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Facts
The assessee company filed appeals against orders relating to assessment year 2018-19. One appeal (ITA No.1241/PUN/2025) was against an order sustaining an addition of Rs. 8,84,97,504/-. Another (ITA No.1242/PUN/2025) was against a penalty of Rs. 1,50,000/- u/s 270A, and the third (ITA No.1243/PUN/2025) against a penalty of Rs. 39,87,280/-. All appeals were dismissed by the CIT(A)/NFAC due to delay in filing.
Held
The Tribunal held that the delay in filing the appeals should be condoned, considering judicial pronouncements on the matter, especially regarding the period of Covid-19 and the principle of substantial justice. The Tribunal restored the matters to the file of the CIT(A)/NFAC for deciding the appeals on merit.
Key Issues
Whether the delay in filing the appeal before the CIT(A)/NFAC should be condoned, considering the Covid-19 period and various judicial precedents, to allow the appeal to be decided on merits.
Sections Cited
68, 143(3), 144B, 270A, 271B, 46A
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
The above 3 appeals filed by the assessee are directed against the separate orders dated 22.03.2025 of the Ld. CIT(A) / NFAC, Delhi relating to assessment year 2018-19. While relates to the order of the Ld. CIT(A) / NFAC dismissing the appeal on account of delay in filing of the appeal and thereby sustaining the addition of Rs.8,84,97,504/- made by the Assessing Officer, Ld. CIT(A) / NFAC confirming the levy of penalty of Rs.1,50,000/- u/s 271B of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) and relates to the order of the Ld. CIT(A) / NFAC confirming the penalty of Rs.39,87,280/- levied u/s 270A of the Act. For the sake of convenience, these appeals were heard together and are being disposed of by this common order.
Facts of the case, in brief, are that the assessee is a company engaged in the business of purchase, sale and letting of leased residential and non-residential buildings. It filed its original return of income on 30.10.2018 disclosing total loss at Rs.69,90,996/-. Subsequently the assessee filed revised return of income on 30.03.2019 disclosing total loss at Rs.25,08,486/-. In absence of any details furnished by the assessee to explain the loan creditors to the extent of Rs.8,07,55,220/-, the Assessing Officer made addition of the same as unexplained cash credit within the meaning of section 68 of the Act. Similarly in absence of any valid explanation regarding the discrepancy in respect of the property sold, the Assessing Officer applied the profit rate of 12% on the sale of property at 6,45,19,025/- and made addition of Rs.77,42,284/-. The Assessing Officer accordingly completed the assessment u/s 143(3) r.w.s. 144B of the Act at a total income of Rs.8,59,89,018/-.
Since the assessee filed the appeal with a delay of 351 days, the Ld. CIT(A) / NFAC dismissed the appeal 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 submitted that the Assessing Officer passed the order on 24.08.2021 and the due date for filing of the appeal before the Ld. CIT(A) / NFAC is 23.09.2021. However, the appeal was filed on 09.09.2022 thereby causing delay of 351 days. He submitted that if the number of days falling during the Covid-19 period is excluded as per the decision of the Hon'ble Supreme Court in the case of Miscellaneous Application No.21 of 2022 in Miscellaneous Application No.665 of 2021 in Suo Motu Writ Petition (C) No.3 of 2020 in Re : Cognizance for Extension of Limitation with Miscellaneous Application No.29 of 2022 in Miscellaneous Application No.665 of 2021 in Suo Motu Writ Petition (C) No.3 of 2020, order dated 10.01.2022, the number of days of delay is only 102 days and not 351 days as mentioned by the Ld. CIT(A) / NFAC. To substantiate the same, he drew the attention of the Bench to the following details: Actual date of filing appeal: 09.09.2022 Delay in filing the appeal: 351 Days Exclusion of Covid Period: 23.09.2021 to 28.02.2022: 159 Days Additional period from 01.03.2022: 90 Days Total Covid Exclusion Days: 249 Days Delay after exclusion of COVID period: 102 Days
While explaining the delay in filing of the appeal, the Ld. Counsel for the assessee submitted that the assessee was completely dependent on the earlier Chartered Accountant who failed to respond to statutory notices and also failed to inform the assessee.
Referring to the decision of Hon’ble Bombay High Court in the case of Vijay Vishin Meghani vs. DCIT (2017) 398 ITR 250 (Bom), he submitted that the Hon’ble Bombay High Court in the said decision has held that where the assessee filed appeal before the Tribunal with a delay of 2984 days by taking a plea that he was wrongly advised by his Chartered Accountant earlier not to file appeal, such delay has to be condoned. Accordingly the order of the Tribunal refusing to condone the delay was reversed and the Tribunal was directed to condone the delay and decide the appeal on merit.
Referring to the decision of the Mumbai Bench of the Tribunal in the case of Nawany Corporation (I) Pvt. Ltd. vs. DCIT vide order dated 06.04.2023 for assessment year 2014-15, he submitted that the Tribunal in the said decision, relying on various decisions, has condoned the delay of 944 days in filing of the appeal.
Referring to the recent decision of Hon'ble Supreme Court in the case of Inder Singh Vs. The State of Madhya Pradesh reported in 2025 LiveLaw (SC) 339, he submitted that the Ld. CIT(A) / NFAC should have condoned the delay in filing of the appeal and should have decided the same on merit. He also relied on the following decisions: i) Collector, Land Acquisition vs. Mst. Katiji & Ors. reported in 167 ITR 471 (SC) ii) N. Balkrishnan vs. M. Krishnamurthy (1998) 7 SCC 123 iii) State of Nagaland vs. Lipuk A.O. 2005 (183) E.L.T. 337 (SC) iv) Earthmetal Electricals (P.) Ltd. vs. ITO (2005) 4 SOT 484 (Mum) v) Bombay Mercantile Co-op. Bank vs. CBDT vi) Vijay V. Megahni vs. DCIT vide of 2015 and 508 of 2015, order dated 19.09.2017
He accordingly submitted that the delay in filing of the appeal before the Ld. CIT(A) / NFAC should be condoned and the matter should be remitted back to the file of the Ld. CIT(A) / NFAC for deciding the issue afresh. Further the Ld. CIT(A) / NFAC has also not accepted the additional evidence filed before him. He accordingly submitted that the matter should be remitted back to the file of the Ld. CIT(A) / NFAC for deciding the issue by condoning the delay and accepting the additional evidences.
The Ld. DR on the other hand heavily relied on the order of the Ld. CIT(A) / NFAC.
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. We have also considered the various decisions cited before us. A perusal of the order of the Ld. CIT(A) / NFAC shows that he dismissed the appeal on account of delay in filing of the appeal before him and also did not admit the additional evidences filed by the assessee under Rule 46A of the Income Tax Rules, 1962. It is an admitted fact that the Assessing Officer passed the order on 24.08.2021. Accordingly the due date for filing of the appeal against the same was 23.09.2021 whereas the appeal has been filed on 09.09.2022. In the light of the decision of Hon'ble Supreme Court in the case of Miscellaneous Application No.21 of 2022 in Miscellaneous Application No.665 of 2021 in Suo Motu Writ Petition (C) No.3 of 2020 in Re : Cognizance for Extension of Limitation with Miscellaneous Application No.29 of 2022 in Miscellaneous Application No.665 of 2021 in Suo Motu Writ Petition (C) No.3 of 2020, order dated 10.01.2022, the period from 23.09.2021 to 28.02.2022 has to be excluded. Therefore, the delay after exclusion of Covid-19 period and the additional period of 90 days from 01.03.2022 is only 102 days. It is the submission of the Ld. Counsel for the assessee that the assessee was completely dependent on the earlier Chartered Accountant who failed to respond to statutory notices and also failed to inform the assessee for which the delay should have been condoned by the Ld. CIT(A) / NFAC and the appeal should have been decided on merit.
We find some force in the above arguments of the Ld. Counsel for the assessee. We find the Hon’ble Bombay High Court under somewhat similar circumstances in the case of Vijay Vishin Meghani vs. DCIT (supra) has reversed the decision of the Tribunal refusing to condone the delay of 2984 days where the assessee filed the appeal with a delay of 2984 days by taking a plea that he was wrongly advised by his Chartered Accountant earlier not to file appeal.
We find the Mumbai Bench of the Tribunal in the case of Nawany Corporation (I) Pvt. Ltd. vs. DCIT (supra) has condoned the delay of 944 days on the ground that the delay in filing of the appeal was on account of wrong advice given by the CA.
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 discussion and relying on the decisions cited (supra), we deem it proper to restore the issue to the file of the Ld. CIT(A) / NFAC with a direction to condone the delay and decide the appeal on merit and in accordance with law after giving due opportunity of being heard to the assessee. We hold and direct accordingly. The grounds raised by the assessee are accordingly allowed for statistical purposes.
These two appeals are also dismissed by the Ld. CIT(A) / NFAC on account of delay in filing of the appeals before him.
We have already decided the issue of delay in filing of the appeal in and restored the matter to the file of the Ld. CIT(A) / NFAC for adjudication of the appeal on merit by condoning the delay. Following similar reasongins, the above 2 appeals are also restored to the file of the Ld. CIT(A) / NFAC with a direction to condone the delay and decide the appeals on merit. The grounds raised by the assessee in the above 2 appeals are accordingly allowed for statistical purposes.
In the result, all the 3 appeals filed by the assessee are allowed for statistical purposes.
Order pronounced in the open Court on 9th September, 2025.