PRASADA RAO BANDELA,WARANGAL vs. ITO, WARD-1, WARANGAL

Succinctly stated, the AO, based on information that the assessee had during the subject year invested an amount of Rs.30 lakhs in “Kapil Group” for the purchase of property, but had not filed his return of income within the prescribed time contemplated under section 139 of the Act, initiated proceedings under section 147 of the Act. Notice under section 148 of the Act was issued to the assessee, who, in compliance thereto, filed his return of income for the year under consideration on 01/09/2022, declaring an income of Rs.3,44,210/-.

Thereafter, the AO, after taking cognizance of the judgment of the Hon’ble Supreme Court in the case of UOI & Ors. Vs. Ashish Agarwal in Civil Appeal No.3005/2022, dated 04/05/2022, proceeded with and passed an order under section 148A(d) of the Act, dated 29/07/2022, and issued notice under section 148 of the Act. Subsequently, the AO issued notices under section 142(1) of the Act, but neither of those was responded to by the assessee.

Aggrieved, the assessee carried the matter in appeal before the CIT(A), who observed that it was the claim of the assessee that the order passed by the AO under section 147 r.w.s 144B of the Act, dated 03/05/2023, was served upon him only on 30/10/2023. The CIT(A), based on his deliberations, did not find favor with the aforesaid claim of the assessee and observed that there was a delay of 180 days, i.e., 5 months and 27 days involved in filing the appeal before him. The CIT(A), considering the fact that the assessee had denied the delay involved in filing of the appeal before him, while the fact was that there was a delay of 180 days, declined to exercise the discretion vested with him to condone the same under section 249(3) of the Act and dismissed the appeal on the ground of limitation.

We have heard the Learned Authorized Representatives of both parties, perused the orders of the authorities below, and considered the material available on record.

Shri AV Raghuram, Advocate, Learned Authorized Representative (for short, “Ld. AR”) for the assessee, at the threshold of hearing of the appeal submitted that as the assessee was in receipt of the order passed by the AO under section 147 r.w.s 144B of the Act, dated 03/05/2023 only on 30/10/2023, therefore, he had specifically so stated at Column No.2(c) of “Form-35” filed before the CIT(A). The Ld. AR submitted that the CIT(A), without affording sufficient opportunity to the assessee to substantiate his claim of having received an assessment order on 30/10/2023, had summarily dismissed the appeal on the ground of limitation. The Ld. AR submitted that considering the fact that the assessee had remained divested of a reasonable opportunity to substantiate the factum of receipt of the assessment order on 30/10/2023, i.e., as stated in Form-35, the matter be set aside to the file of the CIT(A) with a direction to readjudicate the same after affording a reasonable opportunity of being heard to the assessee.

Per contra, Shri Vamshi Krishna, Learned Senior Departmental Representative (for short, “Ld. Sr-DR”), relied upon the orders of the

We have given thoughtful consideration to the contentions advanced by the Learned Authorized Representatives of both parties in the backdrop of the orders of the authorities below.

Admittedly, it is a matter of fact borne from the record that the assessee at Column No.2(c) of “Form-35” had claimed to have received the order passed by the AO under section 147 r.w.s 144B of the Act, dated 03/05/2023, on 30/10/2023. In our view, the CIT(A), considering the aforesaid claim of the assessee, ought to have allowed a sufficient opportunity to substantiate his claim of having received the aforesaid order on 30/10/2023. However, a perusal of the CIT(A) order does not reveal that any sufficient opportunity was afforded to the assessee to fortify his claim regarding the receipt of the assessment order under section 147 r.w.s 144B of the Act, dated 03/05/2023, on 30/10/2023. We thus, considering the aforesaid facts, are of firm conviction that the matter in all fairness requires to be set aside to the file of the CIT(A) with a direction to afford a reasonable opportunity of being heard to the assessee to substantiate his claim that the

In the result, the order passed by the CIT(A) is set aside, and the appeal filed by the assessee is allowed for statistical purposes in terms of our aforesaid observations.