sriraman For Respondent: Mrs.V.Pushpa, SC COMMON JUDGMENT (Judgment was delivered by T.S.Sivagnanam,J) These appeals, filed by assessee under Section 260-A of Income Tax Act, 1961 (hereinafter referred to as 'the Act') are directed 1/9 TCA.Nos.607 & 608 of 2019 against common order dated 15.3.2017 in I.T.A.Nos.2898 and 2899/ Mds/2016 respectively for assessment years 2012-13 and 2013-14. 2. assessee filed these appeals on following substantial questions of law: i. Whether, under facts and circumstances of case, Income Tax Appellate Tribunal was justified in dismissing appeal in limine without going into merits of case ? And ii. Whether Income Tax Appellate Tribunal was justified in exercising power given under Section 254 of Income Tax Act, 1961 in dismissing appeal in limine without appreciating scope of aforesaid provisions that same should be disposed of on merits ? 3. We have heard Mr.A.S.Sriraman, learned counsel for appellant and Mrs.V.Pushpa, learned Standing Counsel accepting notice for respondent - Revenue. 4. Tribunal, by impugned common order dated 15.3.2017, dismissed appeals filed by assessee on ground that none appeared on behalf of assessee when matters were called on that day. In doing so, Tribunal relied upon decision of Delhi Bench in 2/9 http://www.judis.nic.in TCA.Nos.607 & 608 of 2019 case of CIT Vs. Multiplan India P. Ltd. [reported in 38 ITD 320] and decision of High Court of Madhya Pradesh in case of late Tukojirao Holker Vs. Wealth Tax Commissioner [reported in 223 ITR 480]. 5. Thereafter, assessee filed two miscellaneous petitions for restoring appeals and in said petitions, assessee stated that assessee's authorized representative was seated in wrong Bench and consequently, when cases were called, none appeared for appellant assessee. Though such plea was raised by assessee by filing miscellaneous petitions, Tribunal dismissed same by common order dated 21.12.2018 on ground that they were time barred i.e. they were filed beyond period of six months from end of month, on which, common order was passed by Tribunal. 6. correctness of decision of Tribunal in dismissing appeals for non prosecution is no longer res integra and has been decided in several cases by this Court following decision of Hon'ble Supreme Court in case of CIT Vs. S.Chenniappa Mudaliar [reported in (1969) 74 ITR 41]. We had occasion to consider same issue in decision in case of M/s.3M Electro and Communication India Pvt. Ltd. Vs. 3/9 http://www.judis.nic.in TCA.Nos.607 & 608 of 2019 JCIT, Pondicherry [TCA.Nos.353 of 2019 dated 02.7.2019] wherein we have held in paragraph 6 as follows : Therefore, we are not convinced with reason given by assessee stating that they were not aware of order passed by Tribunal. Be that as it may, we find that Tribunal has rejected and dismissed appeal for want of prosecution. This could not have been done in light of various decisions on point, earliest of which was decision of Hon'ble Supreme Court in CIT Vs. S.Chenniappa Mudaliar reported in AIR 1969 SC 1068 which was followed in N.S.Mohan Vs. Income-tax Appellate Tribunal, Chennai reported in [2018] 94 taxmann.com 92 (Madras). Therefore, we are not to necessarily interfere with order passed by Tribunal dismissing matter for want of prosecution. As observed by us earlier, assessee was not diligent in prosecuting matter and reasons assigned by assessee that they were not aware of order passed by Tribunal is not convincing. Nevertheless, respondent Department would be entitled to tax assessee only for amount for which they are liable to be taxed and by default excess tax cannot be recovered, which would be action without authority of law. Therefore, we deem it appropriate to give one more opportunity to 4/9 http://www.judis.nic.in TCA.Nos.607 & 608 of 2019 assessee to file reconciliation statement and for which purpose we send back matter to Assessing Officer subject to certain conditions. In finally, we were of opinion that assessee can be put on terms by directing them to deposit certain sum of money with Assessing Officer for being entitled to opportunity to go before Assessing Officer and place reconciliation statement. However, Mr.S.P.Chidambaram, learned counsel for appellant, on instructions, from his client, submitted that virtually entire amount of tax has been recovered from assessee, partly remitted by assessee and partly adjusted from refund, which was ordered. In light of said submission, we do not impose any condition for deposit of any sum of money. 7. other decisions are (i) by Hon'ble First Bench of this Court in case of N.S.Mohan Vs. ITAT, Chennai [reported in (2018) 94 taxmann.com 92 (Madras)]; (ii) by Division Bench of this Court in case of Smt. Ritha Sabapathy Vs. DCIT [TCA. No.169 of 2019 dated 19.2.2019]; and (iii) by Division Bench of Gujarat High Court in case of Sanket Estate & Finance (P) Ltd. Vs. CIT [reported in (2013) 32 Taxmann. 5/9 http://www.judis.nic.in TCA.Nos.607 & 608 of 2019 Com 342] wherein of decision in case of Multiplan India (P) Ltd., was taken note of and it was held that reliance on decision of Tribunal in case of Multiplan India (P) Ltd., was erroneous, operative portions of which read as follows : '24. When Supreme Court decided case of S.Chenniappa Mudaliar (supra), no amendment in rule in Income Tax Appellate Tribunal Rules was made as yet. Rule 24 of Income Tax Rules, 1963 makes it abundantly clear that Tribunal cannot dismiss appeal without adverting to merits. Even on day, on which, hearing is adjourned, appellant chose not to appear in person or through authorized representative. It is incumbent upon Tribunal to dispose of appeal on merits after hearing respondent and afterwards if appellant appears and satisfies Tribunal, sufficient cause for its non appearance on date of hearing, Tribunal can set aside ex parte order and restore appeal. However, reliance of Tribunal on decision of Delhi Bench in case of Multiplan India (P) Ltd. (supra) is erroneous and therefore, requires to be set aside. In instant case, it can be noted from letters addressed by present appellant to Tribunal that it was awaiting transfer of both appeals of 6/9 http://www.judis.nic.in TCA.Nos.607 & 608 of 2019 1998-99 and 1999-2000 since CIT (Appeals) had relied upon such orders of earlier years. 25. If record of these appeals were necessary for proceedings with appeals, which were pending of year 2001-02, 2002-03, in instant case, it was matter of transfer from Mumbai Bench to Ahmedabad Bench of these appeals and present appellant has made out sufficient cause indicating from material placed on record that it had never abandoned cause. On contrary, it had consistently pursued matters as it was having direct bearing on appeals of subsequent years. Even otherwise, what is requirement of law is of adjudication on merit even when either side or both sides choose not to contest. In view of aforesaid, we are of considered view that Tribunal erred in dismissing appeal only on ground of non prosecution without adverting to merits of matter and therefore, we set aside order impugned dated 04.8.2006 passed by Tribunal and also remand matter to Tribunal to adjudicate same on merits. Appeal is allowed accordingly.' 8. Yet another decision on same point is decision of Division Bench of Rajasthan High Court in case of Tribhuvan Kumar Vs. CIT 7/9 http://www.judis.nic.in TCA.Nos.607 & 608 of 2019 [reported in (2007) 294 ITR 401], in which, substantial question of law itself as to whether decision of Delhi Bench of Tribunal in case of Multiplan India (P) Ltd., could have been applied to facts of that case was decided in favour of assessee. In light of above, order impugned in this appeal has to be necessarily set aside and substantial questions of law are to be answered in favour of assessee. 9. In result, above tax case appeals are allowed, impugned common order dated 15.3.2017 and also common order 21.12.2018 are set aside and appeals in I.T.A.Nos.2898 and 2899/Mds/2016 are restored to file of Tribunal for decision on merits. substantial questions of law are answered in favour of assessee. No costs. Consequently, connected CMP is closed. 19.8.2019 Internet : Yes To 1.The Income Tax Appellate Tribunal, Chennai 'A' Bench. 2.The Income Tax Officer, Non Corporate Ward 12(3), Chennai-34. RS 8/9 http://www.judis.nic.in TCA.Nos.607 & 608 of 2019 T.S.SIVAGNANAM,J AND V.BHAVANI SUBBAROYAN, J RS TCA.Nos.607 & 608 of 2019 and CMP.No.17652 of 2019 19.8.2019 9/9 Government Telecommunication Employees Cooperative Society Ltd. v. Income-tax Officer, Non Corporate Ward-12(3), Chennai