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Facts
The assessee filed an appeal against an order that dismissed its appeal due to delay. The assessee's case was reopened based on significant credits in their bank account and sale of properties, which were not in coherence with the declared income. The CIT(A) dismissed the appeal for being barred by limitation.
Held
The Tribunal noted that the Hon'ble High Court had directed that the appeal be entertained on merits without raising any objection regarding limitation. The CIT(A) was required to decide the case on merit after condoning the delay. The Tribunal set aside the impugned order and remitted the matter back to the CIT(A) for fresh decision on merit.
Key Issues
Whether the CIT(A) was justified in dismissing the appeal on grounds of limitation, despite a High Court order to decide on merits after condoning the delay.
Sections Cited
148, 250
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCH ‘G’: NEW DELHI
Before: SHRI MAHAVIR SINGH, HON’BLE & SHRI AVDHESH KUMAR MISHRA
ORDER PER AVDHESH KUMAR MISHRA, AM
The appeal filed by the assessee is directed against the order dated 23.06.2025 of the Commissioner of Income Tax (Appeals), NFAC, New Delhi [‘CIT(A)’].
The assessee has raised following grounds of appeal: - “1. Because order of Id. CIT (Appeals) is bad in law and against the facts and circumstances of the case.
2. Because, Id. CIT (Appeals) inherently wrong in dismissing the appeal by denying to condone the delay against the specific direction Proplarity infratech Pvt. Ltd. of Hon'ble Allahabad High Court, whereby reason for delay of 69 days being on account of Writ filed before Hon'ble Allahabad High Court along with court's direction to entertain the appeal on merits without raising any objection with regard to limitation was duly explained in the Form 35.
3. Because Id. CIT (Appeals) erred in not admitting the appeal on ground of delay even after admitting appeal with issuance of hearing notices u/s 250 to furnish submission/documents that too without providing a single opportunity of being heard on the issue of delay and/or to file any reply/evidence in support of same Therefore, it is very respectfully prayed that this Hon'ble Court may kindly be pleased to quash the orders of Id. lower authority with the directions as deemed fit.”
3. The relevant facts giving rise to this appeal are that the assessee, a builder, filed its Income Tax Return (‘ITR’) of the relevant year on 29.03.2018 declaring income of Rs.1,80,080/-. Later on, the case was reopened under section 148 of the Income Tax Act, 1961 (‘Act’) based on the information that the assessee’s bank account of the relevant year has credits aggregating to Rs.3,33,55,50,459/-, which is not in coherence with the details shown in the ITR. Further, the Assessing Officer (‘AO’) was also in possession of the fact that the assessee had sold immovable properties to Mrs. Ashi Malhotra, Mrs. Sheetal Midha and Shri Bal Kirshnan for Rs.57,20,000/-, Rs.17,05,138/- and Rs.1,51,25,000/- respectively in the relevant year. However, the assessee has shown turnover of Rs.1,20,000/- in its ITR. Consequentially, the reopened assessment was completed at income of Rs.3,35,82,80,677/- taxing the entire credit of Rs.3,33,55,50,459/- and the above-mentioned sale consideration aggregating to Rs.2,25,50,138/- received from Mrs. Ashi Proplarity infratech Pvt. Ltd. Malhotra, Mrs. Sheetal Midha and Shri Bal Kirshnan. Aggrieved, the assessee filed appeal before the Ld. CIT(A), who dismissed the appeal treating the same as barred by limitation as the Ld. CIT(A) was not satisfied with the explanation offered by the appellant-assessee for condonation of delay.
4. Aggrieved with the assessment order dated 25.05.2023, the appellant assessee filed writ petition before the Hon’ble Allahabad High Court, which was decided vide order dated 18.08.2023 as under: -
“Heard learned counsel for the parties. This petition is directed against the order of assessment passed against the petitioner on 25.05.2023. Various grounds are urged in support of the petition in order to contain that order of assessment itself is arbitrary and is without jurisdiction. The contention advanced on behalf of the petitioner is strongly reputed by Sri Ashish Bansal who appears for the petitioner. We have prima- facie examined the contentions urged on behalf of the petitioner on merits and in the facts and circumstances of the present case, we are of the opinion that appropriate remedy for the petitioner in the facts of the case would be to pursue his departmental appeal. Since we are relegating the petitioner to remedy of appeal, we are not persuaded to record the arguments and the reasons for which we are not persuaded to interfere in the matter as those observations may prejudice the case of the parties at the time of appeal. Learned counsel for the parties also submits that instead of elaborating the grounds of challenge or the defence in respect thereof, the petitioner be relegated to the remedy of appeal. We also find such course to be appropriate in the facts of the case. In that view of the mater, this petition is consigned to records on the ground of availability of alternative remedy. In the facts of the case we provide that in the event, the petitioner prefers an appeal within three Proplarity infratech Pvt. Ltd. weeks from today along with a copy of this order, the same shall be entertained on merits without raising any objection with regard to limitation. All questions of fact and law are left open for examination at the time of appeal.” [Emphasis supplied] 5. The appellant assessee, in pursuance of the above-mentioned order of the Hon’ble High Court, filed appeal before the Ld. CIT(A) within the time period of three weeks provided by the Hon’ble High Court. However, the Ld. CIT(A), highlighting the appellant assessee’s failure to produce the said order of the Hon’ble High Court directing the CIT(A) to decide the case on merit, dismissed the appeal treating the same as barred by limitation.
Before us, the Ld. Authorized Representative (‘AR’) contended that the Ld. CIT(A) issued notices for hearing in the month of April and May, 2025 to file submissions/ documents. The Assessee sought adjournment, but to its great dismay, the appeal was held non-maintainable on account of delay and was dismissed in limine. The Ld. AR therefore, prayed for setting aside the impugned order and remanding the appeal before the Ld. CIT(A) for deciding the same on merit. To which Ld. Sr. DR did not object to.
We have heard both parties and have perused the material available on record. There is no dispute and is an admitted fact that there has been a delay in filing the present appeal. The said delay in filing appeal before the Ld. CIT(A), in view of the above-mentioned order of the Hon’ble High Proplarity infratech Pvt. Ltd. Court, has to be condoned and has to be decided on merit. However, the Ld. CIT(A) decided the case in absence of the order of the Hon’ble High Court.
We take note of the fact that the Ld. CIT(A) has dismissed the appeal as non-maintainable being barred by limitation. In view of the above- mentioned order of the Hon’ble High Court, the Ld. CIT(A) is required to decide the case on merit after condoning the delay in filing appeal. Thus, without offering any comment on merit of the case, we deem it fit to set aside the impugned order and remit the matter back to the file of the Ld. CIT(A) for deciding the case afresh on merit after condoning the delay in filing appeal before him, in accordance with law, after providing adequate opportunity of being heard to the appellant assessee. Ordered accordingly. The appellant assessee, no doubt, shall cooperate in remitted appellate proceedings.
In the result, the appeal of the assessee is allowed for statistical purposes.
Order pronounced in open Court on 4th July, 2025