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Facts
The assessee's case was selected for scrutiny due to a large investment in immovable property (Rs. 63,45,45,714/-). Upon the assessee's failure to respond to a Section 143(2) notice, the Assessing Officer treated the investment as unexplained credit under Section 68 and added it to the income. The CIT(A) confirmed this addition, refusing to condone a 128-day delay in the assessee's appeal filing.
Held
The ITAT, considering the assessee's explanation for the delay (director's ill-health and consultant's negligence) and the principle of substantial justice, remanded the case back to the CIT(A). The CIT(A) was directed to condone the delay and decide the appeal on merits after providing the assessee a fair hearing.
Key Issues
Whether the delay in filing an appeal before the CIT(A) should be condoned, and consequently, whether the addition made under Section 68 for unexplained investment in immovable property is justified.
Sections Cited
250, 143(2), 68
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “D” BENCH KOLKATA
Before: Shri Rajesh Kumar & Shri Pradip Kumar Choubey
order
: October 16, 2025 ORDER
Per Pradip Kumar Choubey, Judicial Member:
This appeal filed by the assessee is directed against the order dated 28.07.25 of the National Faceless Appeal Centre [‘CIT(A)’] passed under Section 250 of the Income-tax Act, 1961 (hereinafter referred to as “the Act”) for the assessment year 2022–23.
Brief facts of the case are that the case of the assessee was selected under CASS for “large investment in immovable property” as per 26QB as the assessee had invested in immovable property at Rs.63,45,45,714/- during the year under consideration which was shown in the balance sheet of the assessee. The Assessing Officer issued notice u/s 143(2) of the Act but the assessee failed to furnish its reply. Due to non-compliance, the Assessing Officer treated the entire amount of Rs.63,45,45,714/- as unexplained credit u/s 68 of the Act and added the same to the total income of the assessee.
M/s Sarvlok Realtors Pvt. Ltd 3. Aggrieved by the said order, the assessee filed an appeal before the CIT(A) with a delay of 128 days in filing the appeal. The Ld. CIT(A) confirmed the addition made by the Assessing Officer mainly on the ground that 128 days’ delay in filing of the appeal which was not condoned.
Aggrieved, the assessee is in appeal before this tribunal. At the time of hearing, the Ld. AR submitted that in support of the delay of 128 days before the ld. CIT(A), the assessee-company produced an affidavit by one of the directors of the assessee-company namely Shri Dilip Kr. Dhandhania who mainly took care of the income tax matter of the company was undergone medical treatment for long time and due to negligence of the then tax consultant of the assessee company, the assessee could not file the appeal before the Ld. CIT(A) timely and the delay was purely unintentional and without the control of the assessee. The ld. AR submitted that proper compliance could not be made before the authorities below and requested for another chance to prove his case before either of the authorities below.
The Ld. DR fairly stated that he would have no objection in case this matter was to be remanded back to the Ld. CIT(A).
We have considered the submissions of the counsels of the respective parties and perused the material available on record. We note from the order of the ld. CIT(A) that the assessee submitted an affidavit explaining the reasons for the delay and due to ill-health of the director of the assessee-company and also the negligence of the tax consultant of the assessee-company which was beyond the control of the assessee, the assessee could not participate before the lower authorities. We note that the various judicial forums have constantly held that technical lapses should not override the cause of substantial justice. Thus, in the interest M/s Sarvlok Realtors Pvt. Ltd of substantive justice, we deem it fit to remand this matter back to the file of Ld. CIT(A) with the direction to condone the delay of 128 days and adjudicate on merit of the case after affording opportunity to the assessee of being heard. The assessee is directed to cooperate in the remand proceedings by submitting necessary explanations and evidences to substantiate its claim.
In the result, the appeal filed by the assessee is allowed for statistical purposes.
Kolkata, the 16th October, 2025.