B CHAVAN ENTERPRISES,PUNE vs. INCOME TAX OFFICER WARD 5(2), PUNE

Although a number of grounds have been raised by the assessee, however, these all relate to the order of the Ld. CIT(A) / NFAC in dismissing the appeal on account of delay in filing of the same by 727 days and thereby confirming the addition of Rs.2,79,82,642/- made by the Assessing Officer.

Facts of the case, in brief, are that the assessee is a partnership firm engaged in the business of reality development activities. It has not filed its return of income for the impugned assessment year. The Assessing Officer observed from the CBDT’s insight portal that during the financial year 2017-18 relevant to assessment year 2018-19 the assessee firm has purchased an immovable property amounting to Rs.2,79,82,642/-. Since the assessee has not filed its return of income, the Assessing Officer, after recording reasons, reopened the assessment as per the provisions of section 147 of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’). Subsequently an order u/s 148A(d) was passed on 31.03.2022 after issuing a notice u/s 148A and thereafter a notice u/s 148 of the Act was issued on 31.03.2022. The assessee in response to the same did not file its return of income. Thereafter, the Assessing Officer issued notice u/s 142(1) of the Act along with a questionnaire. However, there was no response from the side of the assessee. The Assessing Officer, therefore, proceeded to complete the assessment u/s 144 of the Act and made addition of Rs.2,79,82,642/-.

Since the assessee filed its appeal with a delay of 727 days, the Ld. CIT(A) / NFAC dismissed the appeal on account of delay on the ground that the assessee failed to demonstrate due diligence in safeguarding its statutory rights. The assessee did not take any steps to review its statutory compliance status including the correctness of the registered email ID on the ITBA portal for a period

Aggrieved with such order of the Ld. CIT(A) / NFAC the assessee is in appeal before the Tribunal.

The Ld. Counsel for the assessee referring to the contents of the condonation application filed along with the affidavit, copy of which is placed at pages 141 to 146 of the paper book drew the attention of the Bench to the same which read as under:

Relying on various decisions the Ld. Counsel for the assessee submitted that the Ld. CIT(A) / NFAC should not have dismissed the appeal on account of delay and should have decided the appeal on merit by condoning the delay. He accordingly submitted that he has no objection if the matter is restored to the file of the Ld. CIT(A) / NFAC with a direction to condone the delay in filing of the appeal and decide the issue on merit.

The Ld. DR on the other hand heavily relied on the order of the Ld. CIT(A) / NFAC.

We have heard the rival arguments made by both the sides, perused the orders of the Assessing Officer and Ld. CIT(A) / NFAC and the paper book filed on behalf of the assessee. We have also considered the various decisions cited before us. It is an admitted fact that due to non-response to the various statutory notices issued by the Assessing Officer, he passed the order u/s 147 r.w.s. 144 of the Act determining the total income of the assessee at Rs.2,79,82,642/-. Since there was a delay in filing of the appeal before the Ld. CIT(A) / NFAC by 727 days, he did not condone the delay and dismissed the appeal as unadmitted. It is the submission of the Ld. Counsel for the assessee that due to restructuring of the partnership firm on a number of occasions and due to loss of e-filing credentials, there was delay in filing of the appeal which was duly explained before the Ld. CIT(A) / NFAC. It is also his submission that in view of various decisions of the Hon’ble Supreme Court the Ld. CIT(A) / NFAC should have decided the issue on merit and should not have become hyper technical. We find the assessee in the instant case has admittedly filed the appeal before the Ld. CIT(A) / NFAC with a delay of 727 days. Further, the assessee has explained the reasons for such delay in filing of the appeal before the Ld. CIT(A) / NFAC which has already been reproduced in the preceding paragraphs.

We find the Hon'ble Supreme Court in the case of Collector, Land Acquisition vs. Mst. Katiji & Ors. reported in 167 ITR 471 (SC) has held that when substantial justice and technical considerations are pitted against each other,

We find recently the Hon’ble Supreme Court in the case of Inder Singh Vs. The State of Madhya Pradesh reported in 2025 LiveLaw (SC) 339 has held as under: “14. There can be no quarrel on the settled principle of law that delay cannot be condoned without sufficient cause, but a major aspect which has to be kept in mind is that, if in a particular case, the merits have to be examined, it should not be scuttled merely on the basis of limitation.”

In the light of the above decisions of Hon’ble Supreme Court cited (supra) and considering the totality of the facts of the case and in the interest of justice, we deem it proper to restore the issue to the file of the Ld. CIT(A) / NFAC with a direction to condone the delay in filing of the appeal and decide the issue on merit and as per fact and law after giving due opportunity of being heard to the assessee. The assessee is also hereby directed to make its submissions, if any, on the appointed date without seeking any adjournment under any pretext failing which the Ld. CIT(A) / NFAC is at liberty to pass appropriate order as per law. We hold

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