ITO Vs Dolphin Educational Foundation (ITAT Chennai)
CIT(A)’s Power to Set Aside Ex-Parte Assessment Affirmed: ITAT Chennai Upholds Remand in Charitable Trust Case
The Chennai Bench of the ITAT dismissed the Revenue’s appeal for AY 2020-21 and upheld the order of the CIT(A) setting aside an ex-parte assessment framed under Section 144 in the case of a charitable institution. The Assessing Officer had completed the assessment ex parte due to alleged non-compliance, treated substantial receipts as taxable income, assessed income under the head “Profits and Gains of Business or Profession,” and made an addition under Section 68.
On appeal, the CIT(A) exercised powers under the first proviso to Section 251(1)(a) and restored the matter to the Assessing Officer for fresh adjudication after due verification and granting proper opportunity of hearing. The Tribunal held that such power to set aside and remand is expressly conferred by statute and was rightly exercised in the facts of the case, particularly where the assessment was completed ex parte.
Finding no illegality or perversity in the directions of the CIT(A), the ITAT affirmed the remand and dismissed the Revenue’s appeal.
FULL TEXT OF THE ORDER OF ITAT CHENNAI
The present appeal of the Revenue is directed against the order dated 03.07.2025 passed by the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi [hereinafter referred to as “the Ld.CIT(A)”] arising out of the assessment order dated 21.10.2022 passed by the Income Tax Officer (Exemptions), Madurai [hereinafter referred to as “the AO”] u/s.144 of the Income-tax Act, 1961 [hereinafter referred to as “the Act”] pertaining to the Assessment Year 2020-21.
