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Facts
The assessee's appeal before the CIT(A) for AY 2016-17 was dismissed ex-parte due to non-compliance. The assessee then filed an appeal with the ITAT, which was delayed by 44 days, attributing the delay to a partner's serious medical condition. The assessee contested disallowances related to employee provisions, depreciation, and a double addition made by the AO.
Held
The Tribunal condoned the 44-day delay in filing the appeal, finding sufficient cause due to the partner's illness. It set aside the orders of both the CIT(A) and the AO, remitting the matter back to the AO for a fresh (de novo) assessment, granting the assessee a proper opportunity to be heard and submit evidence.
Key Issues
Whether there was sufficient cause for condoning the 44-day delay in filing the appeal, and whether the case should be remitted to the AO for a de novo assessment after an ex-parte dismissal by the CIT(A) for non-compliance.
Sections Cited
250, 147, 253(3), 253(5), 143(3)
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Income Tax Appellate Tribunal, KOLKATA ‘C’ BENCH, KOLKATA
Before: SHRI GEORGE MATHAN & SHRI RAKESH MISHRA
PER RAKESH MISHRA, ACCOUNTANT MEMBER:
This appeal filed by the assessee is against the order of the Commissioner of Income Tax (Appeals)-NFAC, Delhi [hereinafter referred to as Ld. 'CIT(A)'] passed u/s 250 of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) for AY 2016-17 dated 21.05.2024, which has been passed against the assessment order u/s 147 of the Act, dated 30.03.2022. 1. 1. The Registry has informed that both the appeals filed by the assessee are barred by limitation by 44 days. An application seeking condonation of delay has been filed by the assessee stating as under: “This is to bring to your notice that the appellate order was passed on 21.05.2024 by the Ld. CIT(A), NFAC u/s 250 of the Act for the captioned Assessment Year. Aggrieved by the impugned order, the appellant has I.T.A. No.: 1857/KOL/2024 Assessment Year: 2016-17 Pearl Park Beach Resorts. preferred an appeal before the Hon'ble Bench of Income-tax Appellate Tribunal, Kolkata. As per the provision of Section 253(3), appeal before the Hon'ble Income Tax Appellate Tribunal against the order u/s 250, has to be filed within sixty days from the date on which the order sought to be appealed against is communicated. Further, as per the provision of Sec. 253(5), the Hon'ble Appellate Tribunal may admit an appeal after the expiry of the relevant period referred to in sub-section (3) or sub-section (4), if it is satisfied that there was sufficient cause for not presenting it within that period. In this connection, it is submitted that one of the partners of the appellant firm, Ms. C. Seetha, was hospitalized in Apollo Hospital, Chennai, Tamil Nadu, for the treatment of Parotid Abscesses. The doctors advised complete bed rest, and as a result, other family members, including the Managing Partner, Mr. C. Kannan, were also in Chennai attending to her during this time. Mr. C. Kannan, being the Managing Partner, was primarily responsible for overseeing the financial and administrative matters of the firm. Due to the severity of Ms. C. Seetha's medical condition, Mr. C. Kannan was required to stay with her and provide the necessary medical care. Consequently, he was unable to attend to his official duties, including the filing of the present appeal. The treatment prolonged beyond the expected period, leading to a delay in filing the appeal. The delay was solely due to the serious medical condition of Ms. C. Seetha. As soon as Mr. C. Kannan returned Port Blair in August 2024, he promptly sought advice from his tax counsel, who recommended filing an appeal against the appellate order. Mr. C. Kannan immediately arranged the relevant documents and shared them with the tax counsel, who prepared the appeal now being presented before the Hon'ble Bench. An affidavit from the appellant is enclosed along with this petition. It is further submitted that for doing substantive justice in the matter and to ensure that our total income is assessed as per the settled legal principles, it is requested that the delay be condoned and the appeal be admitted. We submit that the delay was neither deliberate nor intentional and therefore it is a fit case where the Hon'ble Tribunal should condone the delay for rendering substantive justice…..”
In this regard, reliance has been placed on the decisions of the Hon'ble Apex Court in the case of Improvement Trust vs. Ujagar Singh & Ors. (2010) 6 SCC 786 (SC) and Collector, Land Acquisition vs. Mst. Katiji (1987) 1987 taxmann.com 1072 (SC). Considering the I.T.A. No.: 1857/KOL/2024 Assessment Year: 2016-17 Pearl Park Beach Resorts. application for condonation of delay and the reasons stated therein, we are satisfied that the assessee had a reasonable and sufficient cause and was prevented from filing the instant appeals within statutory time limit. We, therefore, condone the delay and admit the appeal for adjudication.
The assessee has raised the following grounds of appeal before the Tribunal:
“1. For that on the facts and in the circumstances of the case, the Ld. CIT(A) was grossly unjustified in law and on facts in dismissing the appeal ex- parte.
For that on the facts and in the circumstances of the case, the AO grossly erred in disallowing the amount of Rs.13,65,190/- incurred towards the provisions purchased for employee's mess / canteen.
(a) For that on the facts and in the circumstances of the case, the AO grossly erred on facts and in law in disallowing 50% of the depreciation claimed on building to the extent of Rs. 8,45,088/-. (b) For that on the facts and in the circumstances of the case, the AO failed to appreciate that the building on which full depreciation was claimed had been completed before 30th September 2015 and therefore the appellant had rightly claimed depreciation for the year on the Closing WDV of the block of building.
For that on the facts and in the circumstances of the case, the AO was wholly unjustified in disallowing a sum of Rs. 2,77,380/- again without appreciating that the impugned sum had already been added in the original assessment u/s 143(3) of the Act and therefore the impugned addition resulted in double addition of the same sum.
For that the appellant craves leave to submit additional grounds and/or amend or alter the grounds already taken either at the time of hearing of the appeal or before.”
Brief facts of the case are that the assessee is a firm and had filed its return of income for AY 2016-17 showing total income of ₹27,96,830/- and the same was assessed at ₹52,84,488/-. Aggrieved with the assessment order, the assessee filed an appeal before the Ld. I.T.A. No.: 1857/KOL/2024 Assessment Year: 2016-17 Pearl Park Beach Resorts. CIT(A) who issued several notices to the assessee and since there was no compliance on behalf of the assessee, dismissed the appeal on account of non-prosecution. Aggrieved with the order of the Ld. CIT(A), the assessee has filed the appeal before this Tribunal.
Rival contentions were heard and the submissions made and the paper book filed have been examined. Before us, the Ld. AR submitted that both before the Ld. AO as well as the Ld. CIT(A) proper representation could not be made and requested for granting another opportunity as the assessee has sufficient evidence for the expenses claimed.
The Ld. DR raised no serious objection to the request made by the Ld. AR.
We have considered the submissions made. Since there was no proper compliance before both the Ld. AO as well as the Ld. CIT(A), in the interest of justice and fair play it was considered that the request of the assessee to set aside the case before the Ld. AO may be allowed so that a proper opportunity of being heard may be provided. Hence, after examining the facts of the case, we deem it appropriate to set aside the order of the Ld. CIT(A) as well as the order of the Ld. AO and remit the matter back to the Ld. AO for making the reassessment de novo. Needless to say, the assessee shall be given a reasonable opportunity of being heard to make any further submission it wants to make in support of its grounds of appeal and shall not seek unnecessary adjournments. Accordingly, the grounds taken by the assessee in his appeal are allowed for statistical purposes.
In the result, the appeal filed by the assessee is allowed for statistical purposes. I.T.A. No.: 1857/KOL/2024 Assessment Year: 2016-17 Pearl Park Beach Resorts. Order pronounced in the open Court on 14th August, 2025. [George Mathan] [Rakesh Mishra] Judicial Member Accountant Member Dated: 14.08.2025 Bidhan (Sr. P.S.) I.T.A. No.: 1857/KOL/2024 Assessment Year: 2016-17 Pearl Park Beach Resorts. Copy of the order forwarded to:
Pearl Park Beach Resorts, Neil Islands, Gandhi Market, Port Blair, Andaman and Nicobar Islands, 744104. 2. I.T.O., Ward-3(4), Port Blair.
CIT(A)-NFAC, Delhi.
CIT-
CIT(DR), Kolkata Benches, Kolkata.
Guard File. //// By order