THE GOOD SHEPHERD EDUCATION SOCIETY ,BENGALURU vs. ITO, EXEMPTIONS WARD-2, BENGALURU

This appeal is filed by the assessee against the CIT(A)’s Order dated 05.12.2024 vide DIN and Order No.ITBA/APL/S/250/2024- 25/1070938109(1).

Briefly stated, the facts of the case are that assessee is running an educational institution in the name and style “Good Shepherd Education society”. Assessee filed return of income on 28.07.2018 declaring a total income of Rs.1,36,652/-. The return was processed and income was determined at Rs.1,13,35,744/- disallowing the assessee’s claim of application of income amounting to Rs.1,11,99,092/-. The return was processed on Page 2 of 4 26.09.2019. Against the intimation issued by the CPC, assessee instituted appeal before the learned CIT(A) on 07.07.2020 with a delay of 15 days. The intimation was physically served to the assessee on 23.11.2019. The learned CIT(A) noted that the appeals should have been filed as per section 249 of the Act within 30 days from the date of receipt of the Order. However, there was a delay of 15 days and reasons for delay were explained duly by the assessee. As per the opinion of the learned CIT(A), there was no sufficient cause to file the appeal before the learned CIT(A) with the dealy o by 15 days and relying on the judgment of Hon’ble Apex Court, he dismissed the appeal of the assessee without going into the merits of the case.

Aggrieved from the above Order, assessee filed appeal before the Tribunal. The learned Counsel reiterated the submissions made before the learned CIT(A) and submitted that the assessee is totally depending upon his auditor. The return was processed on 26.09.2019 but the assessee did not check its email. It came to the knowledge of the assessee only when physical copy was served. The delay was due to oversight by the auditor. It is submitted that assessee is not conversant with the tax matters. When the hard copy was received, it was immediately handed over for further processing. There is no failure on the part of the assessee and it was further submitted that the CPC while processing the return has not considered the real income. It is in contravention to the scheme of Income Tax Act. In support of his arguments, he relied on the following judgments:

On the other hand, learned DR relied on the Order of the learned CIT(A) and submitted that assessee should have filed appeal within the stipulated time. The return was processed on 26.09.2019. Later hard copy was sent to the assessee. Assessee should have checked its email. The intimation was sent immediately after the return was processed. In this regard, the learned CIT(A) has relied on various judgments and correctly dismissed the appeal of the assessee.

Considering the rival submissions, we noticed that the return filed by the assessee was processed on 26.09.2019 and later on hard copy was received by the assessee on 23.11.2019. As per the submissions of the assessee, the auditor of the assessee did not file appeal within the stipulated time and the assessee was diligent in taking appropriate steps and the delay was caused due to the negligence of the auditor of the assessee. Accordingly, we condone the delay. Since in this case, the CPC while processing the return has considered the entire receipts as income within giving benefit of expenditure, the real income theory is absent in this case. Therefore, considering the totality of facts and in the interest of justice, we are remitting this issue back to the file of CIT(A) for a fresh decision as per law. Assessee is directed to co-operate with the Revenue and shall not seek unnecessary adjournments in the matter. In case of failure second leniency shall not be granted to the assessee