BHARAT VANMALIBHAI MODIYA,MUMBAI vs. ITO 31(1)(1), MUMBAI

After having heard the counsels for both the parties and going through the contentions of the application seeking for condonation of delay and also taking into consideration the principles as laid down by Hon’ble Supreme Court in the case of Land Acquisition Collector Vs. Mst. Katiji & Ors., [1987] AIR 1353 (SC) wherein it has been held that where substantial justice is pitted against technicalities of none deliberate delay, then in that eventuality substantial justice is to be preferred.

Thus, considering these principles and also taking into account that the application for seeking condonation of delay is supported by an affidavit. Whereas, on the contrary no affidavit has been filed by the department to rebut or controvert the facts, contained in the affidavit filed by the assessee. Therefore the contention of the affidavit filed by the assessee went un-rebutted. Considering the totality of facts and legal preposition as discussed above, the delay in filing the appeals stands condoned.

At the very outset, Ld. AR submitted that the present appeal has arisen out of the penalty imposed and upheld by the revenue authorities u/s 271(1)(c) of the Act, whereas the main order of assessment stands quashed by the Coordinate Bench of ITAT.

After having heard both the parties and after going through the records, we found that the assessment order for the year under consideration stands quashed by the decision of Coordinate Bench of ITAT in ITA No. 125/Mum/2022 dated 1303.2024. 7. Since assessment order has already been quashed therefore in our view, penalty arising out of the said assessment order also needs to be quashed because when once assessment order which is the basis for initiating penalty proceeding, is no more inexistence then in that eventuality no penalty is maintainable. Therefore keeping in view our above discussion, we quash the penalty imposed by AO and upheld by the Ld. CIT(A) u/s 271(1)(c) of the Act.

In the result, the appeal filed by the assessee stands allowed. ITA No. 6005/Mum/2024, A.Y 2015-16 9. From the records we noticed that assessee was ex-parte before CIT(A), although in our view it was obligatory on the part of assessee to purse his appeal purposefully and cooperatively in the worthwhile manner. The assessee has evidently failed to do so because of the reasons mentioned in the application filed for seeking condonation of delay. 10. Be that as it may, in our view the interest of justice would be met in case the lis between the parties is decided on merits after providing fair opportunity of hearing to both the parties. Therefore, considering the above factual and legal position, the Bench feels that the ends of justice would be met only if the matter is restored back to the file of the CIT(A). And in case proper and sufficient opportunity is not given to the asessee then in that eventuality the rights of the assessee shall be prejudice. Thus keeping in view the above, factual position, the present appeal of the assessee is restored to the file of CIT(A) for deciding it afresh on merits by providing opportunity of hearing to the parties. The assessee shall not seek any adjournment on frivolous grounds and remain cooperative during the course of proceedings. 11. Before parting, we make it clear that our decision to restore the matter back to the file of the CIT(A) shall in no way be construed as having any reflection or expression on the merits of the dispute, which shall be adjudicated by the CIT(A) independently in accordance with law. 12. In the result the appeal filed by the assessee allowed for statistical purposes. Order pronounced in the open court on 14.01.2025. (GIRISH AGRAWAL) (SANDEEP GOSAIN) ACCOUNTANT MEMBER JUDICIAL MEMBER

अपीलाथ / The Appellant 2. थ / The Respondent. 3. संबंिधत आयकर आयु / The CIT(A) 4. आयकर आयु(अपील) / Concerned CIT 5. िवभागीय ितिनिध, आयकर अपीलीय अिधकरण, मुबई / DR, ITAT, Mumbai 6. गाड फाईल / Guard file.

उप/सहायक पंजीकार ( Asst.