2024 (1) TMI 561 - SCH - Income Tax

Supreme Court Restores Dismissed Appeals, Emphasizes Right to Merits-Based Hearing for Tax Assessment Years 2001-2003.

The SC set aside the HC's dismissal of appeals for the Assessment Years 2001-2002 and 2002-2003, which were dismissed on procedural grounds without merit ... Disallowing the allowance of interest - appeals came to be dismissed by the High Court of Rajasthan without adjudication on merits - HELD THAT:- We are of the opinion that the High Court would have condoned the delay in filing the paper books As Appeal stood dismissed for non-compliance, the High Court was of the opinion that inconsistent orders cannot be passed and proceeded to dismiss appeal without examining the matter on merits. We are of the opinion that the Appellant is entitled to have his appeals heard on merits. Issues Involved:The judgment involves the dismissal of appeals by the High Court without adjudication on merits u/s 2001-2002 and 2002-2003 Assessment Years.For Assessment Year 2001-2002:The Assessing Officer disallowed the interest allowance in an order dated 10.03.2004. Appeals against this order were dismissed by the Commissioner of Income Tax on 18.09.2007 and by the Income Tax Appellate Authority on 20.06.2008. The High Court dismissed the appeal on procedural grounds without considering the merits, leading to subsequent dismissal of connected appeals.For Assessment Year 2002-2003:Similar to the previous year, the Assessing Officer disallowed the allowance in an order dated 16.02.2005. The Commissioner of Income Tax allowed the appeal on 28.12.2007, but the Income Tax Appellate Tribunal allowed the Revenue's appeal on 31.07.2008. The High Court dismissed the appeal without considering the merits due to non-compliance with filing requirements, resulting in a series of dismissals.Judgment Details:The Supreme Court set aside the High Court's orders and restored the appeals for proper adjudication on merits. The Court noted that the High Court had not considered the matters on merits and dismissed the appeals solely based on procedural grounds. The Court opined that the appellant was entitled to have the appeals heard on merits and thus condoned the delays in filing the necessary documents.Conclusion:The Supreme Court allowed the Civil Appeals, set aside the High Court's orders, and directed the High Court to hear and dispose of Appeal Nos. 816 and 817 of 2008 together after giving all parties an opportunity. Pending applications were disposed of with no order as to costs.