No Provision To Reject Appeal On Non-Appearance Of Assessee, Must Be Decided By Mandate U/S 250(6) Of Income Tax Act: Kerala High Court

The Bench of Justice Ziyad Rahman A.A. observed that “evidently, going by Subsection 6 of Section 250, no other meaning can be assigned to the words “points for determination” as it obviously leads to the question that arises for consideration based on the contentions raised in the appeal. Therefore, it was obligatory on the part of the appellate authority to refer to the points raised in the appeal, and to determine the same by supplying reasons for such determination.”

Section 250(6) of Income Tax Act, 1961 provides that the order of the Commissioner (Appeals) disposing of the appeal shall be in writing and shall state the points for determination, the decision thereon and the reason for the decision.

In this case, the assessee/petitioner was an employee ICICI Bank, who took voluntary retirement during the assessment year 2004-05. As part of the benefits of retirement scheme, he received a compensation of Rs.4,52,814/-.

The assessee submitted return of income for the said assessment year claiming the relief under Section 89(1) amounting to Rs.24,353/. Subsequently he submitted a rectification application, seeking exemption under Section 10(10C) on retirement compensation, which was turned down by the assessing officer.

Against the same, a revision petition was submitted by the assessee before the Principal Commissioner of Income Tax, which was rejected. Accordingly, the assessee submitted an appeal before the Commissioner of Income Tax (Appeals) which was dismissed.

The assessee submitted that the impugned order does not conform to the statutory requirements contemplated under the provisions of the Income Tax Act.

The department submitted with specific reference to the contents of impugned order that, what prompted the department to reject the appeal, was the nonappearance of the assessee despite repeated opportunities.

The bench observed that even though in impugned order, reasons are mentioned for rejecting the appeal, those reasons are in respect of the non-appearance of the assessee, for hearing on various dates.

On going through Section 250 of the Act, the bench observed that “the provision deals with the procedure in appeal and there is no provision for rejecting an appeal for non-appearance of the assessee. Therefore, in the absence of any such provision, irrespective of the question the assessee had appeared or not, the appellate authority has to take decision by strictly following the mandate contemplated under Section 250(6) of the Income Tax Act, 1961, which can only be a decision answering the points raised in the appeal. Therefore, the impugned order cannot be treated as an order passed in tune with the statutory requirements and therefore, it requires reconsideration.”

In view of the above, the bench allowed the petition and directed the department to reconsider the appeal, after giving a reasonable opportunity of being heard to the assessee.

Case Title: Anandan N. v. The Commissioner of Income Tax (Appeals)

Case Number: WP(C) NO. 11709 OF 2023

Counsel for Petitioner/ Assessee: Sanjana R. Nair

Counsel for Respondent/ Department: Jose Joseph

Citation: 2025 LiveLaw (Ker) 322

Click Here To Read/Downloading The Order