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Facts
The assessee, an individual, failed to file a return of income and explain cash deposits of ₹.3,88,93,360/-. The Assessing Officer made a quantum addition under Section 144 and levied penalty under Section 270A. The CIT(A) dismissed the appeal for a delay of 660 days without condoning it.
Held
The Tribunal held that the CIT(A) erred in dismissing the appeal without condoning the delay, especially considering the pandemic. The matter was remitted to the CIT(A) to condone the delay and decide the appeal on merits. The penalty under Section 270A was also remitted for fresh adjudication.
Key Issues
Whether the CIT(A) was justified in dismissing the appeal on grounds of delay without condoning it, and whether the penalty under Section 270A needs to be adjudicated afresh.
Sections Cited
142(1), 144, 69, 270A
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, ‘D’ BENCH, CHENNAI
Before: SHRI GEORGE GEORGE K., VICE- & SHRI S.R. RAGHUNATHA
आयकर अपीलीय अिधकरण,‘डी’ �ायपीठ,चे�ई IN THE INCOME TAX APPELLATE TRIBUNAL ‘D’ BENCH, CHENNAI �ी जॉज� जॉज� के., उपा�� एवं �ी एस.आर.रघुनाथा, लेखा सद� के सम� BEFORE SHRI GEORGE GEORGE K., VICE-PRESIDENT AND SHRI S.R. RAGHUNATHA, ACCOUNTANT MEMBER आयकरअपीलसं./ITA Nos.: 310 & 311/Chny/2025 िनधा�रणवष� / Assessment Year: 2017-18 Vikram Reddy, Income Tax Officer, 202, Lotus Serviced Apartments Vs. Non Corporate Ward - 18(5), 15, Venkataraman Street, Chennai. Thiyagaraya Nagar, Chennai 600 017. [PAN: AQZPV5520B] (अपीलाथ�/Appellant) (��थ�/Respondent) अपीलाथ� की ओर से / Appellant by Ms. T.V. Muthu Abirami, Advocate : ��थ� की ओर से/Respondent by Shri A. Sasikumar, CIT : सुनवाई की तारीख/ Date of hearing 19.03.2025 : घोषणा की तारीख /Date of Pronouncement : 20.03.2025 आदेश /O R D E R PER S. R. RAGHUNATHA, ACCOUNTANT MEMBER:
Both the appeals filed by the assessee are directed against the order passed by the ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi, both dated 29.11.2024 and pertains to assessment year 2017-18. The appeal in deals with quantum addition and the appeal in is filed against confirmation of penalty levied under section 270A of the Income Tax Act, 1961 [“Act” in short]. & 311/Chny/2025
First, we shall take up the appeal filed against quantum addition in for adjudication, wherein, the assessee challenged the exparte order passed by the ld. CIT(A) without condoning the delay in filing the appeal.
At the outset, we note that the assessee is an individual and no return of income filed. According to the Assessing Officer, the assessee is a salaried employee and made cash deposits prior to demonetization period as well as during demonetization period totaling to ₹.3,88,93,360/-. Despite various notices issued by the Assessing Officer under section 142(1) of the Act requiring the assessee to file the return of income as well as to explain the source for the cash deposits made, there was no response from the assessee to file the return of income or furnishing details for the cash deposit, but, however, simply informed the Assessing Officer that the assessee is out of India. Since the assessee did not explain the source for the cash deposits in various bank account, the entire cash deposits of ₹.3,88,93,360/- is brought to tax under section 69 of the Act vide his order under section 144 of the Act dated 29.11.2019.
The assessee carried the matter in appeal before the ld. CIT(A) with a delay of 660 days in filing the appeal. The assessee filed a condonation petition before the ld. CIT(A) explaining the reasons for the & 311/Chny/2025 delay. However, by rejecting the condonation petition, the ld. CIT(A) dismissed the appeal. On being aggrieved, the assessee carried the matter in appeal before the Tribunal.
The ld. AR for the assessee submits that the assessee duly submitted petition for condonation of delay in filing the appeal before the ld. CIT(A). The ld. AR explained the reasons for the delay in filing the appeal before the ld. CIT(A) was covered by Covid-19 pandemic and the balance No. of 90 days was due to waiting for his employer’s instructions to handle the matter about cash deposits made to his bank account on behalf of the employer. The ld. AR prayed for condoning the delay and remits the matter to the file of the ld. CIT(A) to adjudicate the issue on merits.
The ld. DR fairly conceded that the filing of appeal during Covid-19 pandemic period has been dispensed with the limitation by the Hon’ble Supreme Court.
Heard both the parties and perused the material available on record. Against the assessment order under section 144 of the Act, the assessee preferred an appeal before the ld. CIT(A). The assessee has filed a petition for condonation of delay in filing the appeal before the ld. CIT(A), which is reflected at page 4 of the impugned order. Before us, the ld. AR explained the reasons for the delay in filing the appeal before the ld. CIT(A) was covered by Covid-19 pandemic and the balance No. of 90 days was due to & 311/Chny/2025 waiting for his employer’s instructions to handle the matter about cash deposits made to his bank account on behalf of the employer. We note that in the impugned order, there was no mention of issuing any notice of hearing to the assessee by the ld. CIT(A) calling explanation from the assessee, but, however, simply rejected the condonation petition filed by the assessee and dismissed the appeal. Under the above facts and circumstances, in the interest of justice, we deem it proper to remit the matter to the file of the ld. CIT(A) with a direction to condone the delay and adjudicate the issue on merits in accordance with law by affording reasonable opportunity of being heard to the assessee. Thus, the grounds raised by the assessee are allowed.
8. Against the quantum addition, the Assessing Officer issued notice under section 270A of the Act requiring the assessee to explain as to why penalty should not be levied under section 270A of the Act. Since there was no response from the assessee, the Assessing Officer levied penalty of ₹.1,50,22,560/- being 50% of the assessed income of the assessee. On appeal, the ld. CIT(A) dismissed the appeal filed by the assessee.
On being aggrieved, the assessee is in appeal before the Tribunal against levy of penalty under section 270A of the Act. Since the quantum addition made by the Assessing Officer under section 144 of the Act has & 311/Chny/2025 not attained its finality as the Tribunal, herein above, remanded the matter to the file of the ld. CIT(A) to condone the delay in filing the appeal and adjudicate the issue on merits, the penalty levied under section 270A of the Act is liable to be quashed. However, since we have remitted the quantum addition to the file of the ld. CIT(A) for adjudication in accordance with law, the levy of penalty under section 270A is also remitted to the file of the ld. CIT(A) for fresh adjudication after deciding the quantum addition on merits. Thus, the grounds raised by the assessee are allowed for statistical purposes.
In the result, both the appeals of the assessee are allowed for statistical purposes. Order pronounced in the court on 20th March, 2025 at Chennai.