VELOCITY REAL ESTATE PVT. LTD.,MUMBAI vs. INCOME TAX OFFICER WRD-8(3)(1), MUMBAI, MUMBAI

This appeal is filed by the assessee against the order passed by the Ld. Commissioner of Income Tax (Appeals), NFAC, Delhi dated 25.10.2023 for A.Y. 2014-15 arising out of assessment order passed u/s 143(3) of the Income Tax Act, 1961.

At the outset, it is noticed that there is delay of 694 days in filing the present appeal before the Tribunal. The assessee has filed condonation petition along with affidavit explaining the reasons for

We have heard the rival submissions and perused the material available on record. Considering the entirety of facts and circumstances and in order to advance substantial justice, we are satisfied that the assessee was prevented by sufficient cause in not filing the appeal within prescribed period. However, considering the substantial delay of 694 days, the delay is condoned subject to payment of cost of Rs.11,000/- to the Income Tax Department under the head “Other Receipts” within 15 days from the date of receipt of this order and subject to furnishing proof of such payment before the Registry. Accordingly, the delay is condoned and appeal is admitted for adjudication.

The brief facts of the case are that the assessment was completed u/s 143(3) of the Act determining total income at Rs.3,20,00,000/- by treating the entire sale consideration received on sale of immovable property as long term capital gain. The Assessing Officer observed that though the assessee had sold immovable property for consideration of Rs.3,20,00,000/-, no capital gain was offered to tax and the property was also not reflected in earlier balance sheets. 2

The assessee filed appeal before the Ld. CIT(A) with delay of 144 days. The explanation furnished before the Ld. CIT(A) was that initially the assessee was under impression that tax on long term capital gain was payable and therefore assessment order was not forwarded to Chartered Accountant. However, when notice for penalty u/s 271(1)(c) was received and the matter was examined by Chartered Accountant, it was noticed that while computing long term capital gain, deduction towards cost of acquisition was not granted by the Assessing Officer and therefore appeal came to be filed belatedly. The Ld. CIT(A) held that the reasons furnished by the assessee do not constitute reasonable cause and accordingly declined to condone the delay of 144 days and dismissed the appeal in limine without adjudicating the issues on merits.

Before us, the Ld. Authorised Representative submitted that the Ld. CIT(A) was not justified in refusing to condone the delay particularly when substantial additions were made by the Assessing Officer and the assessee had raised arguable grounds on merits. It was further submitted that the assessee should not be denied opportunity of adjudication on merits on technical considerations.

We find merit in the submissions of the assessee. It is settled proposition of law that while considering condonation petition, liberal approach is required to be adopted so as to advance substantial justice. The judiciary has consistently held that technical considerations should not override substantial justice particularly where no mala fide intention or deliberate negligence is attributable to the assessee. In the present case, we notice that the assessee has challenged substantial addition of

Since the Ld. CIT(A) has dismissed the appeal in limine without adjudicating the issues on merits, in the interest of justice, we deem it appropriate to restore the matter back to the file of the Ld. CIT(A) with direction to condone the delay in filing appeal before him and adjudicate the issues raised by the assessee afresh on merits in accordance with law after providing adequate opportunity of being heard to the assessee. The assessee is also directed to cooperate in appellate proceedings and file all details/documents as may be called for by the Ld. CIT(A).

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