VISHNU RAGHUNATH SURYAVANSHI,SATARA vs. ITO WARD 1, SATARA, SATARA

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ITA 2684/PUN/2024Status: DisposedITAT Pune23 July 20253 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal noted that the CIT(A)/NFAC had dismissed the assessee's appeal as barred by limitation without deciding the issue on merits. However, it was observed that in the quantum appeal of the assessee, the CIT(A)/NFAC, by an appellate order dated 31.01.2025, had set aside the case to the file of the AO for de novo consideration. The AO was directed to pass a speaking order after affording a full opportunity to the assessee. In light of this development in the quantum appeal, the Tribunal set aside the impugned order of the CIT(A)/NFAC. The matter was restored to the file of the AO to decide the penalty afresh once the fresh assessment is completed. The Tribunal directed accordingly. No issue was expressly left undecided.

What were the facts?

The assessee, Vishnu Raghunath Suryavanshi, an individual, failed to file his return of income for Assessment Year 2017-18. Information from ITBA (AIMS) revealed cash deposits of Rs. 20,89,500/- with Union Bank, Karad during the demonetization period. The Assessing Officer (AO) completed the assessment under Section 144, making an addition of Rs. 20,89,500/- under Section 69A. Consequently, penalty proceedings under Section 271AAC were initiated. A show cause notice was issued on 09.03.2021, and the AO passed a penalty order under Section 271AAC(1) on 16.06.2021, levying a penalty of Rs. 1,61,413/-. The assessee appealed to the CIT(A)/NFAC, but the appeal was dismissed due to a delay of 773 days (546 effective days). The assessee is now in appeal before the ITAT against the CIT(A)'s order.

What were the issues?

1. Whether the CIT(A)/NFAC erred in not condoning the delay in filing the appeal before him. (Question of law and fact) 2. Whether the CIT(A)/NFAC erred in confirming the penalty when the appeal against the assessment order was pending before the CIT(A). (Question of law) 3. Whether the AO erred in levying penalty when the appeal against the assessment order was pending before the CIT(A). (Question of law) 4. Whether the order passed under Section 271AAC(1) is time-barred. (Question of law) Assessee's Contentions: - The Ld. AR submitted that in the assessee's quantum appeal, the Ld. CIT(A)/NFAC has set aside the matter to the file of the Ld. AO for de novo consideration. Therefore, the present penalty appeal should also be set aside to the file of the Ld. AO for fresh decision after the completion of the fresh assessment. Revenue's Contentions: - The Ld. DR had no objection to the request made by the Ld. AR.

Which sections of the Income-tax Act were involved?

Section 271AAC,Section 69A,Section 144

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “B” BENCH, PUNE

Before: SHRI R.K. PANDA & MS. ASTHA CHANDRA

आदेश / ORDER

PER ASTHA CHANDRA, JM :

1.

The appeal filed by the assessee is directed against the order dated 22.07.2024 of the Ld. Commissioner of Income Tax (Appeals)/NFAC, Delhi [“CIT(A)”] whereby he confirmed the penalty of Rs.1,61,413/- levied by the Ld. Assessing Officer (“AO”) u/s 271AAC of the Income Tax Act, 1961 (the “Act”) pertaining to Assessment Year (“AY”) 2017-18.

2.

The appeal is late by 78 days. The assessee has moved an application for condonation of delay. Sworn affidavit has been filed along with the application stating therein the reasons for such delay. After hearing both the sides, we are of the view that the delay is attributable to the sufficient cause. We, therefore, condone the delay and proceed to decide the appeal.

3.

The assessee has raised the following grounds of appeal :- “1. Under the facts and circumstances of the case and in law, Ld CIT/NFAC has erred in not condoning delay in filing Appeal.

2. Under the facts and circumstances of the case and in law, Ld CIT/NFAC has erred in Confirming Penalty, though the appeal against the Assessment Order is pending before CIT(A).

3. Under the facts and circumstances of the case and in law, Ld Assessing Officer has erred in levying penalty, though the appeal against the Assessment Order is pending before CIT(A).

4.

Under the facts and circumstances of the case and in law, the order passed u/s 271AAC(1) is time barred. Hence, needs to be quashed.

5.

The appellant craves the permission to add, amend, modify, revise, substitute, delete or alter any/all of the above grounds of appeal if deemed necessary at the time of hearing of the appeal.”

4. Briefly stated, the facts of the case are that the assessee is an individual. For AY 2017-18, the assessee did not file his return of income. The case of the assessee was selected for scrutiny based on the information received through ITBA (AIMS), which revealed that the assessee has made cash deposits of Rs.20,89,500/- with Union Bank, Karad during the demonetization period. The Ld. Assessing Officer (“AO”) completed the assessment u/s 144 of the Act vide order dated 18.12.2019 making an addition of Rs.20,89,500/- u/s 69A of the Act. Consequently, penalty proceedings u/s 271AAC was initiated against the assessee and a show cause notice was issued on 09.03.2021. The Ld. AO passed the penalty order u/s 271AAC(1) of the Act on 16.06.2021 levying penalty of Rs.1,61,413/-.

5. The assessee filed appeal before the Ld. CIT(A)/ NFAC. Since the assessee filed the appeal with a delay 773 days (including 227 days covered by Covid Period) thereby making effective days of delay to be 546 days, the Ld. CIT(A) dismissed the appeal filed by the assessee as barred by limitation for the reason that there exists no sufficient or good reason for condoning inordinate delay of more than 546 days in filing the appeal.

6.

Aggrieved with such order of the Ld. CIT(A)/NFAC, the assessee is in appeal before the Tribunal.

7.

The Ld. AR, at the outset submitted that in the assessee’s quantum appeal, the Ld. CIT(A)/NFAC has set aside the matter to the file of the Ld. AO for denovo consideration. He, therefore, requested that the present penalty appeal may also be set aside to the file of the Ld. AO to decide the same afresh after completion of the fresh assessment.

8.

The Ld. DR had no objection of the above request of the Ld. AR.

9.

We have heard the Ld. Representative of the parties and perused the material available on record. The Ld. CIT(A)/NFAC has passed the impugned order dismissing appeal of the assessee being barred by limitation without deciding the issue on merits of the case. However, we find that in the quantum appeal of the assessee, the Ld. CIT(A)/NFAC vide his appellate order dated 31.01.2025 has set aside the case to the file of the Ld. AO for de-novo consideration directing him to pass a speaking order, after affording full and complete opportunity to the assessee to present and substantiate his case before him. In this view of the matter, we set aside the impugned order of the Ld. CIT(A)/NFAC and restore the matter to the file of the Ld. AO to decide the same afresh once the fresh assessment is completed. We direct and order accordingly.

10.

In the result, the appeal of the assessee is allowed for statistical purposes.

Order pronounced in the open court on 23rd July, 2025.

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