SHANKAR SAHU,TAMNAR vs. ITO, WARD- 1, RAIGARH

The assessee appellant has raised following grounds of appeal:

1 Later, the appellant assessee raised one additional ground as under:

The relevant facts giving rise to this appeal are that the assessee, a non-filer of his Income Tax Return (‘ITR’), has entered into following financial transactions during the relevant year: (i) Cash deposits in current account: Rs.7,81,930/-; (ii) Cash withdrawal including withdrawals through bearer’s cheque from current account: Rs.2,60,88,500/-; (iii) Commission income as per 26AS of the assessee: Rs.2,75,220/-. Based on the above financial transactions, the assessee’s case was reopened under section 148 of the Act. The assessee had neither filed any ITR in response to the notice issued under section 148 of the Act nor ensured any compliance to various statutory notices issued during the assessment proceedings (page No. 2 of the assessment order). In such circumstances, the Ld. Assessing Officer (‘AO’) had no option except to complete the assessment ex-parte. Consequentially, he completed the assessment by taxing cash withdrawal of Rs.2,60,88,500/- under section 69A r.w.s. 115BBE of the Act. Further, the Ld. AO also taxed the commission income of Rs.2,75,220/-. Aggrieved with the assessment order, the assessee filed belated appeal (705 days) before the Ld. CIT(A), who did not condone the delay and dismissed the appeal in limine as under: “5.7 In view of the above it is apparent that there is a delay of 705 days in filing of appeal and no case has been made out by the appellant explaining this delay.

8 It is thus seen that no evidence for existence of any circumstances which prevented the appellant from filing the appeal in time has been filed.

9 The appellant has therefore failed to demonstrate sufficient cause. It is a settled position of law that the appellant is duty bound to explain each day's delay after the last date of limitation. It is a clear case of sheer negligence for non-pursuing available remedy in time. It is for the appellant concerned to explain the delay and it is not the function of the appellate authorities to find the cause of delay. The appellate authority has to examine whether sufficient cause has been shown by the party for condoning delay and whether such cause is acceptable or not. In that view of the matter, the Tribunal cannot condone the delay without asking the party concerned to explain the delay, by giving its own reason for the delay [DCM Ltd. vs. State of Tamil Nadu, (1995) 96 STC 263, 264 (Madras)].

10 In this regard, it will be relevant to examine how the Courts have dealt with similar cases. A reference may be made to decision of Hon'ble High Court of Madras in the case of Madhu Dadha vs. ACIT reported 317 ITR 458 (Mad); (2010) 186 Taxmann 8 (Madras). In this case, there was delay of 558 days in filing appeal. The Hon'ble Court observed that though liberal approach is to be adopted while deciding the condonation of delay, however, there is always a requirement of sufficient cause to explain the delay. In para 8, the Hon'ble Court examined the reasons and has observed as under:

From a reading of the above, it is clear that the appellant has not explained the cause of delay in filing the appeal, especially when authorised representative viz., representative who was given charge to file the appeal had died exactly one year after the last date of filing of the appeal. When that be so, it is pertinent to point out that actually the filing of the appeal was not done and even after the death of Ashok Kumbat, the assessee had taken more than six months in filing the present appeal. The assessee had neither given any particular or details in the affidavit as on which date the papers were handed over to the counsel for preparing the appeal and on what occasion the assessee enquired about the progress in preparing the appeal and filing the same".

1 The Hon'ble Court, in para 9, observed that averments in the affidavit were quite vague. Further, in para 11 and 12, Hon'ble court referred to the judgment of Hon'ble Supreme Court in the case of Collector, Land Acquisition v. Mst. Katiji [1987] 167 ITR 471 (SC)., wherein the Honourable Supreme Court had explained the fact for sufficient cause for condonation of delay. The Hon'ble court observed as under:

At this juncture, we have to be guided by the judgment in the case of T.N.M. Bank Ltd. v. App. Auty [1990] 1 LLN 457. In that particular case, the Division Bench of this court has held that,

11 It is also a settled position of law that the delay is unexcusable unless sufficient cause is shown. In this regard, reliance is placed on Hon'ble Supreme Court decision in the case of Calcutta Municipal Corporation vs. Pawan Kumar Saraf (1999) 1 SC 39. Their Lordships in para 20 in the above case held as under:

Before us, Shri Sunil Agrawal, CA, Ld. Authorized Representative (‘AR’) of the assessee prayed for condonation of delay in filing the appeal before the Ld. CIT(A) by admitting the additional ground raised under Rule 11 of the Income-tax Appellate Rules, 1963. He submitted that the assessee was authorized Kiosk Operator of SBI. He contended that the cash withdrawals were made on behalf of the various individuals as the assessee worked as Kiosk Operator of SBI during the relevant year. However, a certificate issued by the Bank on 18.05.2016 was filed (page 10 of Paper Book). It is not ascertainable that whether the said certificate is valid for the relevant year. It was submitted by the Ld. AR that the assessee, during the relevant year, had accepted the deposits and had provided withdrawal facilities to the customers in accordance with the SBI Guidelines. With respect to condonation of delay by the Ld. CIT(A), he reiterated the affidavit of the assessee dated 23.10.2025 (page No. 18 of the paper book), wherein following reasons have been stated for filing belated appeal:

The Ld. AR submitted that the delay was not due to any negligence or lack of due diligence on the part of the assessee as assessee. However, he has not denied that he had not received the impugned appellate order. Further, the Ld. AR made a statement at the bar that he would provide further substantial reasons before the Ld. CIT(A) for filing belated appeal him for his consideration. He submitted that there is no dispute that under section 254 of the Act, the Tribunal may pass such order as it thinks fit. He, therefore, prayed that the appeal should be remanded back to the Ld. CIT(A).

On the other hand, the Ld. Sr. DR opposed for remanding the matter back to the Ld. CIT(A). He argued the case vehemently. He placed reliance on the orders of the authorities below and submitted that there was no justification for filing belated appeal after 705 days. He submitted that the reasons stated for delay condonation before the Ld. CIT(A) did not demonstrate any sufficient cause. The Condonation application filed before the Ld. CIT(A) contained general reasons, submitted the Ld. Sr. DR. He prayed for dismissal of the appeal.

We have heard both parties and have perused the material available on the record. We have taken note of the fact that the Ld. CIT(A) has not admitted the appeal after rejecting the delay condonation petition of the assessee. Even we do not find the said condonation petition filed before the Ld. CIT(A) by the assessee satisfactory. Further, we have taken note of the fact that the assessee has not ensured any compliance before the Authorities below. In view of the Ld. AR’s statement at the bar that he would provide further substantial reasons for condonation of the delay in filing appeal, we are of the considered view that the assessee’s petition for delay condonation, if filed with detailed justification demonstrating sufficient cause for filing belated appeal before the Ld. CIT(A); needs a fresh consideration by the Ld. CIT(A). In case the Ld. CIT(A) finds the revised condonation petition of the assessee satisfactory, then he should decide the condonation petition on merit and thereafter the appeal on merit, if required, by a well-reasoned order.

In the factual matrix of the present case, the statement of Ld. AR at bar and in the interest of substantial justice, we, therefore, keeping in view the above discussion/observations and in exercise of powers under section 254 of the Act, direct the Ld. CIT(A) to consider the revised delay condonation petition of the assessee, if filed before him within the reasonable time after receipt of this order. Therefore, considering the facts of the case. afore-stated observations, the statement of Ld. AR at bar and without offering any comment on merit of the case, we, in the interest of justice, set aside the impugned order and remit the matter back to the file of the Ld. CIT(A) to provide an opportunity of being heard to the assessee and decide the fate of the revised delay condonation application afresh in accordance with the above and thereafter, if required, the case on merit shall be decided as per the law. The appellant assessee should ensure compliance during the remitted appellate proceeding before the Ld. CIT(A).

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

""थ"/ The Respondent

The Pr. CIT, Raipur (C.G.) 4. िवभागीय "ितिनिध, आयकर अपीलीय अिधकरण, रायपुर/ DR, ITAT, Raipur 5. गाड" फाईल / Guard file.