PRATIBHA AND PRATIK ASSOCIATES,KOLHAPUR vs. INCOME TAX OFFICER, KOLHAPUR

Aggrieved with such order of the Ld. AO, the assessee filed an appeal before the Ld. CIT(A)/NFAC. There was a delay of 122 days in filing of the appeal before the Ld. CIT(A)/NFAC. The Ld. CIT(A)/NFAC dismissed the appeal of the assessee in limine as non-maintainable on account of delay in filing of the appeal by observing that that the assessee has not been able to demonstrate that sufficient cause existed for non-filing the appeal within due time.

Dissatisfied, the assessee is in appeal before the Tribunal raising the following grounds of appeal : “1. On the facts and circumstances of the case and in law the notice u/s 148 issued by the AO dated 31.03.2021 being unsigned either physically or digitally the same is invalid and hence the consequent assessment proceedings are invalid. The appellant prays that it be held accordingly. 2. On the facts and circumstances of the case and in law the CIT(A), NFAC erred in not condoning the delay in filing the appeal in spite of there being reasonable cause for the delay thereby confirming the action of the AO in computing income of the appellant at Rs.1,61,23,539/-being 8% of the turnover of the appellant as against the income of the appellant as per the audited accounts and the Tax Audit Report filed by it. The appellant prays that the AO be directed accordingly in the matter. 3. On the facts and circumstances' of the case and in law the CIT(A), erred in not considering the ground the appellant regarding non grant of credit of TDS deducted of Rs.8,59,344 during the year on its contract receipts. The appellant craves leave to add to, amend, alter, delete or modify all or any of the above ground of appeal or raise a new ground of appeal before or at the time of hearing.”

The Ld. AR submitted that the delay in filing of the appeal before the Ld. CIT(A)/NFAC was not intentional but resulted due to the reasons which are reproduced by the Ld. CIT(A)/NFAC in para 3.1 of his impugned order as under :

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

We have heard the Ld. Representatives of the parties and perused the material available on record. We find that the Ld. AO completed the assessment ex-parte qua the assessee u/s 147 r.w.s. 144 r.w.s. 144B of the Act vide his order dated 26.03.2022 due to the failure on the part of the assessee to make any submissions/filing relevant supporting documents and evidence despite being afforded several opportunities by the Ld. AO. It is an admitted fact that the assessee filed appeal before the Ld. CIT(A)/NFAC with a delay of 122 days. The Ld. CIT(A)/NFAC has dismissed the appeal of the assessee observing that the reasons cited by the assessee for the said delay do not constitute sufficient cause for condoning the delay. Referring to the condonation application filed before the Ld. CIT(A)/NFAC, the Ld. AR has submitted that the delay in filing of the appeal was not intentional. He submitted that the partners of the assessee firm were not aware of the assessment proceedings till they received notices by physical mode from the JAO at Kolhapur in respect of penalty proceedings u/s 271(1)(c)/ 271(1)(b) of the Act. On receipt of such notices, the partners approached another Chartered Accountant and accordingly the appeal was filed through such newly appointed Chartered Accountant which led to delay in filing of the appeal before the Ld. CIT(A)/NFAC. It is therefore his submission that the assessee had a sufficient cause for such delay. Before us, the Ld. Counsel for the assessee submitted that the assessee has a strong case on merits and therefore humbly prayed that the assessee may be granted an opportunity to present and substantiate his case by filing the requisite details/documents.

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, cause of substantial justice deserves to be preferred for the other side cannot claim to have vested right in injustice being done because of a non-deliberate delay. Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As against this when delay is condoned the highest

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 decision(s) of the Hon'ble Supreme Court (supra), we hereby set aside the impugned order of the Ld. CIT(A)/NFAC and restore the matter back to his file with a direction to condone the delay in filing of the appeal before him by the assessee and decide the appeal on merits as per fact and law, after giving due opportunity of being heard to the assessee. Needless to say, the assessee shall comply with the notices issued by the Ld. CIT(A)/NFAC and make its submissions before him on the appointed date without seeking any adjournment under any pretext, unless required for the sufficient cause, failing which the Ld. CIT(A)/NFAC shall be at liberty to pass appropriate order as per law. We hold and direct accordingly. The grounds raised by the assessee are accordingly allowed for statistical purposes.

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

Since we have set aside the quantum appeal in ITA No. 2677/PUN/2025 to the file of the Ld. CIT(A)/NFAC with a direction to condone the delay and decide the impugned issue on merits, we set aside the impugned penalty appeal also to the file of the Ld. CIT(A)/NFAC to decide the same afresh once the quantum appeal of the assessee is decided. The grounds raised by the assessee are accordingly allowed for statistical purposes.

To sum up, both the appeals of the assessee in ITA Nos. 2677 & 2723/PUN/2025 are allowed for statistical purposes.