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Income Tax Appellate Tribunal, SMCBENCH: BANGALORE
Before: SHRI WASEEM AHMED & SHRI KESHAV DUBEY
PER KESHAV DUBEY, JUDICIAL MEMBER:
This appeal at the instance of the assessee is directed against the order of the ld. CIT(A)/NFAC dated 29.08.2024 vide DIN & Order No. ITBA/NFAC/S/250/2024-25/1068128115(1) passed u/s. 250 of the Income Tax Act, 1961 (in short “the Act”) for the assessment year 2012-13.
The assessee has raised the following grounds of appeal:
1. The order passed by the authorities below in so far as it is against the appellant is opposed to law, equity and weight of evidence, probabilities, facts and circumstances of the case.
Page 2 of 16 2. The appellant denies himself to be assessed to a total income of Rs.19,11,500/-as against the returned income of Rs.2,91,500/- for the impugned assessment year 2017-18, on the facts and circumstances of the case.
3. The learned CIT(A) ought to have provided another opportunity of hearing in the interest of natural justice before dismissing the appeal, on the facts and circumstances of the case.
4. The learned CIT(A) has failed to issue notice to the mail id mentioned in the form 35, on the facts and circumstances of the case.
5. The learned CIT(A) has erred in dismissing the appeal on delay and has failed to appreciate that there existed sufficient cause for filing the appeal with delay, on the facts and circumstances of the case.
6. The appellant craves leave to add, alter, modify, delete or substitute any or all of the grounds and to file a paper book at the time of hearing the appeal.
7. In the view of the above and other grounds that may be urged at the time of the hearing of the appeal, the Appellant prays that the appeal may be allowed in the interest of justice and equity.”
At the outset, the ld. A.R. of the assessee submitted that there is a delay of 132 days in filing the appeal before this Tribunal. Further, the ld. A.R. of the assessee also drew our attention on an application for condonation of delay filed along with an affidavit dated 19/06/2025 stating the cause for such delay, which are reproduced below for ease of reference and record:
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On going through the above application for condonation, we find that the assessee filed the appeal with a delay of 132 days for the reason that the assessee, being an agriculturist, was unaware of the password of the email created by his tax practitioner. The assessee does not access the email or any electronic information &
Page 10 of 16 therefore the assessee was completely unaware of the notices & order passed u/s 250 of the Act. The assessee was subsequently informed by the office of Revenue while making recovery of the demand. Thereafter, the assessee immediately informed the Chartered Accountant who had availed the services of the present counsel for preparation & filing of the appeal before the Tribunal. The ld. A.R. also submitted that the delay is unintentional and no benefit can be attributed to the assessee in filing the appeal belatedly. He thus prayed to condone the delay and requested to consider the issues raised by the assessee on merits.
On the contrary the ld. D.R. vehemently objected for granting the condonation of delay.
We have perused the details filed by the assessee to justify the delay and we are satisfied that there is no malafide intention on the part of the assessee in filing the appeal belatedly before us. It is to be noted that u/s 253(5) of the Act the Tribunal may admit the appeal filed beyond the period of limitation where it has established that there exists a sufficient cause on the part of the assessee for not presenting the appeal within the prescribed time. The explanation therefore, becomes relevant to determine whether the same reflect sufficient and reasonable cause on the part of the assessee in not filing this appeal within the prescribed time.
6.1 While considering a similar issue the Apex Court in the case of Collector, Land Acquisition v. Mst. Katiji and Ors. (167 ITR 471) laid down six principles. For the purpose of convenience, the principles laid down by the Apex Court are reproduced hereunder:
Page 11 of 16 (1) Ordinarily, a litigant does not stand to benefit by lodging an appeal late.
(2) Refusing to condone delay can result in a meritorious matter being thrown at the very threshold and cause of justice being defeated. As against this, when delay is condoned, the highest that can happen is that a cause would be decided on merits after hearing the parties. (3) 'Every day's delay must be explained' does not mean that a pedantic approach should be made. Why not every hour's delay, every second's delay? The doctrine must be applied in a rational, commonsense and pragmatic manner. (4) When substantial justice and technical consideration are pitted against each other, the cause of substantial justice deserves to be preferred, for the other side cannot claim to have vested right in injustice being done because of a nondeliberate delay. (5) There is no presumption that delay is occasioned deliberately, or on account of culpable negligence, or on account of mala fides. A litigant does not stand to benefit by resorting to delay. In fact, he runs a serious risk. (6) It must be grasped that the judiciary is respected not on account of its power to legalize injustice on technical grounds but because it is capable of removing injustice and is expected to do so.
6.2 When substantial justice and technical consideration are pitted against each other, the cause of substantial justice deserves to be preferred, for the other side cannot claim to have vested right for injustice being done because of nondeliberate delay. Therefore, we have to prefer substantial justice rather than technicality in deciding the issue. As observed by Apex Court, if the application of the assessee for condoning the delay is rejected, it would amount to legalize injustice on technical ground when the Tribunal is capable of removing injustice and to do justice. Therefore, this Tribunal is bound to remove the injustice by condoning the delay on technicalities. If the delay is not condoned, it would amount to legalizing an illegal order which would result in unjust enrichment on the part of the State by retaining the tax relatable thereto. Under the scheme of Constitution, the Government cannot retain even a single pie of the individual citizen as tax, when it is not authorized by an authority of law. Therefore, if we refuse to Page 12 of 16 condone the delay, that would amount to legalize an illegal and unconstitutional order passed by the lower authority.
6.3 Further, in the case of People Education & Economic Development Society Vs/ ITO reported in 100 ITD 87 (TM) (Chen), wherein held that “when substantial justice and technical consultation are pitted against each other, the cause of substantial justice deserves to be preferred for the other side cannot claim to have vested right in injustice being done because of non-deliberate delay”.
6.4 The next question may arise whether delay was excessive or inordinate. There is no question of any excessive or inordinate when the reason stated by the assessee was a reasonable cause for not filing the appeal. We have to see the cause for the delay. When there was a reasonable cause, the period of delay may not be relevant factor. In fact, the Madras High Court in the case of CIT vs. K.S.P. Shanmugavel Nadai and Ors. (153 ITR 596) considered the condonation of delay and held that there was sufficient and reasonable cause on the part of the assessee for not filing the appeal within the period of limitation. Accordingly, the Madras High Court condoned nearly 21 years of delay in filing the appeal. When compared to 21 years, 132 days cannot be considered to be inordinate or excessive. Furthermore, the Chennai Tribunal by majority opinion in the case of People Education and Economic Development Society (PEEDS) v. ITO (100 ITD 87) (Chennai) (TM) condoned more than six hundred days delay. Therefore, in our opinion, by preferring the substantial justice, the delay of 132 days has to be condoned and accordingly we condone the delay and admit the appeal for adjudication.
Now the brief facts of the case are that the assessee filed his return of income for the AY 2013-14 on 07/03/2014, declaring a total income of Rs.2,91,500/-. As per the information available on record, the assessee had made cash deposits of Rs.16,20,000/- in State Bank of Mysore, which in the opinion of AO, prima facie indicates that the assessee had taxable income. Accordingly, notice u/s 148 of the Act was issued after recording the reason. As the assessee neither responded to notice issued u/s 148 of the Act nor u/s 142(1) of the Act as well as show cause notice dated 06/12/2019, the AO had no option but to complete the assessment to the best of his judgment ex-parte u/s 144 r.w.s. 147 of the Act and the entire cash deposits of Rs.16,20,000/- was added as unexplained money u/s 69A of the Act.
Aggrieved by the order passed by the AO u/s. 147 r.w.s. 144 of the Act dated 20.12.2019, the assessee preferred an appeal before the ld. CIT(A)/NFAC.
The ld. CIT(A)/NFAC dismissed the appeal of the assessee by not condoning the inordinate delay of 493 days for which in the opinion of the ld. CIT(A)/NFAC no cogent reason had been given. Therefore, the ld. CIT(A)/NFAC dismissed the appeal in limine in view of provision of section 249(3) of the Act.
Again, being aggrieved by the order of the ld.CIT(A)/NFAC, the assessee has filed the present appeal before this Tribunal.
Before us, the ld. A.R. of the assessee vehemently submitted that assessee is an agriculturist and he does not have access to the e-mail ID as he is not a tech savvy person. The ld. AR submitted that the ld.CIT(A)/NFAC failed to appreciate that there existed sufficient cause for filing the appeal belatedly before the ld.CIT(A)/NFAC. Further, the ld. A.R. of the assessee submitted that Sasalu Nagaraju Satheesh Page 14 of 16 as the assessee could not represent his case before both the authorities below and accordingly prayed that one more opportunity may be granted before the AO to represent his case in order to substantiate his claim.
The ld. D.R. on the other hand strongly opposed for remitting the matter back to the file of AO as the assessee is very callous in his approach in filing appeal not only before the ld.CIT(A)/NFAC but also before this Tribunal & prayed that the appeal of the assessee may be dismissed in limine.
We have heard the rival submissions and perused the materials available on record. The ld. CIT(A)/NFAC dismissed the appeal by not condoning the delay in filing the appeal. On going through the detailed affidavit filed before us, we take note of the fact that the assessee, being an agriculturist, was unaware of the password of the email created by his tax practitioner. The assessee does not access the email or any electronic information & therefore, the assessee was completely unaware of the notices & order passed by the AO u/s 147 r.w.s. 144 of the Act.
13.1 Perused the record and having heard learned counsel for the respective parties, it is perceived that the explanation offered in the condonation application as well as in affidavit is plausible and sufficient cause being shown by the assessee, which prevented him from filing the appeal within the specified period and accordingly we are inclined to condone the delay in filing the appeal before the ld. CIT(A)/NFAC.
13.2 Now it is an undisputed fact that assessee could not represent his case before the AO and accordingly the AO passed an ex-parte order u/s 144 of the Act and the entire cash deposit of Page 15 of 16 Rs.16,20,000/- was treated as unexplained money u/s 69A of the Act. It is also an undisputed fact that ld. CIT(A)/NFAC without condoning the delay of 493 days in filing the appeal before him, dismissed the appeal in limine in view of provisions contained u/s 249(3) of the Act. Before us, the ld. A.R. of the assessee vehemently submitted that while filing Form-35, the assessee categorically mentioned that the notices/communication may not be sent on the e-mail ID. This being so, in the interest of justice and fair play and as requested by the ld. A.R. of the assessee, we deem it fit and proper to remit the entire issue in dispute to the file of AO to decide afresh in accordance with law. Needless to say, a reasonable opportunity of being heard must be granted to the assessee. The assessee is also directed to produce all the documents/records/ financials/reports/information to substantiate his claim. We make it clear that in case of further default, the assessee shall not be entitled to any leniency. It is ordered accordingly.
In the result, the appeal filed by the assessee is partly allowed for statistical purposes.