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Facts
The assessee's appeal was dismissed by the CIT(A) as infructuous due to alleged incompleteness of Form 35 and related documents. The assessee claimed to have filed all necessary documents and that the CIT(A) did not provide a proper opportunity to rectify any deficiencies.
Held
The Tribunal held that the dismissal of the appeal by the CIT(A) without a proper opportunity to rectify alleged defects was contrary to natural justice. The matter was set aside and restored to the CIT(A) for adjudication on merits.
Key Issues
Whether the CIT(A) was justified in dismissing the appeal as infructuous without providing adequate opportunity for rectification, and whether the transfer to a faceless assessment portal prejudiced the assessee.
Sections Cited
143(1), 143(2), 142(1), 143(3), 68, 69, 250, 250(6)
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Income Tax Appellate Tribunal, “F” BENCH MUMBAI
आदेश / ORDER
PER MAKARAND VASANT MAHADEOKAR, AM:
1. This appeal filed by the assessee is directed against the order passed by the learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi[hereinafter referred to as "CIT(A)"] under section 250 of the Income Tax Act, 1961[hereinafter referred to as "the Act"] dated Vicky Agro Food Products & Suppliers Pvt. Ltd. 16.09.2025, arising from the assessment order passed by the Assessing Officer under section 143(3) of the Income Tax Act, 1961 dated 20.03.2015 for the Assessment Year 2012-13. Condonation of Delay 2. At the outset, it is noticed that the present appeal has been filed with a delay of 26 days beyond the prescribed period of limitation. The Registry has pointed out the said delay. The assessee has filed a petition for condonation of delay explaining the reasons for not filing the appeal within the prescribed time limit. In the said petition, the assessee has stated that the order of the learned CIT(A) which is the subject matter of the present appeal is dated 18.09.2025 and it is presumed that the said order was uploaded on the Income-tax portal on the same day. The assessee has further submitted that the appeal involved is an old matter and the assessee company had ceased its business operations after the Covid period. Consequently, there was no accounting staff available in the company and the person who was earlier looking after the income-tax matters of the company had left the organisation in the year 2021.It has further been explained that since the business of the company had stopped, the income-tax portal of the assessee company was not being regularly monitored. According to the assessee, the portal was checked only in November 2025, whereupon it came to the knowledge of the assessee that the learned CIT(A) had already passed the impugned order. Immediately after coming to know about the impugned order, the assessee contacted its Chartered Vicky Agro Food Products & Suppliers Pvt. Ltd. Accountant and thereafter the counsel, and the present appeal was filed thereafter. The assessee has thus submitted that the delay occurred due to the above circumstances and the same was neither intentional nor deliberate. The assessee has therefore prayed that the delay in filing the appeal may kindly be condoned.
We have considered the submissions of the assessee and perused the condonation petition placed on record. Considering the explanation furnished by the assessee and having regard to the fact that the delay involved is only 26 days, we are satisfied that the assessee was prevented by sufficient cause from filing the appeal within the prescribed period of limitation. The delay does not appear to be deliberate or attributable to any mala fide intention. Accordingly, in the interest of substantial justice, the delay of 26 days in filing the present appeal is condoned and the appeal is admitted for adjudication on merits. Facts of the Case 4. The assessee company filed its return of income for the Assessment Year 2012-13 declaring total income at Rs. Nil on 29.09.2012. The return was processed under section 143(1) of the Act. Subsequently, the case of the assessee was selected for scrutiny and notice under section 143(2) of the Act was issued on 06.08.2013. Thereafter notices under section 142(1) along with questionnaires were issued from time to time calling for details and explanations from the assessee. After considering the material available on record, the Assessing Officer passed the Vicky Agro Food Products & Suppliers Pvt. Ltd. assessment order under section 143(3) dated 20.03.2015 making the following additions: (i) Addition on account of Share Capital and Share Premium – During the year under consideration, the assessee had increased its share capital from Rs. 16,66,670/- to Rs. 20,20,000/-, thereby receiving share capital of Rs. 3,53,330/- from its shareholders/directors. Apart from the share capital, the assessee had also shown receipt of share premium of Rs. 14,13,320/-. The Assessing Officer observed that the assessee failed to furnish confirmations, bank statements and other supporting documents to establish the creditworthiness of the investors and genuineness of the transactions. Accordingly, the Assessing Officer treated the share capital and share premium aggregating to Rs. 15,14,650/- as unexplained cash credit under section 68 of the Act. (ii) Addition on account of cash credit in bank account -The Assessing Officer further noticed that the assessee had received an amount of Rs. 25,00,000/- in its bank account maintained with Shyamrao Vithal Co-operative Bank Ltd. The assessee failed to furnish satisfactory explanation regarding the source of the said credit. Accordingly, the Assessing Officer treated the said amount as unexplained cash credit under section 68 of the Act.
Vicky Agro Food Products & Suppliers Pvt. Ltd. (iii) Addition on account of unexplained investment - The Assessing Officer also observed that the assessee had made payments for acquisition of a property situated at Plot No. D-70, MIDC Industrial Area, Turbhe, Navi Mumbai. Based on the affidavit of the seller Shri Nirmal G. Doshi, the Assessing Officer noted that the assessee had paid Rs. 3,18,00,000/-, whereas the books of account reflected payment of only Rs. 1,88,00,000/-. The difference amount of Rs. 1,30,00,000/- was treated by the Assessing Officer as unexplained investment under section 69 of the Act. Accordingly, the Assessing Officer determined the total income of the assessee at Rs. 1,70,14,650/-.
Aggrieved by the assessment order, the assessee filed an appeal before the learned CIT(A)-14, Mumbai on 08.04.2015. Subsequently, the appeal was migrated to the National Faceless Appeal Centre in accordance with the faceless appeal scheme notified by the CBDT. The learned CIT(A) observed that Form No. 35 and the assessment order were not available on the system. Several notices were issued by the appellate authority calling upon the assessee to furnish the relevant documents. Finally, the learned CIT(A) held that the Form No. 35 filed by the assessee was incomplete as it was not accompanied by the grounds of appeal and statement of facts. On this basis, the learned CIT(A) held that the appeal could not be effectively adjudicated and
Aggrieved by the said order, the assessee is in appeal before us and has raised following grounds of appeal:
In the facts and circumstances of the case and in law the learned CIT(A) erred in dismissing the appeal filed by the Appellant on the ground that Form 35 filed by the Appellant was not accompanied by Grounds of Appeal
and Statement of Facts.
2. Without prejudice to the contention of the Appellant that along with the Form 35 filed by the Appellant in physical form Grounds of Appeal and statement of facts were enclosed, the learned CIT(A) erred in not granting the Appellant an opportunity to file the same by specifically pointing out that there were no grounds and statement of facts on his record.
3. The learned CIT(A) erred in not dealing on merits the following grounds of the Appellant: (i) the learned AO erred in treating as unexplained share capital with premium raised from the shareholders and making an addition of Rs. 15,14,650/- (ii) The learned AO erred in treating a loan of Rs. 25,00,000/- received from a shareholder as unexplained and making an addition of Rs. 25,00,000/- (iii) The learned AO erred in treating a sum of Rs. 1,30,00,000/- towards acquiring a property as unexplained investment and making an addition of Rs. 1,30,00,000/-
7. During the course of hearing before us, the learned Authorised Representative (AR) submitted that the learned CIT(A) erred in dismissing the appeal as infructuous without adjudicating the issues on merits. The learned AR drew our attention to the notices issued by the learned CIT(A), particularly Vicky Agro Food Products & Suppliers Pvt. Ltd. the notice dated 09.09.2024 issued under section 250 of the Act, wherein the assessee was asked to furnish ground-wise submissions in support of the grounds of appeal
. It was submitted that the said notice did not indicate that the appeal papers were incomplete or that the grounds of appeal and statement of facts were not available on record. It was further submitted that another notice was issued on 23.12.2024, but even in that notice no deficiency in the appeal papers was pointed out.
8. The learned AR further submitted that subsequently a notice dated 29.07.2025 was issued by the appellate authority asking the assessee to upload: i. Form 35 along with statement of facts and grounds of appeal ii. Assessment order iii. Any other document to enable disposal of the appeal.
9. The learned AR submitted that after issuing the above notice and almost one year after the first notice, the learned CIT(A) proceeded to pass the impugned order dismissing the appeal on the ground of incompleteness of Form 35.
10. It was further submitted that the assessee had originally filed the appeal along with all necessary documents as evidenced by the letter dated 02.04.2015 addressed by the Chartered Accountant to the CIT(A)-14, Mumbai, wherein it was specifically mentioned that the appeal in Form 35 along with grounds of Vicky Agro Food Products & Suppliers Pvt. Ltd. appeal and statement of facts was enclosed. The learned Authorised Representative also referred to the letter dated 09.10.2024 addressed to the CIT(A), wherein the assessee had stated that submissions had already been made before the CIT(A) between June 2016 and February 2020 and had also requested for a physical hearing.
It was therefore submitted that the assessee was under a bona fide belief that the appeal papers were complete and that the appeal was being processed normally.Accordingly, it was submitted that dismissal of the appeal without adjudicating the issues on merits is contrary to the principles of natural justice.
On the other hand, the learned Departmental Representative relied upon the orders passed by the Assessing Officer and the learned CIT(A).
We have carefully considered the rival submissions and perused the material placed on record. It is an undisputed fact that the assessment in the present case was completed by the Assessing Officer under section 143(3) of the Income Tax Act, 1961 on 20.03.2015 making additions on account of unexplained share capital and premium, unexplained loan and unexplained investment aggregating to Rs. 1,70,14,650/-. Aggrieved by the said assessment order, the assessee filed an appeal before the learned CIT(A)-14, Mumbai on 08.04.2015.
From the record it is seen that at the time of filing the appeal before the jurisdictional CIT(A), the assessee had Vicky Agro Food Products & Suppliers Pvt. Ltd. addressed a letter dated 02.04.2015 through its Chartered Accountant, wherein it was specifically stated that the appeal in Form No. 35 together with the grounds of appeal
and statement of facts was being filed along with the notice of demand, assessment order and challan for appeal fee. The said correspondence prima facie indicates that the assessee had filed the appeal in the prescribed form along with the relevant enclosures.
15. Subsequently, the appellate proceedings were migrated to the National Faceless Appeal Centre under the faceless appeal scheme. The learned CIT(A), NFAC, while passing the impugned order dated 16.09.2025 under section 250, observed that Form No. 35 and other documents were not available on record and therefore held that the appeal could not be adjudicated and dismissed the appeal as infructuous.
16. However, from the notices placed on record it is seen that the notice issued by the appellate authority dated 09.09.2024 under section 250 merely called upon the assessee to furnish ground-wise submissions and supporting evidences. The said notice did not indicate that the appeal papers were incomplete or that the grounds of appeal and statement of facts were not available on record. Even the subsequent notice dated 23.12.2024 did not point out such deficiency.
17. It is only much later, vide notice dated 29.07.2025, that the assessee was asked to upload the appeal papers including Form No. 35 and other documents. In our considered opinion, if the Vicky Agro Food Products & Suppliers Pvt. Ltd. appellate authority was of the view that the appeal records were incomplete, the assessee ought to have been clearly informed of the specific deficiency and granted an effective opportunity to rectify the same.
18. Further, we find merit in the contention of the learned Authorised Representative that the appeal was originally filed before the jurisdictional CIT(A)-14, Mumbai and the matter was subsequently migrated to the Faceless Appeal Centre under the faceless appeal scheme. When such migration of appellate proceedings takes place, it is expected that the entire appellate record maintained with the jurisdictional office of the CIT(A) is also duly transferred to the Faceless Appeal Centre. In the absence of such transfer of records, the assessee cannot be prejudiced merely because certain documents are not available on the electronic system of the faceless platform.
In our view, the dismissal of the appeal by the learned CIT(A) merely on the ground that the grounds of appeal
and statement of facts were not available on record, without examining the earlier correspondence and without providing adequate opportunity to cure the alleged defect, is not in consonance with the mandate of section 250(6) of the Act which requires the appellate authority to dispose of the appeal by passing a reasoned order stating the points for determination and the decision thereon.
20. It is well settled that procedural irregularities should not defeat the cause of substantive justice, particularly when the 21. Considering the entirety of the facts and circumstances of the case, we are of the view that the impugned order passed by the learned CIT(A) cannot be sustained. Accordingly, the order of the learned CIT(A) dated 16.09.2025 is set aside and the matter is restored to the file of the learned CIT(A) for adjudication of the appeal on merits after granting reasonable opportunity of being heard to the assessee.
The assessee is also directed to furnish all relevant documents including Form No. 35, statement of facts and grounds of appeal before the learned CIT(A) so as to enable proper adjudication of the appeal.
In the result, the appeal filed by the assessee is allowed for statistical purposes.
Order pronounced in the open court on 16.03.2026.