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Facts
The assessee's appeal was filed with a delay of 403 days, attributed to a lack of communication regarding the CIT(A)'s order. The assessment order, dated 30.06.2017, involved an addition of Rs. 3,54,565/- on account of alleged bogus profit from commodities trading.
Held
The Tribunal condoned the delay in filing the appeal, acknowledging the assessee's explanation of not receiving timely communication. The Tribunal found a contradiction between the AO's finding of admission of bogus entry and the assessee's denial. Therefore, the matter was remanded to the AO.
Key Issues
Whether the delay in filing the appeal can be condoned, and whether the addition of Rs. 3,54,565/- was correctly made without proper evidence or admission from the assessee.
Sections Cited
147, 143(3), 250, 271(1)(c), 148
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “SMC” BENCH KOLKATA
Appearances by: Assessee represented by : Anil Kumar Kochar, Advocate Department represented by : Anindya Kumar Bandopadhyay, Addl. CIT Date of concluding the hearing : 18.02.2025 Date of pronouncing the order : 03.03.2025
ORDER PER SANJAY AWASTHI, ACCOUNTANT MEMBER:
In this case, the appeal is barred by limitation to the tune of 403 days for which the assessee has filed an affidavit requesting condonation of the same as under: “I SUNITA GUPTA, presently residing at Flat No.3121,127-A TVH Lumbini Square, Bricklin Road, Purrasawalkam, Chennai, Tamil Nadu 600 007, having PAN: ADYPG2405Q, do hereby state and declare as under: - 1. That I am assessed to Income Tax under PAN: ADYPG2405Q.
Sunita Gupta 2. That for the AY 2010-11, an Order u/s 147/143(3) of the Income Tax Act, 1961 was passed by the A.O., Circle-37(1), Kolkata on 30.06.2017 against which I had preferred an appeal before the Ld. CIT(A) who passed appeal Order u/s 250 of the Act on 26.06.2023.
3. That I was not having any intimation about the order of the Ld. CIT(A) having been passed u/s 250 of the Act but upon receipt of intimation letter dated 09.08.2024 towards show cause Notice u/s 271(1)(c) of the Act, I came to learn that the Ld. CIT(A) had disposed off my appeal as aforesaid on 26.06.2023.
4. That the Order passed u/s 250 of the Act by the Ld. CIT(A) on 26.06.2023 was not received by me via postal authorities nor did I receive any communication regarding it from my Counsel.
That upon consultation with my Tax Counsel I was advised to submit appeal against the said Appellate Order to the Income Tax Appellate Tribunal, Kolkata.
That accordingly upon collection of all relevant papers, I could submit the appeal before the Income Tax Appellate Tribunal on 14.11.2024.
That in the grounds of appeal
before the Hon'ble Tribunal, I have mentioned at Ground No.6 as under; - For that the Order of the CIT (A) is dated 26.06.2023 but the same came into the knowledge of the appellant only upon receipt of the penalty notice dated 09.08.2024 issued u/s 271(1)(c) of the Income Tax Act, 1961 and taking note of the same the appeal being submitted may kindly be considered as well within time.
8. That the delay in submission of appeal before the Hon'ble Income Tax Appellate Tribunal against the Order dated 26.06.2023 passed by Ld. CIT(A) is bonafide and reasonable.
9. That the appellant submits that there is no malafide or any intentional default in the matter.
10. That in the circumstances as aforesaid, I pray that the delay in submission of appeal before the Hon'ble Tribunal against the Order of the Ld. CIT(A) may kindly be condoned for which I shall be highly obliged. The above statements are true to the best of my knowledge and belief.” 1.1 Considering the reasons given in the said affidavit, the delay is hereby condoned and the appeal is admitted for adjudication.
2. The present appeal arises from the order of the Ld. Commissioner of Income-tax (Appeals)/National Faceless Appeal Centre (NFAC), Delhi (hereinafter referred to as the “Ld. CIT(A)”], dated 26.06.2023. 2 Sunita Gupta 2.1 In this case, the assessment was completed u/s 147/143(3) of the Act by making addition of Rs. 3,54,565/-. The impugned amount was added after some report from the Investigation Wing of the Income Tax department in which it was mentioned that the assessee has earned bogus profit from trading in commodities. In para 3 of the Ld. AO’s order, it is mentioned that the impugned amount was admitted as a bogus commodities’ profit by the assessee and hence it was added to the business income of the assessee.
2.2 However, the assessee was aggrieved with this action of the Ld. AO and carried the matter before the Ld. CIT(A). It is recorded that before the Ld. CIT(A), there was no worthwhile compliance to the notices issued for fixing the case for hearing. Thereafter, the Ld. CIT(A) confirmed the impugned addition in an exparte manner.
3. Further aggrieved with the action of Ld. CIT(A), the assessee has filed the present appeal with the following grounds:
“1. For that the orders passed by the lower authorities are arbitrary, erroneous, without proper reasons, invalid and bad-in-law, to the extent to which they are prejudicial to the interests of the appellant.
For that on facts and in the circumstances of the case and in law, the Ld. CIT (A) erred in sustaining the order passed by the A.O. u/s 143(3) of the Act without appreciating that assumptions of jurisdiction u/s 148 by the A.O. was in violation of mandatory jurisdictional conditions stipulated under the Act.
For that the returned income of the appellant being less than Rs.30,00,000/-the assumption of jurisdiction by the A.O. being Deputy Commissioner of Income Tax was wrong and in violation of the CBDT's Circular relating to allocation of work on the basis of the returned income.
4. For that there being no such income having been taken by the appellant from the alleged entry provider the addition of Rs.3,54,565/- on account of bogus commodity profit having been confirmed by the CIT (A) is wrong and not based on factual aspect.
Sunita Gupta 5. For that the Ld. CIT(A) erred in confirming addition of Rs.3,54,565/- made by the A.O. on the alleged grounds.
6. For that the Order of the CIT (A) is dated 26.06.2023 but the same came into the knowledge of the appellant only upon receipt of the penalty notice dated 09.08.2024 issued u/s 271(1)(c) of the Income Tax Act, 1961 and taking note of the same the appeal being submitted may kindly be considered as well within time.
7. For that the appellant craves leave to amend, alter, modify, substitute, add to, abridge and/or rescind any or all of the above grounds.”
3.1 Before us, the Ld. AR vehemently argued and stated that regarding the impugned amount of Rs. 3,54,565/-, it was not clear as to how the assessee has been treated as a recipient when this amount was not received at all and the Ld. AO has proceeded ahead on factually incorrect presumptions. The Ld. AR also argued on the alleged illegality of assuming jurisdiction for issuance of notice u/s 148 of the Act. The Ld. AR also mentioned that due to a communication gap between the assessee and the Ld. CIT(A), notices issued for fixing the dates of hearing were not received by the assessee. In fact, he requested for another chance to establish the factual position regarding the impugned amount before the Ld. AO.
We have carefully considered the rival submissions and gone through the documents before us. On the one hand, the Ld. AO has recorded a categorical finding that the assessee has admitted to receiving a bogus accommodation entry, whereas the Ld. AR has made a categorical statement at the Bar that no such entry was received from the party as alleged by the Ld. AO. It is felt that since this matter revolves around the receipt, or otherwise, of the impugned amount, hence, we deem it fit to remand the issue to the file of Ld. AO for examining whether this amount was received at all or not. We also find that the grounds pertaining to the assumption of jurisdiction can also be handled by the Ld. AO, who is directed to dispose of the objections in this regard, once the same are tendered by the assessee.
Sunita Gupta 5. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the court on 03.03.2025