DUMPALA KAVITHA REDDY,HYDERABAD vs. ITO, WARD -10(1), HYDERABAD

The brief facts of the case are that the assessee is an individual and is the proprietrix of M/s. Sri Durga Ads, engaged in the business of advertisement. The assessee filed her return of income for the assessment year 2020-21 on 28.12.2020 declaring a total income of Rs.4,10,460/-, comprising income from business, loss under the head "House Property" and income from other sources. The return of income was processed under section 143(1) of the Income-tax Act, 1961. Subsequently, the case was selected for limited scrutiny under CASS on the issue of large credit card payments made by the assessee during the relevant previous year. Accordingly, statutory notices under sections 143(2) and 142(1) of the Act were issued calling upon the assessee to furnish the details relating to the credit card transactions and the sources for payment of the credit card dues. However, according to the A.O., the assessee failed to comply with the statutory notices and did not furnish the details called for. Therefore, the assessment was completed under section 144 r.w.s. 144B of the Act.

During the course of assessment proceedings, the A.O. obtained information from various banks by issuing notices under

Aggrieved by the assessment order, the assessee preferred an appeal before the learned CIT(A). The appeal was filed on 08.01.2025, involving a delay of more than two years and three months from the date of the assessment order. During the appellate proceedings, the learned CIT(A) called upon the assessee to explain the delay in filing the appeal. In response, the assessee furnished an explanation stating that the affairs of her business

The learned CIT(A), after considering the explanation furnished by the assessee, held that the reasons stated did not constitute "sufficient cause" within the meaning of section 249(3) of the Act. According to the learned CIT(A), the assessment order had been duly served through the registered e-mail address of the assessee and it was the responsibility of the assessee to monitor the income-tax portal and the electronic communications issued by the Department. The learned CIT(A) further observed that the assessee had failed to discharge the burden of proving sufficient cause for condonation of the inordinate delay of more than two years and three months and, accordingly, declined to condone the

Aggrieved by the order of the learned CIT(A), the assessee is now in appeal before the Tribunal.

The learned counsel for the assessee, Shri R. Mohan Kumar, Advocate, referring to the affidavit filed before the Tribunal, submitted that the learned CIT(A) was not justified in refusing to condone the delay in filing the appeal. The learned counsel for the assessee submitted that the assessee was prevented by sufficient cause from filing the appeal within the prescribed period. He submitted that during the relevant period, the husband of the assessee, who was looking after the business affairs as well as the income-tax matters of the assessee, was suffering from serious medical ailments and had undergone prolonged treatment. It was further submitted that the daughter of the assessee was also suffering from medical complications and, on account of the continuous medical emergencies in the family, the assessee could not attend to the income-tax proceedings within the prescribed time. The learned counsel for the assessee further submitted that the assessee has now filed a detailed affidavit explaining the

The learned Senior A.R. for the Revenue, Ms. T. Mythili, on the other hand, supporting the order of Ld. CIT(A), submitted that the appeal before the learned CIT(A) was filed after an inordinate delay of more than two years and three months and that the learned CIT(A), after considering the explanation furnished by the assessee, had rightly held that the assessee failed to establish sufficient cause for condonation of the delay. She further submitted that the order of the learned CIT(A) does not call for any interference. However, she fairly submitted that the issue may be decided in accordance with law after considering the affidavit and

We have heard both parties and considered the relevant reasons given by the assessee in the affidavit filed before us explaining the delay in filing the appeal before the learned CIT(A). The delay of two years and three months in filing the appeal before the learned CIT(A) was not properly explained before the learned CIT(A). However, before the Tribunal, the assessee has filed a detailed affidavit explaining that, due to medical emergencies in the family, including the illness of her husband and daughter, she could not prosecute the appeal before the learned CIT(A) within the prescribed period. The assessee has also filed the relevant medical records in support of the reasons explained in the affidavit. After considering the relevant reasons and the material placed on record, we find that the reasons explained by the assessee appear to be bona fide and thus come under 'sufficient cause' for condoning the delay of two years and three months in filing the appeal before the learned CIT(A). Further, it is a well- settled principle of law laid down by the Hon'ble Supreme Court in the case of Collector, Land Acquisition Vs. Mst. Katiji, reported in

Since the learned CIT(A) has not adjudicated the issues on merits on account of dismissal of the appeal on the ground of limitation, in our considered view, the matter needs to be restored to the file of the learned CIT(A). Accordingly, we condone the delay of two years and three months in filing the appeal before the learned CIT(A) and set aside the matter to the file of the learned CIT(A), with costs of Rs. 10,000/- (Rupees Ten Thousand only) to be paid to the Bar Association, ITAT, Hyderabad within 15 days from the date of receipt of this order. The learned CIT(A) shall admit the appeal and dispose of the same on merits, in

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