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Facts
The assessee, a senior citizen and housewife, filed an appeal with a 97-day delay against an ex-parte order from the CIT(A). She claimed dependence on a tax consultant and only became aware of the adverse order upon receiving a recovery notice. The Assessing Officer had made additions on account of capital gains and unexplained investments.
Held
The Tribunal condoned the delay, finding the assessee's reasons reasonable and without mala fide intent. It found that the CIT(A) had dismissed the appeal ex-parte without applying its mind or considering documents already filed by the assessee with Form-35. Consequently, the Tribunal set aside the CIT(A)'s order and remanded the matter to the Assessing Officer for fresh adjudication, allowing the assessee to present all relevant records and be granted a proper opportunity of hearing.
Key Issues
1. Condonation of delay in filing appeal due to reliance on a tax consultant and late awareness of the order. 2. Validity of an ex-parte order by the CIT(A) when relevant documents were already filed with Form-35. 3. Additions made by the Assessing Officer on capital gains and unexplained investments without considering the source of funds and cost of acquisition.
Sections Cited
250, 69, 133(6), 234A, 234B, 234C, 147, 144, 144B
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, Hyderabad ‘A’ Bench, Hyderabad
Before: SHRI VIJAY PAL RAO & SHRI MADHUSUDAN SAWDIA
सुनवाई की तारीख/Date of hearing: 12.11.2025 घोषणा की तारीख/Pronouncement: 19.11.2025 आदेश/ORDER
PER VIJAY PAL RAO, VICE PRESIDENT :
This appeal by the Assessee is directed against the order dated 12.03.2025 of learned CIT(A)-National Faceless Appeal Centre [in short “NFAC], Delhi, for the assessment year 2016-2017.
2 ITA.No.1439/Hyd./2025 2. At the outset, there is a delay of 97 days in filing the present appeal before the Tribunal. The assessee has filed an application for condonation of delay as well as an affidavit explaining the cause of delay. The learned Authorised Representative of the Assessee has submitted that the assessee is a house-wife and senior citizen and, therefore, is not well-versed with the process of getting up- date of the proceedings pending before the Income Tax Authorities. The assessee was totally dependent upon the Tax Professionals for the tax matters and, therefore, all the notices were sent only to the Tax Consultant who was dealing with the matters of the assessee. It was only when the assessee has received the recovery notice dated 29.08.2025, she came to know about the impugned order passed by the learned CIT(A). The learned Authorised Representative of the Assessee submitted that she said recovery notice was sent by the Assessing Officer on the email-ID of the assessee, whereas the notice as well as the impugned order passed by the learned CIT(A) were sent only to the email-ID of the Tax Consultant and, therefore, the 3 ITA.No.1439/Hyd./2025 assessee was not aware about the impugned order till she received the recovery notice. Thus, the delay in filing the present appeal is neither wilful nor deliberate, but, due to the reason that the assessee was having no knowledge about the impugned order till the recovery notice dated 29.08.2025 was received and immediately thereafter, the assessee has filed the present appeal. The learned Authorised Representative of the Assessee has pleaded that the delay of 97 days in filing the present appeal be condoned and the appeal of the assessee be admitted for adjudication on merits.
On the other hand, the learned DR for the Revenue has objected to the condonation of delay and submitted that the conduct of the assessee would show that she was negligent about the proceedings before the Assessing Officer as well as the learned CIT(A). There was no compliance on behalf of the assessee to the notice issued by the Assessing Officer and thereafter before the learned CIT(A). Thus, he has vehemently opposed to the condonation of delay.
4 ITA.No.1439/Hyd./2025 4. We have considered the rival submissions as well as relevant material on record as well as perused the reasons/explanation in the affidavit in paragraph nos.3 to 8 as under :
“3. The Appellant is a housewife and a senior citizen. Given the background, the Appellant does not have access to real-time updates on proceedings and is heavily reliant on consultants for necessary legal action. 4. The Appellant had entrusted the appellate proceedings related compliances to one professional, and all the notices were duly sent to him for his action. However, the Appellant was assured that the same had been duly attended.
5. It was only upon receipt of a recovery notice dated 29th August 2025, which was duly served on the Appellant's email ID, that the Appellant became aware of the adverse outcome in the appeal and was compelled to engage another professional for initiating appropriate remedial action, including filing of an appeal before the Hon'ble Tribunal.
6. Due to the aforesaid reason, the appeal could not be filed within two months from the end of the month in which the order sought to be appealed against is communicated to the assessee. It is prayed before your Honours to condone the delay in rendering substantial justice by deciding the matters.
It is further submitted and brought to your kind notice that I would have nothing to gain even tangentially/remotely by not filing the appeal on time.
5 ITA.No.1439/Hyd./2025 8. It is submitted that the aforesaid delay was due to insufficient knowledge of the provisions of the Act and reasonable cause and obviously there was no mala fide intention in delaying the filing of appeal.”
The reasons explained by the assessee are found to be reasonable and further it appears that there was no malafide on behalf of the assessee in filing the appeal belatedly. This is a matter of record that the Assessing Officer issued a recovery notice dated 29.08.2025 and immediately thereafter, the assessee has filed the present appeal on 05.09.2025. Therefore, considering facts and circumstances of the case and status of the assessee being a house-wife and senior citizen, we condone the delay of 97 days in filing the present appeal.
The assessee has raised the following grounds : 1. “The order of the Ld.AO, insofar as it is against the appellant, is opposed to law, equity, and the weight of evidence, probabilities, facts and circumstances of the case.
The Ld.AO's order is against the principle of natural justice and opposed to law inasmuch as the order suffers from being a completely unilateral act and thereby requires to be struck down as null and void.
6 ITA.No.1439/Hyd./2025 3. The order of CIT(A) is bad in law as it is against the provisions of the Act and also against the principles of natural justice.
The impugned order is bad in law as it is against the provisions of the Act.
5. The Ld. CIT(A) has erred in law and on facts in upholding the order of the Ld.AO;
6. The Order of the Ld. CIT(A) is against the provisions of section 250 of the Act, as it is dismissed for non-prosecution.
7. The Ld. CIT(A) has erred in law and on facts in not appreciating that the Ld.AO lacked jurisdiction to pass the impugned order.
The Assessment order was arrived at without considering the computation of the taxable component and had taken gross receipts which are of a capital nature as revenue receipts and passed the order accordingly.
The Ld.AO has erred in law and on the facts in making an addition of Rs.99,75,000/- as a short-term capital asset;
10. Without prejudice to the above, the Ld.AO has erred in law and on facts in not following the computation mechanism provided under the statute;
The Ld. AO has erred in law and on facts in making addition under section 69 of the Act to the extent of Rs.60,49,065/ on account of investment in property:
In making the above addition, the Ld.AO has erred in law and on facts in not appreciating that provisions of section 69 are not 7 ITA.No.1439/Hyd./2025 applicable to the facts in the present case considering the documents available on the records;
The Ld.AO has erred in law and on facts in making an addition on account of short-term capital gain earned on the sale of equity shares of Rs.9,04,912/- without following the computation mechanism provided under the statute.
The Ld.AO has erred in not invoking the provisions of section 133(6) or in making reference to the verification unit to collate the required details instead of making high-pitched additions;
The Ld.AO has erred in law and on facts in making an addition on account of investment made in equity shares to the extent of Rs.9,29,358/-.
The Ld.AO has erred in law and on facts in not considering the documents available on the records;
The additions made on the basis of surmises and presumptions are liable to be deleted;
The demand raised based on the above erroneous additions are liable to be deleted;
The Appellant denies its liability to pay interest under sections 234A, 234B and 234C of the Act on the facts and circumstances of the case.
The Appellant craves leave to add, alter, modify, delete or substitute any or all of the grounds and to file a paper book at the time of hearing the appeal.
8 ITA.No.1439/Hyd./2025 21. In view of the above and other grounds that may be urged at the time of the hearing of the appeal, the Appellant prays that the appeal may be allowed in the interest of justice and equity. (Tax effect Rs.59,78,532/-)
On the basis of the above grounds and other grounds which may be urged at the time of hearing with the consent of the Honourable Tribunal, it is prayed that the order passed under section 147 r.w.s 144 r.w.s 144B of the Act, as upheld by the Commissioner of Income Tax (Appeals), be quashed and relief sought be granted.”
7. The learned Authorised Representative of the Assessee has submitted that the learned CIT(A) has passed the impugned order ex-parte without considering the relevant documents and record filed by the assessee along with the appeal as Annexure to Form-35. He has referred to the Annexure to Form-35 and submitted that the assessee has filed all the relevant documentary evidences regarding the sale of property as well as purchase of property by producing the sale deed and purchase deed as investment in the new asset, statement of securities for purchase of shares and, therefore, the source of the investment in purchase of new property as well as in the shares is self- explanatory being the sale proceeds of the immovable
9 ITA.No.1439/Hyd./2025 property. The learned Authorised Representative of the Assessee has pointed-out that the Assessing Officer has made the additions on account of capital gain arising from the sale of the immovable property and further unexplained investment in purchase of property as well as investment in shares without considering the bare fact the assessee was having sufficient funds as sale proceeds of the immovable property. Thus, he has submitted that the assessment framed by the Assessing Officer is highly arbitrary and unjustified when the facts on record itself explains the source of the investment in the new property as well as in shares. He has further submitted that while computing the capital gain, the Assessing Officer has not allowed the cost of acquisition. Thus, ignoring all these facts by the learned CIT(A) while passing the impugned order ex-parte is also unjustified and arbitrary. He has thus submitted that though there was no response on behalf of the assessee to the notice issued by the learned CIT(A) as the matter was handled by the Tax Consultant who has not taken the requisite steps. However, once the assessee filed all the 10 ITA.No.1439/Hyd./2025 relevant details and documents along with the appeal in the shape of attachment to Form-35, then, dismissing the appeal by the learned CIT(A) for want of evidence is not justified. He has further pointed-out that the Assessing Officer has already passed ex-parte order u/sec.144 of the Act and accordingly, the matter be set-aside to the record of the Assessing Officer for fresh adjudication after considering all the relevant details on record already filed by the assessee and if need arises, the assessee will again file the relevant record for verification and examination.
8. On the other hand, learned DR has submitted that there was no compliance on behalf of the assessee to the notice issued by the Assessing Officer as well as by the learned CIT(A). The learned CIT(A) has given the details of notices issued to the assessee in para-4 of the impugned order and thereafter passed the impugned order when there was no participation on behalf of the assessee. He has relied upon the orders of the authorities below.
9. We have considered the rival submissions as well as relevant material on record. Though on behalf of the 11 ITA.No.1439/Hyd./2025 assessee there was no response to the notices issued by the learned CIT(A) however, it is matter on record that the assessee has filed copy of the sale deed, copy of purchase deed, statement of the investment in shares and securities along with other details with bank account statement to show that the assessee was having sufficient funds for making the investment in the new immovable property as well as shares. These documents are duly reflected as part of the Form-35 filed by the assessee before the learned CIT(A). The learned CIT(A) has dismissed the appeal of the assessee for non-prosecution and also on the ground that assessee has not filed any evidence to substantiate the grounds taken in the appeal but nowhere the learned CIT(A) has discussed the documents already filed by the assessee along with Form-35. Thus, it is apparent that the impugned order was passed by the learned CIT(A) without application of mind and without considering the documents filed by the assessee. Accordingly, in the facts and circumstances of the case and in the interest of justice, we set-aside the impugned order of the learned CIT(A). Since, the assessment
12 ITA.No.1439/Hyd./2025 order was also passed ex-parte without considering the relevant details and documents, therefore, the matter is remanded to the record of the Assessing Officer for fresh adjudication, after considering the relevant record and details filed by the assessee. The assessee may also file further record and details, if necessary to substantiate the claim. Needless to say, the assessee be given an appropriate opportunity of hearing before the passing the order by the Assessing Officer.
In the result, appeal of the Assessee is allowed for statistical purposes.
Order pronounced in the open Court on 19.11.2025.