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Facts
The assessee failed to file its income tax return for AY 2018-19. Despite multiple notices and opportunities from the Assessing Officer and CIT(A)/NFAC, the assessee did not respond, leading to an ex-parte assessment under Section 144, confirming additions of Rs. 6,59,29,324/-.
Held
The Tribunal condoned the delay in filing the appeal after considering the reasons provided by the assessee and legal precedents. The Tribunal restored the issue to the file of the CIT(A)/NFAC, directing it to grant an opportunity to the assessee to substantiate its case.
Key Issues
Whether the delay in filing the appeal should be condoned, and whether the assessee should be granted an opportunity to present its case before the CIT(A)/NFAC.
Sections Cited
144, 148A, 148, 151, 142(1)
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Income Tax Appellate Tribunal, PUNE BENCH “A”, PUNE
Before: SHRI R. K. PANDA & MS. ASTHA CHANDRA
This appeal filed by the assessee is directed against the order dated 28.05.2024 of the Ld. CIT(A) / NFAC, Delhi relating to assessment year 2018-19.
Although a number of grounds have been raised by the assessee, however, these all relate to the ex-parte order of the Ld. CIT(A) / NFAC confirming the addition of Rs.6,59,29,324/- made by the Assessing Officer in the order passed u/s 144 of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’).
There is a delay of 247 days in filing of the appeal before the Tribunal for which the assessee has filed a condonation application along with an affidavit explaining the reasons for such delay. It has been explained in the affidavit that since the company was shutdown, therefore, the notice could not be seen by any of the Directors of the company. Relying on various decisions the Ld. Counsel for the assessee submitted that the delay in filing of the appeal should be condoned.
The Ld. DR on the other hand opposed the condonation application filed by the assessee.
We have heard the rival arguments made by both the sides on the issue of delay in filing of the appeal. We have also considered the contents of the condonation application filed along with the affidavit of the assessee.
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.”
Considering the totality of the facts of the case and in the light of the decisions of Hon’ble Supreme Court cited (supra), the delay in filing of the appeal is condoned and the appeal is admitted for adjudication.
Facts of the case, in brief, are that the assessee had not filed its return of income for the impugned assessment year. On the basis of certain information flagged in the Insight portal, according to which the assessee has made huge cash deposits and withdrawals in the bank account and has also earned certain interest income, a notice u/s 148A(b) of the Act was issued to the assessee. However, the assessee failed to submit its reply to the show cause notice for which the Assessing Officer had no option but to pass the order u/s 148A(d) of the Act as a fit case for issue of notice u/s 148 of the Act after obtaining the approval of the competent authority u/s 151 of the Act. Accordingly notice u/s 148 of the Act dated 27.03.2022 was issued and served on the assessee electronically and also through speed post. However, there was no response from the side of the assessee. Subsequently the case of the assessee was picked up for faceless assessment by the Faceless Assessment Unit. Again, notice u/s 142(1) of the Act was issued to the assessee. However, there was again no response from the side of the assessee. Finally, NFAC issued a letter dated 23.01.2023 to the assessee proposing to complete the assessment u/s 144 of the Act. Since there was no response from the side of the assessee, the Assessing Officer proceeded to complete the assessment u/s 144 of the Act on the basis of information available on record. He accordingly completed the assessment on a total income of Rs.6,59,29,324/- by making the following additions:
Since, there was a delay in filing of the appeal before the Ld. CIT(A) / NFAC and none appeared on behalf of the assessee despite issue of various notices, the Ld. CIT(A) / NFAC dismissed the appeal filed by the assesse by observing as under:
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 criminal cases filed by the Directors of the company against each other and shutdown of the company, notices could not be seen by either of the Directors for which there was non-compliance from the side of the assessee. He submitted that in the interest of justice the assessee should be given an opportunity to substantiate its case by filing the requisite details.
The Ld. DR on the other hand opposed the arguments advanced by the Ld. Counsel for the assessee. Referring to the order of the Assessing Officer as well as the Ld. CIT(A) / NFAC, he submitted that despite number of opportunities granted by the Assessing Officer as well as the Ld. CIT(A) / NFAC, there was no- compliance from the side of the assessee, therefore, the order of the Ld. CIT(A) / NFAC confirming the addition made by the Assessing Officer should be upheld.
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 admitted fact that due to non-compliance to the statutory notices issued by the Assessing Officer from time to time he completed the assessment u/s 144 of the Act determining the total income of the assessee at Rs.6,59,29,324/-. Since the assessee did not respond to any of the notices issued by the Ld. CIT(A) / NFAC, he upheld the various additions made by the Assessing Officer. 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 an opportunity to the assessee to substantiate its case by filing the requisite details and decide the issue as per fact and law. The assessee is also hereby directed to appear before the Ld. CIT(A) / NFAC on the appointed date and make its submissions, if any, without seeking any adjournment under any pretext 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.
In the result, the appeal filed by the assessee is allowed for statistical purposes.
Order pronounced in the open Court on 11th September, 2025.