BIRLA AIRCON INDUSTRIES,ROORKEE vs. ITO WARD-1 (3)(4), ROORKEE

IN THE INCOME TAX APPELLATE TRIBUNAL DEHRADUN BENCH, DEHRADUN/SMC

BEFORE SHRI YOGESH KUMAR U.S, JUDICIAL MEMBER AND SHRI SANJAY AWASTHI, ACCOUNTANT MEMBER

ITA No. 78/DDN/2026( A.Y 2017-18) ITA No. 77/DDN/2026( A.Y 2017-18) ITA No. 76/DDN/2026( A.Y 2017-18)

Birla Aircon Industries Vs ITO 1104/1, 1105/1, Salempur, Ward-1(3)(4) Rajputana, Industrial Area, Hardiwar, Uttarakhand Roorkee, Haridwar (RESPONDENT) PAN: AARFB2798R (APPLICANT)

Appellant by None Respondent by Sh. Akash Barnwal, Sr DR

Date of Hearing 08.04.2026 Date of Pronouncement 30.04.2026

ORDER PER YOGESH KUMAR, U.S. JM: The captioned Appeal in ITA No. 78/DDN/2026 is filed by the

Assessee challenging the orders of Ld. Commissioner of Income Tax

(Appeals)-4 Mumbai (‘Ld. CIT(A)’ for short), dated 20/03/2024 for the

Assessment Year 2017-18, wherein the Ld. CIT(A) has confirmed the

assessment order passed under Section 143 (3) of the Income Tax Act, 1961

(‘Act’ for short). Assessee has also filed ITA No. 77/DDN/2026 and

76/DDN/2026 by challenging the orders of the CIT(A) dated 22/03/2023,

wherein the Ld. CIT(A) affirmed two penalty orders passed by the A.O. under

Section 272A(1)(d) of the Act.

the present Appeals, we deem it fit to decide the Appeals on hearing the Ld.

DR.

respectively. The Assessee filed condonation of delay assigning certain

reasons which are reproduced as under:-

“ii. That the appellant is a partnership firm, and does not have an in-house tax or legal department. All income-tax compliances, including appellate proceedings, were handled through external professional advisors. iii. That the appellant had engaged Late Shri H.K. Jain, Advocate, a senior practitioner and a close family acquaintance, to represent and prosecute its appeal before the Income-tax authorities, including before the Ld. CIT(A). The appellant had complete faith in his professional competence and integrity. iv. That owing to long-standing family relations and past professional association, the appellant firm entirely relied upon Late Shri H.K. Jain for monitoring the appeal proceedings, attending hearings, receiving notices, and communicating developments. v. No independent parallel follow-up was undertaken by the appellant, which is common practice where a trusted counsel is engaged. That unfortunately, Shri H.K. Jain suffered from prolonged illness for a considerable period prior to his demise and ultimately passed away on 23.03.2023. During his illness, the functioning of his office was severely disrupted, and effective communication with clients had substantially ceased. vi. (Copy of Death Certificate enclosed as Annexure A.) vii. That the appellant was never informed, either orally or in writing, about the fixation of hearings or progress of the appellate proceedings during the period of Shri H.K. Jain's illness or thereafter. No notices or appellate orders were ever served upon the appellant at its registered address or through email. viii. That after the demise of Shri H.K. Jain, the appellant made sincere and repeated efforts to ascertain the status of its appeal by contacting his family members and office staff. However, due to dislocation of records, absence of proper handover, and lack of access to digital credentials, no concrete information could be obtained. ix. That during this period, the appellant was under the bona fide belief that the appeal was either pending or had not been taken up for effective

hearing, especially considering the substantial backlog of appellate cases and absence of any communication from the Department. x. That the appellant being a small partnership firm, with partners engaged primarily in business operations, was unaware of the technical aspects of the ITBA portal and had no independent access or knowledge to periodically verify appellate status online. xi. That it was only upon receipt of coercive recovery notices from the Income-tax Department that the appellant realized that the appeal proceedings might have already 1. concluded. Immediately thereafter, the appellant engaged new counsel, Mr. Shivam Garg, Advocate, to examine the matter. xii. That upon verification through the ITBA portal, the newly appointed counsel informed the appellant that the appeal before the Ld. CIT(A) had already been dismissed vide order dated 02.03.2024, without the knowledge or participation of the appellant. xiii. That the appellant states on oath that it never received any physical copy, email communication, or electronic intimation of the appellate order, nor was the order ever made available to it in the normal course. xiv. That immediately upon acquiring knowledge of the appellate order, the appellant acted with utmost promptness and diligence and filed the present appeal without any further loss of time, clearly demonstrating bona fide conduct and absence of negligence. xv. That the delay has not resulted in any undue advantage to the appellant, nor has it caused any prejudice to the Revenue. On the contrary, dismissal of the appeal on technical grounds would cause irreparable loss to the appellant by denying adjudication on merits.”

sufficient cause to condone the inordinate delay in filing the captioned

Appeals, thus sought for dismissal of the present Appeal on delay in

latches.

the material available on record on the issue of delay in filing the

captioned Appeals. The Assessee assigned several reasons for

condoning the delay in filing the captioned Appeals, which are

reproduced in the previous paragraph. The same is not reproduced in

order to avoid the repetition.

delay in filing the Appeal with sufficient cause should be looked into in

a liberal way and shall condone the delay. In the landmark decision in

Collector, Land & Acquisition vs. Mst. Katiji& Others (1987) 167 ITR

471 (SC), the Hon'ble Supreme Court settled the law that the delay

when supported by justifiable reasons, must make way for the cause

of substantial justice. Considering the above facts and circumstances

and also the issue involved in the Appeals, by taking liberal view, we

condone the delay of617, 983 and 983 days in filing the captioned

Appeals.

ITA No. 78/DDN/2026 (Quantum Appeal)

passed on 23/12/2019 u/s 143(3) of the Income Tax Act, 1961 ('Act'

for short) by making certain addition. Further, two penalty orders

came to be passed under Section 272A(1)(d) of the Act on 04/09/2019

and 11/11/2019. The Assessee preferred Appeals before the Ld.

CIT(A) which have been dismissed vide order impugned. As against

the respective orders of the Ld. CIT(A), Assessee preferred the

captioned Appeals.

Assessee is a chronic defaulter, who has either not made full

compliance or not appeared before the Lower Authorities, therefore,

both the A.O. as well as the Ld. CIT(A) have passed the respective

orders in accordance with law which requires no interference, thus by

relying on the orders of the Lower Authorities, sought for dismissal of

the Appeals.

material available on record. It is found that during the assessment

proceedings, Assessee has not made full compliance and not produced

the entire material/document sought by the A.O. Accordingly, A.O.

made the addition. The Ld. CIT(A) has also passed ex-parte order and

affirmed the addition made by the A.O.

restore the issue to the file of the A.O. for de-novo assessment.

Accordingly, the order of the CIT(A) and the assessment order are

hereby set aside and we remand the matter to the file of the A.O. for

framing de-novo assessment in accordance with law. Needless to say,

the A.O. shall provide opportunity of being heard to the Assessee

before passing the assessment orderin accordance with law. The

Assessee is also directed to participate in assessment proceedings

without fail.

ITA No. 76/DDN/2026 and 77/DDN/2026 (Penalty Appeals)

2017-18 and remanded the matter to the file of the A.O. for framing

de-novo assessment. The penalty imposed under Section 272A(1)(d) of

the Act cannot be sustained. Accordingly, the impugned orders of the

penalty are hereby set aside.

and 77/DDN/2026 are allowed.

Order pronounced in the Open Court on this 30th Day of April, 2026

Sd/- Sd/- (SANJAY AWASTHI) (YOGESH KUMAR U.S.) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 30/04/2026 R. Naheed * Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI