SUDHAKAR AKUTOTA,WARANGAL vs. INCOME TAX OFFICER, WARD-1, WARANGAL

Per contra, the Learned Departmental Representative (“Ld. DR”), strongly opposed the condonation of delay. He submitted that the appeal proceedings before the Ld. CIT(A) were conducted online, and therefore, no physical notices could have been sent to the assessee. He argued that in the faceless regime, notices are served electronically through the income tax portal and the assessee had an obligation to regularly check the portal. According to the Ld. DR, the assessee cannot take shelter under the plea of non-receipt of notices at his physical address when the law itself prescribes electronic mode of communication. He therefore contended that sufficient cause has not been shown, and the petition for condonation of delay deserves to be rejected.

We have considered the rival submissions and perused the material available on record including the affidavit filed by the assessee. On a careful perusal, we note that the assessee has explained the reasons for the delay in a plausible manner. It is an admitted fact that in column No.17 of Form No.35, the assessee had given his specific address for service of notices. This column is specifically provided in Form No.35 to enable the assessee to exercise his option regarding the address at which notices may be served. Once such option has been exercised, the notices ought to have been served at that address in addition to any electronic mode prescribed. In the present case, the Ld. CIT(A) did not serve any notices on the address so specified in column No.17 of Form No.35. The plea of the Revenue that the proceedings were online does not absolve the Ld. CIT(A) of the statutory requirement to serve notices at the address opted by the assessee. This strengthens the explanation given by the assessee for non-appearance before the Ld. CIT(A) and also supports the bona fides in filing the delayed appeal.

The assessee has also substantiated his claim that he came to know of the impugned order only on 03.06.2025, after which he acted with promptness in filing the present appeal on 23.06.2025. Considering the overall circumstances, we are satisfied that the delay was neither wilful nor deliberate but caused due to reasonable cause. In this regard, we draw support from the decision of the Hon'ble Supreme Court, in the case of Vidya Shankar Jaiswal vs. The Income Tax Officer, Ward-2, Ambikapur in Special Leave Petition (Civil) Nos. 26310-26311/2024, dated 31st January, 2025, wherein the Hon'ble Supreme Court has held that a justice-oriented and liberal approach should be taken while dealing with the application filed by an appellant seeking condonation of the delay in filing of the appeal. Therefore, in view of the above facts and the ratio laid down by the Hon’ble Supreme Court, we condone the delay of 296 days in filing the appeal. The appeal is admitted for adjudication on merits.

The assessee has raised the following grounds of appeal :

The brief facts of the case are that, the assessee is an individual who did not file any return of income for assessment year 2013–14 under section 139 of the Act. Accordingly, the case of the assessee was reopened under section 147 of the Act, and notice under section 148 of the Act was issued to the assessee on 28.03.2021. The assessee did not file any return of income in response to the said notice. The assessee also failed to respond to subsequent notices issued by the Learned Assessing Officer (“Ld. AO”). Consequently, the Ld. AO proceeded to complete the assessment on best judgment basis. During the course of assessment, the Ld. AO noticed that there were total credits of Rs.1,65,68,373/- in the bank accounts of the assessee, which remained unexplained. The Ld. AO accordingly treated the said amount as unexplained money under section 69A of the Act. Further, the Ld. AO also noted that the assessee was in receipt of rental income of Rs.2,20,800/- and contract receipts of Rs.5,010/- during the year under consideration. Since these amounts were also not explained, the same were brought to tax as unexplained money under section 69A of the Act. Accordingly, the Ld. AO completed the assessment under section 147 read with section 144 and section 144B of the Act on 24.03.2022, making a total addition of Rs.1,67,94,183/- under section 69A of the Act.

Aggrieved with the order of Ld. AO, the assessee filed an appeal before the Ld. CIT(A). However, the assessee did not respond to the notices issued by the Ld. CIT(A), and consequently, the appeal was dismissed ex parte.

Aggrieved with the order of Ld. CIT(A), the assessee is now in appeal before this Tribunal. The Ld. AR submitted that the assessee could not file submissions before the Ld. CIT(A) due to reasons already explained in the affidavit filed in connection with condonation of delay. It was submitted that the non-appearance before the lower authorities was not deliberate but was on account of unavoidable circumstances. The Ld. AR contended that since the assessment was framed ex parte and the appeal was also dismissed ex parte, the assessee has not been provided with adequate opportunity to substantiate his claim on merits. Therefore, he submitted that, in the interest of justice, the matter may be remanded back to the file of the Ld. AO with a direction to afford one more opportunity to the assessee to submit the necessary evidence.

Per contra, the Ld. DR opposed the request for remand. He submitted that sufficient opportunities had already been granted by both the Ld. AO as well as the Ld. CIT(A), but the assessee failed to avail the same. According to the Ld. DR, repeated non-compliance on the part of the assessee shows negligence, and therefore, no further opportunity is warranted.

We have heard the rival submissions and perused the material available on record. It is an admitted position that both the assessment as well as the first appellate order were passed ex parte due to non- compliance by the assessee. At the same time, the assessee has explained the circumstances in the affidavit filed in support of condonation petition and such explanation has already been accepted by us while condoning the delay in filing the present appeal. In our considered view, since the additions made by the Ld. AO are substantial and were made without the assessee furnishing any explanation, the principles of natural justice warrant that the assessee be granted one final opportunity to substantiate his claim. The assessee has also expressed willingness to fully cooperate in the proceedings. Accordingly, in the interest of justice, we set aside the impugned order of the Ld. CIT(A) and restore the matter to the file of the Ld. AO for fresh adjudication after affording due opportunity to the assessee. The assessee is directed to extend full cooperation and file the necessary details before the Ld. AO.

In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open Court on 10th Sept., 2025.