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Facts
The assessee filed its return for AY 2020-21 and the assessment was completed. However, a deduction of Rs. 34,79,970/- u/s 80JJAA was disallowed. The assessee filed an appeal before the CIT(A) which was dismissed due to a delay of 43 days without deciding on merits.
Held
The Tribunal held that the assessee had a reasonable cause for the delay in filing the appeal due to a bonafide belief that the issue would be addressed via rectification u/s 154. Therefore, the delay was condoned, and the CIT(A) was directed to decide the matter afresh on merits.
Key Issues
Whether the delay of 43 days in filing the appeal before the CIT(A) was for a reasonable cause and deserved condonation. Whether the CIT(A) should decide the appeal on merits after condoning the delay.
Sections Cited
250, 143(3), 144B, 80JJAA, 154
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Before: SHRI RAHUL CHAUDHARY & SMT. RENU JAUHRI
Assessee by : None Revenue by : Shri R. R. Makwana Date of Hearing 10.02.2025 Date of Pronouncement 14.02.2025 आदेश / O R D E R PER RENU JAUHRI [A.M.] :- This appeal is filed by the assessee against the order of the Learned Commissioner of Income-tax (Appeals), Mumbai/National Faceless Appeal Centre, Delhi [hereinafter referred to as “CIT(A)”] dated 20.11.2024 passed u/s. 250 of the Income-tax Act, 1961 [hereinafter referred to as “Act”] for Assessment Year [A.Y.] 2020-21.
The assessee has raised the following grounds of appeal:
1. On the facts and in the circumstances of the case, the Commissioner of Income-tax (Appeals), hereinafter referred to as the CIT (A), has erred in dismissing the appeal of the appellant as inadmissible without appreciating the facts and circumstances of the case. The CIT (A) has erred in not A.Y. 2020-21 RAC Infra Rental LLP appreciating the fact that there was a reasonable cause for the delay of 43 days in filing the appeal by the appellant.
2. The CIT(A) further erred in not deciding the appeal on merits, after allowing the appellant to make its submissions on merits, thereby impliedly allowing condonation of the delay in filing the appeal.
3. Without prejudice to any of the above grounds, the assessment unit has erred in not allowing the deduction of Rs. 35,79,970/- u/s. 80JJAA while making the final computation of income despite of its own categorical finding confirming the claim of the appellant. The CIT (A) has erred in not allowing the bona-fide claim of the appellant u/s. 80JJAA.
4. The appellant prays that the deduction of Rs. 35,79,970/-u/s. 80JJAA may please be allowed and necessary directions in this regard may please be issued to the assessment unit.
5. On the facts and in the circumstances of the case, the assessment unit has erred in allowing credit of Rs. 90,44,267/- as TDS while computing the tax liability of the appellant as against TDS credit of Rs. 91,28,470/- as available in Form 26AS of the appellant. The appellant prays that the necessary directions in this regard may please be issued to the assessment unit.”
Brief facts of the case are that the assessee filed its return for AY 2020-21 on 29.12.2020 declaring income of Rs. 13,44,43,540/-. The assessment was completed u/s 143(3) r.w.s. 144B of the Act at returned income. However, while computing taxable income, the deduction u/s 80JJAA of Rs. 34,79,970/- was disallowed.
Aggrieved with the assessment order, the assessee filed an appeal before Ld. CIT(A). The appeal was dismissed by Ld. CIT(A) on account of the delay of 43 days without deciding it on merits.
Aggrieved with the order of Ld. CIT(A), the assessee has filed an appeal before the Tribunal.
It has been explained by the Ld. AR that the assessee was under a bonafide belief that the mistake in the computation of taxable income was an inadvertent error, and therefore, it made a request for rectification u/s 154 vide A.Y. 2020-21 RAC Infra Rental LLP letter dated 10.10.2022 before the AO. Subsequently, the assessee was informed by the jurisdictional AO that the power of rectification did not vest with him since the assessment was made under the faceless assessment scheme. Accordingly, the assessee decided to file an appeal against the order dated 11.09.2022. However, in this process, a delay of 43 days occurred as the appeal was filed on 22.11.2022. The assessee, therefore, requested for condonation of delay in filing of appeal before the Ld. CIT(A). However, vide his order dated 22.11.2024, Ld. CIT(A) observed that there was no sufficient and good reason for the delay of 43 days, and hence, he declined to condone the delay and dismissed the appeal. Aggrieved with the order of Ld. CIT(A), the assessee is in appeal before the Tribunal.
We have heard the rival submissions. Since the disallowance of deduction u/s 80JJA was not discussed in the assessment order, it was presumed by the assessee that the claim has been inadvertently disallowed while computing the income. It, therefore, filed a rectification application u/s 154 of the Act on 10.10.2022. These facts have not been disputed by the Ld. Dr. Considering the explanation furnished by the assessee, we are of the view that there was a reasonable cause for the delay of 43 days in filing of appeal as the assessee was genuinely under the impression that the issue would be addressed and resolved u/s 154 of the Act for which he had duly filed an application before the A.Y. 2020-21 RAC Infra Rental LLP jurisdictional AO. We, therefore, hold that the delay of 43 days being for a reasonable cause deserves to be condoned. We, therefore, direct the Ld. CIT(A) to condone the delay of 43 days and decide the matter afresh on merits after giving due opportunity to the assessee.
In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open court on 14.02.2025.