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Facts
The assessee, engaged in marketing agricultural produce, filed a NIL return for AY 2018-19. The AO completed assessment u/s 143(3), accepting NIL income but incorrectly computed tax liability and assessed income. The assessee's subsequent appeal to CIT(A)/NFAC, filed with a 28-day delay, was rejected solely on account of delay without a decision on merits or condonation of delay.
Held
The ITAT found that CIT(A)/NFAC erred in dismissing the appeal without addressing the condonation of delay or merits. Citing Supreme Court precedents on condonation of delay, the ITAT condoned the delay in filing the appeal before CIT(A)/NFAC. The case was remanded back to CIT(A)/NFAC with directions to decide the appeal on merits after giving due opportunity to the assessee.
Key Issues
Whether the CIT(A)/NFAC was justified in dismissing an appeal solely due to delay without considering condonation of delay or the merits of the case, and the condonation of delay in filing an appeal.
Sections Cited
143(1), 143(2), 142(1), 143(3), 249(2)
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Income Tax Appellate Tribunal, PUNE “B” BENCH : PUNE
Before: SHRI RAMA KANTA PANDA, VICE- & Ms. ASTHA CHANDRA
I.T.A.No.2191/PUN/2025 (Assessment Year 2018-2019) Shrivardhan Biotech Pvt. ITO, Ward-1, Kolhapur Ltd., Kondigre, Tal-Shirol, Kolhapur-416101, vs. Maharashtra PAN : AALCS 2484 C (Appellant) (Respondent) For Assessee : Shri Pramod S Shingte For Revenue : Smt. Indira R. Adakil, Addl.CIT Date of Hearing : 04.12.2025 Date of Pronouncement : 17.12.2025 ORDER PER : ASTHA CHANDRA, JM
This appeal is directed against the order of National Faceless Appeal Centre (NFAC)/ Commissioner of Income Tax (Appeals), Delhi [“CIT(A)/NFAC”] dated 12/03/2025 pertaining to the Assessment Year (“AY”) 2018-19.
There is a delay of 115 days in filing of the instant appeal. The assessee has filed an application seeking condonation of delay along with affidavit explaining the reasons for such delay. After hearing both the sides and considering the contents of the affidavit, we find that the delay in filing the appeal is not intentional, but 2 ITA.No.2191/PUN/2025 (Shrivardhan Biotech Pvt. Ltd.) attributable to sufficient cause. We, therefore, in the light of the judgments of Hon’ble Apex Court in the case of Collector, Land Acquisition, Anantnag & Anr. Vs. Mst. Katiji & Ors. [(1987) 2 SCC 107] and in the case of Inder Singh Vs. State of Madhya Pradesh judgment dated 21.03.2025 (2025 INSC 382), condone the delay of 115 days in filing of the appeal and proceed to adjudicate the same.
Briefly stated, the facts are that assessee is a company, engaged in the business of marketing of agricultural produce cultivated in its farm. For AY 2018-19, assessee filed its return of income on 31/10/2018 declaring income of ₹ NIL and agricultural income of ₹ 2,07,56,730/-. The return was initially processed u/s. 143(1) of the Income Tax Act, 1961 (“Act”). Subsequently, case of the assessee was selected for scrutiny under CASS. Statutory notices u/s. 143(2) and 142(1) along with questionnaire were issued and served upon the assessee from time to time calling for information. In response thereto, assessee uploaded its online reply in ITBA e-Assessment module. Ld. Assessing Officer (“AO”) completed the assessment u/s. 143(3) accepting the income returned by the assessee, but incorrectly computed the tax liability at ₹71,47,260/- and assessed the income at ₹1,82,61,540/-.
Aggrieved, assessee filed an appeal before the Ld.CIT(A)/NFAC with a delay of 28 days, which was rejected on account of delay in filing of appeal.
Dissatisfied, assessee is in appeal before this Tribunal raising the following grounds of appeal:-
3 ITA.No.2191/PUN/2025 (Shrivardhan Biotech Pvt. Ltd.) “On the facts and circumstances of the case and in law the CIT(A),NFAC erred in confirming the action of the Assessing Officer, NFAC, Delhi (hereinafter referred to as the „AO') of computing the tax liability at ₹ 71,47,260/- taking taxable income at ₹ 1,82,61,540/- even though the assessment has been completed accepting NIL returned income. The appellant submits that the tax liability as computed is incorrect. The appellant prayed that the ITO be directed to delete the tax liability.”
Ld. AR submitted that appeal was filed before the CIT(A)/NFAC with delay of 28 days for the reason that assessee’s company is facing financial crisis, due to which day-to-day administrative work was disturbed and was unable to monitor official communications including the emails, which remained unattended, therefore delay is not deliberate and unintentional. Relying on various decisions, Ld.AR requested that the Ld.CIT(A)/NFAC may be directed to condone the delay and decide the appeal on merits.
The Ld. DR, on the other hand, relied on the order of CIT(A)/NFAC.
We have heard Ld. Representatives of both the parties and perused the material available on record. Admittedly, there is a delay in filing of the appeal before the CIT(A)/NFAC on account of which he dismissed the appeal of the assessee without deciding the issues on merits. We find that the Ld.CIT(A)/NFAC has dismissed the appeal of the assessee for the reason that assessee has not claimed condonation of delay in filing of appeal and no condonation request has been made, which is in violation of provisions of section 249(2) of the Act. Learned counsel for the assessee 4 ITA.No.2191/PUN/2025 (Shrivardhan Biotech Pvt. Ltd.) admitted that there is non-compliance on the part of the assessee, however, the same has happened due to the reasons cited above and prayed that in the interest of justice, matter may be set aside to the file of Ld.CIT(A)/ NFAC to decide the issues on merits after condoning the delay in filing appeal before him.
We find, the Hon'ble Supreme Court in the case of Collector, Land Acquisition vs. Mst. Katiji & Ors. reported in 167 ITR 471 (SC) has held that when substantial justice and technical considerations are pitted against each other, cause of substantial justice deserves to be preferred for the other side cannot claim to have vested right in injustice being done because of a non-deliberate delay. Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As against this when delay is condoned the highest that can happen is that a cause would be decided on merits after hearing the parties.
We find recently the Hon’ble Supreme Court in the case of Inder Singh Vs. The State of Madhya Pradesh reported in 2025 LiveLaw (SC) 339 has held as under: “14. There can be no quarrel on the settled principle of law that delay cannot be condoned without sufficient cause, but a major aspect which has to be kept in mind is that, if in a particular case, the merits have to be examined, it should not be scuttled merely on the basis of limitation.”
In the light of the above decisions of Hon’ble Supreme Court cited (supra), we deem it proper, in the interest of justice, to restore the matter to the file of the Ld.CIT(A)/NFAC with a direction to condone the delay in filing of appeal before him and decide the appeal on merits as per facts and law after giving due opportunity of being heard to the assessee. The assessee is also hereby directed
5 ITA.No.2191/PUN/2025 (Shrivardhan Biotech Pvt. Ltd.) to make its submissions, if any, on the appointed date without seeking any adjournments, unless required for a sufficient cause, failing which the Ld.CIT(A)/NFAC shall be 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.
12. In the result, the appeal of assessee is treated as allowed for statistical purpose. Order pronounced in open Court on 17.12.2025.