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Facts
The assessee filed appeals against orders passed by the CIT(A) for AY 2018-19 and 2019-20. The appeals were delayed due to internal partner disputes, an arbitration petition, IBC proceedings, and issues with accessing records and email credentials, leading to non-compliance and ex-parte orders.
Held
The Tribunal condoned the delay in filing the appeals, stating that the reasons provided constituted 'sufficient cause'. The Tribunal set aside the ex-parte orders of the CIT(A) and restored the matters for fresh adjudication, emphasizing the principle of 'audi alteram partem' (hear the other side).
Key Issues
Whether the delay in filing the appeals and non-appearance before the lower authorities were due to sufficient cause, and whether the ex-parte orders passed by the CIT(A) should be set aside.
Sections Cited
143(3), 250, 69B, 69C, 147, 144, 249(3)
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Income Tax Appellate Tribunal, MUMBAI BENCH “B” MUMBAI
Before: SHRI OM PRAKASH KANT & SHRI NARENDER KUMAR CHOUDHRY
ORDER PER OM PRAKASH KANT, AM
Both these appeals by the assessee are directed against two separate order dated 10.02.2025 and 21.03.2025, passed by the Ld. Commissioner of Income-tax (Appeals) – 48, Mumbai [in short ‘the Ld. CIT(A)’] for assessment year 2018-19 and 2019-2020 respectively. As identical issue-in-dispute is involved in both these appeals and therefore, same were heard together and disposed off by way of this consolidated order for the sake of convenience.
Blufab Fashion Fabrics LLP Blufab Fashion Fabrics LLP 2 & 4367/MUM/2025 & 4367/MUM/2025
2. Firstly, we take up the appeal of the assessee for assessment Firstly, we take up the appeal of the assessee for assessment Firstly, we take up the appeal of the assessee for assessment year 2018-19. The grounds raised
by the assessee are reproduce 19. The grounds raised by the assessee are reproduce 19. The grounds raised by the assessee are reproduced as under:
1. The Ld. CIT(A) has erred in law and in fact by not appreciating 1. The Ld. CIT(A) has erred in law and in fact by not appreciating 1. The Ld. CIT(A) has erred in law and in fact by not appreciating that the Ld. A.O. has passed an order u/s 143(3) of the Act that the Ld. A.O. has passed an order u/s 143(3) of the Act that the Ld. A.O. has passed an order u/s 143(3) of the Act which is bad in law and illegal. which is bad in law and illegal.
2. The Ld. CIT(A) has erred in law and in facts in passing order 2. The Ld. CIT(A) has erred in law and in facts in passing order 2. The Ld. CIT(A) has erred in law and in facts in passing order u/s 250 of the Act u/s 250 of the Act and confirming the addition made by Ld. A.O. and confirming the addition made by Ld. A.O. without granting effective opportunity of hearing to the assessee. without granting effective opportunity of hearing to the assessee. without granting effective opportunity of hearing to the assessee.
The Ld. CIT(A) has erred in law and in facts in confirming the 3. The Ld. CIT(A) has erred in law and in facts in confirming the 3. The Ld. CIT(A) has erred in law and in facts in confirming the addition on account of unexplained money Rs. 1,90,40,291/ addition on account of unexplained money Rs. 1,90,40,291/ addition on account of unexplained money Rs. 1,90,40,291/-u/s 69B of the Act 69B of the Act as under valuation of stock. 4. The Ld. CIT(A) has erred in law and in facts in confirming the 4. The Ld. CIT(A) has erred in law and in facts in confirming the 4. The Ld. CIT(A) has erred in law and in facts in confirming the addition of Rs. 3,82,099/ addition of Rs. 3,82,099/- on account of short fall in cash found on account of short fall in cash found u/s 69C of the Act. 3. At the threshold At the threshold, the learned counsel for the assessee invited , the learned counsel for the assessee invited our attention to the defective memo issued by the Registry pointing attention to the defective memo issued by the Registry pointing attention to the defective memo issued by the Registry pointing out a delay of 63 days in filing the present appeal. The learned out a delay of 63 days in filing the present appeal. The learned out a delay of 63 days in filing the present appeal. The learned counsel, however, clarified that as per the computation enclosed counsel, however, clarified that as per the computation enclosed counsel, however, clarified that as per the computation enclosed with the condonation application supported by a duly sworn with the condonation application supported by a duly sworn with the condonation application supported by a duly sworn affidavit, the actual delay in filing the appeal is of 82 days. He idavit, the actual delay in filing the appeal is of 82 days. He idavit, the actual delay in filing the appeal is of 82 days. He submitted that the delay has occurred due to bona fide and submitted that the delay has occurred due to bona fide and submitted that the delay has occurred due to bona fide and unavoidable circumstances beyond the control of the assessee and unavoidable circumstances beyond the control of the assessee and unavoidable circumstances beyond the control of the assessee and that there was no deliberate or contumacious conduct warranting that there was no deliberate or contumacious conduct warranting that there was no deliberate or contumacious conduct warranting penal consequences. l consequences. The learned counsel further submitted that The learned counsel further submitted that the Income-tax affairs of the assessee tax affairs of the assessee-firm, M/s Blufab Fashion M/s Blufab Fashion Fabrics LLP, were being handled by a chartered accountancy firm , were being handled by a chartered accountancy firm , were being handled by a chartered accountancy firm which, owing to internal disputes amongst its partners, failed to which, owing to internal disputes amongst its partners, failed to which, owing to internal disputes amongst its partners, failed to Blufab Fashion Fabrics LLP Blufab Fashion Fabrics LLP 3 & 4367/MUM/2025 & 4367/MUM/2025 make e e effective effective effective representation representation representation before before before the the the learned learned learned CIT(A). CIT(A). CIT(A). Consequently, the order passed by the first appellate authority was Consequently, the order passed by the first appellate authority was Consequently, the order passed by the first appellate authority was not communicated to the assessee. It was only upon the not communicated to the assessee. It was only upon the not communicated to the assessee. It was only upon the appointment of a new counsel and verification of the Income Tax appointment of a new counsel and verification of the Income Tax appointment of a new counsel and verification of the Income Tax portal that the assessee became aware of the order and promptly assessee became aware of the order and promptly assessee became aware of the order and promptly preferred the present appeal. preferred the present appeal. The relevant part of the affidavit is The relevant part of the affidavit is reproduced as under: reproduced as under:
I say that I am one of the partners of Blufab Fashion Fabrics I say that I am one of the partners of Blufab Fashion Fabrics I say that I am one of the partners of Blufab Fashion Fabrics LLP along with other partners, namely Mr. Luv Harish LLP along with other partners, namely Mr. Luv Harish LLP along with other partners, namely Mr. Luv Harish Arya and Mr. Kush Harish Arya. Mr. Kush Harish Arya.
I say that for A.Y. 2018 I say that for A.Y. 2018-19, the firm filed its return of income 19, the firm filed its return of income on 30.10.2018 3 declaring total income at Rs. 1,98,93,236/ on 30.10.2018 3 declaring total income at Rs. 1,98,93,236/ on 30.10.2018 3 declaring total income at Rs. 1,98,93,236/-. 3. 1 say that a survey action was conducted on the firm on 3. 1 say that a survey action was conducted on the firm on 3. 1 say that a survey action was conducted on the firm on 31.01.2018 31.01.2018 wherein wherein certain certain discrepancies discrepan cies were were found. found. Subsequently, the case was selected for scrutiny. I say that after Subsequently, the case was selected for scrutiny. I say that after Subsequently, the case was selected for scrutiny. I say that after centralization of the case on 23.04.2021, various notices were centralization of the case on 23.04.2021, various notices were centralization of the case on 23.04.2021, various notices were issued. 4. I say that in the meantime, a dispute arose between the 4. I say that in the meantime, a dispute arose between the 4. I say that in the meantime, a dispute arose between the partners of the firm and we accordingly se partners of the firm and we accordingly separated in 2018. I say parated in 2018. I say that subsequently on 03.12.2020, I, as the partner of the firm, that subsequently on 03.12.2020, I, as the partner of the firm, that subsequently on 03.12.2020, I, as the partner of the firm, filed a commercial arbitration petition against other partners filed a commercial arbitration petition against other partners filed a commercial arbitration petition against other partners before the Hon'ble Bombay High Court on the ground that they before the Hon'ble Bombay High Court on the ground that they before the Hon'ble Bombay High Court on the ground that they were illegally selling raw materials and fini were illegally selling raw materials and finished goods belonging shed goods belonging to the firm. 5. I further state that IBC proceedings were also initiated against 5. I further state that IBC proceedings were also initiated against 5. I further state that IBC proceedings were also initiated against the firm by one of the creditors of the firm before the Hon'ble the the firm by one of the creditors of the firm before the Hon'ble the the firm by one of the creditors of the firm before the Hon'ble the NCLT on 04.12.2019. NCLT on 04.12.2019. 6. I say that meanwhile, notices were issued by the Ld. A.O. for 6. I say that meanwhile, notices were issued by the Ld. A.O. for 6. I say that meanwhile, notices were issued by the Ld. A.O. for carrying out the assessment proceedings for A.Y. 2018 arrying out the assessment proceedings for A.Y. 2018 arrying out the assessment proceedings for A.Y. 2018-19 during May 2021 to June 2021. May 2021 to June 2021. 7. I say that these notices could not be attended due to ongoing 7. I say that these notices could not be attended due to ongoing 7. I say that these notices could not be attended due to ongoing Covid-19 pandemic (2nd phase) which was prevalent during the 19 pandemic (2nd phase) which was prevalent during the 19 pandemic (2nd phase) which was prevalent during the said period."
Blufab Fashion Fabrics LLP Blufab Fashion Fabrics LLP 4 & 4367/MUM/2025 & 4367/MUM/2025
8. I say that complia I say that compliances were looked after by Mr. Kush Kush Harish Arya and Mr. Kush Harish Arya, other partners of the firm with Arya and Mr. Kush Harish Arya, other partners of the firm with Arya and Mr. Kush Harish Arya, other partners of the firm with the help of the chartered accountant who was also looking after the help of the chartered accountant who was also looking after the help of the chartered accountant who was also looking after their personal affairs. In order to have effective compliance, the their personal affairs. In order to have effective compliance, the their personal affairs. In order to have effective compliance, the email ID of the partners of t email ID of the partners of the Arya family and the said C.A. Mr. he Arya family and the said C.A. Mr. AD Atul Gupta being atul.o.gupta@gmail.com was registered. I AD Atul Gupta being atul.o.gupta@gmail.com was registered. I AD Atul Gupta being atul.o.gupta@gmail.com was registered. I say that the notices Would have been served upon the email say that the notices Would have been served upon the email say that the notices Would have been served upon the email address of the said partners and the said address of the said partners and the said chartered accountant. hartered accountant.
I say that when I realized about I say that when I realized about the ongoing assessment the ongoing assessment proceedings during June, 2021, I immediately sent an email proceedings during June, 2021, I immediately sent an email proceedings during June, 2021, I immediately sent an email informing the Ld. A.O. of the dispute amongst the partners and informing the Ld. A.O. of the dispute amongst the partners and informing the Ld. A.O. of the dispute amongst the partners and the fact that the records of the firm were with other partner. 1 the fact that the records of the firm were with other partner. 1 the fact that the records of the firm were with other partner. 1 therefore requested that the compliance to th therefore requested that the compliance to the I-T notices was to T notices was to be done by other partners of the Arya family. be done by other partners of the Arya family.
I say that since the details and the documents could not be say that since the details and the documents could not be say that since the details and the documents could not be sought from the oth sought from the other partners, I could not make a compliance to compliance to the assessment proceedings and assessment was completed the assessment proceedings and assessment was completed the assessment proceedings and assessment was completed u/s. 143(3) of the Act on 15.06.2021 making the several 143(3) of the Act on 15.06.2021 making the several 143(3) of the Act on 15.06.2021 making the several additions and determining the total income at Rs. 3,93,15,626/ additions and determining the total income at Rs. 3,93,15,626/ additions and determining the total income at Rs. 3,93,15,626/-. 11. I say that even the said order was served upon the email ID ay that even the said order was served upon the email ID ay that even the said order was served upon the email ID of the C.A. Atul Gupta and hence was not received by me. When I of the C.A. Atul Gupta and hence was not received by me. When I of the C.A. Atul Gupta and hence was not received by me. When I visited the I-T portal to verify the status of the assessment, I T portal to verify the status of the assessment, I T portal to verify the status of the assessment, I found the said order issued on 15.06.2021. found the said order issued on 15.06.2021. 12. I say that I immediately contacted the CA Atul Gupta and 12. I say that I immediately contacted the CA Atul Gupta and 12. I say that I immediately contacted the CA Atul Gupta and asked him to file the appeal immediately which was accordingly asked him to file the appeal immediately which was accordingly asked him to file the appeal immediately which was accordingly filed on 20.09.2021. filed on 20.09.2021. 13. I say since the said C.A. Atul Gupta was looking after the ince the said C.A. Atul Gupta was looking after the ince the said C.A. Atul Gupta was looking after the affairs of the firm since past few years and he was also in affairs of the firm since past few years and he was also in affairs of the firm since past few years and he was also in communication of other partners of Arya family, he was in better communication of other partners of Arya family, he was in better communication of other partners of Arya family, he was in better position to obtain records from them and also represent the position to obtain records from them and also represent the position to obtain records from them and also represent the appeal. 1 therefore appeal. 1 therefore requested him to represent the said appeal requested him to represent the said appeal and carry out compliance. and carry out compliance. 14. I say that however, even the said chartered accountant could 14. I say that however, even the said chartered accountant could 14. I say that however, even the said chartered accountant could not obtain the records and could not represent before the Ld. not obtain the records and could not represent before the Ld. not obtain the records and could not represent before the Ld. CIT(A). He filed reply to one of the notices issued in and CIT(A). He filed reply to one of the notices issued in and CIT(A). He filed reply to one of the notices issued in and around October, 2022 requesting for adjournment. October, 2022 requesting for adjournment. 15. I say that in the meantime, the assessment order came to be 15. I say that in the meantime, the assessment order came to be 15. I say that in the meantime, the assessment order came to be passed by the Ld. A.O. also in case of the firm for A.Y. 2019 passed by the Ld. A.O. also in case of the firm for A.Y. 2019 passed by the Ld. A.O. also in case of the firm for A.Y. 2019-20 vide his order u/s. 147 r.w.s. 144 of the Act dated 05.03.2024. vide his order u/s. 147 r.w.s. 144 of the Act dated 05.03.2024. vide his order u/s. 147 r.w.s. 144 of the Act dated 05.03.2024. Immediately, o Immediately, on noticing the said order, I requested the said CA n noticing the said order, I requested the said CA
Blufab Fashion Fabrics LLP Blufab Fashion Fabrics LLP 5 & 4367/MUM/2025 & 4367/MUM/2025 Atul Gupta to file the appeal against the said order and ensure Atul Gupta to file the appeal against the said order and ensure Atul Gupta to file the appeal against the said order and ensure that necessary action is taken to resolve the said demands. that necessary action is taken to resolve the said demands. that necessary action is taken to resolve the said demands. 16. say that thereafter, since the said CA Atul Gupta was also 16. say that thereafter, since the said CA Atul Gupta was also 16. say that thereafter, since the said CA Atul Gupta was also not getting any co not getting any co- Operation from the partners of Arya family, he Operation from the partners of Arya family, he withdrew himself from handling the said matters and informed of withdrew himself from handling the said matters and informed of withdrew himself from handling the said matters and informed of his intentions to the partners of the Arya family. his intentions to the partners of the Arya family.
I say that, upon knowing that he has willingly withdrew 17. I say that, upon knowing that he has willingly withdrew 17. I say that, upon knowing that he has willingly withdrew himself from attending the appea himself from attending the appeal matters, in order to ensure that l matters, in order to ensure that the notices are attended and atleast request for adjournment is the notices are attended and atleast request for adjournment is the notices are attended and atleast request for adjournment is filed, I appointed another chartered accountant, CA Mr. Rajendra filed, I appointed another chartered accountant, CA Mr. Rajendra filed, I appointed another chartered accountant, CA Mr. Rajendra Laddha in and around October, 2024, to take care of the said Laddha in and around October, 2024, to take care of the said Laddha in and around October, 2024, to take care of the said appellate matters. appellate matters.
I say that since the email ID of the Arya family and earlier CA at since the email ID of the Arya family and earlier CA at since the email ID of the Arya family and earlier CA Atul Gupta was registered in the I Atul Gupta was registered in the I-T Portal, I was unable to have T Portal, I was unable to have access to the notices issued by the Ld. CIT(A). Hence, the said access to the notices issued by the Ld. CIT(A). Hence, the said access to the notices issued by the Ld. CIT(A). Hence, the said new chartered accountant used to occasionally visit the portal to new chartered accountant used to occasionally visit the portal to new chartered accountant used to occasionally visit the portal to check the issue to notices in appeal. I say that when he noticed k the issue to notices in appeal. I say that when he noticed k the issue to notices in appeal. I say that when he noticed The receipt of notice for hearing during November, 2024, he filed The receipt of notice for hearing during November, 2024, he filed The receipt of notice for hearing during November, 2024, he filed the reply to the said notice requesting for adjournment. the reply to the said notice requesting for adjournment. the reply to the said notice requesting for adjournment. 19. 1 also say that in the petition filed before Hon'ble Bombay 19. 1 also say that in the petition filed before Hon'ble Bombay 19. 1 also say that in the petition filed before Hon'ble Bombay High Court, the issue was w.r.t. illegal sale of the stock and I had rt, the issue was w.r.t. illegal sale of the stock and I had rt, the issue was w.r.t. illegal sale of the stock and I had prayed that all documents w.r.t. said stock as well as all prayed that all documents w.r.t. said stock as well as all prayed that all documents w.r.t. said stock as well as all inventory be provided to the firm. I say that until such documents inventory be provided to the firm. I say that until such documents inventory be provided to the firm. I say that until such documents and inventory were provided to the firm, no submissions could and inventory were provided to the firm, no submissions could and inventory were provided to the firm, no submissions could have been made before the Ld. CIT(A). I further say that I was en made before the Ld. CIT(A). I further say that I was en made before the Ld. CIT(A). I further say that I was under impression that until the CIRP was appointed, the firm under impression that until the CIRP was appointed, the firm under impression that until the CIRP was appointed, the firm could not make any submissions before the Ld. CIT(A) as could not make any submissions before the Ld. CIT(A) as could not make any submissions before the Ld. CIT(A) as moratorium period would be declared due to which I would be moratorium period would be declared due to which I would be moratorium period would be declared due to which I would be unable to go ahead with unable to go ahead with the proceedings.
I say that the Ed. CIT(A) disregarded the adjournment 20. I say that the Ed. CIT(A) disregarded the adjournment 20. I say that the Ed. CIT(A) disregarded the adjournment requests filed and passed an order u/s. 250 on 10.02.2025 requests filed and passed an order u/s. 250 on 10.02.2025 requests filed and passed an order u/s. 250 on 10.02.2025 dismissing the appeal filed by the firm. dismissing the appeal filed by the firm. 21. 1 say that even the said order was not received by me in 21. 1 say that even the said order was not received by me in 21. 1 say that even the said order was not received by me in email as the same wo email as the same would have been received by the erstwhile CA uld have been received by the erstwhile CA Atul Gupta whose email ID was registered on the I Atul Gupta whose email ID was registered on the I-T Portal or by T Portal or by partners of Arya family. partners of Arya family.
I say that subsequently, even the appeal against the order 22. I say that subsequently, even the appeal against the order 22. I say that subsequently, even the appeal against the order u/s. 147 r.w.s. 143(3) of the Act for A.Y. 2019 u/s. 147 r.w.s. 143(3) of the Act for A.Y. 2019 u/s. 147 r.w.s. 143(3) of the Act for A.Y. 2019-20 dated 05.03.2024 was also disposed off due to non 03.2024 was also disposed off due to non- attendance and attendance and the order was passed on 21.03.2025. the order was passed on 21.03.2025.
Blufab Fashion Fabrics LLP Blufab Fashion Fabrics LLP 6 & 4367/MUM/2025 & 4367/MUM/2025
"I say that on my request, when the said new C.A. Rajendra 23. "I say that on my request, when the said new C.A. Rajendra 23. "I say that on my request, when the said new C.A. Rajendra Laddha visited the Portal to verify the status of the appeal; he Laddha visited the Portal to verify the status of the appeal; he Laddha visited the Portal to verify the status of the appeal; he found that the appeals for A.Y. 201 found that the appeals for A.Y. 2018-19 and A.Y. 2019 19 and A.Y. 2019-20 were already disposed off vide orders dated 10.02.2025 and already disposed off vide orders dated 10.02.2025 and already disposed off vide orders dated 10.02.2025 and 21.03.2025 respectively. 21.03.2025 respectively. 24 say that immediately knowing of the said orders passed, I 24 say that immediately knowing of the said orders passed, I 24 say that immediately knowing of the said orders passed, I requested the said CA Rajendra Laddha to file the appeals for requested the said CA Rajendra Laddha to file the appeals for requested the said CA Rajendra Laddha to file the appeals for the both the years before the both the years before Hon'ble ITAT. 25. I say that the non 25. I say that the non-appearance before Ld. A.O. and Ld. CIT(A) appearance before Ld. A.O. and Ld. CIT(A) as well as delay in filing the appeal before Hon'ble Tribunal was as well as delay in filing the appeal before Hon'ble Tribunal was as well as delay in filing the appeal before Hon'ble Tribunal was not intentional but was purely due to genuine reasons beyond not intentional but was purely due to genuine reasons beyond not intentional but was purely due to genuine reasons beyond the control of the firm. There is no malafide inte ntrol of the firm. There is no malafide intention on the part ntion on the part of the firm or its partners. of the firm or its partners. 26. I say that the reasons for delay in filing the appeal are also say that the reasons for delay in filing the appeal are also say that the reasons for delay in filing the appeal are also explained in detail in the prayer for condonation of delay being explained in detail in the prayer for condonation of delay being explained in detail in the prayer for condonation of delay being filed before Hon'ble Tribunal and I affirm the facts stated therein filed before Hon'ble Tribunal and I affirm the facts stated therein filed before Hon'ble Tribunal and I affirm the facts stated therein to be true and and correct. 3.1 The learned counsel relied upon the principles laid down by The learned counsel relied upon the principles laid down by The learned counsel relied upon the principles laid down by the Hon’ble Supreme Court in the Hon’ble Supreme Court in Collector, Land Acquisition v. Mst. Collector, Land Acquisition v. Mst. Katiji [(1987) 167 ITR 471 (SC)] to contend that when substantial [(1987) 167 ITR 471 (SC)] to contend that when substantial [(1987) 167 ITR 471 (SC)] to contend that when substantial justice and technical considerations are pitted against each other, justice and technical considerations are pitted against each other, justice and technical considerations are pitted against each other, the cause of substantial justice must prevail. He urged that the the cause of substantial justice must prevail. He urged that the the cause of substantial justice must prevail. He urged that the delay in the present case, being occasioned by genuine difficulties delay in the present case, being occasioned by genuine difficul delay in the present case, being occasioned by genuine difficul and not by negligence or indifference, deserves to be condoned. and not by negligence or indifference, deserves to be condoned. and not by negligence or indifference, deserves to be condoned.
We have carefully considered the rival submissions and We have carefully considered the rival submissions and We have carefully considered the rival submissions and perused the record. The chronology of events, as evidenced by the perused the record. The chronology of events, as evidenced by the perused the record. The chronology of events, as evidenced by the detailed affidavit of one of the partners of the assessee-firm, detailed affidavit of one of the partners of the assessee detailed affidavit of one of the partners of the assessee unmistakably shows that the delay in filing the appeal has occurred unmistakably shows that the delay in filing the appeal has occurred unmistakably shows that the delay in filing the appeal has occurred on account of peculiar circumstances involving internecine disputes on account of peculiar circumstances involving internecine disputes on account of peculiar circumstances involving internecine disputes between partners, ongoing litigation before the Hon’ble Bombay between partners, ongoing litigation before the Hon’ble Bombay between partners, ongoing litigation before the Hon’ble Bombay
Blufab Fashion Fabrics LLP Blufab Fashion Fabrics LLP 7 & 4367/MUM/2025 & 4367/MUM/2025 High Court, insolvency proceedings before the Hon’ble NCLT, and High Court, insolvency proceedings before the Hon’ble NC High Court, insolvency proceedings before the Hon’ble NC lack of access to firm records and email credentials. lack of access to firm records and email credentials.
4.1. The affidavit elaborately narrates how notices and orders were 4.1. The affidavit elaborately narrates how notices and orders were 4.1. The affidavit elaborately narrates how notices and orders were sent to the email ID of the erstwhile chartered accountant and the sent to the email ID of the erstwhile chartered accountant and the sent to the email ID of the erstwhile chartered accountant and the other partners of the Arya family, which effectively deprived the other partners of the Arya family, which effectively depriv other partners of the Arya family, which effectively depriv assessee of notice and opportunity at various stages. Upon assessee of notice and opportunity at various stages. Upon assessee of notice and opportunity at various stages. Upon appointment of new counsel, the assessee took immediate corrective appointment of new counsel, the assessee took immediate corrective appointment of new counsel, the assessee took immediate corrective steps and filed the appeal without any undue lapse of time. steps and filed the appeal without any undue lapse of time. steps and filed the appeal without any undue lapse of time.
4.2. On a conspectus of these facts, we are of the considered 4.2. On a conspectus of these facts, we are of the considered 4.2. On a conspectus of these facts, we are of the considered opinion that the delay was neither deliberate nor attributable to pinion that the delay was neither deliberate nor attributable to pinion that the delay was neither deliberate nor attributable to gross negligence. It is settled law that “sufficient cause” should gross negligence. It is settled law that “sufficient cause” should gross negligence. It is settled law that “sufficient cause” should receive a liberal construction to advance the ends of justice, as laid receive a liberal construction to advance the ends of justice, as laid receive a liberal construction to advance the ends of justice, as laid down by the Hon’ble Supreme Court in down by the Hon’ble Supreme Court in Collector, Land Collector, Land Acquisition v. Mst. Katiji (supra 4.3. In the totality of the circumstances, we are satisfied that the 4.3. In the totality of the circumstances, we are satisfied that the 4.3. In the totality of the circumstances, we are satisfied that the assessee was prevented by reasonable cause in not preferring the assessee was prevented by reasonable cause in not preferring the assessee was prevented by reasonable cause in not preferring the appeal within the prescribed period. Accordingly, the delay in filing appeal within the prescribed period. Accordingly, the delay in filing appeal within the prescribed period. Accordingly, the delay in filing the appeal is condoned and the appeal is admitted for adjudication oned and the appeal is admitted for adjudication oned and the appeal is admitted for adjudication on merits.
Upon perusal of the impugned appellate order, it is seen that Upon perusal of the impugned appellate order, it is seen that Upon perusal of the impugned appellate order, it is seen that the learned CIT(A) had issued multiple notices between July 2022 the learned CIT(A) had issued multiple notices between July 2022 the learned CIT(A) had issued multiple notices between July 2022 and January 2025, but no effective compliance was made by the and January 2025, but no effective compliance was made by the and January 2025, but no effective compliance was made by the Blufab Fashion Fabrics LLP Blufab Fashion Fabrics LLP 8 & 4367/MUM/2025 & 4367/MUM/2025 assessee. The learned CIT(A), therefore, proceeded to dispose of the ssee. The learned CIT(A), therefore, proceeded to dispose of the ssee. The learned CIT(A), therefore, proceeded to dispose of the appeal ex parte, relying upon the ratio of appeal ex parte, relying upon the ratio of CIT v. B.N. Bhattacharjee CIT v. B.N. Bhattacharjee and Another [(1979) 118 ITR 461 (SC)], that filing an appeal implies [(1979) 118 ITR 461 (SC)], that filing an appeal implies [(1979) 118 ITR 461 (SC)], that filing an appeal implies an obligation to prosecute it effectively. an obligation to prosecute it effectively. The relevant finding of the nt finding of the Ld. CIT(A) is reproduced as under: Ld. CIT(A) is reproduced as under:
“7. During the course of appellate proceedings, the following 7. During the course of appellate proceedings, the following 7. During the course of appellate proceedings, the following hearing notices u/s 250 of the Income hearing notices u/s 250 of the Income-tax Act, 1961, were issued tax Act, 1961, were issued to the appellant: to the appellant:
1. 1. Notice dated 20.07.2022 asking the appellant to attend 1. Notice dated 20.07.2022 asking the appellant to attend 1. Notice dated 20.07.2022 asking the appellant to attend the hearing on or before 25.08.2022 by 03:00 PM. hearing on or before 25.08.2022 by 03:00 PM.
2. Notice dated 13.09.2022 asking the appellant to attend the 2. Notice dated 13.09.2022 asking the appellant to attend the 2. Notice dated 13.09.2022 asking the appellant to attend the hearing on or before 26.09.2022 by 03:00 PM. hearing on or before 26.09.2022 by 03:00 PM.
3. Notice dated 04.10.2022 asking the appellant to attend the 3. Notice dated 04.10.2022 asking the appellant to attend the 3. Notice dated 04.10.2022 asking the appellant to attend the hearing on or before 11.10.2022 by 03: hearing on or before 11.10.2022 by 03:00 PM.
4. Notice dated 03.10.2023 asking the appellant to attend the 4. Notice dated 03.10.2023 asking the appellant to attend the 4. Notice dated 03.10.2023 asking the appellant to attend the hearing on or before 12.10.2023 by 04:00 PM. hearing on or before 12.10.2023 by 04:00 PM.
5. Notice dated 23.10.2023 asking the appellant to attend the 5. Notice dated 23.10.2023 asking the appellant to attend the 5. Notice dated 23.10.2023 asking the appellant to attend the hearing on or before 12.12.2023 by 03:00 PM. hearing on or before 12.12.2023 by 03:00 PM. 6. Notice dated 27.06.2024 asking Notice dated 27.06.2024 asking the appellant to attend the the appellant to attend the hearing on or before 12.07.2024 by 11:00 AM. hearing on or before 12.07.2024 by 11:00 AM.
7. Notice dated 13.11.2024 asking the appellant to attend the 7. Notice dated 13.11.2024 asking the appellant to attend the 7. Notice dated 13.11.2024 asking the appellant to attend the hearing on or before 19.11.2024 by 12:20 PM. hearing on or before 19.11.2024 by 12:20 PM.
8. Notice dated 22.01.2025 asking the appellant to attend the Notice dated 22.01.2025 asking the appellant to attend the Notice dated 22.01.2025 asking the appellant to attend the hearing on or before 28.01.2025 by 03:43 PM. It is pertinent to note that in order to decide this appeal in a It is pertinent to note that in order to decide this appeal in a It is pertinent to note that in order to decide this appeal in a timely manner, a number of notices/communications through the timely manner, a number of notices/communications through the timely manner, a number of notices/communications through the ITBA portal were sent to the appellant, viz., communications ITBA portal were sent to the appellant, viz., communications ITBA portal were sent to the appellant, viz., communications dated dated 20.07.2022, 20.07.2022, 13.09.2022, 13.09.2022, 04.10.2022, 04.10. 2022, 03.10.2023, 03.10.2023, 23.10.2023, 23.10.2023, 23.10.2023, 27.06.2024, 27.06.2024, 27.06.2024, 13.11.2024, 13.11.2024, 13.11.2024, and and and 22.01.2025.In 22.01.2025.In 22.01.2025.In response to the notices sent, the appellant is merely seeking response to the notices sent, the appellant is merely seeking response to the notices sent, the appellant is merely seeking adjournment. There is no gainsaying that once the appeal is filed adjournment. There is no gainsaying that once the appeal is filed adjournment. There is no gainsaying that once the appeal is filed by the appellant, it is obligatory on his part to purpos by the appellant, it is obligatory on his part to purpos by the appellant, it is obligatory on his part to purposefully and co- operatively pursue the same in a worthwhile manner, which operatively pursue the same in a worthwhile manner, which operatively pursue the same in a worthwhile manner, which Blufab Fashion Fabrics LLP Blufab Fashion Fabrics LLP 9 & 4367/MUM/2025 & 4367/MUM/2025 the appellant has evidently failed to do. It clearly appears that the appellant has evidently failed to do. It clearly appears that the appellant has evidently failed to do. It clearly appears that the appellant has not even bothered to pursue this appeal in any the appellant has not even bothered to pursue this appeal in any the appellant has not even bothered to pursue this appeal in any productive manner. Hence, in view of the aforesaid t productive manner. Hence, in view of the aforesaid t productive manner. Hence, in view of the aforesaid total non- compliance/non prosecution of the instant appeal on the part of compliance/non prosecution of the instant appeal on the part of compliance/non prosecution of the instant appeal on the part of the appellant, the instant appeal is adjudicated and disposed off, the appellant, the instant appeal is adjudicated and disposed off, the appellant, the instant appeal is adjudicated and disposed off, ex-parte, primarily on the basis documents/details available on parte, primarily on the basis documents/details available on parte, primarily on the basis documents/details available on record, which is as under. record, which is as under.
At the outset, that in 8. At the outset, that in the situation as obtained in the instant the situation as obtained in the instant case, as evidently seen from the above, this appeal is liable to be case, as evidently seen from the above, this appeal is liable to be case, as evidently seen from the above, this appeal is liable to be dismissed in terms of the ratio of the judgements of the Hon'ble dismissed in terms of the ratio of the judgements of the Hon'ble dismissed in terms of the ratio of the judgements of the Hon'ble Apex Court and the various High Courts including the Hon'ble Apex Court and the various High Courts including the Hon'ble Apex Court and the various High Courts including the Hon'ble Apex Court which hel Apex Court which held in CIT v. B. N. Bhattarcharjee and Another d in CIT v. B. N. Bhattarcharjee and Another (10 CTR 354) that an appeal means an effective appeal and that (10 CTR 354) that an appeal means an effective appeal and that (10 CTR 354) that an appeal means an effective appeal and that to "prefer an appeal" would mean effectively prosecuting an to "prefer an appeal" would mean effectively prosecuting an to "prefer an appeal" would mean effectively prosecuting an appeal. "Purposefully and constructively interpreted, preferring appeal. "Purposefully and constructively interpreted, preferring appeal. "Purposefully and constructively interpreted, preferring an appeal means more th an appeal means more than formally filing it but effectively an formally filing it but effectively pursuing it and if a party retreats before the contest begins, it is pursuing it and if a party retreats before the contest begins, it is pursuing it and if a party retreats before the contest begins, it is as good as not having entered the fray. as good as not having entered the fray.
9. It is pertinent to add here that laws assist those who are 9. It is pertinent to add here that laws assist those who are 9. It is pertinent to add here that laws assist those who are vigilant and not those who sleep over their rig vigilant and not those who sleep over their rights. This principle hts. This principle is embodied in the well is embodied in the well-known maxim "Vigilantibus non known maxim "Vigilantibus non dormientibus jura subveniunt". It means equity comes to the aid dormientibus jura subveniunt". It means equity comes to the aid dormientibus jura subveniunt". It means equity comes to the aid of the vigilant and not the slumbering. In all actions, suits and of the vigilant and not the slumbering. In all actions, suits and of the vigilant and not the slumbering. In all actions, suits and other proceedings at law and in equity, the diligent other proceedings at law and in equity, the diligent and careful and careful plaintiff is favoured and prejudicial of him who is careless. plaintiff is favoured and prejudicial of him who is careless. plaintiff is favoured and prejudicial of him who is careless. Viewed thus, it is presumed that the appellant has no further Viewed thus, it is presumed that the appellant has no further Viewed thus, it is presumed that the appellant has no further cogent reasoning or/and evidence to substantiate the grounds cogent reasoning or/and evidence to substantiate the grounds cogent reasoning or/and evidence to substantiate the grounds taken in this impugned appeal. It is trite that the onus i taken in this impugned appeal. It is trite that the onus i taken in this impugned appeal. It is trite that the onus is on person person person making making making the the the claim, claim, claim, and and and the the the primary primary primary responsibility/onus/burden for proving the claim made before responsibility/onus/burden for proving the claim made before responsibility/onus/burden for proving the claim made before the tax authorities (Assessing Officers/Appellate Authorities) lies the tax authorities (Assessing Officers/Appellate Authorities) lies the tax authorities (Assessing Officers/Appellate Authorities) lies with the appellant/appellant. In the present case, the appellant with the appellant/appellant. In the present case, the appellant with the appellant/appellant. In the present case, the appellant has not been abl has not been able to even discharge the primary onus/burden e to even discharge the primary onus/burden statutorily & judicially cast upon him to substantiate the claims statutorily & judicially cast upon him to substantiate the claims statutorily & judicially cast upon him to substantiate the claims made in the grounds of appeal
in spite of adequate time and made in the grounds of appeal in spite of adequate time and made in the grounds of appeal in spite of adequate time and opportunities given as brought out in the foregoing paras. opportunities given as brought out in the foregoing paras. opportunities given as brought out in the foregoing paras.
10. It is, thus, evident th
10. It is, thus, evident that the appellant has no evidence to at the appellant has no evidence to substantiate the grounds taken and it has not even once argued substantiate the grounds taken and it has not even once argued substantiate the grounds taken and it has not even once argued with any supporting, relevant and cogent arguments/averments, with any supporting, relevant and cogent arguments/averments, with any supporting, relevant and cogent arguments/averments, constraining me to, therefore, go through the extremely brief non constraining me to, therefore, go through the extremely brief non constraining me to, therefore, go through the extremely brief non- speaking submission appearing speaking submission appearing in the grounds of appeal and in the grounds of appeal and statement of facts filed along statement of facts filed along-with the impugned appeal to decide with the impugned appeal to decide on the merits while adjudicating the same. I am constrained to on the merits while adjudicating the same. I am constrained to on the merits while adjudicating the same. I am constrained to concur with the AO's findings of fact and decisions thereof, more concur with the AO's findings of fact and decisions thereof, more concur with the AO's findings of fact and decisions thereof, more
Blufab Fashion Fabrics LLP Blufab Fashion Fabrics LLP 10 & 4367/MUM/2025 & 4367/MUM/2025 particularly in the absence of particularly in the absence of any meaningful and worthwhile any meaningful and worthwhile submissions/documentations even during the instant appellate submissions/documentations even during the instant appellate submissions/documentations even during the instant appellate proceedings in this case to counter effectively the position proceedings in this case to counter effectively the position proceedings in this case to counter effectively the position adopted by the AO on the concerned issues and reduced in adopted by the AO on the concerned issues and reduced in adopted by the AO on the concerned issues and reduced in writing in the assessment order. writing in the assessment order.
I have carefully perused the facts of the appellant's case and carefully perused the facts of the appellant's case and carefully perused the facts of the appellant's case and the order of the Assessing Officer. It is observed from the facts of the order of the Assessing Officer. It is observed from the facts of the order of the Assessing Officer. It is observed from the facts of the case that the appellant has failed to furnish any the case that the appellant has failed to furnish any the case that the appellant has failed to furnish any documentary evidence to the issue raised by them in the appeal documentary evidence to the issue raised by them in the appeal documentary evidence to the issue raised by them in the appeal In connection In connection with additions made by the AO regarding additions with additions made by the AO regarding additions made made made on on on account account account unexplained unexplained unexplained money money money and and and unexplained unexplained unexplained expenditure Considering the above facts, I decide the appeal on expenditure Considering the above facts, I decide the appeal on expenditure Considering the above facts, I decide the appeal on the basis of facts mentioned by AO in the assessment order and the basis of facts mentioned by AO in the assessment order and the basis of facts mentioned by AO in the assessment order and facts submitted by appellant facts submitted by appellant along-with Form No. 35.
APPELLATE DECISION: 12. APPELLATE DECISION: 12.1 Decision on Ground No. 1: This ground is genera 12.1 Decision on Ground No. 1: This ground is genera 12.1 Decision on Ground No. 1: This ground is genera general in nature and all the nature and all the detailed ground raised by the appellant are detailed ground raised by the appellant are adjudicated in subsequent paragraphs, therefore, no separate adjudicated in subsequent paragraphs, therefore, no separate adjudicated in subsequent paragraphs, therefore, no separate adjudication of this adjudication of this ground is required. Accordingly, the ground ground is required. Accordingly, the ground no. 1 of appeal is dismissed. no. 1 of appeal is dismissed.
12.2 Decision on Ground No. 2: In ground no. 2, the appellant 12.2 Decision on Ground No. 2: In ground no. 2, the appellant 12.2 Decision on Ground No. 2: In ground no. 2, the appellant urged urged urged that that that the the the AO AO AO has has has erred erred erred in in in making making making addition addition addition of of of Rs.1,90,40,291 u/s.698 as unexplained money on account of Rs.1,90,40,291 u/s.698 as unexplained money on account of Rs.1,90,40,291 u/s.698 as unexplained money on account of undervaluation of closing stock. tion of closing stock. 12.2.1 I have carefully considered the facts mentioned by the AO, 12.2.1 I have carefully considered the facts mentioned by the AO, 12.2.1 I have carefully considered the facts mentioned by the AO, facts of the appellant submitted alongwith Form No. 35 and the facts of the appellant submitted alongwith Form No. 35 and the facts of the appellant submitted alongwith Form No. 35 and the other materials on the record on these issues. The AO has other materials on the record on these issues. The AO has other materials on the record on these issues. The AO has pointed out that during the survey proceedings pointed out that during the survey proceedings conducted on the conducted on the appellant's case, the inventory of the stock taken during the appellant's case, the inventory of the stock taken during the appellant's case, the inventory of the stock taken during the survey action conducted on 31.01.2018 was Rs.6,91,55,437/ survey action conducted on 31.01.2018 was Rs.6,91,55,437/ survey action conducted on 31.01.2018 was Rs.6,91,55,437/- and total stock as per the books amounted to Rs.5,01,15,146/ and total stock as per the books amounted to Rs.5,01,15,146/ and total stock as per the books amounted to Rs.5,01,15,146/-. There was a difference of Rs. 1,90,40,291/ There was a difference of Rs. 1,90,40,291/- Further, a Further, as per the statement of Shri. Luv Arya (partner) during the survey action, he statement of Shri. Luv Arya (partner) during the survey action, he statement of Shri. Luv Arya (partner) during the survey action, he admitted that excess stock amounting to Rs.1,90,40,291/ admitted that excess stock amounting to Rs.1,90,40,291/ admitted that excess stock amounting to Rs.1,90,40,291/-were not recorded as those were lying outstation. not recorded as those were lying outstation. 12.2.2. In the above connection, the appellant was showcaused 12.2.2. In the above connection, the appellant was showcaused 12.2.2. In the above connection, the appellant was showcaused as to as to why Rs. 1,90,40,291/-should not be treated as why R should not be treated as unexplained money u/s.698 of the IT Act. In response the unexplained money u/s.698 of the IT Act. In response the unexplained money u/s.698 of the IT Act. In response the appellant submitted that the proceedings are pending in the court appellant submitted that the proceedings are pending in the court appellant submitted that the proceedings are pending in the court
Blufab Fashion Fabrics LLP Blufab Fashion Fabrics LLP 11 & 4367/MUM/2025 & 4367/MUM/2025 of law for taking the custody of all the documents and stock and of law for taking the custody of all the documents and stock and of law for taking the custody of all the documents and stock and the matter is sub judice. T the matter is sub judice. The AO stated that the matter cannot be he AO stated that the matter cannot be kept in abeyance just because the matter is pending before the kept in abeyance just because the matter is pending before the kept in abeyance just because the matter is pending before the Hon'ble Courts, until and unless there is such specific directions Hon'ble Courts, until and unless there is such specific directions Hon'ble Courts, until and unless there is such specific directions from the Court. Hence in the absence of source of genuineness of from the Court. Hence in the absence of source of genuineness of from the Court. Hence in the absence of source of genuineness of the the above above transactions transactions the the AO AO made made an an addition addition o o Rs.1,90,40,291/ Rs.1,90,40,291/- u/s.69B of the Act. 12.2.3 Further, in the appellate proceedings before me, the 12.2.3 Further, in the appellate proceedings before me, the 12.2.3 Further, in the appellate proceedings before me, the appellant even after so many opportunities, neither attended the appellant even after so many opportunities, neither attended the appellant even after so many opportunities, neither attended the hearing nor submitted any documents to substantiate his ground, hearing nor submitted any documents to substantiate his ground, hearing nor submitted any documents to substantiate his ground, nor offered a shred of evidence to the contrary, to indicate that offered a shred of evidence to the contrary, to indicate that offered a shred of evidence to the contrary, to indicate that the above addition was not justified. It is, thus, evident that the the above addition was not justified. It is, thus, evident that the the above addition was not justified. It is, thus, evident that the appellant has no evidence to substantiate the grounds taken. appellant has no evidence to substantiate the grounds taken. appellant has no evidence to substantiate the grounds taken. Hence, considering the totality of above facts, I am of the opin Hence, considering the totality of above facts, I am of the opin Hence, considering the totality of above facts, I am of the opinion that the AO has rightly made addition of Rs. 1,90,40,291/ that the AO has rightly made addition of Rs. 1,90,40,291/ that the AO has rightly made addition of Rs. 1,90,40,291/- u/s.69B of the IT Act. Accordingly, addition of Rs. 1,90,40,291/ u/s.69B of the IT Act. Accordingly, addition of Rs. 1,90,40,291/ u/s.69B of the IT Act. Accordingly, addition of Rs. 1,90,40,291/- made by AO is hereby confirmed. Thus, ground no. 2 of appeal made by AO is hereby confirmed. Thus, ground no. 2 of appeal made by AO is hereby confirmed. Thus, ground no. 2 of appeal raised by appellant is dismissed. raised by appellant is dismissed. 12.3 Decision on Ground No. 3: I 12.3 Decision on Ground No. 3: In ground no. 3, the appellant n ground no. 3, the appellant urged that the AO has erred in making addition of Rs.3,82,099/ urged that the AO has erred in making addition of Rs.3,82,099/ urged that the AO has erred in making addition of Rs.3,82,099/- u/s.69C as unexplained expenditure. u/s.69C as unexplained expenditure. 12.3.11 have carefully considered the facts mentioned by the AO, 12.3.11 have carefully considered the facts mentioned by the AO, 12.3.11 have carefully considered the facts mentioned by the AO, facts of the appellant submitted alongwith Form No. 35 and th facts of the appellant submitted alongwith Form No. 35 and th facts of the appellant submitted alongwith Form No. 35 and the other materials on the record on these issues. On perusal of the other materials on the record on these issues. On perusal of the other materials on the record on these issues. On perusal of the assessment order, it was seen that the AO has mentioned that assessment order, it was seen that the AO has mentioned that assessment order, it was seen that the AO has mentioned that during the survey proceedings it was seen that the cash in hand during the survey proceedings it was seen that the cash in hand during the survey proceedings it was seen that the cash in hand as per book of account was stated as Rs.4,16,399/ as per book of account was stated as Rs.4,16,399/- whereas the whereas the actual cash found in the premises was only Rs.34,300/ ctual cash found in the premises was only Rs.34,300/ ctual cash found in the premises was only Rs.34,300/-. Hence there was a difference of Rs.3,82,099/ there was a difference of Rs.3,82,099/-. The appellant was . The appellant was showcaused as to why the shortfall in the cash found should not showcaused as to why the shortfall in the cash found should not showcaused as to why the shortfall in the cash found should not be treated as unexplained expenditure u/s.69C of the IT Act. In be treated as unexplained expenditure u/s.69C of the IT Act. In be treated as unexplained expenditure u/s.69C of the IT Act. In response the appellant did not file any submissions. Hence, in the appellant did not file any submissions. Hence, in the appellant did not file any submissions. Hence, in the absence of any evidences the AO treated the sum of the absence of any evidences the AO treated the sum of the absence of any evidences the AO treated the sum of Rs.3,82,099/ Rs.3,82,099/- as unexplained expenditure and made addition to as unexplained expenditure and made addition to the total income u/s.69C of the IT Act. the total income u/s.69C of the IT Act. 12.3.2 Further, in the appellate proceedings 12.3.2 Further, in the appellate proceedings before me, the before me, the appellant even after so many opportunities, neither attended the appellant even after so many opportunities, neither attended the appellant even after so many opportunities, neither attended the hearing nor submitted any documents to substantiate his ground, hearing nor submitted any documents to substantiate his ground, hearing nor submitted any documents to substantiate his ground, nor offered a shred of evidence to the contrary, to indicate that nor offered a shred of evidence to the contrary, to indicate that nor offered a shred of evidence to the contrary, to indicate that the above addition was not justified. It is, the above addition was not justified. It is, thus, evident that the thus, evident that the appellant has no evidence to substantiate the grounds taken. appellant has no evidence to substantiate the grounds taken. appellant has no evidence to substantiate the grounds taken. Hence, considering the totality of above facts, I am of the opinion Hence, considering the totality of above facts, I am of the opinion Hence, considering the totality of above facts, I am of the opinion that the AO has rightly made addition of Rs. 3,82,099/ that the AO has rightly made addition of Rs. 3,82,099/ that the AO has rightly made addition of Rs. 3,82,099/- u/s. 69C
Blufab Fashion Fabrics LLP Blufab Fashion Fabrics LLP 12 & 4367/MUM/2025 & 4367/MUM/2025 of the Income tax Act to the total inco of the Income tax Act to the total income on account of me on account of unexplained expenditure. Accordingly, addition of Rs. 3,82,099/ unexplained expenditure. Accordingly, addition of Rs. 3,82,099/ unexplained expenditure. Accordingly, addition of Rs. 3,82,099/- made by AO is hereby confirmed. Thus, ground no. 3 of appeal made by AO is hereby confirmed. Thus, ground no. 3 of appeal made by AO is hereby confirmed. Thus, ground no. 3 of appeal raised by appellant is raised by appellant is dismissed.” 5.1 We have noticed that the reasons for non We have noticed that the reasons for non-compliance on the compliance on the part of the assessee have already been referred in the affidavit filed. ssee have already been referred in the affidavit filed. ssee have already been referred in the affidavit filed. In our opinion, the assessee was prevented by way of sufficient In our opinion, the assessee was prevented by way of sufficient In our opinion, the assessee was prevented by way of sufficient reason for not complying before the Ld. CIT(A) reason for not complying before the Ld. CIT(A). While an approach While an approach of ld CIT(A) is legally permissible where the appellant remains of ld CIT(A) is legally permissible where the appellant remains of ld CIT(A) is legally permissible where the appellant remains recalcitrant, the judicial conscience of this Tribunal cannot remain recalcitrant, the judicial conscience of this Tribunal cannot remain recalcitrant, the judicial conscience of this Tribunal cannot remain unresponsive to the peculiar circumstances emerging from the unresponsive to the peculiar circumstances emerging from the unresponsive to the peculiar circumstances emerging from the affidavit and the material placed before us. The affidavit explains, in affidavit and the material placed before us. The affidavit explains, in affidavit and the material placed before us. The affidavit explains, in cogent detail, that due to partner disputes, IBC proceedings, and cogent detail, that due to partner disputes, IBC proce cogent detail, that due to partner disputes, IBC proce control of records by other partners, the assessee could not access control of records by other partners, the assessee could not access control of records by other partners, the assessee could not access documents or correspondences necessary for compliance. These documents or correspondences necessary for compliance. These documents or correspondences necessary for compliance. These facts, in our view, constitute a “sufficient cause” within the meaning facts, in our view, constitute a “sufficient cause” within the meaning facts, in our view, constitute a “sufficient cause” within the meaning of section 249(3) of the Act, read with the of section 249(3) of the Act, read with the principles of natural principles of natural justice.
5.2. The maxim audi alteram partem audi alteram partem—no one should be condemned no one should be condemned unheard—is not an empty ritual but a foundational postulate of fair is not an empty ritual but a foundational postulate of fair is not an empty ritual but a foundational postulate of fair procedure. When the assessee has shown that its non-appearance procedure. When the assessee has shown that its non procedure. When the assessee has shown that its non was occasioned by genuine and de was occasioned by genuine and demonstrable reasons, it would be monstrable reasons, it would be contrary to equity and justice to sustain an order passed without contrary to equity and justice to sustain an order passed without contrary to equity and justice to sustain an order passed without affording a meaningful opportunity of hearing. affording a meaningful opportunity of hearing.
Blufab Fashion Fabrics LLP Blufab Fashion Fabrics LLP 13 & 4367/MUM/2025 & 4367/MUM/2025 5.3. In such circumstances, we deem it just and proper to set aside 5.3. In such circumstances, we deem it just and proper to set aside 5.3. In such circumstances, we deem it just and proper to set aside the impugned order of the learned CIT(A) an the impugned order of the learned CIT(A) and restore the matter to d restore the matter to his file for fresh adjudication in accordance with law, after affording his file for fresh adjudication in accordance with law, after affording his file for fresh adjudication in accordance with law, after affording adequate opportunity to the assessee to present its case. adequate opportunity to the assessee to present its case. adequate opportunity to the assessee to present its case.
5.4. The assessee is directed to extend full cooperation before the 5.4. The assessee is directed to extend full cooperation before the 5.4. The assessee is directed to extend full cooperation before the learned CIT(A) and to ensure that learned CIT(A) and to ensure that no unnecessary adjournments are no unnecessary adjournments are sought except for reasonable and bona fide cause. sought except for reasonable and bona fide cause. The ground No. 2 The ground No. 2 of the appeal of the assessee is accordingly allowed. The remaining of the appeal of the assessee is accordingly allowed. The remaining of the appeal of the assessee is accordingly allowed. The remaining grounds are rendered academic and therefore, we are not grounds are rendered academic and therefore, we are not grounds are rendered academic and therefore, we are not adjudicated upon at this stage. adjudicated upon at this stage.
In the appeal for assessment year 2019 In the appeal for assessment year 2019–20, a delay of 32 days 20, a delay of 32 days has been pointed out by the Registry. The reasons for the delay, has been pointed out by the Registry. The reasons for the delay, has been pointed out by the Registry. The reasons for the delay, being identical to those discussed for the preceding assessment being identical to those discussed for the preceding assessment being identical to those discussed for the preceding assessment year, stand duly explained in the same affidavit. Following our year, stand duly explained in the same affidavit. Following ou year, stand duly explained in the same affidavit. Following ou findings and reasoning rendered in para 4 above, the delay for this findings and reasoning rendered in para 4 above, the delay for this findings and reasoning rendered in para 4 above, the delay for this year is also condoned and the appeal is admitted. year is also condoned and the appeal is admitted.
6.1 It is further noticed that the learned CIT(A) has disposed of the It is further noticed that the learned CIT(A) has disposed of the It is further noticed that the learned CIT(A) has disposed of the appeal ex parte for want of compliance. Having regard to the parity appeal ex parte for want of compliance. Having regard to the parit appeal ex parte for want of compliance. Having regard to the parit of facts and the reasoning recorded while deciding the appeal for AY of facts and the reasoning recorded while deciding the appeal for AY of facts and the reasoning recorded while deciding the appeal for AY 2018–19, we similarly set aside the order of the learned CIT(A) for 19, we similarly set aside the order of the learned CIT(A) for 19, we similarly set aside the order of the learned CIT(A) for AY 2019–20 and restore the matter to his file for denovo 20 and restore the matter to his file for denovo 20 and restore the matter to his file for denovo adjudication after giving due opportunity to the assessee to submit adjudication after giving due opportunity to the assessee to adjudication after giving due opportunity to the assessee to evidence and arguments in support of its claim. evidence and arguments in support of its claim.
Blufab Fashion Fabrics LLP Blufab Fashion Fabrics LLP 14 & 4367/MUM/2025 & 4367/MUM/2025 6.2. The assessee is again directed to respond to all notices issued 6.2. The assessee is again directed to respond to all notices issued 6.2. The assessee is again directed to respond to all notices issued by the first appellate authority with diligence and to refrain from by the first appellate authority with diligence and to refrain from by the first appellate authority with diligence and to refrain from seeking adjournments save in exceptional circumstances duly seeking adjournments save in exceptional circumstances duly seeking adjournments save in exceptional circumstances duly substantiated. The ground No. 3 of the appeal for assessment year The ground No. 3 of the appeal for assessment year The ground No. 3 of the appeal for assessment year 2019-2020 is accordingly allowed and the remaining grounds are 2020 is accordingly allowed and the remaining grounds are 2020 is accordingly allowed and the remaining grounds are rendered academic, therefore, we are not adjudicating upon at this rendered academic, therefore, we are not adjudicating upon at this rendered academic, therefore, we are not adjudicating upon at this stage.
In the result, both appeals are allowed for statisti In the result, both appeals are allowed for statisti In the result, both appeals are allowed for statistical purposes. The delay in filing the appeals stands condoned. The impugned The delay in filing the appeals stands condoned. The impugned The delay in filing the appeals stands condoned. The impugned orders of the learned CIT(A) for assessment years 2018–19 and orders of the learned CIT(A) for assessment years 2018 orders of the learned CIT(A) for assessment years 2018 2019–20 are set aside, and the matters are restored to his file for 20 are set aside, and the matters are restored to his file for 20 are set aside, and the matters are restored to his file for fresh adjudication in accordance with law after af fresh adjudication in accordance with law after affording adequate fording adequate opportunity of hearing to the assessee. opportunity of hearing to the assessee.