ASTORMUELLER SHOES PRIVATE LIMITED ,BANGALORE vs. DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-1(1)(1), BANGALORE

IN THE INCOME TAX APPELLATE TRIBUNAL ‘A’ BENCH : BANGALORE BEFORE SHRI PRASHANT MAHARISHI, VICE – PRESIDENT AND SHRI KESHAV DUBEY, JUDICIAL MEMBER ITA No. 1954/Bang/2025 Assessment Year : 2018-19

M/s. Astormueller Shoes Private Limited, The Deputy Commissioner of #2, Ground Floor S R Complex, Income Tax, Thavarekare Main Road, Circle – 1(1)(1), Vs. S G Palya, Bengaluru. Bengaluru – 560 029. PAN: AAGCA3756L APPELLANT RESPONDENT

Assessee by : Sri C R Krishna AR : Sri N. Balusamy – JCIT DR Revenue by

Date of Hearing : 23-03-2026 Date of Pronouncement : 11-06-2026

ORDER PER PRASHANT MAHARISHI, VICE – PRESIDENT

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35 at paragraph No. 15 of that form. He further referred that due to the issue of website, several grievances were raised before the respective authorities but the response was not received and therefore there is a delay in filing of the appeal. He admitted that the order of the ld. AO was received by the assessee on 10 May 2021 whereas the appeal is filed on 31st of July 2021 which has caused the delay of 2 months and 21 days. He further submitted that delay is for a reasonable cause, and therefore the learned CIT – A should have condoned the delay. Even otherwise, the CIT-A should have given an opportunity to the assessee to explain the facts of the case that why there is a delay. He further referred to paragraph No. 2.3 of the appellate order stating that though assessee attributed the delay of approximately 2 months on the non-working of the income tax website, the learned CIT – A wanted that such delay should have been explained by providing specific evidence to demonstrate technical glitches. Thus the claim made by the assessee was held to be a general and non-specific reason. He submitted that when the assessee has raised the grievance, it cannot be non-specific and a general argument. Even otherwise, he submitted that the learned CIT – A should have condoned the delay and admitted the appeal of the assessee to decide it on merits of the case. 6. On the merits of the case he submitted that the provisions have been made in the books of accounts on the basis of the ICDS and therefore the disallowance of the same profit made by the ld. AO is beyond the provisions of the law. 7. The ld. DR vehemently submitted that the assessee has not complied with the any of the notices issued by the ld. AO and further did not explain the delay in filing of the appeal before the learned CIT – A and therefore no infirmity can be found in the order of the learned lower authorities. 8. We have carefully considered the rival contention and perused the orders of the learned lower authorities. Admittedly, the assessee was issued five notices by the ld. AO at respective time. However such notices were issued starting from 7th December 2020 to 7th April 2021. It is apparent that during that period the country was affected with Covid-19. Further before the learned CIT – A the

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assessee in form No. 35 has categorically stated that appeal is filed late because of the reason of the technical glitches and for which the grievance has also been filed. We find that the learned CIT – A should have condoned the delay in filing of the appeal, when the assessee is saying that there is a grievance raised by the assessee before the respective authorities also. Technical glitches were on part of the income tax department and not on the part of the assessee. Thus the assessee was prevented by sufficient cause in filing of the appeal. It is not the case of the learned CIT – A that he can certify that during the period in which the assessee should have filed the appeal there were no technical glitches. Therefore, the learned CIT – A is not justified in not condoning the delay in filing of the appeal of 2 months and 21 days before him. Even otherwise the delay is caused because of the bonafide reasons. Nothing would have been gained by the assessee in filing the appeal late. 9. Coming to the merits of the case, we find that the assessee has debited a sum of ₹ 14,19,266 which was made on account of the provisions of ICDS VI relating to the facts of changes in foreign exchange rates. As per paragraph No. 8 of the section, the applicability of income is that any premium or discount arising at the inception of the foreign exchange contract shall be amortised as an expense or income over the life of the contract. The exchange difference in such a contract shall be recognised as income or expense in the previous year in which the exchange rates change. Any profit or loss arising on cancellation of renewal shall be recognised as income or as expense for the previous year. Further the provision of the above sum is made in terms of the above condition of ICDS. Accordingly we find that the provision made by the assessee could not have been added to the total income of the assessee. In view of the above facts we find that the above addition should not have been made. 10. In view of the above facts, we restore the whole matter back to the file of the ld. AO with a direction to the assessee to explain the provision of ICDS, the ld. AO may verify the same, and thereafter decide the issue afresh. If the ld. AO finds

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that the provisions has been made in accordance with the provisions of ICDS, the addition deserves to be deleted. 11. In the result appeal filed by the assessee is allowed with above direction for statistical purposes. Order pronounced in the open court on 11th June, 2026.

Sd/- Sd/- (KESHAV DUBEY) (PRASHANT MAHARISHI) JUDICIAL MEMBER VICE-PRESIDENT Bangalore, Dated, the 11th June, 2026. *TNTS* / Desai S Murthy/ Copy to: 1. Appellant 2. Respondent 3. PCIT/CIT 4.CIT(A) 5. DR, ITAT, Bangalore By order

Assistant Registrar, ITAT, Bangalore