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Facts
The assessee deposited Rs. 13.79 lakhs during the demonetization period, with total credits of Rs. 1.15 crore in her bank accounts, but failed to file an ITR or respond to notices under Section 142(1). Consequently, the AO made an addition of Rs. 1.15 crore under Section 144. The assessee, operating an e-rickshaw business, faced losses, financial distress, and business closure due to COVID-19, leading to non-receipt of notices and a significant delay in filing appeals.
Held
The Tribunal condoned the delay of 852 days in filing the appeal before the CIT(A) and 7 days before the Tribunal, finding the explanation for the delay not to be mala fide. It set aside the orders of the CIT(A) (which dismissed the delay condonation) and the AO (making the addition). The matter was restored to the AO for fresh adjudication, directing him to provide the assessee a fair opportunity to present her case.
Key Issues
Whether the delay in filing appeals before the CIT(A) and the Tribunal should be condoned due to genuine hardships and non-receipt of notices, and whether the ex-parte assessment order under Section 144 should be set aside for fresh adjudication.
Sections Cited
Section 250, Section 144, Section 139, Section 142(1)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCH “F”: NEW DELHI
Before: SHRI SHAMIM YAHYA & SHRI VIMAL KUMAR
O R D E R
PER VIMAL KUMAR, JUDICIAL MEMBER:
The Application for condonation of delay of 7 days and appeal are against order dated 11.12.2024 of Learned Commissioner of Income-Tax/National Faceless Assessment Centre (NFAC), Delhi (hereinafter referred as “Ld. CIT(A)") under Section 250 of the Income Tax Act, 1961 (“hereinafter referred as “the Act”) arising out of order dated 21.12.2019 passed by the ITO, Ward - 44(1), Delhi (hereinafter referred as “Ld. AO") under Section 144 of the Act for assessment year 2017-18.
Brief facts of case are that as per the information available on record, assessee deposited Rs.13,79,000/- during demonetization period i.e. from 09.11.2016 to 30.12.2016 and her bank account. Total amount of Rs.1,15,06,952/- was credited in various bank accounts during assessment year. The assessee neither filed any online response to the source of cash deposit during demonetization nor filed any ITR under Section 139 of the Act. The case was identified non-filer and notice under Section 142(1) of the Act was issued to assessee to file return on 22.01.2018. The assessee failed to furnish requisite information/details in response to notice under Section 142(1) of the Act. Therefore, on completion of proceedings, Ld. AO vide order dated 21.12.2019 made addition of Rs.1,15,06,952/-.
Against order dated 21.12.2019, appellant/assessee filed application for condonation of 855 days in filing appeal and appeal before Ld. CIT(A) which were dismissed vide order dated 11.12.2024.
Being aggrieved, appellant/assessee preferred application for condonation of delay of 7 days in filing present appeal.
Appellant/assessee in affidavit submitted that she is aged about 37 years. She was running proprietorship business of e-rickshaws and its parts. In May, 2017, the business started incurring losses. There was default in meeting out her financial obligations and repayment of loan taken for business. The business was shut down. Due to such condition, she was struggling and was searching job for survival. In initial months of 2020, COVID, 2019 occurred. All the notices were undelivered due to shut down of the business. Ld. CIT(A) ought to have condoned the delay of 855 days and allowed the appeal of the assessee by restoring the matter back to the Ld. AO.
Learned Authorized Representative for the Revenue had no objection.
From examination of record in light of aforesaid rival contentions, it is crystal clear that the Ld. CIT(A) vide order dated 11.12.2024 dismissed the application for condonation of delay of 852 days due to non-receipt of notices closure of business, huge financial losses. The explanation does not smack of mala fide as appellant had not gained anything by not filing appeal before the Ld. CIT(A) and Tribunal within period of limitation. Therefore, delay of 7 days in filing appeal before the Tribunal and 852 days in filing appeal before the Ld. CIT(A) are condoned.
In view of above material facts, in the interest of justice, it is considered expedient to set aside the orders dated 11.12.2024 of Ld. CIT(A) and 21.12.2019 of Ld. AO and restore the matter to the file of Ld. AO for fresh decision in accordance with law after affording fair opportunity to assessee. Therefore, impugned order is set aside.
In the result, the appeal of appellant/assessee is allowed for statistical purposes.