UTHTHAAN,GURGAON vs. CIRCLE1(1) GURGAON, GURGAON

ITA 1472/DEL/2025Status: DisposedITAT Delhi21 August 2025AY 2018-196 pages

AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal considered the rival contentions and perused the material on record. The assessee had filed an application for condonation of delay, stating that due to COVID-19, the appeal was not filed within time, and had shown sufficient cause. The Tribunal found that the CIT(A) should have condoned the delay and heard the appeal on merits, as the assessee had demonstrated sufficient cause for not filing the appeal within the prescribed time. Therefore, the Tribunal condoned the delay in preferring the appeal before the CIT(A), being satisfied with the explanation rendered by the assessee. The order passed by the CIT(A) was set aside, and the issue was restored to the file of the CIT(A) for decision on merits after giving the assessee an opportunity of being heard. The assessee was directed to cooperate with the appellate authority. The grounds raised by the assessee were accordingly allowed for statistical purposes. The Tribunal did not decide the substantive grounds of appeal as the matter was remanded.

What were the facts?

The assessee, Uththaan, a registered society, filed its return of income for Assessment Year 2019-20 on 26.10.2019, claiming exemption under Section 12A/AA. The Centralized Processing Centre (CPC) processed the return under Section 143(1) and issued an intimation on 31.01.2020, computing aggregate income at Rs. 74,30,397/-, with a tax liability of Rs. 31,78,741/-. The assessee filed an appeal before the Commissioner of Income Tax (Appeals) -2 Bengaluru, which was dismissed as time-barred by an order dated 20.01.2025. The assessee had sought condonation of a delay of 1479 days. The assessee is aggrieved by the CIT(A)'s order and has filed this appeal before the Income Tax Appellate Tribunal (ITAT).

What were the issues?

1. Whether the CIT(A) erred in law and on facts in dismissing the appeal without adjudicating the grounds on merits, thereby upholding the intimation under Section 143(1) dated 31.01.2020, which computed aggregate income at Rs. 74,30,397/- and a tax liability of Rs. 31,78,741/-, which the assessee contends is beyond jurisdiction and bad in law. 2. Whether the CIT(A) erred in dismissing the appeal solely on the basis of delay, denying the appellant an opportunity of fair hearing and failing to appreciate that principles of natural justice require an opportunity to be heard on substantive issues even with a procedural lapse. 3. Whether the CIT(A) erred in law and on facts in dismissing the appeal by rejecting the request for condonation of delay of 1479 days without appreciating that there was a genuine and bona fide reason for the delay, beyond the appellant's control, including lack of proper legal advice during the COVID-19 lockdown and subsequent realization upon consultation with tax professionals, constituting 'sufficient cause' under Section 5 of the Limitation Act, 1963. Assessee's Contentions: The assessee argued that the appeal was dismissed as time-barred by the CIT(A). They moved an application for condonation of delay, showing sufficient cause. The delay was primarily due to lack of proper legal advice during the COVID-19 lockdown and subsequent realization upon consultation with tax professionals, constituting a 'sufficient cause' under Section 5 of the Limitation Act, 1963. They contended that justice should prevail over technicalities when there is no mala fide intent, citing judicial precedents. They prayed for the appeal to be admitted for adjudication on merits and for the delay to be condoned. Revenue's Contentions: The Revenue contended that no sufficient cause was shown by the assessee for condoning the delay in filing the appeal, and therefore, the appeal was rightly dismissed by the CIT(A).

Which sections of the Income-tax Act were involved?

Section 143(1),Section 12A/AA

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Income Tax Appellate Tribunal, DELHI BENCH ‘C’, NEW DELHI

Before: SH. SUDHIR KUMAR & SH. MANISH AGARWAL

For Appellant: Shri Tarun Chanana, Advocate

For Respondent: Shri. Dayainder Singh Sindhu CIT

Hearing: 21/08/2025Pronounced: 21/08/2025

Date of hearing: 21/08/2025 Date of Pronouncement: 21/08/2025 ORDER PER SUDHIR KUMAR, JUDICIAL MEMBER:

This appeal is preferred by the assessee against the order dated 20.01.2025 of the Commissioner of Income Tax, Appeals (A) -2 Bengaluru [hereinafter referred to as “Ld. CIT(A))”] for the assessment year 2018-19 .

That the learned CIT(A) has erred on facts and in law in dismissing the appeal without adjudicating the grounds on merits, thereby erroneously upholding the intimation under Section 143(1) dated 31.01.2020, wherein the CPC has erroneously computed the aggregate income at Rs. 74,30,397/-, raising a tax liability at Rs. 31,78,741/-, which is beyond jurisdiction and bad in law.

2 That the CIT(A) erred in dismissing the appeal without adjudicating the grounds on merits, solely on the basis of delay, denying the Appellant an opportunity of fair hearing, and failing to appreciate that the principles of natural justice require that a litigant should be given an opportunity to be heard on the substantive issues, even if there is a procedural lapse such as a delay in filing

That the CIT(A) erred in law and on facts in dismissing the appeal by rejecting the request for condonation of delay of 1479 days in filing the appeal without appreciating that there was a genuine and bona fide reason for the delay, which was beyond the control of the Appellant.

3.1 That the CIT(A) failed to appreciate that the delay was primarily due to lack of proper legal advice, during the lockdown due to Covid Uththaan vs.Circle –(1) Gurgaon Pandemic, and subsequent realization by the Appellant upon consultation with tax professionals, which constitutes a 'sufficient cause' under the provisions of Section 5 of the Limitation Act, 1963.

3.2 That the CIT(A) erred in law as well as on facts in treating the delay as deliberate and not caused by a reasonable or unavoidable reason, despite judicial precedents where courts have held that justice should prevail over technicalities when a party has not acted with mala fide intent. 3 The brief facts of the case are that the assessee is a registered society. The assessee filed return of income for A.Y.2019-20 on 26-10-2019 claiming exemption under section 12A/AA of the Act. The CPC processed the return of income u/s 143(1) of the Act against the intimation order the assessee filed the time barred appeal before the Ld. CIT(A) who vide his order dated 20-01-2025 dismissed the appeal treated as time barred. Ld. CIT(A) has observed that the assessee has failed to explain the sufficient cause for condonation.

Aggrieved the order of the Ld. CIT(A) the assessee filed this appeal before the Tribunal.

Uththaan vs.Circle –(1) Gurgaon 5. The Ld. AR for the assessee submitted that the appeal was dismissed treating time barred by the appellate authority. The assessee has moved the application for condonation of delay showing the sufficient cause. He submitted that the appeal be admitted for adjudication on merit and delay be condoned.

The Ld. CIT(DR) submitted that no sufficient cause has been shown by the assessee for condone the delay in filling the appeal. He further stated that the appeal was rightly dismissed by the Ld. CIT(A).

We have heard the rival contention and perused the material available on record.

The assessee has filed the application for condonation the delay in filing the appeal. In the application the assessee has stated that due to COVID-19 the appeal was not filed within time. The assessee has shown the sufficient cause not to file the appeal with in time. The Ld. CIT(A) should have condoned the delay in filing the appeal and should have heard the appeal on merit because the assessee has shown the sufficient cause Uththaan vs.Circle –(1) Gurgaon not to file the appeal with in time. Thus, keeping in view, the entire aspects of the matter, we condone the delay in preferring the appeal before the Ld. CIT(A) having been satisfied with the explanation so rendered by the assessee before the said authority. The order passed by the Ld. CIT(A) is setting side, the issue to the file is restored before the Ld. CIT(A) who decide the matter to the file after giving the opportunity of being heard to the assessee. The assessee is directed to co-operate with the appellate authority. The grounds raised

by the assessee are accordingly allowed for statistical purposes.

9. In the result, the appeal of the assessee is allowed for statistical purpose. Order pronounced in the open court on 21.08.2025.

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