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Facts
The assessee filed its return of income for AY 2020-21, claiming a deduction u/s 80IC. The CPC processed the return u/s 143(1) and denied the deduction without providing an opportunity or reasons. The assessee pursued rectification proceedings u/s 154, which were rejected. Subsequently, the assessee filed an appeal before the CIT(A) after a delay of 1007 days.
Held
The Tribunal held that the assessee had sufficient cause for the delay as it was pursuing alternative remedies before the CPC. The Tribunal directed the CIT(A) to condone the delay, admit the appeal, and adjudicate the grounds on merits.
Key Issues
Whether the delay in filing the appeal before the CIT(A) was justified due to the assessee pursuing rectification proceedings for the denial of deduction u/s 80IC without proper reasoning.
Sections Cited
139(1), 80IC, 143(1), 154
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCH “G”: NEW DELHI
Before: SHRI VIKAS AWASTHY & SHRI M. BALAGANESH
O R D E R PER M. BALAGANESH, A. M.: 1. The appeal in AY 2020-21, arises out of the National Faceless Appeal Centre (NFAC), Mumbai [hereinafter referred to as ‘ld. NFAC’, in short] in Appeal No. ITBA/APL/S/250/2024-25/1068380330(1) dated 05.09.2024 against the order of assessment passed u/s 143(1) of the Income- tax Act, 1961 (hereinafter referred to as ‘the Act’) dated 12.10.2021 by the Assessing Officer, Asst. Director of Income Tax, CPC, Bengaluru (hereinafter referred to as ‘ld. AO’).
The only effective issue to be decided in this appeal is as to whether the ld JCIT was justified in condoning the delay in filing of appeal of the assessee by 1007 days and dismissing the appeal inlimine in the facts and circumstances of the instant case.
We have heard the rival submissions and perused the material available on record. The due date for filing of income tax return u/s 139(1) of the Act was 15.02.2021 for AY 2020-21. The assessee filed the return of income on 13.02.2021 declaring total income of Rs. 1,25,58,290/- after claiming deduction of Rs. 35,88,719/- u/s 80IC of the Act. The assessee filed the Tax Audit Report along with audited financial statements for year ended 31.03.2020 relevant to AY 2020-21 which were electronically uploaded on 15.01.2021. The assessee filed the audit report in Form No. 10CCB of the Act for claiming deduction 80IC of the Act on 13.02.2021, i.e. the date of filing of income tax return. The return was duly processed u/s 143(1) of the Act on 12.10.2021 by the ld CPC determining the total income of Rs. 1,61,83,210/- denying the claim of deduction of Rs. 35,88,719/- u/s 80IC of the Act. The assessee preferred rectification u/s 154 of the Act before ld CPC against the denial of deduction u/s 80IC of the Act on the ground that no opportunity was given by ld CPC and no reason has been assigned for denial of deduction u/s 80IC of the Act by the ld CPC. The ld CPC passed an order u/s 154 of the Act on 10.01.2023 rejecting the plea of the assessee. The assessee preferred yet another rectification application u/s 154 of the Act on 11.02.2023 before the ld CPC. The ld CPC dismissed another rectification application u/s 154 of the Act of the assessee. Appeal was filed before the ld CIT(A) against section 154 order dated 11.02.2023 on 21.02.2023. Submissions were filed before the ld CIT(A) on 30.05.2024 by the assessee. The appeal was dismissed vide order dated 26.06.2024 on the grounds that the issue requires long drawn process of reasoning which cannot be subject matter of rectification proceedings u/s 154 of the Act.
Thereafter, the assessee preferred an appeal before the ld CIT(A) on 14.8.2024 against the intimation dated 12.10.2021 u/s 143(1) of the Act along with condonation of delay for the delay of 1007 days. The ld CIT(A) completely ignoring the aforesaid background of the facts and the alternative remedial measures being sought by the assessee, proceeded to hold that there was no sufficient cause for the delay of 1007 days in filing of appeal before the ld CIT(A) and accordingly dismissed the appeal as not maintainable. In our considered opinion, the assessee had indeed sufficient cause for the delay as it was pursuing alternative remedy before the ld CPC as the claim of deduction u/s 80IC of the Act was denied to the assessee without assigning any reason thereon by the ld CPC. In these facts and circumstances, we direct the ld CIT(A) to condone the delay in filing of appeal, admit the appeal of the assessee and adjudicate the grounds raised by the assessee on merits and pass a speaking order thereon. The assessee is also entitled to file additional grounds, if any, in support of its contentions. Needless to mention that the assessee be given reasonable opportunity of being heard. The assessee is also directed to cooperate with the ld CIT(A) in its own interest for expeditious disposal of the appeal by the ld CIT(A). With these directions, the grounds raised by the assessee are allowed for statistical purposes and restored to the file of the ld CIT(A).
In the result, the appeal of the assessee is allowed for statistical purposes.
Order pronounced in the open court on 16/07/2025.