UNIVERSAL ENERGIES LTD.,NEW DELHI vs. DCIT, CIRCLE- 18(1), NEW DELHI

ORDER PER DIVA SINGH, J.M.

The present appeal has been filed by the assessee, wherein the correctness of the order dated 19.06.2018 of Ld. CIT(Appeals)-3, New Delhi pertaining to 2011-12 assessment year is assailed on the following grounds: -

1. “The Ld. CIT(A) has erred on facts and in law in dismissing the condonation application of the appellant without providing any proper opportunity of being heard to the appellant.

2. The Ld. CIT(A) has erred on facts and in law in dismissing the appeal of the appellant after hearing the matter on merits in details without raising any questions with respect to maintainability of the appeal on account of delay.

3. The appellant craves for liberty to add fresh ground(s) of appeal and also to amend, alter and modify any of the grounds of appeal.”

2. At the time of hearing, no one was present on behalf of the assessee. However, on considering the aforesaid grounds and the facts available on record it was deemed appropriate to proceed with the present appeal ex parte qua the assessee appellant on merits after hearing the Ld. Sr. DR.

3. A perusal of the record shows that the additions made to the returned income of the assessee amounting to Rs. 41,38,342/- by the Assessing Officer vide his order dated 28.03.2014 passed u/s 143(3) of the Act were challenged in appeal before the Ld. CIT(A). In the aforesaid order running into 29 unnumbered pages it is seen that from unnumbered pages 2 to 22 the Ld. CIT(A) has reproduced the submissions advanced by the assessee qua the grounds raised

before him and from pages 23 to 24 in paras 4.2 and 4.3 the Ld. Commissioner carries out a discussion on the Condonation of Delay application available on record, wherein the delay of four months in the filing of the appeal was being considered vide paras 4.4 to para 4.9 (pages 24 to 27 of the impugned order) and in paras 4.10 to 4.12 considering the judicial precedents as available in Ajit Singh Thakur Singh And Anr. Vs. State of Gujarat, 1981 AIR 1981 SC 733; Civil Appeal No. 6974 of 2013 Basawaraj & Anr.; Brijesh Kumar Vs. State of Haryana, AIR 2014 SC 1612 and P.K. Ramachandran Vs. State of Kerala, (1997) 7 SCC 556 he summed up the reasons for delay canvassed as under: - a) The company passed through some very severe crises during the last more than 2 years; b) Three major projects of the company namely Ram Garh, Chakulia & Godda Sunderpurpahari could not effectively take off and as a consequence there was massive debt burden on the company; c) The key personnel and the employees have left the company; d) Filing of appeal before your honor also got delayed on account of people responsible for compliance having left the company. These reasons considering the judicial precedent were rejected dismissing the appeal. Aggrieved the assessee is before the ITAT on the above mentioned grounds.

4. The Ld. Sr. DR heavily relies upon the order stating that cogent reasons have been given for rejection of assessee’s appeal and hence, it was his submission that the assessee’s appeal may be dismissed.

5. We have heard the submission as advanced on behalf of the Revenue. On considering the same, we find ourselves unable to confirm the order passed. It is seen that the assessee has specifically invoked Page 2 of 5 lack of proper opportunity before the Ld. CIT(A) in the grounds raised before us specifically alleging that in the course of the hearing no questions with respect to the maintainability of the appeal on account of delay have been raised by the Ld. CIT(A). It is seen from the explanation extracted in the order reproduce in para 4.2 of the order that no doubt generalistic factual statements by way of an explanation were advanced. For ready reference these are reproduced hereunder for the sake of completeness: - “We wish to submit before your honor that the company passed through some very severe crises during the last more than 2 years. Due to various issues, three major projects of the company namely Ram Garh, Chakulia & Godda Sunderpurpahari could not effectively take off and as a comsequence there was massive debt burden on the company. There was a debt restructuring with the four major lender banks also. The company suffered a loss of around Rs. 15 crore during the FY 2012-13 and around Rs. 6 crores during the FY 2013-14. For the current FY 2014-15 we have an expected loss of more than Rs. 5 crore. As a consequence most of the key personnel and the employees have left the company resulting into non- compliance and delays in various legal processes and a breakdown in the operational efficiencies of the company. The company is fighting for survival on account of multiple factors caused primarily by the financial crises. The filing of appeal before your honor also got delayed on account of people responsible for compliance having left the company leading to the breakdown of efficient operations of the company.”

6. The explanation offered was discarded holding that “the appellant however has not indicated any specific detail as to what was the reason within the limitation period pending on 02.04.2014 and 01.05.2014 for the cause of delay.” Thereafter relying upon the principles of law as considered by the Courts in the decisions cited in the order the Ld. Commissioner has concluded that there is no ground for condonation of delay. We find that the arguments advanced on behalf of the Revenue that the conclusion is not a mechanical conclusion and is a reasoned conclusion does not distract from the factual position as emanating from the record namely that effective opportunity of being heard is not granted. It also does not address the allegation set out in the grounds of appeal itself namely that in the course of hearing no questions were asked/raised with respect to the Page 3 of 5