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Facts
The Assessee filed appeals before the Tribunal with a delay of 279 days, citing a delay in communication due to a change in the General Manager (Accounts) and oversight in noticing hearing notices, leading to ex-parte orders. The appeals challenged orders passed by the AO under Section 154 and 143(1) and subsequent rectification orders, as well as ex-parte appellate orders passed by the Ld. Commissioner (Appeals).
Held
The Tribunal condoned the delay in filing the appeals, noting that the reasons provided were bonafide and genuine, but cautioned the assessee for future vigilance. The Tribunal then proceeded to the merits of the case and remitted the impugned orders to the Ld. Commissioner for a fresh decision after providing the assessee with an opportunity of hearing.
Key Issues
Whether the delay in filing the appeal can be condoned due to oversight and change in personnel, and if the ex-parte orders passed by the lower authorities should be set aside and the matter remitted for fresh adjudication.
Sections Cited
250, 154, 143(1), 253, 143(3), 246A, 234D, 234B, 43B, 142(1), 143(2), 36(1)
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Income Tax Appellate Tribunal, “A’’ BENCH: BANGALORE
Before: SHRI NARENDER KUMAR CHOUDHRY, JUDICIAL & SHRI WASEEM AHMED
Appellant by : Sri V. Narendra Sharma, Ld. Advocate Respondent by : Sri Shivanand H. Kalakeri, Ld.CIT Date of Hearing : 04.08.2025 Date of Pronouncement : 04.08.2025 O R D E R PER: NARENDER KUMAR CHOUDHRY, JUDICIAL MEMBER:
These appeals have been preferred by the Assessee against different orders dated 23-03-2024 and 07-02-2024 impugned herein passed by the Ld. Commissioner of Income Tax (Appeals), & 370/Bang/2025 M/s. Karnataka Power Corporation Limited Page 2 of 13 National Faceless Appeal Centre, Delhi (hereinafter in short “Ld. Commissioner”) u/s 250 of the Income Tax Act 1961 {in short ‘Act’} challenging the orders passed by the AO u/s 154 and 143(1) of the Act respectively dated 23-01-2023 and 16-09-2020, for the Assessment Year {in short ‘AY’ } 2019-20.
Since both the appeals having involved identical issues and therefore for the sake of brevity, the same are heard together and are being disposed of by this composite order by taking into consideration as lead case, result of the same would be applicable mutatis mutandis to both the appears under consideration.
ITA 369/BANG/2025 3. Coming to the instant case, we observe that there is a delay of 279 days in filing of the instant appeal, on which the assessee has claimed as under: - “1. The Petitioner / Appellant i.e. M/s. Karnataka Power Corporation Limited, being aggrieved by the appellate order passed by the learned Commissioner of Income-tax [Appeals], NFAC, Delhi, appellate order dated 23/03/2024, has preferred a statutory appeal as per the provisions of section 253 of the Act, on 25/02/2025, which is numbered as and posted before the Hon'ble 'A' Bench of this Hon'ble Income-tax Appellate Tribunal, Bangalore Benches, Bengaluru.
2. The aforementioned appeal preferred by the Petitioner / Appellant before this Hon'ble Tribunal is filed with a delay of about 279 days which is beyond & 370/Bang/2025 M/s. Karnataka Power Corporation Limited Page 3 of 13 the statutory time allowed in the statute i.e. the date of order of the learned Commissioner of Income-tax [Appeals], NFAC, Delhi, i.e. 23/03/2024 if considered as date of receipt of the order then the Petitioner / Appellant ought to have filed the present appeal on or before 22/05/2024, whereas the present appeal has been preferred on 25/02/2025 leading to a delay in filing the present appeal by about 279 days. The reasons leading for the delay in filing the present appeal is brought out in the following paragraphs: 3. The Petitioner / Appellant is a corporation established under the Company Act, 1956. The Petitioner / Appellant is engaged in the business of generation of power. The Petitioner / Appellant filed its return of income on 31/10/2019 for the assessment year 2019-20, declaring total income of Rs. NIL/- under regular provisions of the Act.
4. The return of income of the Petitioner / Appellant was processed and an order of intimation under section 143[1] of the Act dated 16/09/2020 came to be passed by learned Assistant Director of Income Tax, CPC determining the Petitioner's / Appellant's total income at Rs. 34,78,00,210/- as against the returned total income of Nil, consequently reducing the refund of the Petitioner / Appellant from Rs. 62,56,60,536/- to Rs. 54,94,96,498/ - wherein disallowance under section 36[1][val of the Act of Rs. 26,74,01,230/- and disallowance under section 43B of the Act of Rs.8,03,98,978/- total disallowance to the extent of Rs. 34,78,00,210/- being adjustment in the impugned order of intimation passed under section 143[1] of the Act were made by the learned assessing officer.
5. The Petitioner / Appellant being aggrieved by the order of intimation passed under section 143 [1] of the Act dated 16/09/2020, passed by the Assessing Officer had preferred a statutory appeal before the learned Commissioner of Income-tax [Appeals], under the provisions of Section 246A[1] of the Act.
& 370/Bang/2025 M/s. Karnataka Power Corporation Limited Page 4 of 13 6. Thereafter, the case of the Petitioner / Appellant was selected for scrutiny. The Petitioner / Appellant was issued statutory notices under the provisions of section 143 [2] and 142 [1] of the Act. The Petitioner / Appellant in response to the said notices furnished the requisite details. The learned Assessing Officer concluded the assessment by passing an order of assessment under section 143[3] r.w.s. 144B of the Act, dated 30/09/2021 by making certain additions and disallowances to the income returned by the Petitioner / Appellant and thereby assessed the total business income of the Petitioner / Appellant at Rs. 202,79,22,058/- as against the returned business income of Rs. NIL/-.
7. The Petitioner / Appellant being aggrieved by the additions and disallowances made in the order of assessment passed under section 143[3] r.w.s. 144B of the Act dated 30/09/2021, has preferred a statutory appeal before the learned Commissioner of Income-tax [Appeals], NFAC, as per the provisions of section 246A [1] of the Act. The said appeal filed by the Petitioner / Appellant against the order of assessment passed under section 143[3] r.w.s. 144B of the Act dated 30/09/2021, is pending adjudication as on the date of filing this present appeal before this Hon'ble Tribunal.
8. It is submitted that during the pendency of the statutory appeal filed before the learned Commissioner of Income-tax [Appeals], NFAC, appeal preferred against the order of assessment passed under section 143[3] r.w.s. 144B of the Act, dated 30/09/2021, the learned assessing officer sought to amend the order of assessment passed on 30/09/2021 by initiating the proceedings under section 154 of the Act, and thereafter passed an order of rectification under section 154 r.w.s. 143[3] of the Act dated 23/01/2023 by stating that there is a short levy of interest under section 234D of the Act since no 234D interest was levied. Further, the learned assessing officer has stated that in Form 3CD report, an amount of Rs. 52,08,24,535/- was & 370/Bang/2025 M/s. Karnataka Power Corporation Limited Page 5 of 13 disallowed under section 43[b] of the Act towards non- remittance of Gratuity, whereas in the computation statement produced only Rs. 44,04,25,557/- has been disallowed and added back in the total income instead of disallowance amount of Rs. 52,08,24,535/-, which has resulted in short computation of income to the tune of Rs. 8,03,98,978/- resulting in a short levy of tax, Rs. 2,80,94,618/- and interest under section 234B of Rs. 84,28,386/- aggregating to Rs. 3,65,23,004/-• 9. The Petitioner / Appellant being aggrieved by the said order of rectification passed by the learned assessing officer under section 154 r.w.s. 143[3] of the Act, dated 23/01/2024 preferred a statutory appeal as per the provisions of section 246A of the Act before the learned Commissioner of Income-tax [Appeals].
10. It is submitted that Petitioner / Appellant including appeal for the impugned assessment year 2019-10 had also filed multiple appeals for various earlier assessment years and also subsequent assessment years which were pending disposal by the learned Commissioner of Income-tax [Appeals].
It is submitted that the then General Manager [Accounts] Sri. S Raghavendra one Sri. S Raghavendra was incharge of the finance department and was looking after various finance related matters. Since, multiple notices were issued by the Income-tax Department for various other assessment years including notice of hearing issued by the officer of the learned Commissioner of Income-tax [Appeals] for the impugned assessment year 2019-20, due to oversight or due to miscommunication the hearing notices issued by the learned Commissioner of Income-tax [Appeals] for the impugned assessment year 2019-20 went un- noticed and the same could not be responded or complied to the hearing notices issued by the learned Commissioner of Income-tax [Appeals].
& 370/Bang/2025 M/s. Karnataka Power Corporation Limited Page 6 of 13 12. Due to the above-mentioned reason the aforementioned appeal preferred by the Petitioner / Appellant before the learned Commissioner of Income- tax [Appeals], appeal against the impugned order of rectification passed under section 154 r.w.s. 143[3] of the Act could not be responded and the learned Commissioner of Income-tax [Appeals] passed an ex- parte order dismissing the appeal preferred by the Petitioner / Appellant, vide appellate order dated 23/03/2024.
It is submitted that the said appellate order passed by the learned Commissioner of Income-tax [Appeals], dated 23/03/2024, was also went un-noticed by the then General Manager [Accounts] Sri. S Raghavendra and hence the same was inadvertently not to the notice of the Petitioner / Appellant for the reasons as mentioned above.
Thereafter, the then General Manager [Accounts] Sri. S Raghavendra, tendered his resignation from the employment by opting for Voluntary Retirement from his services in the month of December, 2024.
It submitted that in place of General Manager [Accounts] Sri. S Raghavendra who took retirement from his employment, Sri. M.S. Anand was promoted as new General Manager [Accounts] on and from January,2025.
It is submitted that the said new General Manager [Accounts] Sri. M.S. Anand, was taking stock of all the pending files and also the pending issues and while scrutinizing the pending works when they received a notice of hearing from the Commissioner of Income-tax [Appeals] for a different assessment year, while complying to the said notice of hearing the present General Manager [Accounts] when they looked at the information window in e-proceedings of the Income-tax e-filing portal of the Petitioner / Appellant then to his shock he noticed the impugned appellate order was passed by the learned Commissioner of Income-tax & 370/Bang/2025 M/s. Karnataka Power Corporation Limited Page 7 of 13 [Appeals] dated 23/03/2024 appeal preferred by the Petitioner / Appellant against the impugned order of rectification passed under section 154 r.w.s. 143[3] of the Act for the impugned assessment year 2019-20 and also another appellate order was passed by the learned Commissioner of Income-tax [Appeals] dated 07/02/2024 being appeal preferred by the Petitioner / Appellant against the impugned order of intimation passed under section 143[1] of the Act for very same impugned assessment year 2019-20.
Thereafter, the present General Manager [Accounts] approached the office of the present counsel Sri. A. Shankar, Senior Advocate who is the Petitioner / Appellant tax consultant and appraised about the entire circumstances as regard to the ex-parte appellate orders passed by the learned Commissioner of Income-tax [Appeals] as against the appeal preferred against the impugned order of rectification passed under section 154 r.w.s. 143[3] of the Act and also appeal preferred against impugned order of intimation passed under section 143[1] of the Act.
The present counsel after hearing the same from the present General Manager [Accounts] Sri. M. S. Anand, suggested the Petitioner / Appellant to file a statutory appeal against the ex-parte appellate orders passed by the learned Commissioner of Income-tax [Appeals] by preferring a statutory appeal before this Hon'ble Income- tax Appellate Tribunal, Bangalore Bench, Bengaluru.
It is submitted that based on the advice of the office of the present counsel and with the help of the office of the present counsel, the appeal papers were prepared by them and the appeal before the Hon'ble Income-tax Appellate Tribunal, Bengaluru was filed on 25/02/2025 with a delay in filing the appeal before the Tribunal of about 279 days.
It is submitted that as per the provisions of section 253 of the Act the Petitioner / Appellant ought to have & 370/Bang/2025 M/s. Karnataka Power Corporation Limited Page 8 of 13 filed the statutory appeal against the impugned appellate order passed by the learned Commissioner of Income-Tax [Appeals], within 60 days from the date of receipt i.e. 23/03/2024 of the said order i.e. on or before 22/05/2024, before this Hon'ble Tribunal.
Thus, for the reasons as mentioned in the above paragraphs, the Petitioner / Appellant was prevented from filing the statutory appeal within the time stipulated in the statute i.e. within 60 days i.e. on or before 22/05/2024. It is submitted that the Petitioner / Appellant was not aware of passing of the impugned appellate order by the learned Commissioner of Income- tax [Appeals].
Wherefore, in view of the above factual background, the Petitioner / Appellant could not file the Appeal before this Hon'ble Tribunal in time as per the scheme of the Act and there arose of delay of about 279 days in filing this present appeal before this Hon'ble Tribunal due to circumstances beyond the control of the Petitioner / Appellant and further it also could not respond to the notice of hearing issued by the learned Commissioner of Income-tax [Appeals], which infact led to passing of an ex-parte appellate order by the learned Commissioner of Income-tax [Appeals] for the reasons mentioned in the above paragraphs, which fact may kindly be considered by this Hon'ble Tribunal.
It is further submitted that the said act of the Petitioner / Appellant in not filing the present appeal within time is not deliberate or intentional and the Petitioner / Appellant by not filing the appeal in time will not gain any benefit and for the reasons as stated above the Petitioner / Appellant could not file the present appeal within the stipulated time which fact may kindly be appreciated by this Hon'ble Tribunal.
It is humbly submitted that if this application for condonation of delay in filing the appeal is not allowed, the Petitioner / Appellant would be put to great & 370/Bang/2025 M/s. Karnataka Power Corporation Limited Page 9 of 13 hardship and irreparable injury and on the other hand no hardship or injury would be caused to the Respondent if this application of condonation of delay is allowed.
Reliance is placed on the decision of the Hon'ble Apex Court in the case of Collector, Land Acquisition Vs. MST. Katiji and Others [1987] 167 ITR 471 and also in the case of Concord of India Insurance Co. Ltd., Vs. Smt. Nirmala Devi and Others 118 ITR 507. Further the Petitioner / Appellant relies on other decisions of the Hon'ble Apex Court in the case of Radha Krishna Rai Vs. Allahabad Bank & Others [2009] 9 SCC 733; and another decision of the Hon'ble Apex Court in the case of Ram Nath Sao alias Ram Nath Sahu & Others Vs. Gobardhan Sao & Others, reported in [2002] 3 SCC 195 and another decision of the Hon'ble Apex Court in the case of CIT Vs. West Bengal Infrastructure Development Finance Corporation Limited [2011] 334 ITR 269 [SC].
Wherefore the Petitioner / Appellant once again humbly pray before this Hon'ble Tribunal to kindly consider the submissions made and considering the submissions the Petitioner / Appellant humbly pray before this Hon'ble Tribunal to condone the delay in filing the present appeal of about 279 days and hear the same on merits of the matter for the advancement of substantial cause of justice.”
The Assessee in support of its claim for condonation of delay has also filed duly sworn affidavit of Mr. Gaurav Gupta, Managing Director of Assessee organization.
On the contrary, the Ld. DR vehemently opposed the contention raised by the assessee for condonation of delay by specifically claiming that assessee is neither a rustic villager nor a & 370/Bang/2025 M/s. Karnataka Power Corporation Limited Page 10 of 13 common man who cannot understand the intimacies of law but in- fact is an organization, who is having plenty of legal minds and therefore reason stated by the Assessee cannot considered as plausible.
The Ld. Counsel Mr. V. Narendra Sharma, Advocate, in response to the aforesaid contention of the Ld. DR, has demonstrated the fact that Shri S. Raghavendra, being the General Manager (Accounts) of the Assessee was handling the tax matters of the Assessee organization, who had taken retirement from his employment and therefore in place of him, Shri M.S. Anand on being promoted has taken charge as General Manager (Accounts) from January 2025 onwards and took some time to understand the legal cases going on and/ or intricacies of the issues involved in the cases pending before the Courts including before the Tribunal. Thus the said reason also is also one of the major reasons for delay. Even otherwise, there were various proceedings involved in the instant cases, as the assessee has challenged the orders u/s 143(3) as well as 154 of the Act. Thus, lenient view may be taken and delay may be condoned.
Having considered the above stated peculiar facts and circumstances as demonstrated above by the parties and specific to the fact that General Manager (Accounts), who was handling the accounts matter of the assessee Company, took voluntary retirement and therefore new General Manager (Accounts) has taken charge of the accounts affairs of the assessee but somehow & 370/Bang/2025 M/s. Karnataka Power Corporation Limited Page 11 of 13 new General Manager (Accounts) took reasonable time to understand the cases and intricacies of issues involved and thus approached the office of the present Counsel Sri. A. Shankar, Senior Advocate and appraised about the entire circumstances qua ex-parte appellate orders passed by the ld. Commissioner, as against the appeals preferred against the impugned orders of rectification passed under section 154 r.w.s. 143[3] of the Act and intimation passed under section 143[1] of the Act. The present counsel after consulting the present General Manager [Accounts] Sri. M. S. Anand, suggested to challenge such ex-parte appellate orders, by preferring a statutory appeals before this Hon'ble Tribunal. Thus, on the advice and help of the present counsel, the present appeals were filed before the Hon'ble Tribunal, Bengaluru on 25/02/2025 but with a delay of about 279 days.
The reasons stated by the Ld. Counsel Mr. V. Narendra Sharma, Advocate, prima facie appears to be bonafide, genuine and plausible, thus we are inclined to condone the delay, however with a caution that in future the assessee would remain more vigilant and active in prosecuting its proceedings otherwise would not be entitled for leniency and in case of subsequent latches or default, would be subjected to heavy cost. Resultantly, the delay involved is condoned.
& 370/Bang/2025 M/s. Karnataka Power Corporation Limited Page 12 of 13 7. Coming to the merits of the case, both the parties have submitted that the Impugned order, “affirming the order dated 23-01-2023 u/s 154 of the Act passed by the ACIT, Circle 4(3)(1) Bangalore, whereby short levy of tax of Rs. 2,80,94,618/- and interest of Rs. 84,28,386/- u/s 234B of the Act have been made, by rectifying the Assessment order dated 30-09-2021 u/s 143(3) r.w.s. 144B of the Act” is an ex- parte order and therefore, it would be appropriate to remit the case to the file of the Ld. Commissioner for decision afresh.
Considering the aforesaid submissions of the parties, we deem it proper to remit the instant case to the file of Ld. Commissioner for decision afresh, suffice to by providing reasonable opportunity of hearing to the assessee.
The Assessee is also directed to cooperate with the appellate proceedings before Ld.CIT(A) and file the relevant documents and submissions, which would be essentially required for proper and just decision of the case. We clarify that in case of subsequent default, assessee shall not be entitled for any leniency.
In the result, appeal of the assessee is allowed for statistical purposes.
As observed above, since, the issues raised in adjudicated above; therefore the decision rendered said appeal shall apply Mutatis mutandis for this appeal also. Accordingly, this appeal filed by the assessee is also allowed for statistical purposes.
11. To sum-up, both the appeals filed by the assessee are allowed for statistical purposes. Order pronounced in the open court on 04th August, 2025.