HIMALKUMAR PRAVINKUMAR RANA,THANE vs. COMMISSIONER OF INCOME TAX (APPEALS), NATIONAL FACELESS APPEAL CENTER

IN THE INCOME TAX APPELLATE TRIBUNAL “J” BENCH, MUMBAI BEFORE SMT. BEENA PILLAI (JUDICIAL MEMBER) & SHRI BIJAYANANDA PRUSETH (ACCOUNTANT MEMBER) I.T.A. No. 656/Mum/2026 Assessment Year: 2013-14 Himalkumar Pravinkumar Vs. Commissioner of Income Tax (Appeals), Rana NFAC Mumbai Flat No. 3, Building No. 4 New Gosalia Park Boisar, Thane Maharashtra - 401501 [PAN: ALXPR6510J] (Appellant) (Respondent)

Assessee by Shri Henil Babariya, C.A. Revenue by Shri Pankaj Kumar, CIT DR Date of Hearing 10.03.2026 Date of Pronouncement 24.04.2026 ORDER Per Smt. Beena Pillai, JM: The present appeal filed by the assessee arises out of the order dated 11/03/2024 passed by the NFAC, Delhi [hereinafter the “Ld.CIT(A)”] for A.Y. 2013-14 on the following grounds:-

“1. On the facts and circumstances of the case and in law, the Learned Commissioner of Income Tax (Appeals), NFAC, erred in confirming the action of the Assessing Officer in denying the appellant's claim of exemption under section 54F of the Income-tax Act, 1961, though the appellant had sold a capital asset for Rs. 41,75,000/- and reinvested the entire net consideration in a new residential flat purchased for Rs. 92,81,400/- along with Stamp Duty of Rs. 4,64,170/- and Registration Charges of Rs. 30,000/-, all within the prescribed time limit. 2. The Learned CIT(A) erred in not appreciating that the appellant had fully complied with all conditions of section 54F and that the exemption ought to have been allowed in entirety. 3 The Learned CIT(A) further erred in confirming the reassessment made under section 147 r.w.s. 144B and section 144 without properly considering the submissions of the appellant and without granting proper opportunity of being heard 4. The order of the Learned CIT(A) is bad in law, against the principles of natural justice, and liable to be quashed

2 I.T.A. No. 656/Mum/2026 5. The appellant craves leave to add, alter, amend, or withdraw any of the above grounds at the time of hearing of the appeal.” 2. At the outset, the Ld. AR submitted that the delay of approximately 14 months in filing the present appeal is due to genuine and bona fide reasons beyond the control of the assessee. It was submitted that the assessee was continuously residing and working abroad in Dubai during the relevant period and, therefore, could not effectively coordinate and pursue the appellate proceedings within the prescribed time. It was further submitted that the assessee was not aware of the appellate remedy available before the Hon’ble Tribunal and could not take timely steps due to lack of proper legal guidance. Upon receiving appropriate advice, the assessee acted promptly and filed the present appeal without any further delay.

2.1. The Ld. AR submitted that the delay is neither wilful nor deliberate but has occurred due to unavoidable circumstances. It was also submitted that the assessee has a strong case on merits as the entire sale consideration has been reinvested in a residential property within the prescribed time, thereby entitling the assessee to deduction u/s 54F of the Act. Placing reliance on the judgment of the Hon’ble Supreme Court in Collector Land Acquisition v. Mst. Katiji (1987), it was submitted that a liberal approach should be adopted in matters of condonation of delay and substantial justice should prevail over technical considerations. Accordingly, the delay may kindly be condoned.

2.2. The Ld. DR opposed the condonation of delay and submitted that the assessee has failed to file the appeal within the prescribed statutory time limit and the delay is substantial. It was submitted that ignorance of law cannot be accepted as a valid reason for condonation of delay. The Ld. DR further submitted that the

3 I.T.A. No. 656/Mum/2026 assessee has not furnished sufficient evidence explaining each day of delay and, therefore, the explanation offered cannot be considered satisfactory. Accordingly, the Ld. DR prayed that the delay may not be condoned.

We have perused the submissions advanced by both sides in light of the records placed before this Tribunal.

2.3. It is observed that the appeal has been filed with a delay of approximately 14 months. The assessee has explained that he was continuously residing and working abroad in Dubai during the relevant period and, therefore, could not effectively coordinate and pursue the appellate proceedings within the prescribed time. It has also been submitted that the assessee was not aware of the appellate remedy available before the Hon’ble Tribunal and could not take timely steps due to lack of proper legal guidance.

2.3.1. We find that the above explanation constitutes a reasonable and bona fide cause for the delay. The fact of the assessee residing abroad has not been controverted by the Revenue.

2.4. It is observed that the Ld. DR could not controvert the factual assertions made in the affidavit filed by the assessee. Nothing has been brought on record by the revenue to establish that the delay was deliberate or attributable to any malafide intention on the part of the assessee.

2.5. In our considered opinion, the reason advanced by the assessee constitutes a reasonable and sufficient cause for the delay. The sudden demise of a key person responsible for handling tax matters is an unavoidable circumstance, which naturally disrupts the functioning of the assessee firm.

4 I.T.A. No. 656/Mum/2026 2.6. It is noted that there is no malafide intention on behalf of assessee in not filing the present appeal before this Tribunal, within the period of limitation. Nothing to establish any such intention has been filed by the revenue before this Tribunal. In our opinion there was sufficient cause for condoning the delay as observed by Hon’ble Supreme Court in case of Collector Land Acquisition Vs. Mst. Katiji & Ors., reported in (1987) 167 ITR 471 in support of his contentions. 2.7. We refer to the Third Member decision of Hon’ble Chennai, ITAT in the case of People Education & Economic Development Society Vs/ ITO reported in 100 ITD 87 (TM) (Chen), wherein it was held that "when substantial justice and technical consultation are pitted against each other, the cause of substantial justice deserves to be preferred for the other side cannot claim to have vested right in injustice being done because of non-deliberate delay".

2.8. It is also necessary to ascertain whether there was excessive or inordinate delay in the present facts of the case. Hon’ble Madras High Court in the case of CIT vs. K.S.P. Shanmugavel Nadai and Ors. (153 ITR 596) considered a situation of condonation of delay and held that where there exists a reasonable cause, period of delay may not be a relevant factor. Hon’ble Madras High Court relying on this principle had condoned the delay of nearly 21 years.

2.9. We also refer to the decision of Co-ordinate Bench of this Tribunal in the case of Bajaj Hindusthan Ltd. v. Jt. CIT (AT) (277 ITR 1) wherein this Tribunal has condoned the delay of 180 days when the appeal was filed after the pronouncement of the Judgment of the Hon’ble Supreme Court. It was noted that, the revenue had not file any counter-affidavit opposing the application of the assessee for condonation of delay. The Hon’ble Supreme

5 I.T.A. No. 656/Mum/2026 Court under similar circumstances had noted in case of Mrs. Sandhya Rani Sarkar vs. Smt. Sudha Rani Debi (AIR 1978 SC 537) held that non-filing of affidavit in opposition to an application for condonation of delay may be a sufficient cause to condone the delay.

2.10. In the present facts of the case, we note that no such affidavit has been furnished by the revenue countering the condonation application of the assessee. At this juncture, we also take assistance and support from the observation of Justice Krishna Iyer wherein he has quoted at various occasion while dealing with technicalities that "any interpretation that alludes substantive justice is not to be followed and that substantive justice must always prevail over procedural technicalities". Similar is the observation by Hon’ble Supreme Court in the case of Collector Land Acquisition Vs. Mst. Katiji & Ors., reported in (1987) 167 ITR 471.

The assessee is an individual. During the year under consideration, the assessee sold a capital asset for a consideration of Rs. 41,75,000/-. Out of the said sale proceeds, the assessee invested in purchase of a new residential flat amounting to Rs. 92,81,400/- along with stamp duty of Rs. 4,64,170/- and registration charges of Rs. 30,000/-.

The assessee claimed exemption u/s 54F of the Income-tax Act, 1961 on the ground that the entire sale consideration was invested within the prescribed time limit. However, the case was reopened

6 I.T.A. No. 656/Mum/2026 u/s 147 and the Ld. AO passed an order dated 22/09/2021 u/s 147 r.w.s. 144B and section 144, wherein the claim of exemption u/s 54F was disallowed.

4.1. Aggrieved, the assessee preferred an appeal before the Ld. CIT(A), NFAC, Delhi, which came to be dismissed ex-parte.

Aggrieved by the order of Ld.CIT(A) the assessee is in appeal before this Tribunal.

5.1. The Ld. DR relied upon the orders of the lower authorities. It was submitted that sufficient opportunities were granted to the assessee during the appellate proceedings, however, the assessee failed to avail the same. The Ld. DR submitted that the Ld. CIT(A) has rightly passed the order based on material available on record and no interference is called for.

7 I.T.A. No. 656/Mum/2026 We have perused the submissions advanced by both sides in light of the records placed before this Tribunal.

6.1. Considering the totality of facts and circumstances, we are of the view that the assessee did not get sufficient and effective opportunity of being heard before the Ld. CIT(A). Principles of natural justice require that a reasonable opportunity be granted to the assessee to present his case. In the interest of substantial justice, we deem it appropriate to set aside the impugned order and restore the matter to the file of the Ld. CIT(A) for fresh adjudication. The Ld. CIT(A) shall decide the issue afresh in accordance with law after providing adequate opportunity of being heard to the assessee. The assessee is also directed to cooperate in the appellate proceedings and file necessary evidences in support of the claim.

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

Order pronounced in the open court on 24/04/2026

Sd/- Sd/-

(BIJAYANANDA PRUSETH) (BEENA PILLAI) Accountant Member Judicial Member Mumbai Dated: 24/04/2026 SC Sr. P.S.

8 I.T.A. No. 656/Mum/2026

Copy of the order forwarded to:

(1)The Appellant (2) The Respondent (3) The CIT (4) The CIT (Appeals) (5) The DR, I.T.A.T.