BHARAT BHERAJI BAROT,AHMEDABAD vs. THE INCOME TAX OFFICER, WARD 1(2)(1), AHMEDABAD, AHMEDABAD

Thisappealhas been preferred by the Assessee against the Order, dated 27/09/2024, passed by the National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as the ‘CIT(A)’] whereby the Learned CIT(A) had dismissed the appeal against the Assessment Order, dated 20/12/2022, passed under Section 154of the Income Tax Act, 1961 [hereinafter referred to as ‘the Act’] for the Assessment year 2020-2021. 2. The Assessee has raised the following grounds of appeal:

We have heard both the sides and have perused the material on record.

It emerges that for the Assessment Year 2020-2021, the Assessing Officer made addition of INR.1,25,98,300/- under Section 56(2) of the Act vide Assessment Order, dated 24/09/2022. Later, on receipt of report of District Valuation Officer (DVO), the Assessee filed an application for rectification pursuant to which the Assessing Officer passed Rectification Order under Section 154 of the Act on 20/12/2022 and restricted the aforesaid addition made by the Assessing Officer under Section 56(2) of the Act to INR.42,00,000/-. The case of the Assessee is that Assessee was under a bona-fide impression that rectification proceedings under Section 154 of the Act were in continuation of assessment proceedings under Section 143(3) of the Act and therefore, no separate appeal was filed by the Assessee against the Assessment Order passed under Section 143(3) of the Act. The Assessee only filed appeal against the Rectification Order, dated 20/12/2022. The Learned CIT(A), vide order dated 27/09/2024, dismissed the said appeal.It has been explained by the Assessee that though the aforesaid order was received by the Assessee, appeal could not be filed by the Assessee before the Tribunal in time on account of financial hardship. The Assessee has stated that the Assessee was not in a position to engage any professional for filing an appeal. When the phase of financial crisis was over, the Assessee engaged an advocate and filed the present appeal before the Tribunal challenging the Order, dated 27/09/2024, passed by the Learned CIT(A). It was submitted that the Assessee has also filed appeal against the Assessment Order passed under Section 143(3) of the Act which is pending adjudication before the First Appellate Authority. During the course of hearing the Learned Authorised Representative for the Assessee made limited prayer that the delay in filing the present appeal be condoned and the issue be restored back to the file of Learned CIT(A) since the Assessee has now filed against the Assessment Order passed under Section 143(3) of the Act raising larger issue of applicability of Section 56(2) of the Act and on account of the same the reason given by the Learned CIT(A) for rejecting the appeal filed by the Assessee against the Rectification Order passed under Section 154 of the Act no longer holds good. The Learned Departmental Representative did not mount any serious challenge to the issue of condonation of delay and supported the order passed by the Learned CIT(A). It was submitted that there was no infirmity either in the rectification order or in the order passed by the Learned CIT(A).

Having considered the overall facts and circumstances of the present case and after taking into consideration the explanation offered on behalf of the Assessee, we are inclined to accept the plea advanced by the Learned Authorised Representative for the Assessee. In the case of Collector of Land Acquisition Vs. Mst. Katiji& others AIR 1987 1353 (SC) the Hon’ble Supreme Court has, while dealing with the issue of condonation of delay, emphasized that substantial justice should prevail over technical considerations. Every day’s delay must be explained does not mean that a pedantic approach should be taken and that the aforesaid doctrine must be applied in a rational common sense and pragmatic manner, more so in circumstances where a litigant does not stand to benefit by lodging the appeal late (as is the case in appeal before us). Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold. As against this, when delay is condoned, the highest that can happen is that a cause would be decided on merits after hearing the parties. There is nothing on record to doubt the bonafides of the explanation offered by the Assessee for seeking condonation of delay in filing the present appeal. In our view, no benefit would have accrued to the Appellant by delaying filing of appeal. When substantial justice and technical consideration are pitted against each other, the cause of substantial justice deserves to be preferred. Keeping in view the aforesaid judgment of the Hon'ble Supreme Court we hold that in the present case Assessee was prevented by reasonable cause from filing appeal before this Tribunal within the prescribed time. Accepting the explanation offered by the Assessee to be reasonable and bonafide, we condone the delay of 485 days in filing the present appeal.

As regards contention raised by the Assessee on merits is concerned, it is admitted position that the present appeal stems from the Order (rectifying the Assessment Order) passed under Section 154 of the Act.

In terms of Paragraph 6 above, Ground No.1 raised by the Assessee is allowed for statistical purposes while all the other grounds are dismissed as having been rendered infructuous at this stage without returning any findings on merits.

""यथ"/ The Respondent. 3. संबंिधतआयकरआयु"/ Concerned CIT 4. आयकरआयु"(अपील) / The CIT(A) 5. िवभागीय"ितिनिध, आयकरअपीलीयअिधकरण/ DR, ITAT, 6. गाड"फाईल /Guard file. आदेशानुसार/BY ORDER, उप/सहायकपंजीकार (Dy./Asstt.