Loading judgment…
Facts
The assessee's appeal was dismissed by the CIT(A) for non-compliance with hearing notices, leading to a delayed appeal before the Tribunal. The delay was attributed to the assessee's personal and financial hardships, including the severe illness and death of his parents, and a family property dispute.
Held
The Tribunal condoned the 110-day delay in filing the appeal due to reasonable cause. The CIT(A)'s order dismissing the appeal was set aside, and the matter was remanded for fresh adjudication, with the assessee given an opportunity to be heard and present submissions.
Key Issues
Whether the delay in filing the appeal before the Tribunal can be condoned due to reasonable cause and if the CIT(A)'s order of dismissal should be set aside.
Sections Cited
250, 147, 144, 144B, 148, 69, 270A, 271F, 271AAC, 272A(1)(d), 234B, 234C, 253(5)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “C” BENCH, MUMBAI
order : 07.04.2025 O R D E R [ Per Rahul Chaudhary, Judicial Member:
1. 1. The present appeal preferred by the Assessee is directed against the order, dated 21/08/2024, passed by the National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as ‘the CIT(A)’] under Section 250 of the Income Tax Act, 1961 [hereinafter referred to as ‘the Act’] whereby the Ld. CIT(A) had dismissed the appeal against the Assessment Order, dated 24/04/2023, passed under Section 147 read with Section 144 read with Section 144B of the Act for the Assessment Year 2017-2018.
2. The Assessee has raised following grounds of appeal :
“1. On the facts and circumstances of the case and in law, the reassessment proceedings initiated under Section 147 of the ITA No,1121/Mum/2025 Assessment Year 2017-2018 Act are bad in law and deserve to be quashed. The NFAC/Assessing Officer has failed to comply with the mandatory procedural requirements for reassessment as set in section 147 to 151A of the Act. The order under section 147 is therefore illegal and without jurisdiction.
On the facts and circumstances of the case and in law, the notice under section 148 is bad in law and without jurisdiction as the jurisdictional conditions of section 147 to 151 have not been complied with.
3. On the facts and circumstances of the case and in law, the NFAC passed an order under section 250 of the Act by accepting the Order framed by the Assessing officer under section 144 of the Act which is contrary to the law, facts and circumstances of the case to the extent prejudicial to the interest of the assessee and is opposed to the principles of equity, natural justice and fair play.
4. On the facts and circumstances of the case and in law, the NFAC erred in confirming / making an addition under section 69 of the Act of Rs.47,61,380/- by considering the stamp authority value of the property purchased as unexplained investment.
5. On the facts and circumstances of the case and in law, the NFAC erred in confirming / making additionsRs.9,35,250/- on account of contractual payments considering Form 26AS since various parties has deducted the TDS.
6. For that the appellant objects, the initiation of penalty proceedings under Sections 270A, 271F, 271AAC, and 272A(1)(d) of the Act which are consequential to the additions made. If the additions are deleted, the penalty proceedings should also be dropped.
7. For that the appellant objects to the levy of interest under sections 234B and 234C of the Act.”
We have heard both the sides and perused the material on record.
4. The relevant facts as emerging from record are the assessment under Section 147 read with Section 144/144B of the of the Act was framed by the Assessee vide Assessment Order dated 24/04/2023. The Assessing Officer assessed the total income of the Assessee at INR.61,40,630/- after making addition of INR.47,61,380/- under Section 69 of the Act and addition of INR.9,23,250/- in respect of contractual payments. Thus, the Assessing Officer made an addition Assessment Year 2017-2018 of aggregating addition of INR.56,96,630/- to the returned of income of INR.4,44,000/-. On perusal of the Assessment Order, we find that the Assessee had failed to respond to the notice issued by the Assessing Officer and therefore, assessment under Section under Section 147 read with Section 144/144B of the Act was framed by the Assessing Officer. Being aggrieved, the Assessee preferred appeal before the CIT(A). Again during the appellate proceedings, the notice of hearing issued by the CIT(A) for not compliant with, therefore, the appeal was dismissed vide order dated 21/08/2024. Being aggrieved, the Assessee has preferred the present appeal before the Tribunal which is delayed by 110 days.
5. Learned Authorized Representative for the Assessee appearing before us explained the facts and circumstances delaying to the filing of the present appeal which showed that the Assessee was traversing through tough time in personal life on account of multiple reasons. Reliance was placed on the affidavit sworn by the Assessee which was filed on 20/03/2025 wherein it was stated as under:
“3. I say that the above order was received at my home address as stated above somewhere in the month of September 2024 but I could not checked such courier at that time due reason stated below.
I say that my father suffered a brain haemorrhage in January 2024. This critical medical emergency required immediate and intensive care, placing a tremendous burden on me. I had to dedicate all my time and resources to my father's medical treatment and well-being, which understandably took absolute priority over all other matters.
I say that, my beloved mother passed away on 14.05.2024. This untimely loss caused me immense emotional distress and grief, which severely impacted my ability to attend to any other matters, including the filing of this appeal. I was completely consumed with performing the last rites and fulfilling my familial responsibilities during this difficult period.
I say that, following my father health condition and mother's Assessment Year 2017-2018 demise, a significant dispute arose within the family concerning property & inheritance between 4 brothers. This unfortunate situation created further stress and anxiety, diverting my attention and energy away from all other matters, including his tax affairs. The family dispute required considerable time and effort to address, and it was simply not possible for me to focus on the appeal during this period.
I say that, concurrent with these emotionally challenging events, I also faced a severe financial crunch. I am an electrician and could not recovered post COVID-19 pandemic and due to the business losses, medical expenses, etc., I defaulted on several EMIS, leading to further financial strain. This financial hardship limited my access to professional assistance for preparing and filing the appeal, which further contributed to the delay.
8. It was only recently, that when our Chartered Accountant Mr. Ravi Jain, was going through the portal, he realised that an order has been passed in the appeal for the AY 2017-18.
I say that, thereafter, immediately I had decided to file the present appeal.”
6. In view of above, we hold that the Assessee was prevented by reasonable cause in filing the present appeal before the Tribunal within the prescribed time. Accordingly, the delay of 110 days in filing the present appeal is condoned in view of the provision contained in Section 253(5) of the Act.
7. We further note that the Assessee had instituted appeal against the Assessment Order dated 24/04/2023 before CIT(A) on 02/05/2023 which was dismissed on 21/08/2024. During the course of appellate proceeding before the CIT(A), notices were issued to the Assessee on 15/05/2024, 27/10/2024 and 19/06/2024. As we have noted while condoning the delay in filing the present appeal, the Assessee was traversing through tough time in personal life on account of multiple reasons. The Assessee, who is stated to be an electrician engaged in the business of providing contractor labour for electrical work, had suffered financial losses during the Covid-19 Pandemic period. The Assessee defaulted in repayment of loans and underwent Assessment Year 2017-2018 financial hardship. It is stated that the aforesaid limited Assessee’s access to professional assistance for tax matters. In January, 2024 father of the Assessee suffered from brain hemorrhage. Thereafter, in the month of May, 2024 mother of the Assessee passed away. Soon thereafter, disputes arose amongst the family members relating to property/inheritance. In the aforesaid facts and circumstances proper representation could not be made before the CIT(A) and the appeal preferred by the Assessee is dismissed. Accordingly, we set aside the order dated 21/08/2024 passed by the CIT(A) with the directions direction to adjudicate the grounds raised by the Assessee in appeal before CIT(A) afresh as per law after granting the Assessee a reasonable opportunity of being heard. The Assessee is directed to file submissions along with supporting documents before the CIT(A) on receipt of notice of hearing. The Assessee is directed to be vigilant and track the proceedings through Income Tax Business Application Portal. It is clarified that in case the Assessee fails to appear before the CIT(A) or fails of file details/documents/submissions before the CIT(A), the CIT(A) would be at liberty to proceed with the adjudication of the appeal on merits based upon material on record.
In result, in terms of paragraph 7 above, the appeal preferred by the Assessee is allowed for statistical purposes.