JAGDISHCHANDRA SHANTILAL CHHATRALIA,GUJARAT vs. ASSESING OFICER, RAJKOT

ITA 623/RJT/2025Status: DisposedITAT Rajkot12 March 2026AY 2016-174 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal condoned the delay of 763 days in filing the appeal, finding 'sufficient cause' for the delay as per Section 253(5) of the Act. The Tribunal noted that the delay was due to the assessee not being well-versed in taxation laws and legal procedures, relying on professional guidance, and an oversight by the authorized representative. The Tribunal observed that the Ld. CIT(A) had not decided the appeal as per the mandate of Section 250(6) of the Act, despite issuing several notices. In the interest of justice and adhering to the principles of natural justice and fair play, which require granting sufficient opportunity to the affected party, the Tribunal set aside the order of the Ld. CIT(A). The matter was remitted back to the file of the Ld. CIT(A) for fresh adjudication after giving due opportunity to the assessee to plead their case. The Tribunal did not decide the merits of the penalty under Section 271(1)(c) in this order.

What were the facts?

The assessee, Jagdishchandra Shantilal Chhatralia, filed an appeal before the Income Tax Appellate Tribunal (ITAT) challenging an order dated 28.06.2023 passed by the National Faceless Appeal Centre (NFAC), which upheld a penalty of ₹2,87,850 levied under Section 271(1)(c) of the Income Tax Act, 1961. This penalty was based on an assessment order dated 12.06.2019 passed by the Assessing Officer (AO) under Section 143(3) for Assessment Year 2016-17. The AO had made an addition of ₹11,21,000 for unexplained cash deposits. The appeal to the ITAT was filed late by 763 days. The assessee sought condonation of delay, citing an oversight by their previous authorized representative. The revenue did not object to the condonation.

What were the issues?

1. Whether the delay of 763 days in filing the appeal before the ITAT should be condoned under Section 253(5) of the Income Tax Act, 1961, on the grounds of sufficient cause. 2. Whether the penalty of ₹2,87,850 levied under Section 271(1)(c) of the Income Tax Act, 1961, for furnishing inaccurate particulars of income was justified, considering the assessee's explanation regarding cash deposits from prior withdrawals and savings and the procedural history of the quantum appeal. Assessee's arguments: - The delay in filing the appeal was due to an unfortunate oversight and inaction by the previous authorized representative, and the assessee was under the bona fide belief that the matter was being handled diligently. There was no intentional delay or mala fide intention. - The penalty under Section 271(1)(c) was not justified as there was no deliberate intention to conceal income. The assessee provided detailed explanations and documentary evidence, including bank statements and cash flow statements, to justify the source of cash deposits. - The CIT(A)'s decision to uphold the penalty was erroneous as it failed to consider that the penalty should be held in abeyance pending the final outcome of the quantum appeal, and that a subsequent appeal against the quantum order was filed before the ITAT. Revenue's arguments: - The Ld. DR did not object to the prayer for condonation of delay but requested that the assessee be directed to present his case before the Ld. CIT(A) and not seek unnecessary adjournments.

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 143(3),Section 253(5),Section 250(6)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, RAJKOT BENCH, RAJKOT

Before: DR. ARJUN LAL SAINI & DR. DINESH MOHAN SINHA

For Appellant: Shri Mehul Ranpura, Ld. A.R
For Respondent: Shri Abhimanyu Singh Yadav, Ld. Sr. DR
Hearing: 16/02/2026Pronounced: 12/03/2026

Per Dr. Dinesh Mohan Sinha, JM: Captioned appeal filed by the assessee, pertaining to Assessment Year (AY) – 2016-17, is directed against the order passed by the National Faceless Appeal Centre [(in short “NFAC/Ld. CIT(A)"] vide order dated 28.06.2023, which in turn assessment order passed by Income Tax Department/Assessing Officer under section 143(3) of the Income Tax Act, 1961 (in short “the Act”), vide order dated 12.06.2019. 2. Grounds of appeal raised by the assessee are as follows:

“1. The grounds mentioned hereunder are without preju

The order continues below.

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