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Facts
The assessee filed an appeal against the order of the Commissioner of Income Tax (Appeals) with a delay of 384 days. The delay occurred due to a misunderstanding of legal procedures following the quashing of a revision order under Section 263 by the ITAT. The AO had passed an order giving effect to the revision order, and the CIT(A) had dismissed the assessee's appeal against this order.
Held
The Tribunal condoned the delay of 384 days in filing the appeal, finding sufficient cause. The Tribunal observed that the revision order under Section 263 was quashed by the ITAT, rendering the subsequent order giving effect to it infructuous. Therefore, the impugned order of the AO and the order of the FAA were set aside.
Key Issues
Whether the delay in filing the appeal can be condoned and whether the order giving effect to a quashed revision order is valid.
Sections Cited
250, 143(3), 263, 143(2)
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Income Tax Appellate Tribunal, ‘A’ BENCH, CHENNAI
Before: SHRI GEORGE GEORGE KAND MS PADMAVATHY S
आदेश/ O R D E R
PER GEORGE GEORGE K, VICE PRESIDENT:
This appeal filed by the assessee is directed against the order of Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi dated 26.02.2024, passed under section 250 of the Income Tax Act, 1961 (hereinafter called ‘the Act’). The relevant Assessment Year is 2016-17.
2 -: 2. There is a delay of 384 days in filing this appeal before the Tribunal. The appeal ought to have been filed before ITAT on or before 26.02.2024. However, the appeal was filed belatedly on 15.05.2025. The assessee has filed a petition for condonation of delay and also supporting affidavit stating there in the reasons for belated filing of this appeal. The reasons stated for belated filing of this appeal are as follows:- “ 5. That the appeal ought to have been filed within 60 days from the date of receipt of the order i.e., 60 days from 26.02.2024. However, the appeal was filed on 15.05.2025 resulting in a delay of 384 days (specified as 380 days in the defective notice) beyond the time allowed for filing the appeal, which ended on 26.04.2024.
6. That the Assessing Officer completed the assessment vide order u/s.143(3) dated 20.12.2018 assessing the total income at Rs.9,92,43,382/- and raising a demand of Rs.2,35,06,065/-. Aggrieved by the order of the Assessing Officer, I filed an appeal before the Commissioner of Income Tax (Appeals) on 18.01.2019, which is still pending before the Commissioner of Income Tax (Appeals).
That a revision order u/s.263 was passed by the Principal Commissioner of Income Tax, Chennai-3 on 30.03.2021. Aggrieved by the order passed u/s.263, an appeal was filed before the Hon'ble Income Tax Appellate Tribunal on 27.12.2021.
8. That the Hon'ble Income Tax Appellate Tribunal vide order in dated 06.12.2022 quashed the revision order passed u/s.263 by the Principal Commissioner of Income Tax, Chennai-3, for the assessment year 2016-17.
9. That the Assessing Officer on 31.03.2022 passed an order giving effect to the order passed u/s.263 by the Principal Commissioner of Income Tax, Chennai-3. Aggrieved by the order of the Assessing Officer issued u/s.143(3) r.w.s.263, an appeal was filed before the Commissioner of Income Tax (Appeals) on 25.04.2022.
10. That pursuant to the notices issued u/s.250 on 10.08.2023 and on 02.02.2024, the Commissioner of Income Tax (Appeals) passed the order u/s 250 on 26.02.2024 and at this juncture I was required to file an appeal.
That since the order u/s.263 was quashed by the Hon'ble Income Tax Appellate Tribunal, I in good faith, believed that the order u/s.250 passed 3 -: by the Commissioner of Income Tax (Appeals) against the order passed u/s.143(3) r.w.s 263 requires no further action, since the order passed u/s.143(3) r.w.s 263 will not survive as a result of the quashing of the order u/s.263 by the Hon'ble Income Tax Appellate Tribunal. Due to an inadvertent misunderstanding coupled with lack of proper understanding of the legal procedures as per the Income Tax Act. 1961. I did not take any action against the order of the Commissioner of Income Tax (Appeals). 12.That I received a notice u/s.250 from the National Faceless Appeal Centre (NFAC) dated 13.05.2025 to file written submissions on or before 20.05.2025, for the appeal filed on 18.01.2019 against the assessment order u/s.143(3) dated 20.12.2018. Upon receipt of this notice, I approached the office of Shri.T.Banusekar, Advocate for drafting written submissions. While checking the e-filing portal, the office of Shri.T.Banusekar viewed the order passed u/s.250 by the National Faceless Appeal Centre (NFAC) in connection with the order of the Assessing Officer u/s.143(3) r.w.s 263 and enquired regarding the action taken against the same. Only at that time l came to know that an appeal has to be filed against the said order even though the order u/s.263 was quashed.
That Shri.T.Banusekar, Advocate, advised that an appeal has to be filed against the order passed u/s.250 dated 26.02.2024 and the same can be filed with a petition to condone the delay in filing the appeal. Thereafter, the appeal was drafted and filed on 15.05.2025 with a delay of 384 days (specified as 380 days in the defective notice).”
On perusal of the reason stated, we are of the view that there is sufficient cause for belated filing this appeal and no latches can be attributed to the assessee. Hence, we condone the delay of 384 days in filing this appeal and proceed to dispose off the appeal on merits.
Brief facts of the case are as follows:- The assessee is an individual. For the assessment year 2016-17, the assessee filed his return of income on 31.03.2017 declaring a total income of Rs.2,79,45,410/-. The assessee’s case was selected for limited 4 -: scrutiny under CASS and notice u/s.143(2) of the Act was issued on 18.09.2017. The AO completed the assessment u/s.143(3) of the Act vide order dated 20.12.2018 assessing the total income at Rs.9,92,43,382/- and raising a demand of Rs.2,35,06,065/-. Aggrieved by the order of the AO, the assessee filed an appeal before the Commissioner of Income Tax (Appeals) on 18.01.2019. It is stated by Ld.AR that the appeal is still pending before the Commissioner of Income Tax (Appeals).
Subsequently, the PCIT passed an order u/s.263 of the Act on 30.03.2021. Aggrieved by the order passed u/s.263 of the Act, the assessee filed an appeal before the Tribunal on 27.12.2021. The Tribunal vide order in dated 06.12.2022 quashed the revision order passed u/s.263 by the PCIT, for the assessment year 2016-17.
In the meanwhile, the AO on 31.03.2022 passed an order giving effect to the order passed u/s.263 by the PCIT. Aggrieved by the order of the AO passed u/s.143(3) r.w.s.263 of the Act, the assessee filed an appeal before the First Appellate Authority (FAA) on 25.04.2022. Pursuant to the notices issued u/s.250 of the Act on 10.08.2023 and 02.02.2024, since the assessee has not complied to Aggrieved by the order of the FAA, the assessee has filed 7. the present appeal before the Tribunal. The Ld.AR placed on record copy of the Tribunal’s order in dated 06.12.2022 and submitted that the revision order passed by the PCIT u/s.263 of the Act has been quashed by the Tribunal. Therefore, the Ld.AR submitted that the order giving effect to the PCIT’s order is rendered infructuous and same needs to be set aside.
The Ld.DR was duly heard.
We have heard rival submissions and perused the material on record. The present appeal proceedings arise out of the order of the AO dated 31.03.2022 giving effect to the order of PCIT passed u/s.263 of the Act. The order of PCIT passed u/s.263 of the Act was quashed by the Tribunal vide its order dated 06.12.2022 in ITA No.612/CHNY/2021. The First Appellate Authority (FAA) had not allowed the appeal of the assessee since the relevant material was not placed before him. Since, the Tribunal has quashed the revision order of the PCIT passed u/s.263 of the Act, the order giving effect to the PCIT’s order is rendered infructuous and same is set aside.
In the result, the appeal filed by the assessee is allowed.
Order pronounced in the open court on 1st August, 2025 at Chennai.