PERUMALSAMY SRINIVASAN,CUDDALORE vs. ITO WARD 1 CUDDALORE, CUDDALORE

The brief facts of the case are that the assessee is an individual and did not file his return of income for the AY 2012-13. As per the information available with the department, the AO found that the assessee has made cash deposits to the tune of Rs.30,55,223/- into his savings bank account during the assessment year. The case was re-opened u/s.147 of the Act, a notice u/s.148 of the Act was issued to the assessee. In response, the assessee failed to file the return of income for A.Y.2012-13. Further, the AO issued statutory notices to the assessee and by calling for details. However, the assessee chose to be silent and did not respond to any of the notices. In the meanwhile, the AO issued a notice u/s.133(6) of the Act and obtained account statement of the assessee from City Union Bank Ltd., Tamilnadu. On perusal of the account statement, the AO completed the reassessment by passing an exparte order u/s.147 r.w.s 144 of the Act dated 16.04.2021 by making an addition of Rs.30,55,223/- as unexplained money u/s.69A of the Act.

Further, the AO initiated penalty proceedings u/s.271(1)(c) of the Act for concealment of income and accordingly the notices were issued to the assessee and by calling for details. Since the assessee chose to be silent and did not respond to any of the notices, the AO imposed a penalty of Rs.7,91,624/- being 100% of tax payable on income by passing a penalty order u/s.271(1)(c) of the Act dated 24.09.2021.

Aggrieved by the orders of the AO, the assessee filed two separate appeals before the ld.CIT(A), NFAC, Delhi on 22.04.2025 and 26.04.2025 with a delay in filing the appeals.

At the outset, we observed that the ld.CIT(A) dismissed the appeals in limine filed by the assessee without condoning the delay in filing the appeals against reassessment order and penalty order by 1,796 days and 1,610 days respectively. Aggrieved by the impugned orders of the Ld.CIT(A), the assessee is in appeal before us.

The ld.AR of the assessee submitted that ld.CIT(A) erred in not appreciating that the assessee was prevented by sufficient cause in not filing the appeals within time. The assessee is super senior citizen aged over 80 years suffering from hearing impairment and dementia restricting his ability to understand and respond to complex communications. Further, the assessee submitted that his wife underwent glaucoma surgery during the relevant period and both live without any assistance or digital literacy. The assessment was concluded during pandemic Covid 19 and all the communications were through digital. The assessee also stated that a personal tragedy occurred with the untimely demise of the assessee’s second son in gruesome accident causing severe emotional and psychological trauma. In view of the above, the ld.AR prayed that the Tribunal may be pleased to set aside the order of ld.CIT(A) and remit the issues to the file of AO by providing one more opportunity. Further, ld.AR assured the bench that the ld.AR will represent on behalf of the assessee before the AO to complete the assessment proceedings effectively.

Per contra, the ld.DR submitted that the appeal was to be filed before the ld.CIT(A) by the assessee within 30 days of the service, but the assessee has filed these appeals with a delay of 1,796 days and 1,610 days respectively. The assessee has been negligent in filing the appeals within the time limit provided and hence prayed for confirming the orders of the ld.CIT(A).

We have heard the rival parties and perused the material available on record and gone through the orders of the lower authorities. We note that the AO had passed the ex parte orders of reassessment and penalty by considering the information available with the Department, and on appeal, the same have been dismissed in limine by the ld.CIT(A), NFAC, due to delay in filing the appeals before the first appellate authority, without any adjudication whatsoever on the merits of the additions or the penalty.

The short question that falls for our consideration is whether, on the facts and in the circumstances narrated above, the ld.CIT(A) was justified in dismissing the appeals in limine without condoning the delay of 1,796 days and 1,610 days in filing the appeals against the reassessment order and the penalty order, respectively.

It is well settled that the expression “sufficient cause” employed in the provisions relating to condonation of delay, including u/s.249(3) of the Act, has to be construed liberally so as to advance substantial justice, more so when no negligence, inaction or mala fide can be imputed to the assessee. The Hon’ble Supreme Court in Collector, Land Acquisition, Anantnag & Anr. v. Mst. Katiji & Ors., 1987 AIR 1353 : (1987) 2 SCC 107, has held that a litigant does not stand to benefit by lodging an appeal late, that refusing to condone delay can result in a meritorious matter being thrown out at the threshold without deciding it on merits, and that when substantial justice and technical considerations are pitted against each other, the cause of substantial justice deserves to be preferred, since there is no presumption that delay is occasioned deliberately, on account of negligence or on account of mala fides. Similarly, the Hon’ble Supreme Court in N. Balakrishnan v. M. Krishnamurthy, AIR 1998 SC 3222 : (1998) 7 SCC 123, has held that the length of delay is not material; the acceptability of the explanation is the only criterion, and that some lapse on the part of the litigant, by itself, is not sufficient to reject a plea for condonation of delay.

Applying the aforesaid principles to the facts of the present case, we find that the reasons put forth by the assessee for the delay, taken cumulatively, constitute sufficient and reasonable cause. It is on record and not disputed by the Revenue that the assessee is a super senior citizen aged over 80 years, suffering from hearing impairment and dementia, which would have seriously impaired his ability to understand and respond to notices/communications, more so when the assessment as well as the appellate proceedings were conducted in the faceless, digital mode during the Covid-19 pandemic. The

The contention of the ld.DR that the assessee has been merely negligent, in our view, does not adequately account for the totality of the personal and health-related circumstances placed on record, which remain uncontroverted. We are also mindful of the fact that the additions and the consequent penalty involved are substantial, and that dismissal of the appeals in limine, on the technical ground of limitation alone, without any adjudication on merits, would result in serious and irreversible prejudice to the assessee, whereas condonation of delay would only result in the appeals being decided on merits, causing no prejudice to the Revenue except being called upon to defend the additions/penalty on merits. Substantial justice, in our view, clearly deserves to be preferred over a technical approach in the facts of the present case.

In view of the foregoing discussion, we condone the delay of 1,796 days in filing the appeal against the reassessment order and the delay of 1,610 days in filing the appeal against the penalty order before the ld.CIT(A). Since the ld.CIT(A) has dismissed both the appeals in limine without rendering any finding on the merits of the additions made u/s.69A of the Act or the penalty levied u/s.271(1)(c) of the Act, we deem it appropriate, in the interest of justice, to restore both the matters to the file of the ld.CIT(A), NFAC, Delhi, for fresh adjudication on merits in accordance with law, after affording due and

In the result, both the appeals of the assessee are allowed for statistical purposes.