ILAYARAJA SHANMUGAM,PUDUKKOTTAI vs. ITO, WARD-1,, PUDUKKOTTAI

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ITA 928/CHNY/2026Status: DisposedITAT Chennai25 May 2026AY 2018-195 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal condoned the delay in filing the appeal before the CIT(A) subject to a cost payment. It also set aside the CIT(A)'s order and restored the assessment to the AO for de novo assessment, granting the assessee an opportunity to be heard.

What were the facts?

The assessee's appeals were dismissed by the CIT(A) for a delay of 188 days in filing. The assessee claimed non-receipt of notices from the AO due to technical glitches, leading to ex-parte assessment orders with significant additions.

What were the issues?

Whether the delay in filing the appeal before the CIT(A) should be condoned due to non-receipt of notices, and if the assessee should be granted a fresh opportunity for assessment.

Which sections of the Income-tax Act were involved?

Section 69A

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘C’ BENCH: CHENNAI

Before: SHRI ABY T. VARKEY & SHRI INTURI RAMA RAO

Hearing: 20.04.2026Pronounced: 25.05.2026

Heard together (2 matters)

ITA No.928/Chny/2026
ITA No.929/Chny/2026

Read from the judgment's own cause title. This page is filed under one of them.

आदेश / O R D E R PER ABY T. VARKEY, JM: These two appeals preferred by the assessee are against the order of the Learned Commissioner of Income Tax (Appeals)/NFAC, (hereinafter referred to as the ‘Ld.CIT(A)‘), Delhi, dated 31.12.2025 for the Assessment Years (hereinafter referred to as ‘AYs’) 2018-19 and 2019-20 respectively.

ITA Nos.928 & 929/Chny/2026 (AY 2018-19 & 2019-20) Ilayaraja Shanmugam :: 2 :: 2. At the outset, it was brought to our notice that the Ld.CIT(A) has passed the impugned orders [for both years] refusing to condone the delay of 188 days in filing the appeal before him. Further, he brought to our notice that the AO also passed ‘best judgment assessment’ (ex-parte) against the assessee making a huge addition of Rs.2,77,09,843/- for AY 2018-19 and Rs 3,14,11,620/- for AY 2019-20. Hence, relying on the decision of the Hon’ble Supreme Court in the case of TIN Box Co. v. CIT reported in [2001] 249 ITR 216 (SC), pleads that assessee may be given one more opportunity before the AO.

3.

Per contra, the Ld.DR does not want to give one more chance to the assessee.

4.

Having heard both the parties and after perusal of the records, we note that the Ld.CIT(A) without admitting the appeal of the assessee, has refused to condone the delay of 188 days in filing of the appeal before him, has dismissed the same. The Ld AR explained the reason for the delay in filing of appeal before the Ld CIT(A), and brought to our notice that the assessee didn’t receive any notice/communication from the AO because of which he was neither aware of the assessment proceedings nor assessment order passed against him. Since he was in the dark about the assessment itself, he neither participated in the assessment proceedings nor could file the appeal before the Ld.CIT(A) within 30 days

ITA Nos.928 & 929/Chny/2026 (AY 2018-19 & 2019-20) Ilayaraja Shanmugam :: 3 :: of the passing of the assessment order. In this regard, it is noted from the perusal of the assessment order that the assessee did not participate in the assessment proceedings which led the AO to add the entire credits in the bank account of the assessee to the tune of Rs.2,76,07,000/- u/s 69A of the Act; and contract receipt of Rs.1,02,843/- as undisclosed business income. Thus, made total addition of Rs.2,77,09,843/- for AY 2018-19 and similarly, the AO added the entire credits in the bank account of the assessee to the tune of Rs 3,14,11,620/- u/s 69A for AY 2019-20. The reasons for not participating during the proceedings have been attributed to non-receipt of notice/communication which led to the passing of the ex-parte assessment orders dated 20.03.2024. In such an event, the assessee cannot be expected to participate in the assessment proceedings, which led to the passing of ex-parte assessment order. Since the assessee was in dark about the existence of the assessment order, he cannot be expected to file appeal within time, which led to the delay of 188 days in filing of the appeal before the Ld.CIT(A). The notice issued by the AO, due to technical glitches, might have gone to SPAM account, because of which the assessee was not aware of the notice or the assessment order. The assessee cannot be faulted in such a scenario and hence the delay in filing before the Ld.CIT(A) need to be condoned and we order so, subject to the assessee remiting a cost of Rs.3,000/- (Rupees three thousand only) to the Tamil Nadu State Legal Services

ITA Nos.928 & 929/Chny/2026 (AY 2018-19 & 2019-20) Ilayaraja Shanmugam :: 4 :: Authority at Hon’ble High Court of Madras within 90 days of the receipt of this order and produce the receipt before the AO.

5.

Having condoned the delay in filing of appeal before the Ld CIT(A), [subject to remitting cost], finding that assessee didn’t get proper opportunity before the AO during assessment proceedings, we are of the view that the assessee should be given one more opportunity before the AO. Hence, we set aside the impugned order of the Ld.CIT(A) and restore the assessment back to the file of the AO for de novo assessment [refer the decision of the Hon’ble Supreme Court in the case of TIN Box Co. v. CIT reported in (2001) 249 ITR 216 (SC)]. The assessee is directed to diligently participate and file relevant documents as called for by the AO without fail and the AO to frame the assessment order after hearing the assessee.

6.

In the result, appeals filed by the assessee are allowed for statistical purposes.

Order pronounced on the 25th day of May, 2026, in Chennai.

Sd/- Sd/- (इंटूरी रामा राव) (एबी टी. वर्की) (INTURI RAMA RAO) (ABY T. VARKEY) न्यानयक सदस्य/JUDICIAL MEMBER लेखा सदस्य/ACCOUNTANT MEMBER चेन्नई/Chennai, ददनांक/Dated: 25th May, 2026. KB

ITA Nos.928 & 929/Chny/2026 (AY 2018-19 & 2019-20) Ilayaraja Shanmugam :: 5 ::

आदेश की प्रनतललपप अग्रेपर्त/Copy to: 1. अपीलार्थी/Appellant 2. प्रत्यर्थी/Respondent 3. आयकरआयुक्त/CIT, Chennai / Madurai / Salem / Coimbatore. 4. विभागीयप्रविविवि/DR 5. गार्डफाईल/GF

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