RASAIYAN MARIYA ALASU RAJAN,CHENNAI vs. DCIT, NON-CORPORATE CIRCLE-8(1), CHENNAI

Brief facts of the case are that the assessee is an individual and has filed his return of income for AY 2016-17 on 30.11.2016, declaring total income of Rs.83,41,140/-. During the scrutiny proceedings, the AO found that the assessee in his Balance sheet has shown an addition of Rs.89,73,500/- being sale of land at Kuthambakkam village and admitted capital gain of sale consideration of only Rs.48,93,000/- during the assessment year and hence the AO made an addition of difference of Rs.40,80,500/- as unexplained cash credit u/s.68 of the Act and passed an assessment order u/s.143(3) of the Act dated 31.12.2018. 4. Further verification revealed that the assessee along with other co- owners, entered into a JDA with M/s.Roma Housing through a power of attorney with a assessee’s share of land of 1 Acre and 6 guntas. The AO held that the arrangement reflected a business transaction and not mere transfer of capital asset, therefore treated the gains as business income. Hence, the case was re- opened u/s.147 of the Act, accordingly, a notice u/s.148 of the Act and other statutory 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 completed the reassessment by passing an exparte order u/s.147 r.w.s 144

Aggrieved by the order of the AO, the assessee preferred an appeal before the ld.CIT(A) on 04.04.2025 with a delay in filing an appeal.

At the outset, we observed that the ld.CIT(A) dismissed the appeal filed by the assessee in limine, due to delay in filing an appeal by 1,071 days. Aggrieved by the impugned order of the Ld.CIT(A), the assessee is in appeal before us.

The ld.AR submitted that the delay in filing an appeal due to the assessee’s income tax proceedings was handled by Mr.Sekar, Accountant, and all the communications were sent to his email ID (smsekar1959@gmail.com) and he passed away during COVID-19 Pandemic. After his demise, his post was unoccupied for a very long time. The business of the assessee was drastically affected by the pandemic, and his companies went through grave financial crisis in meeting all the statutory and financial obligations. The assessee, along with his other family members, has been receiving a lot of income tax notices and orders and many of such orders were misplaced. Further, the ld.AR stated that the assessee came to know about this pending order very recently when a new auditor, Mr. K.Senthilraja (Email ID – ksr@krrca.in) was appointed in 2025 and immediately file the appeal before the first appellate authority with a delay of 1,071 days. 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. 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 :-4-: ITA. No:1129/Chny/2026. filed an appeal with delay of 1,071 days. The assessee has been negligent in filing an appeal within the time limit provided and hence prayed for confirming the order 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 order by considering the information available with the department and on appeal the same has been dismissed in limine by the ld.CIT(A), NFAC due to delay in filing the appeal before the first appellate authority. Since, the assessee has failed to participate before the AO as well as the first appellate authority, we levy cost of Rs.25,000/- to be paid to State Legal Aid Authority, Hon’ble High Court of Madras within 30 days from the date of receipt of this order and the assessee shall satisfy the payment of cost before the authorities.

In view of the above and to meet the ends of justice we set aside the order of ld.CIT(A) and remit the matter back to the file of AO and direct the AO to denovo frame the assessment order 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.

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