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The Marthandam Bee Keepers Co Op… vs ITO | s.147, 148 | ITAT Chennai 2025 | BharatTax

THE MARTHANDAM BEE KEEPERS CO OP SOCIETY LTD,MARTHANDAM, KANYAKUMARI DIST vs. INCOME TAX OFFICER WARD 1, NAGERCOIL, NAGERCOIL

ITA 2816/CHNY/2025Status: DisposedITAT Chennai28 October 2025AY 2018-19Bench: SHRI ABY T. VARKEY (Judicial Member), SHRI M. BALAGANESH (Accountant Member)1 pages

AI SummaryPartly Allowed

Facts

The assessee, a cooperative society collecting honey, filed its return declaring 'nil' income. The AO made additions of over ₹2 Cr. without proper hearing, and the CIT(A) dismissed the appeal for being filed late without condoning the delay.

Held

The Tribunal condoned the delay in filing the appeal before the CIT(A), noting that the assessee was not heard by the AO due to potential technical issues. The CIT(A)'s order was set aside, and the case was restored for de novo assessment.

Key Issues

Whether the delay in filing the appeal before the CIT(A) should be condoned and whether the assessee was afforded a proper opportunity of being heard by the AO.

Sections Cited

147, 148, 10(23B), 10(23BB), 44B, 68, 69, 144

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Cases cited in this judgment

Detected automatically from the text. The count shows how many other judgments on BharatTax rely on the same authority.

Tin Box Company v. CIT
249 ITR 216 · 2001 · SC
624 citing

Income Tax Appellate Tribunal, ‘C’ BENCH: CHENNAI

Before: SHRI ABY T. VARKEY & SHRI M. BALAGANESH

Hearing: 17.10.2025Pronounced: 24.10.2025

आदेश / O R D E R PER ABY T. VARKEY, JM:

1.

This is an appeal preferred by the assessee against the order of the Learned Commissioner of Income Tax (Appeals)/NFAC, (hereinafter referred to as “the Ld.CIT(A)”), Delhi, dated 18.06.2025 for the Assessment Year (hereinafter referred to as "AY”) 2018-19 and SP No.98/Chny/2025 is a Stay Petition filed by the assessee for AY 2018-19.

2.

At the outset, the Ld.AR of the assessee brought to our notice that the appeal has been filed belatedly by ‘43’ days and for condoning the delay, the assessee has filed an affidavit explaining the cause for the delay. Having gone through the contents of the same, we find that cause for delay was reasonable, so we excuse the same and proceed to hear the assessee’s appeal.

3.

The Ld.AR of the assessee brought to our notice that the impugned first appellate order is an ex parte order without going into the merits of grounds of appeal raised by the assessee. According to the Ld.AR, the Ld.CIT(A) didn’t condone the delay of ‘175’ days in filing of appeal before him and has passed the impugned order. According to the Ld.AR, even though the assessee had furnished the reason for the cause of delay [refer Para No.2.2 of the impugned order], still the Ld.CIT(A) has dismissed the appeal by citing few case laws which is distinguishable on the facts of the case. Therefore, he pleaded for an opportunity to explain the grounds of appeal and submitted that assessee may be heard before fastening the additions on it. Then, he also brought to our notice that the assessment order was also passed by the AO without hearing it i.e. it was an ex parte order (best judgment assessment). Therefore, he prayed for one more opportunity by citing the decision of the Hon’ble Supreme Court in the case of TIN Box Co. v. CIT reported in [2001] 249 ITR 216 (SC).

5.

Having heard both the parties and after perusal of the records, we note that the assessee claims to be a Co-operative Society which is working under the control of Tamil Nadu Khadi & Village Industries Board and hence financed by the All India Khadi & Village Industries Commission, Bombay. According to the assessee, it was formed on 14.04.1937 as a Co-operative Society by the Members who are basically from the rural villages and adjacent forest area in and around Marthandam in Kanyakumari District. According to the assessee, the members collected honey from honeycombs from the plantation in and around Marthandam and supplied it through Khadi & Village Industries Board as well as to general public. And the sale amount collected from retail sale, mostly in cash are deposited in its bank account. According to the assessee, its entire income is exempt u/s.10(23B) & 10(23BB) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act‘). That being the position, the assessee on receiving notice u/s.148 of the Act, filed its return of income (RoI) declaring ‘nil’ income, which was duly supported by books of accounts maintained by the assessee society with proper audit report u/s.44B of the Act and filed before the AO, the bank account linked with the PAN of the assessee. However, according to the assessee, they were astonished to receive assessment order wherein the AO made an addition of ₹2,09,62,411/-. According to the assessee, the AO without raising any queries during the assessment proceedings has passed the assessment order which action of the AO is bad in law for violation of natural justice. Per contra, the Ld.DR pointed out that the notice issued to the assessee didn’t elicit in response from the assessee which led the AO to pass the assessment order, wherein the AO made addition of ₹1,13,91,631/- towards ‘unexplained cash credits’ u/s.68 & also made addition of ₹11,07,938/- towards ‘unexplained investment’ u/s.69 of the Act and disallowed exempt income to the tune of ₹84,62,842/- and assessed total income at ₹2,09,62,411/- by passing assessment order u/s.147/144 on 06.02.2024. On appeal, the Ld.CIT(A) has refused to condone the delay of ‘175’ days in filing of appeal and dismissed the appeal without going into the merits of the grounds of appeal raised by the assessee. We don’t countenance this action of the Ld.CIT(A). We note that the assessee had give reason for the cause of delay which the Ld.CIT(A) has noted at Para No.2.2 of the impugned order. Having gone through the contents of the same and also taking note that the assessee is a Co-operative Society working under the Tamil Nadu Khadi & Village Industries Board which consists of members who are making a livelihood by collecting natural honey and noticing that they are from the Southern tip of India (Kanyakumari District); and further taking note of the fact that after the assessee had filed the ITR pursuant to notice u/s.148 and other documents in support of it, doesn’t gain anything from not appearing before the assessing authority and therefore, it is probable that assessee might not be aware of the assessment proceedings going on, which led the AO to pass the assessment order by making addition of more than ₹2 Cr. and when it came to know to its notice about the action of AO i.e. only a week before filing the same before the Ld.CIT(A) on 29.08.2024, they filed appeal, hence we are of the view that delay needs to be condoned and so we condone the delay of ‘175’ days in filing of appeal before the Ld.CIT(A) and considering the facts that the assessee has not been heard by the AO during the course of assessment proceedings, due to technical glitches in the internet/computer, we are of the view that one more opportunity should be granted to the assessee.