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Facts
The appeals were filed by the Assessee against orders of the NFAC/Ld. Commissioner, preferring the appeals with a significant delay. The delay was attributed to the Assessee's Chartered Accountant failing to notice notices, leading to ex-parte orders.
Held
The Tribunal condoned the delay of 332 days, stating that the Assessee's explanation was bonafide and for substantial justice, subject to a deposit. The Tribunal further held that the CIT(A) does not have the power to dismiss an appeal for non-prosecution and should decide on merits.
Key Issues
Whether the delay in filing the appeal is to be condoned, and if the CIT(A) can dismiss an appeal for non-prosecution.
Sections Cited
250, 143(3), 69, 251(1)(a), 251(1)(b), 251(2)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, MUMBAI BENCH “B”, MUMBAI
Before: SHRI NARENDER KUMAR CHOUDHRY & SHRI OMKARESHWAR CHIDARA
Per : Narender Kumar Choudhry, Judicial Member:
These appeals have been preferred by the Assessee against the orders dated 19.01.2024 & 15.02.2024, impugned herein, passed by the National Faceless Appeal Center (NFAC)/ Ld. Commissioner of Income Tax (Appeals) (in short Ld. Commissioner) u/s 250 of the Income Tax Act, 1961 (in short ‘the Act’) for the A.Y. 2017-18 & 2018-19 respectively.
As both the cases having involved identical issue and therefore for the sake of brevity and convenience, the same were & M/s. Nimantran Restaurant Pvt. Ltd. heard together and are being disposed of by this composite order by taking into consideration ITA No.1331/M/2025 as a lead case. it is observed that there is a delay of 332 days in filing the instant appeal, on which the Assessee has claimed that notices issued by the Ld. Commissioner remained unnoticed by the then Chartered Accountant of the Assessee, which resulted into passing of the impugned order as ex- parte, whereby the assessment order dated 19.12.2019 u/s 143(3) of the Act has been upheld, by which the additions of Rs.62,00,000/- on account of unexplained money u/s 69 of the Act and Rs.3,99,310/- on account of disallowance of expenses were made.
The Assessee accepted lapse on his part for not taking appropriate action for getting knowledge of the appellate proceedings and therefore regret the inconvenience caused due to non-compliances to the various notices issued by the Ld. Commissioner. The Assessee further claimed “that he came to know about the passing of the impugned order only on receiving the demand notice. Non-compliance before the Ld. Commissioner and delay occurred in filing the instant appeal, was neither intentional nor malafide but because of the aforesaid reasons and therefore lenient view may be taken and the delay may be condoned”.
On the contrary, the Ld. D.R. refuted the claim of the Assessee.
Having heard the parties and considering the contentions raised by the Assessee qua condonation of delay duly supported with affidavit, as bonafide and genuine and for substantial justice, we are inclined to condone the delay. Thus, the delay of 332 days in filing the instant appeal is condoned, however, subject to deposit
Coming to the merits of the case, as observed above that the Assessee remained unrepresented before the Ld. Commissioner, as the notices issued by him remained unnoticed by the then Ld. CA of the Assessee, which resulted into passing the impugned order as ex-parte and in limine but not on merit. Further the provisions of the Act does not empowers the CIT(A) to dismiss the appeal on non-prosecution, as held by Hon’ble Jurisdictional High Court in the case of Commissioner of Income Tax Vs. Prem kumar Arjundas (HUF) of 2013 dated 25.04.2016 (2017) 297 CTR (Bom.) 614, by observing and holding as under:
“ That this is amply clear from section 251(1)(a) & (b) and explanation 2 to section 251(2) of the Act which requires CIT(A) to apply his mind to all the issues which arise from the impugned order before him, whether or not the same has been raised by the appellant before him. Accordingly, the law does not empower CIT(A) to dismiss the appeal for non prosecution as it is evident from the provisions of the Act”.
And therefore in our view, the Ld. Commissioner should have decided the appeal of the Assessee on merit. Further it also appears from the assessment order that the same is also prima-facie appears, to be as ex-parte.
Thus, considering the peculiar facts and circumstances in totality, as the assessment order is also more or less an ex-parte and therefore in our considered opinion, it would be appropriate to remand the instant case to the file of the Assessing Officer (AO) so that real adjudication would take place and therefore for just and proper decision of the case and substantial justice, the case is remanded to the file of the Jurisdictional AO for decision afresh,
The Assessee is also directed to comply with the notices to be issued by the AO and file the submissions and documents which would be essentially required for proper and just decision of the case. We clarify that in case of subsequent default, the Assessee shall not be entitled for any leniency. is allowed for statistical purposes. in view of our judgment in this appeal i.e. ITA No.1332/M/2025 is also allowed for statistical purposes in the same terms.
In the result, both the appeals are allowed for statistical purposes in the aforesaid terms.
Order pronounced in the open court on 29.08.2025.