VIVEK JAGANNATH BHOLE,KANDIVALI WEST, MUMBAI vs. DEPUTY COMMISSIONER OF INCOME TAX CIRCLE 42(1)(1), KAUTILYA BHAWAN, KANDIVALI WEST

As the instant cases emanated from the same assessment order and therefore, for the sake of brevity, the same were heard together and are being disposed of by this composite order.

Coming to ITA No.1045/M/2026, which pertains to the affirmation of the quantum addition by the ld. Commissioner vide impugned order, it is observed that there was a delay of 732 days in filing of first appeal before the ld. Commissioner, challenging the assessment order under Section 143(3) r.w.s. 147 of the Act, whereby the addition of Rs.75,00,000/- has been made as undisclosed income. The Assessee before the ld. Commissioner for condonation of delay stated the reasons, which read as under:

The ld. Commissioner by considering such reasons, as mentioned in Column No. 15 of Form No. 35 by the Assessee, held as under:

The ld. Commissioner on the aforesaid findings ultimately rejected the plea of the Assessee for condonation of delay by following the judgment of the Hon’ble Apex Court viz-a-viz in the case of Rajneesh Kumar and Anr. Vs. Ved Prakash (SLP) (Civil Nos. 935-936 of 2021 decided on 21.011.2024) as well.

Thus, the Assessee being aggrieved, has preferred instant appeal.

Having heard the parties and perusing the material available on record, including the affidavit filed by the Assessee with regard to the condonation of delay, we observed that the Assessee with regard to the condonation of delay, in filing the first appeal, has contended as under:

The Assessee in support of its case for condonation of delay has prayed that admittedly, the Assessee accepting his fault for not filing the first appeal before the ld. Commissioner in time however, the Assessee relied on the tax consultant, who may be due to miscommunication or misunderstanding, could not file the first appeal before the ld. Commissioner. As the Assessee was completely relied on tax consultant and therefore, on a bona-fide belief that all necessary actions were taken by the tax consultant, the Assessee was unaware of the subsequent development of the case, however, on receipt of demand notice, he had come to know that 1st appeal has not yet been filed by the tax consultant and therefore, the Assessee praying for leniency, may be by imposing a reasonable cost.

On the contrary, the ld. D.R. specifically raised the issue that the affidavit filed by the Assessee, does not contain specific details regarding his tax consultant.

We have given thoughtful consideration to the peculiar facts and circumstances of the case. It is a fact that in the instant case, the assessment order was passed on dated 21.12.2017, against which the Assessee instituted the first appeal on dated 27.01.2020 and the cognizance of the same was initially taken during the Covid-19 period and thereafter the same was disposed of after a gap of 05 yrs., vide order dated 30.12.2025. Though we are in agreement with the ld. D.R. that the Assessee has levelled certain allegations against the professional without substantiating the same through any documentary evidence and the affidavit filed by the Assessee does not contain specific details with regard to the tax consultant of the Assessee. However, it is also a fact that the Assessee after getting the assessment order dated 21.12.2017, immediately deposited the appeal fee through challan of Rs.1000/- on dated 02.01.2018 i.e. well within 30 days of the assessment order, the statutory period prescribed for filing the first appeal. Further, on subsequent date i.e. on 22.10.2018, the Assessee again deposited fresh appeal fee of Rs.1000/. Further, it is a fact that the issue involved also remains to be adjudicated. Thus, considering the peculiar facts and circumstances in totality, for just and proper decision of the case and substantial justice, we deem it appropriate to condone the delay, however, subject to cost of Rs. 22,000/- to deposited in the Revenue Department under ‘other heads’ within 15 days from the date of this order and therefore, it is ordered accordingly.

Considering the merits of the case, we observe that admittedly, the Assessee, in response to the notices issued filed various replies, such as dated 09.03.2024, 22.04.2024, 25.09.2024 and 01.12.2025. However, the same remains to be considered by the ld. Commissioner, as the ld. Commissioner did not touch the merits of the case, as he dismissed the appeal of the Assessee in limine and as we have condoned the delay in filing first appeal before the ld. Commissioner therefore, the case is remanded to the file of the ld. Commissioner for decision on merit, suffice it to say by affording reasonable opportunity of being heard to the Assessee.

In the result, Assessee’s appeal is allowed for statistical purposes, in the above terms.

Coming to ITA No. 1044/M/2026, which pertains to the decision of the ld. Commissioner in affirming the penalty levied under Section 271(1)(c) of the Act, in respect of the addition of Rs. 75,00,000/-, made on account of undisclosed investment. As we have set aside the impugned order passed in quantum appeal and remanded the case pertaining to the quantum to the file of the ld. Commissioner for decision afresh. Thus, in view of the above, this case is also remanded to the file of the ld. commissioner for decision afresh, suffice it to say by affording reasonable opportunity of being heard to the Assessee.

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