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Facts
The assessee filed an appeal against the CIT(A)'s order (dated 10/07/2024 for AY 2017-18) with a delay of 110 days. The CIT(A) had dismissed the appeal for non-appearance and lack of evidence. The assessee explained the delay was due to the order not being physically served, email registered with CA, and unawareness until the bank account was attached by the AO u/s 226(3). The original assessment was completed ex-parte u/s 144, with additions for estimated profit and unexplained money u/s 69A.
Held
The ITAT condoned the 110-day delay, finding a reasonable cause based on the assessee's affidavit and corroborating evidence of bank account attachment. Recognizing that both the AO and CIT(A) orders were passed without the assessee's full participation due to communication issues and the pandemic, the ITAT set aside the CIT(A)'s order. The matter was remanded to the Assessing Officer for fresh adjudication after verifying the additional evidence filed by the assessee and providing a proper opportunity of hearing.
Key Issues
Condonation of delay in filing appeal; validity of ex-parte assessment and appeal dismissal by CIT(A); proper opportunity for the assessee to present evidence before authorities; additions made by AO under Section 144 and Section 69A.
Sections Cited
144, 226(3), 69A, 250
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, Hyderabad ‘ DB-B ‘ Bench, Hyderabad
Before: Shri Vijay Pal Rao, Vice-Shri Madhusudan Sawdia
Per Vijay Pal Rao, Vice President
This appeal by the assessee is directed against the order dated 10/07/2024 of the learned CIT (A)-NFAC Delhi, for the A.Y.2017-18.
There is a delay of 110 days in filing the present appeal. The assessee has filed an application/affidavit for condonation of delay. The learned Counsel for the assessee has submitted that the assessee is an individual and deriving income from distribution of Parle Agro and Nourishco beverages. The impugned order passed by the learned CIT (A) NFAC Delhi was Page 1 of 9 not served physically to the assessee but the same was uploaded on the Income Tax Portal only. He has further pointed out that the email registered with the Department belongs to the Office of the CA and not of the assessee and therefore, the assessee did not receive any communication through mail about the impugned order passed by the learned CIT (A). Thus, the learned Counsel for the assessee has submitted that due to lack of knowledge of the impugned order, the assessee could not file the present appeal within the period of limitation. He has submitted that only when the bank account of the assessee was attached by the Assessing Officer, the assessee came to know about the impugned order and immediately consulted the Counsel on 17/01/2025 who found that the impugned order was already passed on 10/07/2024. Thus, the learned Counsel for the assessee has submitted that the delay of 110 days in filing the present appeal is neither intentional nor deliberate when the impugned order was not communicated physically to the assessee, nor it was sent to the email of the assessee and therefore, the assessee was not aware till the bank account of the assessee was attached. He has thus, pleaded that the delay may be condoned and the appeal of the assessee may be admitted for adjudication on merits.
On the other hand, the learned DR has submitted that in the Faceless Appeal Proceedings, the orders are not sent physically, but it is only sent to the email given by the assessee. The learned DR has objected to the condonation of the delay in filing the present appeal.
We have considered the rival contentions as well as the relevant material available on record. The assessee has explained the cause of delay in the petition for condonation of delay as well as in the affidavit of the assessee. The contention of the assessee in the affidavit are reproduced as under:
There is no dispute that the Assessing Officer has attached the bank account of the assessee vide notice u/s 226(3) of the Act dated 07/1/2025 and thereafter, the assessee has filed the present appeal on 18/01/2025 after a delay of 110 days. Therefore, the averments made in the affidavit as well as in the petition for condonation of delay that the assessee came to know about the impugned order only when the Bank Account of the assessee was attached as corroborated with the record of the notice issued by the Assessing Officer u/s 226(3) of the Act to the bank of the assessee. Accordingly, in the facts and circumstances of the case and in the interest of justice, we are satisfied that the assessee was having a reasonable cause for the delay of 110 days in filing the present appeal. Hence, the delay in filing the appeal is hereby condoned.
The assessee has raised the following grounds of appeal:
The learned Counsel for the assessee has submitted that the learned CIT (A) has dismissed the appeal for want of any documentary evidence. He has pointed out that due to the non- communication of the notices issued by the learned CIT (A), the assessee could not file the evidences/details and therefore, the assessee may be given one more opportunity to submit the relevant details and supporting evidences. He has further submitted that the Assessing Officer has also passed an ex-parte order u/s 144 of the Act and submitted that due to Covid-19 Pandemic, the assessee could not participate in the proceedings before the Assessing Officer and could not submit the relevant details and supporting evidences. Thus, the learned Counsel for the assessee has submitted that now the assessee has filed the additional evidences in support of the claim of the assessee which may be considered and the merits of the addition made by the Assessing Officer.
On the other hand, the learned DR has submitted that it is a case of gross negligence on the part of the assessee as the assessee has not participated in the proceedings before the Assessing Officer as well as before the learned CIT (A) despite sufficient opportunities were granted. He has objected to the prayer of the assessee for granting one more opportunity for production of relevant details and supporting evidences.
We have considered the rival submissions as well as relevant material available on record. The learned CIT (A) has dismissed the appeal of the assessee in para 5 to 9 as under:
Thus, the learned CIT (A) has dismissed the appeal of the assessee for non-appearance on the part of the assessee and then the additions were confirmed for want of any documentary evidence filed by the assessee. We further note that the Assessing Officer has also passed the assessment order dated 23/12/2019 u/s 144 of the Act. The assessee has explained the reasons for non-appearance and compliance of notices issued by the Assessing Officer as well as the learned CIT (A) that there was non-communication of the notices issued to the assessee as the email of the office of the CA was registered with the Department. Further, the assessment order was passed at the time of advent of Covid-19 pandemic. Having considered the facts and circumstances of the case when both the Assessing Officer as well as the learned CIT (A) has passed the impugned orders by giving the reasons that the assessee has not filed any evidence in support of the claims, we are of the considered view that the additional evidence filed by the assessee is required to be verified and examined at the level of the Assessing Officer. Accordingly, the impugned order of the learned CIT (A) is set aside and the matter is remanded to the record of the Assessing Officer for fresh adjudication after verification and examination of the additional evidence filed by the assessee as well as giving an appropriate opportunity of hearing to the assessee.
In the result, appeal filed by the assessee is allowed for statistical purposes.