ITAT Appeal Dismissed for Improper Verification: Analysis of Rajiv Gandhi University of Health Sciences vs ACIT (Exemptions)

The Bangalore Bench of the Income Tax Appellate Tribunal in Rajiv Gandhi University of Health Sciences Vs ACIT (Exemptions) has reiterated a critical procedural requirement: an appeal that is not verified by the legally competent “principal officer” is not maintainable.

In this matter, although the assessee is a statutory university and the dispute related to assessment under Section 143(3) r.w.s. Section 142(2A), the appeal was thrown out at the threshold due to a defect in who signed and verified the appeal, not on the merits of the case. The Tribunal nonetheless allowed liberty to the assessee to file a fresh, properly verified appeal with an appropriate condonation application.

This decision serves as an important reminder that procedural compliance regarding authorization and verification is indispensable in appellate proceedings, even for strong substantive cases.

Background of the Case

Parties and Assessment Year

  • Assessee/Appellant: Rajiv Gandhi University of Health Sciences, Bangalore
  • Respondent: ACIT (Exemptions)
  • Forum: ITAT Bangalore
  • Appeal No.: ITA No. 113/Bang/2024
  • Assessment Year: 2015-16

The assessee challenged the order of the National Faceless Appeal Centre, Delhi (Ld. CIT(A)), dated 22.11.2023, which had partly allowed its appeal against an assessment order framed under Section 143(3) read with Section 142(2A) dated 07.05.2018.

Sequence of Proceedings and Signatories

The Tribunal examined the records to identify who had signed and verified various documents at each appellate stage:

  1. Return of Income

    • A revised return of income was placed in the paper book (pages 11-14).
    • This return was signed by the Finance Officer of the University.

  2. Appeal before CIT(A) – Form No. 35

    • The Form No. 35 filed before the Ld. CIT(A) was verified by the Finance Officer.

  3. Appeal before ITAT – Form No. 36

    • The Form No. 36 filed before the ITAT in ITA No. 113/Bang/2024 was verified by the Assistant Registrar, Dr. Santosh C.S.

The Tribunal highlighted that three different stages reflected varying authorized persons, with no clear, consistent indication as to who was the legally designated “principal officer” competent to verify returns and appeals on behalf of the University.

Role of Section 140 of the Income Tax Act 1961

Section 140 lays down who is authorized to verify the return of income in different situations, including for companies, local authorities, firms, and other entities. For institutions like a statutory university, the provision essentially mandates that the “principal officer” must verify the return.

The Tribunal, therefore, posed a specific query to the assessee’s representative to clarify who, in law, is the person authorized to verify the return of income of Rajiv Gandhi University of Health Sciences in terms of Section 140.

However, this question remained unanswered satisfactorily. The assessee could not explain why:

  • The revised return had been verified by the Finance Officer,
  • The appeal before Ld. CIT(A) was also verified by the Finance Officer, and
  • The appeal before the ITAT was instead verified by the Assistant Registrar.

Rule 45(3) and Rule 47(1) of the Income Tax Rules 1962

The Tribunal referred to Rule 47(1) and Rule 45(3) of the Income Tax Rules 1962. These rules together provide that:

  • The person competent to verify the return under Section 140 is also the proper person to sign and file the appeal before the appellate authorities, including the ITAT.