S. 254(1) : Appellate Tribunal-Powers-Tribunal remanding matter with cost-Cost of ₹50,000 imposed on small trader held to be harsh and unjustified – Order of Tribunal set aside. [S. 250(6), 254(2B), 260A]
The assessee, a small trader of glass articles, filed appeal against the order of the ITAT, Kolkata `SMC’ Bench, for AY 2017–18. The ITAT had remanded the matter to the AO for fresh assessment but imposed a cost of ₹50,000 payable to Legal Aid Services, citing repeated non-compliance of notices. On appeal the assessee explained that due to ill health, poor knowledge of online compliances, and complete reliance on a consultant who failed to appear, he could not attend proceedings before the AO and CIT(A). The High Court observed that the CIT(A)’s order suffered from violation of S. 250(6) as it did not deal with grounds raised by the assessee. The ITAT itself had accepted that the matter required a fresh assessment. In such circumstances, imposing heavy cost on an individual small trader would be harsh and unjustified. The Court accordingly set aside the cost, while remanding the matter to the AO with direction to issue fresh notice and complete assessment after giving full opportunity to the assessee, who undertook to cooperate in the proceedings. Substantial questions of law were left open. Court held that when Tribunal itself finds that matter needs to be remanded, imposing hefty cost on small assessee for restoration is unjustified.( AY. 2017 -18 ) (ITAT/170/2025, GA/1/2025, dt. 09/09/2025 )
Abdul Mannan v. ITO (Cal)(HC) www.itatonline.org.
Editorial : Order of Tribunal in Abdul Mannan v. ITO, ITA No. 738/Kol/2025 dt. 15-7-2025 (SMC) (AY. 2017-18), levying cost of Rs .50,000/ was set aside.
[Coaram : Chief Justice T. S. Sivagnanam and Hon’ble Justice Chaitali Chatterjee (Das)]