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Facts
The assessee did not file a return of income for AY 2017-18 but had deposited Rs. 89,50,000/- during demonetization. The case was reopened, and an assessment was made under Section 144 read with Section 147, adding the deposited amount as unexplained money under Section 69A. The learned CIT(A) dismissed the assessee's appeal due to a delay of 1054 days without considering the merits of the case.
Held
The Tribunal condoned the delay of 1054 days, stating that justice should prevail over technicalities, especially when a genuine intention to rectify an error is shown. It found that the learned CIT(A)'s dismissal without addressing the merits was contrary to Section 250(6) of the Act. Therefore, the matter was remanded back to the learned CIT(A) for a fresh decision on merits after providing due opportunity of being heard to the assessee.
Key Issues
1. Whether the learned CIT(A) was justified in dismissing the appeal solely on the ground of delay without considering the merits. 2. Whether the delay in filing the appeal before the learned CIT(A) should be condoned by the Tribunal. 3. Whether the learned CIT(A) failed to pass a speaking order as mandated by Section 250(6) of the Income Tax Act.
Sections Cited
250, 139(1), 147, 148, 143(2), 142(1), 144, 69A, 249(2), 250(6)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “C” BENCH KOLKATA
Before: Shri Rajesh Kumar & Shri Sonjoy Sarma
order
: January 23, 2025 आदेश / ORDER
Per Sonjoy Sarma, Judicial Member:
The present appeal has been preferred by the assessee against the order dated 18.10.2024 of the National Faceless Appeal Centre [hereinafter referred to as ‘CIT(A)’] passed u/s 250 of the Income Tax Act (hereinafter referred to as the ‘Act’).
Brief facts of the care are that the assessee is an individual and did not file any return of income u/s 139(1) of the Act for the assessment year 2017-18. An information was received that the assessee had deposited an amount of Rs.89,50,000/- in his bank account during demonetization period. Thereafter, the case of assessee was reopened u/s 147 of the Act by issuing notice u/s 148 of the Act requesting thereon to file return. In response to notice u/s 148 of the Act, the assessee submitted return declaring total income of Rs.2,37,850/-. Subsequently, notices u/s 143(2) and 142(1) of the Act Assessment Year: 2017-18 Akash Jain were also issued requisitioning relevant documents to prove the nature and source of cash amounting to Rs.89,50,000/- deposited in his bank account. In the absence of any satisfactory reply or explanation from the assessee, the Assessing Officer completed assessment u/s 144 r.w.s 147 of the Act by assessing total income at Rs.91,87,850/- and made addition of Rs.89,50,000/- as unexplained money u/s 69A of the Act.
Dissatisfied with the above order, the assessee preferred an appeal before the ld. CIT(A) against the assessment order challenging the validity of the assessment order. The ld. CIT(A) noted that the appeal filed before him was contained a delay of 1054 days which is beyond the prescribed limited u/s 249(2) of the Act. The assessee explained reasons for the delay in filing the appeal before the ld. CIT(A) through an application, Form 35 and grounds of appeal. The ld. AR further submitted that the delay in filing the appeal was neither wilful nor attributable to any extraneous or ulterior motive on the part of the assessee and the assessee was not benefitted in any way from delayed filing of this appeal. However, the ld. CIT(A) dismissed the appeal of the assessee solely on technical ground of delay in filing the appeal and did not consider the merit of the case and did not address the assessee’s application for the delay.
3. Aggrieved by the above order, the assessee approached this Tribunal arguing that the ld. CIT(A) erred in dismissing the appeal on the basis of delay in filing the appeal before him without adjudicating the merits of the case. The ld. AR in order to substantiate his contention has stated that as per Article 265 of the Constitution of India emphasises that no tax can be levied and collected except by authority of law, however, denial of hearing on merit of the case only on the ground of delay is not proper. The ld. AR contended that as per section 250(6) of the Act, the ld. CIT(A) was required to pass a speaking order by adjudicating the appeal on merits. He, therefore, prayed before the Assessment Year: 2017-18 Akash Jain Bench that the matter may be remanded back to the ld. CIT(A) with a direction to consider the merit of the case after condoning the delay.
On the other hand, the ld. DR supported the decision rendered by the authorities below.
We, after hearing the submissions of the parties and perusing the materials available on record, find that there was substantial delay of 1054 days in filing the appeal. However, we find that the opportunity of justice cannot be sacrificed at the alter of the technicalities. We note that it is well-settled principle that justice should prevail over procedural lapses especially when a party shows genuine intention to rectify its error. After considering the reasons given by the assessee for the delay and in view of our above discussion, we condone the delay of 1054 days in filing the appeal before the ld. CIT(A). We also find that the order of the ld. CIT(A) was passed without addressing the merit of the case which is contrary to the mandate of section 250(6) of the Act. We, therefore, deem it fit to remand the matter back to the file of the ld. CIT(A) with a direction to re-examine the issue on merits after providing reasonable opportunity to the assessee of being heard and due consideration of facts and submissions made before him while passing a fresh order.
In terms of the above, the appeal of the assessee is allowed for statistical purposes.
Kolkata, the 23rd January, 2025.