SARANGA ANIL AGGARWAL,MUMBAI vs. ACIT, CIRCLE 14(1)(1), MUMBAI

5. Aggrieved by the order of Ld. CIT(A), the assessee has preferred the appeal before us and has raised the following grounds of appeal:-

“1. On the facts and circumstances of the case and in law, the non-compliance of the appellant in respect of the notices issued by the CIT (A) / AO may please be excused as it was for the genuine reasons and the appeal of the appellant before the CIT (A) may please be restored back or alternatively, the matter may be restored back to the Assessing Officer for fresh assessment.

2. On the facts and circumstances of the case and in law, without prejudice to the above, the learned CIT (A) has erred in dismissing the appeal without dealing with the grounds of appeal raised before him on merits.

3. On the facts and circumstances of the case and in law, the Ld. CIT(A) has erred in confirming the addition of Rs. 11,34,69,800 as unexplained investment in respect of the immoveable property purchased by the appellant during the year under consideration.

4. On the facts and circumstances of the case and in law, the Ld. CIT(A) has erred in confirming the addition of Rs. 22,00,600 as interest income of the appellant.

5. On the facts and circumstances of the case and in law, without prejudice, the Ld. CIT(A) ought to have appreciated that the amount of interest income as added by the Ld. Assessing Officer was double the amount of interest income which was reflected in Form 26AS of the appellant.

The Appellant craves leave to add, alter, amend, vary and / or withdraw any or all the above grounds of appeal.”

6. It is to be noticed that as per Registry, there is delay of 885 days in AY 2012-13 (lead case) and there is delay of 857 days in for AY 2017-18. The assessee/appellant has filed a detailed application seeking condonation of delay and has elaborated the causes of delay for making out a sufficient cause for condonation of delay.

“1. The order u/s 250for A.Y. 2012-13has been passed in my case on 26th December, 2022confirming the addition amounting to Rs. 11,56,70,400and thereby confirming a demand of Rs. 9,68,56,810.

2. I hereby confirm that the copy of the said order has not been served physically upon me or any other person authorized to receive it on my behalf.

3. I came to know about the fact that such an order has been passed recently when the Jurisdictional Assessing Officer issued the letter for recovery for outstanding dues which reached by hands on 18th July, 2025. Vide this letter, the status of the appeal filed in respect of the year under consideration had been inquired.

7. Upon untimely demise of the Shri Anil Aggarwalon1 May, 2014, the entire RNA Group lost its leader and no one else could succeed him for taking the control of the group immediately. The Group was primarily into redevelopment and since Late Shri Anil Aggarwal himself was dealing with the tenants, finalizing the project design, looking into the approvals, etc, his untimely passing away brought the business of the Group almost to a standstill situation. The construction of projects slowed down and eventually stopped. This choked up the cashflows and as consequence of which the Group started defaulting in its debt servicing obligations.

10. There were many such financial defaults which had occurred in several companies of the group and, as a result of which, various proceedings were being launched against the entire group which included taking over of the mortgaged properties.

12. In respect of another group company i.e. RNA Corp. Pvt. Ltd. which was in fact a flagship company of the entire group, the NCLT, Mumbai vide its order dated 26 ^ (th) November, 2019, had admitted the petition filed under Section 7 of IBC, 2016 by Bank of India consequent to the default in repayment of its dues to the tune of Rs.80.73 crores. The suspended Board of Directors of this company had preferred an appeal against this order before the Hon'ble NCLAT which was dismissed vide order dated 7 ^ m February, 2020. Consequently, a Civil Appeal No. 827-828/2021 challenging the Hon'ble NCLAT's dismissal was preferred before the Supreme Court which is pending for final adjudication.

18. As a consequence of all such events, most of the mails which have been sent to the said e-mail id (accounts@rnacorporate.com) have remained unseen and / or unattended due to lack of adequate manpower and due to the fact that whatever limited staff available had also become demotivated and inattentive as a result of delay in payment of their dues, extreme work pressure upon handful of employees, Page | 8 lack of required infrastructure etc. Further, the systems and technology which were being used were never upgraded due to lack of funds. As a result, the system in place was such that it was not possible to access any given e-mail id from any other computer other than the one over which it had been configured (through outlook express). Therefore, during the time when the corporate office was not accessible as it was being sealed, it was not even possible for to access the e-mail id which was designated in my account. It was only from November-23, the appointed insolvency professional has permitted the access to the part of the office premises of the group.

20. The e-mail id of one, Mr. Rajendra Pawar (rajendra.pawar@rnacorporate.com) was also provided as an alternate e-mail id over the e-filing portal of the Income-tax Department. However, this employee had resigned with effect from 21 February, 2020 and, therefore, his personal e-mail id was not in use and not being accessed thereafter. Therefore, the mails addressed to me if were sent to this e-mail id have never reached to me after he had resigned.

23/Upon receipt of the recent communication with respect to the recovery of outstanding demand, the concerned person assisting and handling the accounting and tax compliance of the group was asked to verify all the records, as a result of which, it came to my notice that the order in respect of the appeal filed has already been passed on 26th December, 2022 which has remained unaddressed.

8. The assessee put reliance upon the judgment of the Hon'ble Supreme Court in the case of Collector, Land Acquisition Vs. MST. Katiji&Ors., [1987] 167 ITR 471 (SC),dated 19.02.1987, the Hon’ble Apex Court was pleased to hold regarding the condonation of delay as under:

“The Legislature has conferred the power to condone delay by enacting section 51 of the Limitation Act of 1963 in order to enable the courts to do substantial justice to parties by disposing of matters on de merits”. The expression “sufficient cause” employed by the Legislature is adequately elastic to enable the courts to apply the law in a meaningful manner which subserves the ends of justice that being the life-purpose of the existence of the institution of courts. It is common knowledge that this court has been making of justifiably liberal approach in matters instituted in this court. But the message does not appear to have percolated down to all the other courts in the hierarchy.

And such a liberal approach is adopted on principle as it is realized that:

2. Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As against this, when delay is condoned, the highest that can happen is that a cause would be decided on merits after hearing the parties.”

9. The Ld. DR on the other hand supported the judgment of the Ld. CIT(A) and submitted that the assessee has not pursued its case before the lower authorities despite services of various notices and due to lack of prosecution, Ld. CIT(A) has dismissed the appeal of the assessee.

11. Further, it was argued on behalf of the appellant/assessee that the notice issued by the Ld. CIT(A) were never received or served upon the assessee and as such they could not present its case before the Ld. CIT(A) who proceeded ex parte and decided the appeal without giving effective opportunity of hearing to the assessee and as such the assessee was prevented from presenting its case before the Ld. CIT(A). Therefore, the impugned order suffers from illegality and liable to be set aside. The Ld. DR on the other hand supporting the judgment of the Ld. CIT(A) stating that there is no merit in the appeal and same is liable to be dismissed.

Section 250 (2) The following shall have the right to be heard at the hearing of the appeal: - a. The appellant, either in person or by an authorised representative;

13. It is evident from the provision that the hearing to be given is not a formality but an effective hearing is sine qua non for the purpose of upholding the principal of natural justice. We have examined the impugned order and in para no. 7 of the Ld. CIT(A) observed as under: -

“7. The first notice for hearing was issued on 15.12.2020 fixing the date of hearing on 28.12.2020. However, there was no response to this notice. Thereafter, subsequent notices dated 05.07.2021, 07.07.2022, 03.11.2022, 14.11.2022, 23.11.2022, 01.12.2022 and 14.12.2022 were issued fixing the hearings on various dates. However, it is observed that the assessee has neither complied to nor attended in response to any of these notices. It is also noticed that the assessee has not elaborated on the above grounds in the statement of facts filed along with the grounds of appeal. In view of these facts, it is clear that the assessee is not serious in pursuing his appeal. Therefore, the appeal of the assessee is dismissed for lack of prosecution.”

14. It is thus evident from the contents of the impugned order extracted above that no effective opportunity of hearing has been given and there is no proof that the notice sent on various dates were duly served or brought to the notice of the appellant/assessee. It is evident from the grounds taken in the appeal and also argued on behalf of the assessee that for the reasons mentioned in the affidavit of the assessee, the assessee could not present its case before the AO and the assessment order is also ex-parte. It was therefore submitted by the Ld. AR that it will be in the interest of natural justice, if the case is remitted to the file of AO for fresh adjudication after giving opportunity of hearing to the assessee.

15. We have considered the above submissions and in the given facts as discussed above, we are considered opinion that the assessee has satisfactorily explained the reasons for non-appearance and failure to present its case before the AO as well as before the Ld. CIT(A), and both the Ld. Authorities below has passed the orders including the impugned order without an effective representation of the assessee during the hearing at the time of passing of the assessment order as well as impugned order which has resulted into miscarriage of justice.

16. For these reasons, we are of the considered opinion that matter needs to be restored to the file of the AO for deciding afresh after giving effective hearing to the assessee who shall present its case before the AO within 60 days. The impugned order of Ld. CIT(A) is accordingly set aside and appeal filed by the assessee is allowed for statistical purposes in above terms.

(A.Y: 2017-18) 17. Since this appeal also raises the similar grounds of appeal as raised by the assessee in for AY 2012-13 including the grounds seeking condonation of delay in filing the appeal before the ITAT, therefore the findings in as returned aboveshall mutatis mutandisapply to this appeal also. Hence, the impugned order of Ld. CIT(A) is also set aside and the matter is remitted to the file of AO for deciding afresh on merit after giving effective hearing to the assessee who shall present its case before the AO within 60 days.

Order pronounced in the open court on 24.09.2025.