DHANALAKSHMI,THENI vs. ITO, WARD-1,, THENI

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ITA 719/CHNY/2026Status: DisposedITAT Chennai07 May 2026AY 2017-186 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that the CIT(A) erred in dismissing the appeal solely on the ground of delay without properly considering the assessee's explanation for the delay. The Tribunal directed the CIT(A) to admit the appeal for adjudication on merits.

What were the facts?

The assessee, engaged in trading used liquor bottles, filed an appeal before the CIT(A) for AY 2017-18 with a delay of 149 days. The CIT(A) dismissed the appeal in limine due to this delay, without condoning it. The assessee's return of income was completed by the AO, making additions based on bank deposits and withdrawals.

What were the issues?

Whether the CIT(A) was justified in dismissing the appeal on the grounds of delay without condoning it, and whether the reassessment proceedings were initiated without jurisdiction.

Which sections of the Income-tax Act were involved?

Section 250,Section 148,Section 147,Section 148A,Section 144,Section 144B,Section 151,Section 149

AI-generated summary — verify with the full judgment below

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

Before: SHRI INTURI RAMA RAO & SHRI MANU KUMAR GIRI

For Appellant: Mr. K.Subash Anabarasu – Advocate
For Respondent: Ms. Sandhya Rani Kure – JCIT
Hearing: 16/04/2026Pronounced: 07/05/2026

आयकर अपीलीय अिधकरण ”ए” �ायपीठ चे�ई म�। IN THE INCOME TAX APPELLATE TRIBUNAL CHENNAI BENCHES “A” :: CHENNAI BEFORE SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER AND SHRI MANU KUMAR GIRI, JUDICIAL MEMBER आयकर अपील सं. / ITA No.719/CHNY/2026 िनधा�रण वष� / Assessment Year: 2017-18 Dhanalakshmi, Vs Income Tax Officer, 192, Shanmugam Nagar, Ward-1, Theni. Koduvilarpatty(PO), Theni – 625534. PAN: AVHPD9819J Appellant/ Assessee Respondent / Revenue Assessee by Mr. K.Subash Anabarasu – Advocate Revenue by Ms. Sandhya Rani Kure – JCIT Date of hearing 16/04/2026 Date of pronouncement 07/05/2026 आदेश/ ORDER PER INTURI RAMA RAO, AM : This appeal filed by the Assessee directed against the order of ld.Commissioner of Income Tax(Appeal)[NFAC], Delhi dated 05.12.2025 passed under section 250 of the Income Tax Act, 1961 for the A.Y.2017-18.

2.

The Assessee raised the following grounds of appeal :

“1. The order of the Commissioner of Income Tax (Appeals) ['CIT (A)] is against the law, the facts and circumstances of the case and the principles of equity and natural justice 2. The CIT(A) erred in dismissing the appeal filed by the Appellant without proper consideration of the Appellants Submission. 3. The CIT(A) erred in dismissing the appeal solely on the ground of delay, without adjudicating the issues on merits, even though the appellant had shown reasonable and bona fide cause for the delay. 4. The CIT(A) failed to appreciate that the reassessment proceedings initiated by the assessing officer is wholly without any jurisdiction. 5. The CIT(A) failed to appreciate that the AO erred in initiating the reassessment proceedings particularly when the preconditions contemplated in the Act for initiating the reassessment proceedings are not fulfilled. 6. The CIT(A) failed to appreciate the Jurisdictional Assessing Officer erred in issuing notice under section 148 of the Act on 14.03.2024, particularly when by virtue of section 151A read with notification issued thereunder, the jurisdiction to issue notice under section 148 of the Act is vested on the faceless authority. Therefore, the notice under section 148 of the Act and consequent assessment order is bad in law 7. The CIT(A) failed to appreciate that the Assessing Officer erred in initiating reassessment proceedings under section 147 by issuing notice under section 148 dated 14.03.2024 for AY 2017-18, which is beyond the permissible period of Semitation under section 149(14) of the Act particularly when the income escaping assessment is less than Rs.50 Lakha The CITIA) failed to appreciate that the Assessing Officer etronecuali asumed jurisdiction to complete the assessment particularly when dunng the course of assessment, the assessing officer is satisfied that the income escaping assessment lene than Rs.50 Lakhs 9. The CIT(A) failed to appreciate that the Assessing Officer had filed to obtun valid approval under section 151 of the Act before itinating the proceedings under section 147 of the Act.

10.

The CIT(A) ought to have appreciated that the Appellant had correctly reported profit at Rs. 6,39,154/-in its return of income. 11. The CIT(A) erred in dismissing the appeal without appreciating that the assessing officer erroneously adopted 8% as profit percentage particularly when the said rate is unreasonable and there is no basis to arrive at the said rate. 12. The Appellant craves the leave of your Honours to adduce additional grounds in support of its contentions before and during the course of hearing of this appeal.” 3. Briefly the facts of the case are that the appellant is an Individual engaged in the business of trading used or empty liquor bottles. No regular return of income under the provision of section 139 of the Act for the Assessment Year 2017-18. However, based on the information that the appellant made the appellant made cash deposits of Rs.46,000/- as well as cash withdrawals of Rs.1,67,60,000/- in the bank account maintained with Axis Bank. The Jurisdictional Assessing Officer formed an opinion that income got escaped assessment from tax. Accordingly, a notice u/s.148 was issued on 14.03.2024 after duly complying with the procedure laid down u/s.148A of the Act. In response to notice u/s.148, the appellant filed the return of income for the A.Y.2017-18 on 14.10.2024 disclosing income of Rs.3,97,580/-. Against the said return of income, the assessment was completed by the e-Assessment Unit of the Department (hereinafter called ‘AO’) vide order dated 24.01.2025 passed u/s.147 r.w.s 144 read with section 144B of the Income Tax Act, 1961 at a total income of Rs.16,98,854/-. While doing so, Assessing Officer made addition of Rs.13,01,004/- by treating credits in the bank accounts as business turnover of the appellant and estimated the business income at 8%.

4.

Being aggrieved, an appeal was filed before the ld.CIT(A), who vide impugned order has dismissed the appeal in limine on the ground of delay without condoning delay of 149 days.

5.

Being aggrieved, the appellant is in appeal before us in the present appeal. The ld.Counsel submits that the ld.CIT(A) ought not have dismissed the appeal in limine without condoning the delay. Further, he also submits that the very initiation of reassessment proceedings were bad in law as the Jurisdictional Assessing Officer(JAO) had not jurisdiction to issue notice u/s.148 and he further submits that the estimate at 8% by the Assessing Officer is excessive ad unreasonable.

6.

On the other hand, ld.Sr.DR vehemently opposed the above submissions.

7.

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 dismissing the appeal on the grounds of delay by refusing the condonation of delay. Admittedly, there is a delay of 149 days in presenting the appeal before the ld.CIT(A). The appellant filed a petition seeking the condonation of delay on the ground that the delay had occurred on account of the fact that delay in approaching the Counsel as he was not aware of the procedure of filing appeal. However, ld.CIT(A) had refused to condone the delay by stating that no sufficient cause was shown for the delay. ON careful perusal of the findings of ld.CIT(A), it would be clear that the ld.CIT(A) had not given findings as to how the explanation offered by the appellant for delay does not constitute a reasonable cause. The averments made in the affidavit remain uncontroverted by the learned Sr.DR.

8.

In 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. 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. 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 direct ld.CIT(A) to admit the appeal for adjudication on merits.

9.

In the result, appeal of the assessee is partly allowed for statistical purpose. Order pronounced in the open Court on 7th May, 2026.

Sd/- Sd/- (MANU KUMAR GIRI) (INTURI RAMA RAO) JUDICIAL MEMBER ACCOUNTANT MEMBER Chennai; �दनांक / Dated : 7th May, 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, “ए” ब�च, 4. चे�नई/ DR, ITAT Chennai. गाड� फ़ाइल / Guard File. 5.

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