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Facts
The assessee, a private limited company, failed to file its return of income. The case was reopened under Section 147, and notices were issued but not complied with. The Assessing Officer completed the assessment under Section 144, treating a large sum as capital gains and income from undisclosed sources. The appeal before the CIT(A)/NFAC was dismissed due to non-compliance and delay.
Held
The Tribunal noted the non-compliance by the assessee and the dismissal by the lower authorities. However, considering the interest of justice, the Tribunal restored the issue to the CIT(A)/NFAC for a final opportunity to the assessee to present its case with requisite details.
Key Issues
Whether the appeals should be restored to the CIT(A)/NFAC for a final opportunity to the assessee to present its case despite previous non-compliance and delays.
Sections Cited
139(1), 147, 148, 142(1), 144, 68, 115BBE, 271(1)(c)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, PUNE BENCH “A”, PUNE
Before: SHRI R. K. PANDA & Ms. ASTHA CHANDRA
filed by the assessee is directed against the order dated 19.03.2025 of the Ld. CIT(A) / NFAC, Delhi relating to assessment year 2015-16.
24.03.2025 of the Ld. CIT(A) / NFAC, Delhi relating to assessment year 2015-16 wherein the Ld. CIT(A) / NFAC has confirmed the penalty levied by the Assessing Officer u/s 271(1)(c) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’). For the sake of convenience, both the appeals were heard together and are being disposed of by this common order.
Facts of the case, in brief, are that the assesse is a private limited company and has not filed its return of income in accordance with the provisions of section 139(1) of the Act. On the basis of certain information received that the assessee has received an amount of Rs.20,20,00,000/- in respect of transfer of immovable property and has also deposited cash aggregating to Rs.19 lakhs, the case of the assessee was reopened by following due procedure as per provisions of section 147 of the Act. Accordingly, notice u/s 148 of the Act was issued on 27.03.2021 calling for return of income. However, there was no compliance from the side of the assessee. The subsequent notice issued u/s 142(1) of the Act also remained un- complied with. The Assessing Officer, therefore, completed the assessment u/s 144 of the Act determining the total income of the assessee at Rs.20,39,00,000/- treating the amount of Rs.20,20,00,000/- as long term capital gain and Rs.19,00,000/- as income from undisclosed sources u/s 68 r.w.s. 115BBE of the Act. Thus, he determined the total income of the assessee at Rs.20,39,00,000/-.
Since there was non-compliance from the side of the assessee despite 5 opportunities granted by the Ld. CIT(A) / NFAC, he dismissed the appeal. While doing so, he also noted that there was an abnormal delay of 535 days in filing of the appeal and the reasons given by the assessee in the condonation petition does not contain any reasonable cause for such delay.
Aggrieved with such order of the Ld. CIT(A) / NFAC, the assessee is in appeal before the Tribunal.
The Ld. Counsel for the assessee at the outset submitted that due to huge business loss the assessee was unable to repay the bank loans for which the assets were sold at distressed rate. Further, house of the key person Mr. Nandurdikar was auctioned by the bank. Under these circumstances, the assessee was not in a position to file the appeal before the Ld. CIT(A) / NFAC in time. He submitted that given an opportunity, the assessee is in a position to substantiate its case by filing the requisite details before the Assessing Officer.
The Ld. DR on the other hand heavily relied on the order of the Ld. CIT(A) / NFAC and submitted that the assessee has not availed any of the opportunities either before the Assessing Officer or the Ld. CIT(A) / NFAC. This type of conduct on the part of the assessee shows that the assessee does not at all interested in prosecuting the appeal.
We have heard the rival arguments made by both the sides, perused the orders of the Assessing Officer and the Ld. CIT(A) / NFAC and the paper book filed on behalf of the assessee. It is an undisputed fact that due to non-compliance to the statutory notices issued by the Assessing Officer, he completed the assessment u/s 144 of the Act. While doing so, he has not given any benefit of cost of acquisition for the sale of property while calculating the capital gain. We find although the assessee filed an appeal before the Ld. CIT(A) / NFAC with delay, however, due to non-compliance to the statutory notices issued by the office of the Ld. CIT(A) / NFAC, he also dismissed the appeal for want of prosecution and delay in filing of the appeal. It is also an admitted fact that he has not decided the appeal on merit. It is the submission of the Ld. Counsel for the assessee that given an opportunity, the assessee is in a position to substantiate its case by filing the requisite details. Considering the totality of the facts of the case and in the interest of justice, we deem it proper to restore the issue to the file of the Ld. CIT(A) / NFAC with a direction to grant one final opportunity to the assessee to substantiate its case by filing the requisite details and decide the issue as per fact and law after providing due opportunity of being heard to the assessee. The assessee is also hereby directed to submit the requisite details before the Ld. CIT(A) / NFAC on the appointed date without seeking any adjournment under any pretext, failing which the Assessing Officer is at liberty to pass appropriate order as per law. We hold and direct accordingly. The grounds raised by the assessee are accordingly allowed for statistical purposes.
The assessee in the instant appeal has challenged the order of the Ld. CIT(A)/NFAC in confirming the penalty of Rs.6,93,05,610/- levied by the Assessing Officer u/s 271(1)(c) of the Act.
After hearing both the sides, we find the quantum appeal has been restored to the file of the Ld. CIT(A) / NFAC in the preceding paragraphs. Therefore, we restore the issue of penalty also to the file of the Ld. CIT(A) / NFAC with a direction to re-adjudicate the issue after completion of the quantum appeal. The grounds raised by the assessee are accordingly allowed for statistical purposes.
In the result, both the appeals filed by the assessee are allowed for statistical purposes.
Order pronounced in the open Court on 29th December, 2025.