- (1.) BY this petition under article 226 of the Constitution of India, the petitioner, an assessee under the Income-tax Act, 1961, challenges an order dated July 29, 1999, passed by the Income-tax Appellate Tribunal, "A" Bench, Allahabad, in ITA Nos. 753 and 1335 (Alld) of 1996 for the assessment years 1992-93 and 1993-94 whereby the said appeals have been dismissed on the grounds that the memorandum of appeals were defective inasmuch as they were argumentative. Counter and rejoinder affidavits have been exchanged. Learned counsel for respondent No. 2 has also filed a supplementary counter affidavit.
(2.) WE have heard Sri Rajesh Kumar, learned counsel for the petitioner, and Sri Ashok Kumar, learned standing counsel for the respondents. The aforesaid appeals were filed by the petitioner through one Sri H.G. Agarwal, a practising chartered accountant of substantial standing. The said appeals were duly registered and posted for hearing. When the appeals came up for hearing on July 29, 1999, an application for adjournment signed by Sri H.G. Agarwal was moved. The Tribunal dismissed the said application on the ground that there was no power of attorney or vakalatnama in favour of the said Sri H.G. Agarwal, authorising" him to represent the appellant and, therefore, the application for adjournment was rejected and the Tribunal proposed to dispose of the appeals ex parte. Then the Tribunal proceeded to examine the grounds of appeal and dismissed the appeals on the ground that the grounds set up by the appellant were argumentative and along with the grounds, several sub-grounds had been set up. The aforesaid narration of facts shows that the Tribunal has dismissed the appeals on the ground that the memorandum of appeals were defective. In CIT v. S. Chenniappa Mudaliar [1969J 74 ITR 41, the Supreme Court held that an appeal under the Income-tax Act has to be decided on the merits and cannot be dismissed for default. Therefore, the absence of Sri H.G. Agarwal was immaterial, so far as the dismissal of the appeals on the merits was concerned. But then the Tribunal has not disposed of the appeals on the merits but has dismissed them on the ground that the memorandum of appeals were defective. The facts and circumstances of the case show that the petitioner-appellant had engaged a senior practising chartered accountant for the presentation and prosecution of his appeals and it has been repeatedly held by the courts that a litigant should not be penalised for the default of his counsel. The same principle applies to a representative like a practising chartered accountant. Therefore, if there was no power of attorney in favour of Sri H.G. Agarwal filed along with the memorandum of appeals or before the hearing, the Tribunal should have brought this fact to the notice of the appellant by issuing a defect memo. Similarly, the supposed defect in the memorandum of appeals should also have been brought to the notice of the appellant requiring if to make the necessary amendments. This has not been done and we find that the petitioner has been deprived of his right of appeal because of some deficiencies on the part of its representative who was a chartered accountant of substantial standing. The assessee was in law entitled to a notice for removal of the defects and this having not been done, the Tribunal's order suffers from illegality and deserves to be quashed.
(3.) THE writ petition is accordingly allowed. THE impugned order dated July 29, 1999, is quashed and the Appellate Tribunal is directed to proceed afresh in the matter, in accordance with law.;