ZAKEE AHMED ABDUL SATTAR SHAIKH,MUMBAI vs. INCOME TAX OFFICER - 1(1), KALYAN, KALYAN

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ITA 2722/MUM/2026Status: DisposedITAT Mumbai22 July 2026AY 2015-1610 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that the CIT(A) erred in dismissing the appeal solely for non-prosecution without adjudicating the grounds on merits. The Tribunal found the assessee's explanation for the delay and non-representation plausible and supported by evidence.

What were the facts?

The assessee's appeal was dismissed by the CIT(A) for non-prosecution due to the negligence of his Chartered Accountant. The assessee faced a significant delay in filing the appeal before the ITAT, also attributed to the Chartered Accountant's failure to act. The assessee claimed to have documentary evidence to support his case regarding cash deposits.

What were the issues?

Whether the CIT(A) was justified in dismissing the appeal for non-prosecution without deciding on merits, and whether the assessee's delay and non-representation were due to sufficient cause.

Which sections of the Income-tax Act were involved?

Section 148,Section 69A,Section 250

AI-generated summary — verify with the full judgment below

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “G” MUMBAI

BEFORE SHRI OM PRAKASH KANT (ACCOUNTANT MEMBER) AND SHRI PAWAN SINGH (JUDICIAL MEMBER)

ITA No. 2722/MUM/2026 Assessment Year: 2015-16

Zakee Ahmed Abdul Sattar Income Tax Officer – 1(1), Mohan Shaikh, SPDC Defency Colony, Plaza, Wayale Nagar, Khadak P-38/2 Siontrombay, NR. Vs. Pada, Kalyan (W) – 421301, BARC, Makhurd East, T.F. Maharashtra. Devnor S.O Mumbai – 400088, Maharashtra.

PAN NO. BIRPS 7408 G Appellant Respondent

Assessee by : Shri Bhavik Chheda, Adv. Revenue by : Shri Basavaraj Hiremath – CIT DR a/w Shri Rajgopal Parthasarathi – SR DR.

Date of Hearing : 15/07/2026 Date of pronouncement : 22/07/2026

ORDER u/s 254(1) of Income Tax Act, 1961 PER OM PRAKASH KANT, AM

This appeal by the assessee is directed against order dated 24.08.2024 passed by the Ld. Commissioner of Income-Tax (Appeals) – National Faceless Appeal Centre, Delhi [in short, ‘the Ld. CIT(A)’], for Assessment Year (in short ‘A.Y’), 2015-16, raising following grounds:

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“1. On the facts and circumstances of the case and in law, the Ld. CIT(A) erred is dismissing the appeal filed by Appellant in limine without appreciating the fact that the impugned notice u/s 148 of the Act for A.Y. 2015-16 itself is time barred and thus the re-assessment cannot survive. 2. On the facts and circumstances of the case and in law, the Ld. CIT(A) erred in dismissing the appeal filed by Appellant in limine simply due to non-prosecution without rendering any finding on merits of the case from the material available on record or on the validity and legality of the case. 3. On the facts and circumstances of the case and in law, the Ld. CIT(A) erred in upholding the addition(s) made by the Assessing Officer u/s 69A of the Act amounting to Rs.53,44,187/- without appreciating the fact that the requirements to make addition u/s 69A are not fulfilled in the present case. 4. On the facts and circumstances of the case and in law, the Ld. CIT(A) erred in upholding the Assessment Order without appreciating the fact that the Appellant had filed two submissions dated 18th October 2023 and 23rd February 2024 before the Assessing Officer thereby duly providing explanation in relation to cash deposits. 5. On the facts and circumstances of the case and in law, the Ld. Assessing Officer failed to even consider two submissions dated 18th October 2023 and 23rd February 2024 in the Assessment Order thereby completely overlooking the explanation and violating the basic principles of natural justice. 6. On the facts and circumstances of the case and in law, the Ld. Assessing Officer failed to follow the procedure stipulated under the law for initiating the re- assessment and framing the assessment.”

2.

At the outset, it is noticed that the present appeal has been preferred with a delay of 494 days. The assessee has filed an application seeking condonation of delay supported by a duly sworn affidavit explaining the circumstances which prevented him from filing the appeal within the prescribed period. The substance of the explanation is that immediately after receipt of the appellate order dated 24.08.2024, the assessee forwarded the same to his Chartered Accountant with a request to take appropriate legal steps. Being a layman and not conversant with the procedural

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requirements under the Income-tax Act, the assessee bona fide believed that the appeal before the Tribunal would be filed by the said professional. However, despite repeated follow-up through WhatsApp messages and personal communications extending over several months, the Chartered Accountant failed to take any effective steps for filing the appeal. Ultimately, upon realizing that no appeal had been filed, the assessee disengaged the said professional, engaged another counsel and immediately initiated the present proceedings. The affidavit further states that the delay was neither deliberate nor attributable to any mala fide intention but occurred solely on account of the negligence of the authorised representative. For ready reference the relevant part of the affidavit is reproduced as under: “5. Ultimately on 24.08.2024 the Ld. Commissioner Appeals passed the impugned Order u/s. 250 of the Act. On the very next day i.e. 25.08.2024, I forwarded the link containing a copy of the impugned Order (on WhatsApp) to my Chartered Accountant, expecting that he would immediately undertake further steps. However, he did not seem to take any immediate / serious steps and casually ignored my messages on WhatsApp.

6.

I say that in the interim, for months together, I regularly followed up with the Chartered Accountant but he re-iterated his stand that he would look into the matter and make necessary compliances, as per his convenience. On 23.08.2025 another conversation took place between us regarding filing of return of income for A.Y. 2025-26. I say that on 25.08.2025, I once again forwarded a copy of impugned Order dated 24.08.2024 to my Chartered Accountant who had promised me that he will take care of the ongoing assessment proceedings and that an appeal against the impugned Order would lie before the Hon'ble Income Tax Appellate Tribunal.

7.

In response thereof, on 27.08.2025 he informed me that he has forwarded the papers relating to my case to one of his colleagues, who would look after the appeal process before the Hon'ble Tribunal. Thus, I was under bonafide

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impression that once the papers were signed, the Form No. 36 would duly be filed by my Chartered Accountant and/or his colleague.

8.

I say that, in the meantime, a Rectification Order was passed on 09.10.2025 in my case stating that the computation in my case was wrongly generated and correct tax was not computed, thereby revising income at Rs. 54,71,047/-. I say that after getting knowledge of this order being passed in my case, I was in utter shock and panic and realised that my Chartered Accountant may not have properly complied with the procedure.

9.

I say that on 16.02.2026, I asked for a final update in the matter but my Chartered Accountant explicitly responded saying that there is no new update on the matter and that he will either update me or return the money if the filing work is not completed. On 24.02.2026 when I once again asked for an update in my matter, he replied stating that the work did not go through and that he would return his fees back to me.

10.

Thereafter, somewhere in March 2026, I approached an Advocate in relation to the present case and requested him to file the present Appeal. Finally, on 09.03.2026, I addressed an email to my Chartered Accountant(s) thereby discharging him and his colleague from service in relation to any of my matters.

11.

I say that I am not proficient in filing procedure and as a layman, I was not aware about the relevant legal provisions under the income tax law. Hence, I relied solely on my Chartered Accountant for all the taxation matters. I had specifically kept my Chartered Accountant in loop and diligently informed him regarding all the developments. However, time and again, my Chartered Accountant had re-assured me saying that he was looking after the case and that he was handling the matter from his end. I entrusted the work to him as he was regularly filing my income tax return. It is for this reason that I could not have discharged him from service earlier and spoil my relations with him.

12.

Thus, I was under bonafide belief that he would make necessary compliance in the present case. I submit that the delay in filing the appeal was, thus, not due to malafide or deliberate intention on my part.

13.

I say that I will face undue hardship and financial distress if my case pertaining to A.Y. 2015-16 is not considered on merits. I say that I am in a position to prove through documentary evidences that the additions upheld by the Ld. Commissioner of Income-Tax (Appeals) were not proper. I say that I have not gained any undue benefit by delaying the lodging of the present appeal.

Zakee Ahmed Abdul Sattar Shaikh 5 ITA No.2722/MUM/2026

14.

I have now been explained the consequences of filing the appeal belatedly. However, I was prevented by sufficient cause as explained hereinabove. I hereby undertake to ensure that necessary compliance is made by me in the present matter, if the delay is condoned.

15.

I say that whatever has been stated in the present affidavit is true to the best of my knowledge and I believe the same to be true. The contents in the Paragraphs hereinabove have been explained to me in Hindi as well as English.” 2.1 We have carefully considered the application for condonation of delay, the affidavit filed in support thereof and the material placed before us, including copies of the ‘WhatsApp chat’ or correspondence exchanged between the assessee and his Chartered Accountant on mobile telephone instrument. The contemporaneous correspondence demonstrates that the assessee had been consistently pursuing the matter and had repeatedly impressed upon his Chartered Accountant to file the appeal within time. The documentary evidence lends complete corroboration to the explanation furnished in the affidavit.

2.2 It is well settled that while considering an application for condonation of delay, the Court is required to adopt a pragmatic, justice-oriented and liberal approach where the explanation offered is bona fide and does not disclose any deliberate negligence or lack of diligence on the part of the litigant. Ordinarily, a litigant who has entrusted his case to a professional cannot be made to suffer irreparable prejudice solely because of the omission or inaction of his authorised representative, provided the conduct of the litigant himself is found to be bona fide.

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2.3 Having regard to the totality of the facts and circumstances of the case, we are satisfied that the assessee was prevented by sufficient cause from presenting the appeal within the prescribed period. We, therefore, condone the delay of 494 days in filing the appeal and admit the appeal for adjudication on merits.

3.

Briefly stated, the facts giving rise to the present appeal are that information regarding cash deposits aggregating to Rs.53,44,187/- in the assessee's bank account prompted the Assessing Officer to reopen the assessment by issuing statutory notices under the provisions of the Income-tax Act, 1961 ( in short the ‘Act’) Since, according to the Assessing Officer, no satisfactory explanation regarding the source of the cash deposits was furnished during the reassessment proceedings, the entire amount was treated as unexplained money under section 69A of the Act and added to the total income while framing the assessment under section 147 read with section 144B vide order dated 29.02.2024.

3.1 Aggrieved by the reassessment order, the assessee preferred an appeal before the Ld. CIT(A). The record reveals that notices fixing the appeal for hearing were issued on three occasions between 02.07.2024 and 01.08.2024. As no compliance was made on behalf of the assessee, the Ld. CIT(A), without examining the issues raised in the grounds of appeal on merits, dismissed the appeal solely for non-prosecution by observing that the assessee was not interested

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in pursuing the appellate proceedings. Relevant finding of the Ld. CIT(A) is reproduced as under:- “4. During the course of appeal proceedings, the appeal was posted for hearing on various dates, the details of which are as follows:

S.No. Date of Notice Date of Hearing Remarks 1 02.07.2024 18.07.2024 No response 2 19.07.2024 31.07.2024 No response 3 01.08.2024 16.08.2024 No response

The appellant did not respond to the above notices of hearing. Hence, the case is decided basing on the material available on record.

5.

Primarily, as there is no proper response to appeal notices, the appeal is liable to be dismissed in terms of verdicts of the Hon'ble Apex Court and the various High Courts. The Hon'ble Apex Court, in the case of CIT v. B.N. Bhattacharjee and another (10 CTR 354) held that- "appeal does not mean only filing of memo of appeal but also pursuing it effectively. In cases where the assesse does not want to pursue the appeal, the Court/Tribunal have inherent power to dismiss the appeal..."

An appeal means an effective appeal--"expression "prefer an appeal" would mean effectively prosecuting an appeal Purposefully interpreted, preferring an appeal means more than formally filing it but effectively pursuing it. If a party retreats before the contest begins, it is as good as not having entered the fray.

5.1 The Hon'ble Bombay High court in the case of M/s Chemipol vs Union of India in Excise Appeal No.62 of 2009 has held that in the cases where assessee does not want to pursue the appeal, appellate authorities have inherent power to dismiss the appeal for non-prosecution. Similar view has been expressed in the case of Late TukojiraoHolkar (MP), 223 ITR 480. Likewise, in the case of CIT vs Multiplan India (P) Ltd (38 ITD 320) (Del) similar view was taken.

5.2 Further, the appellant has failed to submit any substantial evidence to overturn the decision made by the AO in the impugned order. Therefore, it has been construed that the appellant is not interested in prosecuting the appeal. In the instant case, I am refraining from discussion and decision on the Grounds of appeal on merits. The Grounds of appeal are dismissed herewith for non- prosecution.

6.

In the result, the appeal is dismissed.”

Zakee Ahmed Abdul Sattar Shaikh 8 ITA No.2722/MUM/2026

4.

Before us, the learned counsel for the assessee submitted that the same Chartered Accountant, whose negligence resulted in the delayed filing of the present appeal, had also failed to attend the appellate proceedings before the Ld. CIT(A). Consequently, the assessee remained unrepresented despite being under the bona fide belief that his authorised representative was effectively pursuing the matter. It was further submitted that the assessee possesses documentary evidence explaining the source of the impugned cash deposits and undertakes to produce the same if one effective opportunity is granted.

5.

We have considered the rival submissions and have carefully perused the material available on record. It is evident from the impugned order that the Ld. CIT(A) dismissed the appeal merely for want of prosecution and refrained from adjudicating the grounds raised by the assessee on their merits. Such an approach, in our considered opinion, is not in consonance with the statutory obligation cast upon the first appellate authority under section 250 of the Act. The Commissioner (Appeals), being the final fact-finding authority, is duty-bound to examine the issues arising from the assessment order and adjudicate the grounds of appeal by passing a reasoned and speaking order, even where the appellant remains absent. Dismissal of a statutory appeal simpliciter for non- prosecution without adjudication on merits cannot ordinarily be sustained.

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5.1 In the peculiar facts of the present case, we also find that the assessee had remained unrepresented not only before the Ld. CIT(A) but also during the reassessment proceedings. The explanation furnished by the assessee regarding the conduct of his Chartered Accountant appears plausible and is supported by contemporaneous documentary evidence. The principles of natural justice demand that a litigant should ordinarily be afforded an effective opportunity to substantiate his case, particularly where substantial additions have been made under section 69A of the Act.

5.2 Considering the entirety of the circumstances and in order to advance the cause of substantial justice, we deem it appropriate to set aside the impugned order of the Ld. CIT(A). Since the assessee was not effectively represented even before the Assessing Officer and claims to possess documentary evidence explaining the source of the cash deposits, we consider it proper to restore the entire matter to the file of the Assessing Officer for a de novo adjudication in accordance with law after affording the assessee a reasonable and effective opportunity of being heard.

5.3 The assessee is directed to extend full cooperation during the remand proceedings and to furnish all documentary evidence in support of his explanation without seeking unnecessary adjournments. The Assessing Officer shall examine the material so produced objectively and pass a fresh speaking order in accordance

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with law, uninfluenced by any observations contained in the earlier assessment order or in this order.

6.

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

Order pronounced in the open Court on 22/07/2026.

Sd/- Sd/- (PAWAN SINGH) (OM PRAKASH KANT) JUDICIAL MEMBER ACCOUNTANT MEMBER

Mumbai; Dated: 22/07/2026 M. Ranganath Vittal , Sr. P.S.

Copy of the Order forwarded to : 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file.

BY ORDER, //True Copy// (Assistant Registrar) ITAT, Mumbai

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