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Facts
The assessee, a firm from a remote village with partners not conversant with digital technology, was unaware of ex-parte assessment orders passed by the AO under Section 144 for AYs 2018-19 and 2019-20. They became aware only upon initiation of recovery proceedings. Consequently, appeals filed against quantum additions and penalties before the Ld. CIT(A) were significantly delayed (340 days for quantum, 177-215 days for penalties) and were dismissed by the Ld. CIT(A) for being belated.
Held
The Tribunal found the assessee's reasons for delay genuine, noting electronic notices were not responded to due to lack of digital literacy and remote location. It condoned the delay in filing appeals, provided the assessee remits ₹20,000 to the State Legal Aid Authority. Citing the principle of natural justice, the Tribunal set aside the CIT(A)'s orders and remanded the quantum assessments back to the AO for fresh de-novo assessment after hearing the assessee. The penalty appeals were deemed infructuous, with the AO to decide on penalty initiation after fresh assessments.
Key Issues
Condonation of delay in filing appeals before CIT(A) due to lack of awareness of ex-parte assessments, and the validity of ex-parte assessments without providing a proper opportunity of hearing to the assessee.
Sections Cited
144, 147, 148, 142(1), 270A, 271B, 272A(1)(d), 271A
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, ‘A’ BENCH: CHENNAI
Before: SHRI ABY T. VARKEY & MS. PADMAVATHY. S
आदेश / O R D E R PER ABY T. VARKEY, JM:
the assessee against the order of the Learned Commissioner of Income Tax (Appeals)/NFAC, (hereinafter referred to as “the Ld.CIT(A)”), Delhi, both dated 06.10.2025 for the Assessment Year (hereinafter referred to as "AY”) 2018-19 & 2019-20; and other appeals of the assessee are against the penalty levied by the AO which appeals preferred by the assessee before the Ld.CIT(A) has been dismissed for belated filing of the appeals as shown in the chart below: to 3726/Chny/2025 (AYs 2018-19 & 2019-20) S. Balasubramanian :: 2 ::
Delay not Appeal No. & Quantum appeal & condoned by the Under Section Assessment Year Penalty appeal Ld.CIT(A) (no. of days)
& 147/144 Quantum appeal 340 AY 2018- Penalty appeal 177 & AY 2018- Penalty appeal 180 & AY 2018- Penalty appeal 215 & AY 2018- Quantum appeal 328 & AY 2019- Penalty appeal 170 & AY 2019- Penalty appeal 180 & AY 2019- Penalty appeal 180 & AY 2019-20
At the outset, it is taken note from the grounds of appeal preferred by the assessee that the Ld.CIT(A) has dismissed the appeals filed by the assessee against the quantum added by the AO in the assessment order to the tune of ₹86,59,568/- for AY 2018-19 on the ground that the appeal was filed with a delay of ‘340’ days before him. Similarly, for AY 2018- 19, penalty imposed u/s.270A & u/s.271B & u/s.272A(1)(d) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act‘) has been dismissed for belated filing of appeals approximately by ‘200’ days.
Similarly, for AY 2019-20, the Ld.CIT(A) has dismissed the quantum appeal filed by the assessee against the additions made by the AO to the tune of ₹1,91,37,478/-. The other appeals preferred by the assessee before the Ld.CIT(A) against the penalty levied u/s.270A & u/s.271A & u/s.271B of the Act has been dismissed for belated filing of appeals approximately by ‘200’ days. to 3726/Chny/2025 (AYs 2018-19 & 2019-20) S. Balasubramanian :: 3 ::
The reason for the delay in filing of appeals before the Ld.CIT(A) as discernable from the records are that the assessee-Firm is doing business in remote place at Pollachi and the partners are not conversant with the computer & digital gadgets, because of which, it didn’t come to know about the assessment proceedings going on before the Assessing Officer (AO) which resulted in the AO passing ex-parte order u/s.144 of the Act (best judgment assessment) for both the assessment years. Only when the recovery proceedings were initiated against the assessee and the assessee was alerted by a telephone call from the Office of the Income Tax Department, the assessee came to know that the AO has passed orders on 06.03.2024 & 18.03.2024 for both the assessment years. And then, the partner of assessee went to Coimbatore and handed over the assessment orders for filing before the Ld.CIT(A) and the same were filed on 12.03.2025 with a delay of ‘340’ days & ‘328’ days respectively.
Similarly, the assessee was not aware of the penalty orders passed against it, and after coming to know about the quantum additions made for AY 2018-19 & AY 2019-20, they came to know about penalty being imposed on it; and immediately thereafter has filed the appeals before the Ld.CIT(A) who was pleased to dismiss the appeals without condoning the delay of 177-215 days. From the averments made and the considering the relevant facts, we find that assessee has not responded to any of the notices issued by the AO including notice of reopening issued to 3726/Chny/2025 (AYs 2018-19 & 2019-20) S. Balasubramanian u/s.148/142(1)/144 of the Act. The notices issued electronically to assessee were not responded, obviously because partners were not conversant with the internet/computers as noted supra. Considering the fact that notices were issued to the assessee electronically rather than by Post and there is no proof of communication of notices, assessment orders or penalty orders by post, and considering that assessee hails from remote village, it is presumed that assessee was in dark about the ongoing assessment proceedings, hence cannot be faulted for prompt filing of appeal, when it was not aware of the existence of such orders.
The reason provided by the assessee is seen to be genuine and not fabricated since assessee doesn’t gain by not appearing before the assessing officer or participate in the assessment proceedings or filing the appeals within the time. Hence, we are inclined to condone the delay in filing of appeals provided the assessee remit ₹20,000/- (consolidated amount) to the State Legal Aid Authority, Hon’ble Madras High Court within three (3) months of receipt of this order; and produce necessary proof of depositing of the same before the AO. Since the AO is noted to have passed ex-parte orders, without hearing the assessee, for the interest of justice and fair play and considering the fact that the assessee didn’t get proper opportunity for presenting its cases before the AO, by relying on the decision of the Hon’ble Supreme Court in the case of TIN Box Co. v. CIT reported in [2001] 249 ITR 216 (SC), we set aside the to 3726/Chny/2025 (AYs 2018-19 & 2019-20) S. Balasubramanian impugned orders of Ld CIT(A) and restore the assessments for both relevant AY’s back to the file of AO for fresh assessment in accordance to law after hearing the assessee. The Ld AR has undertaken to file written submission/documents to substantiate its case before the AO which we expect the Ld AR of assessee to diligently comply without fail. The AO to frame de-novo assessment for both AY’s in accordance to law.
In the light of the foregoing, having set aside the quantum assessment back to the file of the AO for fresh assessment, the penalty appeals filed by the assessee are infructuous and hence, the AO to take a call for initiation of penalty after the assessments have been framed for both the assessment years.
In the result, all the appeals filed by the assessee are allowed for statistical purposes.
Order pronounced on the 13th day of March, 2026, in Chennai.