JANTA NAGRIK SAHAKARI SAKH SAMITI MARYADIT DEWAS,DEWAS vs. AO DEWAS, BENGALURU

आदेश/ O R D E R

Per B.M. Biyani, A.M.:

Feeling aggrieved by order of first-appeal dated 21.02.2025 passed by learned Commissioner of Income-Tax (Appeals)-Addl/JCIT(A)-6, Mumbai [“CIT(A)”], which in turn arises out of intimation of assessment dated 12.05.2020 passed by learned CPC, Bengaluru [“AO”] u/s 143(1) of Income- tax Act, 1961 [“the Act”] for Assessment-Year [“AY”] 2019-20, the assessee has filed this appeal on following grounds:

“1. That on the facts and circumstances of the case and in law, the Ld. ADDL/JCIT (A)-6 Mumbai erred in rejecting the appeal filed by the appellant due to delay in filing the appeal which was 1 not condoned by the Ld. ADDL/JCIT (A)-6 Mumbai and treating the appeal as non- est in violation of the principle of natural justice which is unjustified and unlawful and based on incorrect facts of the case. 2. That on the facts and circumstances of the case and in law, the Ld. ADDL/JCIT (A)-6 Mumbai erred in rejecting appeal without passing any comments on the merits of the case and sustaining the order of the A.O. passed under section 143(1)(A) of the Act for the relevant period which was filed on 26.09.2019 at Nil Income vide Receipt No. 177037211260919 after claim of deduction of Rs. 33,05,040/- for B/f losses for AY 2011-12, 2013-14 & 2014-15 respectively and it was sent in which positive income of Rs. 48,86,432/- was taken wrongly as against declared positive income of Rs 33,05,040/- before adjustment of unabsorbed B/f losses of Rs. 33,05,040/- as claimed by assessee. 3. That on the facts and circumstances of the case and in law, the Ld. ADDL/JCIT (A)-6 Mumbai erred in rejecting appeal without passing any comments on the merits of the case and not deciding 3 against no response of objection by appellant against notice of intimation under section 143(1) of the IT Act 1961 dtd. 12.05.2020 which was sent by assessee to the CPC by Trans ID 8601458440 dtd. 23.06.2020. 4. That on the facts and circumstances of the case and in law, the Ld. ADDL/JCIT (A)-6 Mumbai erred in rejecting appeal without passing any comments on the merits of the case that the appellant prayed to condone the delay of Approx 860 days due to bona-fide belief that the objection against the notice of intimation under section 143(1) of the IT Act, 1961 dtd. 12.05.2020 which was sent by assessee to the CPC by Trans ID 8601458440 dtd. 23.06.2020 would have been decided by CPC Bangalore and there after opted for next legal course of action to be taken against the pending settlement of objection by filing the appeal before the competent authority. 5. That appellant craves option to add, alter, delete and amend any of the grounds of appeal given. 6. That appellant craves option to refer to any material, documents, filed records of the appellant.”

assessee is a co-operative society. For AY 2019-20, the assessee filed return which was processed by AO u/s 143(1). According to Ld. AR, the AO made

disallowance on account of late payment of PF/ESI which the assessee had

already made before filing return, hence the AO’s action resulted in double

disallowance. Further, the AO also denied the set off of brought forward

loss/depreciation claimed by assessee. Accordingly, the AO created demand

of tax and interest against assessee. Aggrieved, the assessee carried matter

in first-appeal whereupon the CIT(A) considered assessee’s as time-barred

by 860 days (140 days after exclusion of extension granted by Hon‘ble

Supreme Court on account of Covid-19). The assessee made a submission to

CIT(A) explaining the reason of delay and prayed for condonation of delay

but the CIT(A) was not convinced. Ultimately, the CIT(A) dismissed

assessee’s appeal by concluding thus:

“2.9 In view of above, the delay of about 140 days in filing of appeal in this case is not condoned as no "sufficient cause" has been shown under section 249(3) of the Income Tax Act for the appellants failure to file the appeal within prescribed period of limitation u/s 249(2) of the Income Tax Act r.w.s 5 of the Limitation Act. Since, the delay in filing of appeal has not been condoned, consequently the appeal of the appellant becomes non-est and therefore the same is not admitted. 3. Keeping in view the facts and circumstances and the decision of the Honourable Courts the contentions raised by the appellant in the appeal are not adjudicated on merit and the appeal is rejected. 4. In the result, the appeal is rejected.” 3. Before us, Ld. AR submitted the very same reason as explained by

assessee to CIT(A). It is submitted that immediately after receiving

intimation dated 12.05.2020, the staff of Ld. AR filed online response

“Disagree with demand” on 23.06.2020 through transaction id: 8601458440.

In such online response, the demand created by AO was denied. The

assessee bonafidely believed that the issue would be resolved at the level of

AO and was waiting a positive outcome. But ultimately when the ITO, Ward-

1, Dewas being the Jurisdictional Assessing Officer (JAO) sent a follow-up

letter dated 27.09.2022 for payment of demand, the assessee filed another

response dated 14.10.2022 to AO and simultaneously filed appeal to CIT(A)

on 19.10.2022 to CIT(A). Thus, Ld. AR very humbly submitted that there is

no lethargy, negligence, mala fide intention or ulterior motive of assessee in

making delay and the assessee does not stand to derive any benefit because

of delay. He submitted that the case of assessee is quite meritorious also

since the dispute is with respect to double disallowance and not giving set

off of brought forward losses. Ld. AR submitted that there is a “sufficient

cause” for delay and hence the CIT(A) ought to have condoned the delay.

demand” claimed to have been filed by Ld. AR’s staff on 23.06.2020 through

transaction id: 8601458440. In response, Ld. AR submitted that there is a

noting made by his staff Mr. Shashank Gupta, on back of the intimation u/s

143(1); the same is scanned and extracted below:

Ld. AR submitted that he would have filed a confirmatory affidavit of his

staff, Mr. Shashank Gupta, also but unfortunately Mr. Shashank Gupta has

already expired during Covid-19 period and hence there is inability on his

part to submit affidavit.

however, left the matter for wisdom of bench.

on record. The short issue involved in the present appeal is whether the Ld.

CIT(A) was justified in dismissing the appeal of the assessee in limine on

account of delay of 860 days (net delay of 140 days after exclusion of

extension granted by Hon’ble Supreme Court on account of Covid-19). From

the submissions made before us, we find that the assessee has explained

the delay by stating that immediately after receipt of intimation u/s 143(1),

it had filed an online response “Disagree with demand” on 23.06.2020 and

was under a bonafide belief that the issue would be resolved at the level of

the department. It is only upon receipt of follow-up communication from the Jurisdictional AO in September, 2022 that the assessee realised that no

action had been taken, whereafter the assessee promptly filed appeal before

the Ld. CIT(A). We further note that the Ld. AR has attempted to

substantiate its claim by producing a contemporaneous noting made by its

staff, though formal evidentiary support in the nature of affidavit could not

be furnished due to the unfortunate demise of the concerned person during

Covid-19 period. In our considered view, the explanation offered by the

assessee cannot be outrightly brushed aside without proper verification,

particularly when the claim relates to filing of an online response on the

income-tax portal, which is verifiable from departmental records. Further, it

is a settled principle that “substantial justice” should prevail over “technical

considerations”, especially when the assessee does not stand to gain by

delaying the filing of appeal. At the same time, we are also conscious that

the veracity of the assessee’s claim regarding filing of response dated

23.06.2020 requires proper verification from official records. In that view of

matter, we deem it fit and proper to set aside the impugned order of the Ld.

CIT(A) and restore the matter to his file for fresh adjudication. The Ld. CIT(A)

is directed to verify, from the departmental records/ITBA system/online

portal data, whether the assessee had in fact filed response “Disagree with

demand” on 23.06.2020 as claimed. The Ld. CIT(A) may also, if considered

necessary, call for a remand report from the AO/JAO in this regard.

Thereafter, the CIT(A) shall firstly adjudicate the issue of delay. We make it

clear that the CIT(A) shall have full liberty to look at the issue of delay with a fresh mind taking into account the claim of filing of Response by assessee

and/or the fact that the delay after exclusion of Covid-19 period was just

140 days and the assessee is a co-operative society. After resolving the issue

of delay, the Ld. CIT(A) shall pass a reasoned order in accordance with law.

Needless to mention that the CIT(A) shall give full opportunity to assessee

and the assessee shall extend full co-operation to CIT(A).

Order pronounced in open court on 17/04/2026

Sd/- Sd/-

(PARESH M. JOSHI) (B.M. BIYANI) JUDICIAL MEMBER ACCOUNTANT MEMBER

Indore

िदनांक/Dated : 14/04/2026

Patel/Sr. PS Copies to: (1) The appellant (2) The respondent (3) CIT (4) CIT(A) (5) Departmental Representative (6) Guard File By order UE COPYAssistant Registrar Income Tax Appellate Tribunal Indore Bench, Indore

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