NANGAN MOTORS PRIVATE LIMITED,VELLORE vs. DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE -1, VELLORE, VELLORE

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ITA 591/CHNY/2026Status: DisposedITAT Chennai27 April 2026AY 2017-188 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that the CIT(A) should have condoned the delay as the assessee's averments in the affidavit remained uncontroverted. The matter was remitted back to the CIT(A) for adjudication on merits.

What were the facts?

The assessee filed appeals with a significant delay, which the CIT(A) dismissed on technical grounds without condoning the delay. The assessee claimed ignorance of the assessment order and cited the Managing Director's health issues as reasons for the delay.

What were the issues?

Whether the CIT(A) was justified in refusing to condone the significant delay in filing the appeal, and whether the assessment order was valid.

Which sections of the Income-tax Act were involved?

Section 250,Section 147,Section 144,Section 144B,Section 139(1),Section 69A,Section 115BBE

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, CHENNAI BENCHES “D” :: CHENNAI

Before: SHRI INTURI RAMA RAO & SHRI S.S.VISWANETHRA RAVI

For Appellant: Mr. T Banusekar – Advocate & Mr. Suraj
For Respondent: Mr. ARV Sreenivasan – CIT(DR)
Hearing: 17/03/2026Pronounced: 27/04/2026

आयकर अपीलीय अिधकरण ”डी” �ायपीठ चे�ई म�। IN THE INCOME TAX APPELLATE TRIBUNAL CHENNAI BENCHES “D” :: CHENNAI BEFORE SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER AND SHRI S.S.VISWANETHRA RAVI, JUDICIAL MEMBER ITA No. A.Y. Appellant Respondent 590/CHNY/2026 2017-18 Nangan Motors Deputy Private Limited, Commissioner 591/CHNY/2026 2017-18 0/1, MC Road, Ambur, Vs. of Income 592/CHNY/2026 2017-18 Ambur S.O., Tax,Circle-1, 593/CHNY/2026 2018-19 Kannigapuram, Vellore. 594/CHNY/2026 2018-19 Vellore – 635802. PAN: AAECN7598K Assessee by Mr. T Banusekar – Advocate & Mr. Suraj Nahar – CA. Revenue by Mr. ARV Sreenivasan – CIT(DR) Date of hearing 17/03/2026 Date of pronouncement 27/04/2026 आदेश/ ORDER PER INTURI RAMA RAO, AM : This bunch of five appeals filed by the Assessee are directed against the separate orders of ld.Commissioner of Income Tax(Appeal)[NFAC], Delhi dated 26.11.2025, 21.11.2025, 21.11.2025, 27.11.2025 and 26.11.2025 respectively; passed under section 250 of the Income Tax Act, 1961 for the A.Y.2017-18, 2018-19, 2018-19, 2017-18 & 2017-18 respectively.

2.

Since identical facts and issues are involved in all these five appeals, these appeals were heard together and disposed of by this common order. For the sake of convenience and clarity, the facts relevant to the appeal in ITA No.590/CHNY/2026 for A.Y.2017-18 are stated herein:

3.

The Assessee in ITA No.590/CHNY/2026 raised the following grounds of appeal : “1. For that the order of the Commissioner of Income Tax (Appeals) is contrary to law, facts and circumstances of the case and at any rate against the principles of equity. natural justice and fair play. 2. For that the Commissioner of Income Tax (Appeals) erred in dismissing the appeal as not maintainable. 3. For that the Commissioner of Income Tax (Appeals) erred in dismissing the appeal on technical grounds. 4. For that the Commissioner of Income Tax (Appeals) erred in law and on facts in dismissing the appeal solely on the ground of delay, without properly appreciating the facts and circumstances of the case. 5. For that the Commissioner of Income Tax (Appeals) failed to appreciate that the appellant had shown sufficient and reasonable cause for the delay in filing the appeal. 6. For that the Commissioner of Income Tax (Appeals) failed to appreciate that the appellant had no intention to delay the proceedings deliberately, and that the delay occurred due to bona fide and unavoidable circumstances.

7.

For that the reopening in the instant case is bad in law. 8. For that consequently the order issued u/s. 147 r.w.s. 144 r.w.s.144B is bad in law. 9. For that the Commissioner of Income Tax (Appeals) failed to appreciate that the Assessing Officer erred in adding a sum of Rs.23.11,457/- being payment to contractor as undisclosed income. 10. For that the Commissioner of Income Tax (Appeals) failed to appreciate that the Assessing Officer erred in adding a sum of Rs.22,000/- being rent as undisclosed income. 11. For that the Commissioner of Income Tax (Appeals) failed to appreciate that the Assessing Officer erred in adding a sum of Rs.10.182/- being professional or technical fees as undisclosed income. 12. For that the appellant company incurred a loss during the impugned assessment year. 13. For that the Commissioner of Income Tax (Appeals) failed to appreciate that the Assessing Officer erred in adding a sum of Rs. 1,50,38,360/- being cash deposits as unexplained money u/s.69A. 14. For that the Commissioner of Income Tax (Appeals) failed to appreciate that the Assessing Officer erred in adding a sum of Rs. 13,72,765/- being cash withdrawal as unexplained money u/s.69A. 15. For that the provisions of section 69A are not invocable in the facts and circumstances of the case. 16. For that no addition u/s.69A is warranted in the facts and circumstances of the case. 17. For that the appellant objects to the levy of tax at the rates u/s. 115BBE.” 4. Briefly, the facts of the case are that the appellant is a Company engaged under the provisions of Companies Act, 1956. It is engaged in the business of running of Call Service Centre. The appellant had not filed regular Return of Income under the provisions of Section 139(1) of the Act for the Assessment Year 2017-18. However, based on the information that the appellant made payment to contractors and received rent and made a cash deposits in the current account maintained with the bank, the Jurisdictional Assessing Officer formed an opinion that the income got escaped assessment from tax. Accordingly, a notice u/s.148 was issued on 27.03.2021. However, the appellant company neither complied with notice u/s.148 nor the notices issued u/s.142(1) of the Act. In the circumstances, National Faceless Assessment Centre (hereinafter called ‘AO’) proceeded with the framing the best judgment assessment vide order dated 22.03.2022 passed u/s.147 r.w.s 144 read with section 144B of the Act at a total income of Rs.1,87,54,760/-. While doing so, the Assessing Officer made addition of cash deposits in the current account maintained with HDFC Bank of Rs.1,50,38,360/- as unexplained money of the appellant the Assessing Officer also made addition of contract receipts of Rs.23,11,457/- as unexplained income. The Assessing Officer made an addition of rent received of Rs.22,000/-. The AO also made addition of cash withdrawn from current account of Rs.13,72,765/-.

5.

Being aggrieved by the above assessment order, the appellant filed an appeal before the ld.CIT(A) with a delay of 1272 days. The appellant also filed a petition seeking condonation of delay on the ground that the appellant was not aware of the assessment passed by NFAC and the appellant was not served upon the Assessment Order physically. He submits that Managing Director of the appellant company Mr.B.Krishnan was suffering from the severe cervical spondylitis characterized neck pain numbness in arm etc. However, the ld.CIT(A) had refused to condone the delay by citing that the assessment order was served at the appellant’s last known address on the records of the Income Tax Department. Thus, the ld.CIT(A) concluded that there was no sufficient reason for the delay in filing appeal. Accordingly, refused to condone the delay and dismissed the appeal in limine on the ground of delay.

6.

Being aggrieved, the appeal is in appeal before us in the present appeal.

7.

The ld.AR submits that the appellant had shown the existence of sufficient cause for delay in filing of appeal before the ld.CIT(A), the ld.CIT(A) ought not to have refused to condone the delay.

8.

On the other hand, ld.Sr.DR opposed the above submission and submits that the ld.CIT(A) has dealt with the explanation offered by the appellant company in support of the delay in following appeal by passing a reasoned order. Therefore, no interference is required by this Tribunal.

9.

We heard rival submissions and perused the material available on record. The issue that arises for our consideration is whether the ld.CIT(A) was justified in refusing to condone the delay of 1282 days in filing appeal before him. Admittedly, the appellant filed the petition seeking the condonation of delay on the ground that the appellant was not aware of the assessment order passed by the Assessing Officer. This is evident from the fact that the assessment order was passed u/s.144 of the Act.

10.

The averments made in the Affidavit seeking the condonation of delay in filing appeal before the ld.CIT(A), remain uncontroverted by the learned ld.CIT(A). In the absence of any material to the contrary, the averments made in the affidavit cannot be brushed aside. The Hon’ble Supreme Court in the case of M.Kalappa Sethi Vs. M.V.Laxmi Narain Rao AIR 1973 SC 627, it was held that an uncontroverted affidavit shall be taken as an affidavit on fact. Therefore, we are of considered opinion that the ld.CIT(A) ought to have condoned the delay in filing the appeal and admitted the appeal for adjudication on merits. In the circumstances, we remit the matter back to the file of ld.CIT(A) for adjudication of the issues in appeal on merits after affording an opportunity of being heard to the assessee in accordance with law after affording opportunity of hearing to the appellant.

11.

In the result, the appeal filed by the assessee in ITA No.590/CHNY/2026 stands partly allowed for statistical purposes.

ITA Nos.591, 592, 593 & 594/CHNY/2026 12. We find that the identical facts and issues are involved in assessee’s appeal bearing Appeal No.590/CHNY/2026 for A.Y.2017-18. Accordingly, our findings given above shall apply mutatis mutandis to these four appeals in ITA Nos.591, 592, 593 & 594/CHNY/2026 also, accordingly, we remit the matter back to the file of ld.CIT(A) for adjudication of the issues in appeal on merits after affording an opportunity of being heard to the assessee in accordance with law after affording opportunity of hearing to the appellant.

13.

Accordingly, appeal filed by the assessee in ITA Nos.591, 592, 593 & 594/CHNY/2026 are partly allowed for statistical purpose.

14.

To sum up, all appeals of the assessee are partly allowed for statistical purpose. Order pronounced in the open Court on 27th April, 2026.

Sd/- Sd/- (SS VISWANETHRA RAVI) (INTURI RAMA RAO) JUDICIAL MEMBER ACCOUNTANT MEMBER Chennai; �दनांक / Dated : 27th April, 2026 SGR, Sr.PS आदेश क� ��त�ल�प अ�े�षत / Copy of the Order forwarded to : अपीलाथ� / The Appellant. 1. ��यथ� / The Respondent. 2. 3. The CIT Chennai/Madurai/Coimbatore/Salem. �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, “डी” ब�च, 4. चे�नई / DR, ITAT Chennai. गाड� फ़ाइल / Guard File. 5.

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