DEEPCHAND LALJI LODARIA,KUTCH vs. THE INCOME TAX OFFICER, WARD 3,GDHAM(BHUJ-1) , KUTCHH

Grounds of Appeal raised by Assessee are as follows: 1. Ld. CIT(A) erred in law as well as on facts in passing the order u/s. 250 of the Income Tax Act, 1961, which is bad in law and without appropriate jurisdiction

Facts of the Case: The appellant had filed his income tax return on 06/01/2016 declaring a total income of Rs. 3,08,810. The A.O. initiated proceedings based on information from the INSIGHT Portal, under the high-risk CRIU/VRU category, which indicated that the appellant had earned a fictitious profit of Rs. 80,02,698 from equity trading in M/s Excel Castronics Limited, a company identified as a penny stock. This amount was identified as bogus Long Term Capital Gain (LTCG) and was disproportionate to the declared income. Hence, a notice u/s 148 for AY 2015-16 was initially issued on 19/04/2021. a notice u/s 148 was issued on 28/06/2022. the appellant failed to file any return of income or furnish any submission, explanation, details, or evidence regarding the trading in M/s Excel Castronics Limited throughout the assessment proceedings. the assessing officer concluded that the transactions were not genuine and pass an order u/s 147 r.w.s. 144 &144B of the Act on 25.04.2025 with an addition in income of Rs 8002698 and assessed the income at Rs 8311508.

Assesse filed an appeal before CIT(A), against the impugned order dated 25.04.2023. Ld. CIT(A) dismissed the appeal of the assesse with following observation:- “ On the basis of the circumstances of the case, it is held that the appellant did not have “sufficient cause” for delay in filing appeal. The appeal filed by the appellant is held to be invalid and non-maintainable being out of time. For statistical purposes, the appeal is treated as DISMISSED in limine. In the result, the appellant’s appeal is DISMISSED.”

Assessee is in appeal before us against the impugned order dtd. 30.07.2025.

Learned Counsel for assessee submitted that there was delay in filing the appeal for 324 days, before Ld. CIT(A). The assessee filed the petition for condonation of delay before the Ld. CIT(A) and explained the sufficient cause for the delay, however, despite of this, the ld. CIT(A) did not condone the delay and dismiss the appeal of the assessee, without adjudicating the various issues, raised by the assessee, on merit. That is, the ld. CIT(A) did not adjudicate the assessee`s appeal, on merit. The Learned Counsel, therefore, prayed the Bench that delay may be condoned and matter, may be remitted back to the file of the ld. CITA for fresh adjudication, on merit.

On the other hand, Learned Sr. DR for revenue submitted that the assessee has failed to explain the sufficient cause for the delay, during the appellate proceedings. In order to advance substantial justice, though liberal approach, justice oriented approach or cause of substantial justice may be kept in mind but the same cannot be used to defeat the substantial law of limitation contained in Section 3 of the Limitation Act. Therefore, ld. DR stated that the Ld. CIT(A), has rightly dismissed the appeal of the assessee.

That a case has been presented beyond limitation, the assessee has to explain the" sufficient cause" which means an adequate and enough reason which prevented him to approach the court within limitation. In case a party is found to be negligent, or for want of bona fide on his part in the facts and circumstances of the case, or found to have not acted diligently or remained inactive, there cannot be a justified ground to condone the delay. However, in the assessee`s case under consideration, the assessee was active and explained the sufficient cause stating that assessee was residing at a small Village and did not have any technical awareness for email etc. The assessee come to know about assessment order, when demand notice and challan was received from Jurisdictional AO. Then after, the assessee filed the appeal before the ld. CIT( A) immediately. Therefore, we find that explanation was provided by the assessee, which can be

Since we have condoned the delay in filing the appeal, before ld. CIT( A), and also noted that ld. CIT(A) did not adjudicate the various grounds raised by the assessee, on merit. For the reasons given above, we are of the view that the order of the CIT(A) on this issue requires to be set aside in the light of the observations as set out above. We note that the assessment order is an exparte order hence we remand the matter back to the file of AO. We direct the AO to afford opportunity of being heard to the assessee before deciding the issue. The assessee will also be at liberty to produce evidence to substantiate it’s case. For statistical purpose, the appeal of the assessee is treated as allowed.

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