KARUPPUSAMY NATTARAYAN,VELLORE vs. THE INCOME TAX OFFICER, VELLORE

The brief facts of the case are that the assessee is an individual and had not filed his return of income for the AY 2015-16. As per the information available with the department, the AO found that the assessee has made cash deposits to the tune of Rs.52,36,745/- and Rs.38.29 lakhs in saving account maintained with City Union Bank 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.2015-16. Further, the AO issued statutory notices and called for details. Since the assessee chose to be silent and did not respond to any of the notices, the AO completed the reassessment by passing an exparte order u/s.147 r.w.s 144 r.w.s 144B of the Act dated 02.01.2024 by making the addition of Rs.52,36,745/- and Rs.8,585/- as unexplained income u/s.69A of the Act and amount of Rs.1,349/- as income from other sources and by arriving total income of Rs.52,46,679/-.

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.16,20,390/- being 100% of tax payable on income by passing a penalty order u/s.271(1)(c) of the Act dated 21.06.2024.

Aggrieved by the orders of the AO, the assessee filed two separate appeals before the ld.CIT(A), NFAC, Delhi on 11.05.2026 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 375 days and 206 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 the ld.CIT(A) erred in dismissing the appeals in limine on the grounds of delay without properly appreciating the facts and circumstances explained by the assessee and without adopting a liberal approach mandated by law in matters relating to condonation of delay. 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 375 days and 206 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 has passed an exparte 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. Since the assessee has failed to

Therefore, in the present facts and circumstances of the case and to meet the ends of justice, we deem it fit to give one more opportunity to the assessee. Therefore, we condone the delay in filing the appeals before ld.CIT(A) as the assessee had filed the condonation of delay in his form 35 itself and hence, we set aside the order of the ld.CIT(A) and remit the matter back to the file of ld.CIT(A) and direct the ld.CIT(A) to de novo adjudicate the appeal on merit in accordance with law, after providing reasonable opportunity to the assessee. Needless to say, the assessee to be diligent and file written submissions and relevant documents if advised so.

Since the order in quantum appeal in ITA No.3421/Chny/2026 (supra) has been set aside and remitted back to ld.CIT(A), the consequential penalty order passed u/s.271(1)(c) of the Act dated 21.06.2024, which is dismissed by the ld.CIT(A) is likewise hereby set aside and remitted back to CIT(A) to decide the issue on merit along with the quantum appeal.

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