LAXMAN PASNUR,WARANGAL vs. ITO, WARD-1, WARANGAL

The brief facts of the case are that, the assessee is an individual. As per the information received under the “High Risk Non-Filer Cases (NMS)” category in the “Insight” portal in accordance with the Risk Management Strategy (RMS) formulated by the CBDT, it was noticed that, the assessee had made cash deposits of Rs.45,02,000/- and time deposits of Rs.15,00,000/-, aggregating to Rs.60,02,000/-, during the financial year 2014-15 relevant to the assessment year 2015-16. Accordingly, proceedings u/s 147 of the Income-tax Act, 1961, were initiated and notice u/s 148 along with order u/s 148A(d) was issued on 25.04.2022. In response to the notice u/s 148, the assessee filed his return of income on 09.05.2022 declaring total income of Rs.2,02,810/- and agricultural income of Rs.1,50,000/-. During the course of reassessment proceedings, notices u/s 143(2) dated

As the assessee remained non-responsive throughout the reassessment proceedings, the A.O. issued a show cause notice u/s 144 dated 21.12.2023, stating that in the absence of any reply or response, the assessment would be decided ex parte. Further, a show cause notice with variation dated 04.01.2024, requiring compliance by 11.01.2024, was issued and duly delivered on the assessee’s registered e-mail ID. However, no response was received from the assessee. The A.O., therefore, proceeded to complete the assessment ex parte u/s 147 r.w.s. 144 r.w.s. 144B of the Act, on the basis of the material and evidences available on record. The A.O. observed that, the assessee had failed to furnish any explanation or documentary evidence regarding the source of cash deposits of Rs.45,02,000/- and, accordingly, treated the same as unexplained money u/s 69A r.w.s. 115BBE of the Act

Aggrieved by the assessment order passed by the A.O. u/s 147 r.w.s. 144 r.w.s. 144B of the Act on 27.01.2024, the assessee filed an appeal before the learned CIT(A) on 07.06.2024. Before the Ld. CIT(A), the assessee submitted that, the assessment order was received by him on 27.01.2024 and, as per the provisions of section 249(2)(c) of the Act, the appeal was required to be filed on or before 26.02.2024. Thus, there was a delay of 101 days in filing the appeal before the learned CIT(A). The assessee, in the condonation petition, submitted that he was completely unaware of the proceedings and that it was only when recovery was initiated that he came to know that such assessment had been completed. Accordingly, the assessee requested the learned CIT(A) to condone the delay in filing the appeal.

The learned CIT(A), while considering the application for condonation of delay, noted that the assessee had filed the appeal belatedly after receipt of the assessment order/notice of demand. The learned CIT(A) observed that, as per section 249(2) of the Act, an appeal before the CIT(A) is required to be filed within 30 days of the receipt of the notice of demand and that the delay could be condoned only where the appellant had ‘sufficient cause’ for not presenting the appeal within the prescribed period. The learned CIT(A) was of the view that, the reason stated by the assessee that he was completely unaware of the assessment proceedings did not substantiate the delay and that the assessee had not filed any affidavit or supporting documents to substantiate his contention. Accordingly, the learned CIT(A) held that, the assessee had not explained the purported sufficient cause for not preferring the appeal within the prescribed time and, relying upon the judicial precedents referred to in the impugned order, declined to condone the delay and consequently, dismissed the appeal of assessee in ‘limini’ u/s 249(3) r.w.s. 250 of the Act.

Aggrieved with the order of Ld. CIT(A), the assessee preferred an appeal before the Tribunal.

The learned Senior A.R. for the Revenue, Shri B. Laxmi Kanth, on the other hand, opposed the submissions of the learned counsel for the assessee and supported the order passed by the learned CIT(A). He submitted that the assessee had not furnished any affidavit or supporting documentary evidence to substantiate the reasons stated for the delay and, therefore, the learned CIT(A) was justified in declining to condone the delay. However, he fairly submitted that the matter may be decided in accordance with law on the basis of facts and material available on record.

We have heard both the parties, perused the material available on record and had gone through the orders of the authorities below. There is no dispute with regard to the fact that the assessment proceedings before the A.O. were completed ex parte. It is also an admitted fact that, there was a delay of 101 days in filing the appeal before the learned CIT(A). The assessee has explained the reasons for the delay in filing the appeal before the learned CIT(A). Considering the explanation furnished by the assessee and the facts and circumstances of the case, we are of the considered view that, the delay deserves to be condoned. However, considering the fact that the assessee had not complied

Since the learned CIT(A) has dismissed the appeal in ‘limine’ without adjudicating the issues raised by the assessee on merits, in our considered view, one more opportunity needs to be given to the assessee to represent his case before the learned CIT(A). Therefore, in the interest of justice, we set aside the order of the learned CIT(A) and restore the matter back to the file of the learned CIT(A) to decide the appeal afresh on merits, after providing one more effective opportunity to the assessee. Needless to say, the assessee shall cooperate with the proceedings before the Ld. CIT(A) and furnish necessary details and evidences in support of its claim. We order accordingly.

In the result, the appeal of the assessee is allowed for statistical purposes.