M/S. BELL TOWER ENTERPRISE LLP,TIRUNELVELI vs. ITO, NCW-10(1), CHENNAI

The assessee is a firm engaged in the business of share trading. The assessee filed a return of income for AY 2015-16 on 21.01.2016 declaring Nil income. The case was selected for scrutiny and the statutory notices were duly served on the assessee. The A.O noticed that the assessee is having

There is a delay of 622 days in filing the appeal before the Tribunal and the assessee filed an affidavit in this regard. It is stated in the affidavit that: “6. That a Search and Seizure action under section 132 of the Income Tax Act, 1961, along with proceedings under the Prevention of Money Laundering Act, 2002, were initiated against the petitioner firm in the year 2017. The petitioner firm, engaged in the business of trading had, in the ordinary course of its business activities, entered into financial transactions including unsecured borrowings and investments in shares with certain concerns, which were also covered by the aforesaid proceedings. As a consequence of the said search and allied proceedings, the affairs and business operations of the petitioner firm were severely disrupted and thereafter functioned under serious constraints. 7. That the petitioner firm was in the very first year of its operations when its case was selected for scrutiny under CASS, culminating in an assessment order wherein an addition of Rs. 11,27,01,000/- came to be made under section 69 of the Income Tax Act, 1961 by treating the investment in shares as unexplained. 8. That the relevant transactions were being overseen by the Managing Partner, Shri Prakashchand Anand, who alone was fully conversant with the facts pertaining to the affairs of the petitioner firm. However, Shri Prakashchand Anand remained in judicial custody and was released only towards the end of 2024. During the said prolonged period, the petitioner firm was effectively deprived of access to the person having material knowledge of the transactions and custody of the relevant records and evidences. Consequently, the petitioner firm was unable to effectively substantiate and represent its case before the first appellate authority. The appeal accordingly came to be dismissed ex-parte as the petitioner firm was not in a position to properly appear and place the necessary materials before the first appellate authority.

That the accounts and taxation matters of the petitioner firm were being handled by Shri Pasilya Kumar, Accountant, and CA. Padmini, Chartered Accountant, who had been entrusted with maintaining the books of account and attending to the related compliances and proceedings. However, subsequent to the search proceedings, both the aforesaid persons ceased to render professional assistance and stopped responding to the petitioner firm. Apart from them, there was no other statutory compliances of the petitioner firm or to keep the management foremained genuinely unaware of the appellate order dated 28.06.2024 S.NO passed by the Commissioner of Income Tax (Appeals)-19, Chennai.

That after his release from judicial custody towards the end of 2024, Shri Prakashchand Anand gradually resumed oversight of the affairs of the petitioner firm and, after recovering from the effects of the prolonged incarceration and allied proceedings, undertook sincere efforts to understand and regularise the various aspects of the business operations of the petitioner firm. Thereafter, upon turning his attention to the accounts, taxation and compliance matters of the firm, Shri Prakashchand Anand made earnest efforts to contact the erstwhile accountant, Shri Pasilya Kumar, and CA. Padmini, Chartered Accountant, with a view to obtaining the necessary assistance, records and professional support in relation to the pending tax matters, statutory compliances and litigations of the petitioner firm.

That the said persons did not cooperate with the petitioner firm and failed to extend the required assistance despite repeated requests. In these circumstances, Shri Prakashchand Anand was constrained to identify and engage another professional counsel who could take immediate steps to assist and advise the petitioner firm in relation to its pending compliances and legal matters.

That during the period when Shri Prakashchand Anand remained in judicial custody, his wife and co-partner, Mrs. Bindhu Anand, made sincere efforts to manage the affairs and compliances of the petitioner firm under extremely difficult circumstances. During the said period, she was also confronted with severe personal hardships, including the demise of her father, while simultaneously attending to the business affairs of the petitioner firm. The petitioner respectfully submits that both the family and the firm were passing through a period of exceptional hardship and distress during the relevant time.

That thereafter, the petitioner firm approached CA. Rushabh Shah, Chartered Accountant, for professional assistance. Upon a preliminary examination of the Income Tax matters of the petitioner firm, CA. Rushabh Shah, Chartered Accountant, advised the petitioner firm to approach the Jurisdictional Assessing Officer, being the appropriate

Upon enquiry during April 2026, the Assessing Officer informed the petitioner firm that an order had already been passed by the Commissioner of Income Tax (Appeals)-19, Chennai on 28.06.2024 and further informed that the said order had been passed ex-parte as no one had appeared on behalf of the petitioner firm before the appellate authority.

That immediately upon receipt of the said information, the petitioner firm informed CA. Rushabh Shah, Chartered Accountant, who advised that an appeal be forthwith filed before this Hon'ble Tribunal along with an appropriate petition seeking condonation of delay.

That thereafter, time was necessarily consumed in collecting the available papers, understanding the status of proceedings, preparing the appeal memorandum and compiling the documents required for filing the appeal. Immediately upon completion of these formalities, the appeal was sent for approval and after signatures by the partners of the petitioner firm was duly filed on 15.05.2026 without any further delay.

That the delay in filing the appeal has occurred solely on account of unavoidable and bona fide circumstances beyond the control of the petitioner firm. The delay was neither wilful nor deliberate, nor attributable to negligence or any mala fide intention. The petitioner has throughout acted in good faith and has filed the appeal at the earliest possible opportunity after the matter came to its knowledge and professional assistance became available.

That substantial justice deserves to prevail over technical considerations and that the petitioner ought not to be denied an opportunity of contesting the matter on merits for reasons beyond its control. No prejudice would be caused to the Revenue if the delay is condoned, whereas grave prejudice would be caused to the petitioner if the appeal is rejected on limitation.”

Having heard both the parties and perused the material on record, we are of the view that there is a reasonable and sufficient cause for the delay in filing the appeal before the Tribunal. Therefore following the Hon’ble Supreme Court decision in the case of Collector, Land Acquisition Vs.

We have heard the parties, and perused the material available on record. The Ld. Authorized Representative (AR) of the assessee during the course of hearing submitted that the reasons as stated in the petition for condition of delay is the reason for the assessee not representing the case properly before the lower authorities. The ld. AR accordingly prayed for one more opportunity with an undertaking that the assessee would represent the case properly. Considering the facts and circumstances peculiar to assessee's case, we are inclined to give one more opportunity to the assessee in the interest of natural justice and fair play to represent the case properly by producing the required details. Accordingly, we remit the appeal back to the CIT(A) with a direction to call for necessary details and decide the issue in accordance with law. The assessee is directed to submit the necessary details as may be called for and cooperate with appellate proceedings. It is ordered accordingly.

In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced on 04th day of August, 2026 at Chennai.