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Facts
The assessee filed a return of income, but the case was reopened. The assessee did not file a return in response to the notice u/s 148. The AO completed the assessment u/s 144, making additions for unexplained investment. The CIT(A) dismissed the assessee's appeal due to a delay in filing.
Held
The Tribunal held that the CIT(A) erred in dismissing the appeal solely on the grounds of delay without adjudicating on the merits. The delay was approximately 90 days and did not warrant dismissal on technical grounds.
Key Issues
Whether the CIT(A) was justified in dismissing the appeal on technical grounds of delay without considering the merits of the case, and whether the reopening of assessment was valid.
Sections Cited
147, 148, 142(1), 144, 69B, 56(2)(x)(b), 151A, 144B
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Income Tax Appellate Tribunal, “B” BENCH, MUMBAI
Before: SHRI ANIKESH BANERJEE, JM & SHRI OMKARESHWAR CHIDARA, AM
In this case, the assessee filed a return of income with an income of Rs. 6,70,330/- for AY 2018-19 subsequently.The case was reopened by issuing a notice u/s 148 of the Act. In pursuance of notice issued u/s 148 of the Act, the appellant did not file a return of income. From the assessment order, it is seen that the assessee was served notices u/s 142(1) on three different dates. Thereafter a show-cause notice was issued dt. 24/11/2022. On 25/01/2023, an issue centralised communication and a final show caused notice dt. 02/03/2023 were issued by Ld. AO. Since there was no compliance to any of these notices, the Ld. AO completed the assessment u/s 144 of the Act. While completing the assessment, the Ld. AO made an addition of Rs. 57,25,000/- u/s 69B and Rs. 2,80,840/- u/s 56(2)(x)(b) of the Act towards unexplained investment in immovable property and the differential amount as per sub-registrar value respectively.
Aggrieved by the addition, the assessee filed an appeal before Ld. CIT(A) and the first appellate authority dismissed the appeal as there is delay in filing of appeal by more than 90 days and adjudicated the same as under : “It is apparent that virtually no reason has been given and very conveniently blamehas been put on the "earlier tax consultant". Even if the advice of consultant for non filing of appeal was incorrect, it was the appellant who had agreed to the same and therefore he has to bear the cost of his action of not filing the appeal within the prescribed time limit. This reason cannot be a ground for condoning the delay in filing of appeal and therefore the appeal is not fit to be admitted. Hence, dismissed.”
As the Ld. CIT(A) dismissed the appeal, the appellant filed an appeal before Ld. CIT(A) with the following grounds: “The ground or grounds of appeal are without prejudice to one another. 1.a) On the facts and in the circumstances of the case and in law, the Id. CIT(A)-NFAC-Delhi erred in dismissing the appeal filed by the Appellant against the order u/s. 147 r.w.s 144 r.w.s. 144B dated 14-03-2023 in summary manner on the plea that the appeal was filed beyond the due date prescribed under law and sufficient reasons for such delay are not established. b) The Id. CIT(A)-NFAC-Delhi failed to appreciate that the Appellant was prevented by sufficient cause from furnishing the appeal in time before the CIT(A)-NFAC-Delhi and the delay in presenting the appeal ought to have been condoned in the fairness of law as the delay was not stemmed from negligence or lack of diligence.
2. On the facts and in the circumstances of the case and in law, the Id. CIT(A) erred in not adjudicating on the ground Nos. 1 to 6 raised by the Appellant in the appeal without discussing these grounds on the merit of the case. 3.a) On the facts and in the circumstances of the case and in law, the Id. CIT(A) erred in confirming the action of the AO, that AO erred in re- opening the assessment u/s.147 of the Income Tax Act, 1961. The re- opening of the assessment is incorrect and invalid. b) The notice u/s 148 of the Act dated 25-03-2022 is issued by the Jurisdictional Assessing Officer in violation of provisions of section 151A of the Act. 4. On the facts and in the circumstances of the case and in law, the ld. CIT(A) erred in confirming the addition of 60,05,840/- made by the AO to the income of the Appellant on account of Unexplained Investment. The Appellant craves leave to add, alter, amend or delete any or all of the above grounds of appeal
.”
5. On the day of hearing before ITAT, none represented the assessee. The Ld. DR has argued Revenue’s case stating that there is continuous non-compliance from assessee’s side before the Ld. AO and the reason mentioned before the Ld. CIT(A) for filing the appeal with delay was also not convincing. Hence, the appeal of assessee deserves to be dismissed.
6. Heard the Ld. DR and perused the assessment order, Ld. CIT(A)’s order and the grounds of appeal filed by appellant before ITAT. The order of Ld. CIT(A) is dismissed simpliciter due to delay and other grounds of appeal were not adjudicated including validity of reopening of assessment. The period of delay is only 90 days (approx) and there is no reason to disbelieve the assessee’s version by Ld. CIT(A). Anyhow, the jurisdictional High Court in the case of Premkumar Arjundas Luthra (HUF) 69 taxmann.com 407 (Bom) held that Ld. CIT(A) can’t dismiss the appeal on technical grounds, but he has to pass the order on all issues of assessment order and grounds raised by appellant. In view of the same, the order of Ld. CIT(A) is set aside with a direction to condone the delay as the same is only 3 months (appox) and pass an order on merits after giving an opportunity to the appellant.
6. The appeal of the assessee is allowed for statistical purposes. Order pronounced in the open court on 14 -08-2025.