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Facts
The assessee, an individual, failed to file his income tax return for AY 2017-18 despite having agricultural income and business transactions. The Assessing Officer (AO) reopened the case, issued notices, and made additions to the total income based on unexplained transactions, including cash deposits, business income, professional fees, commission, and property payments. The assessee's appeal before the CIT(A) was dismissed due to a significant delay.
Held
The Tribunal condoned the delay in filing the appeal before the CIT(A) by considering the COVID-19 pandemic period and the Supreme Court's decision on extending limitation. It also noted that the assessee had a reasonable cause for not responding to notices. The Tribunal decided to give the assessee another opportunity by remitting the issues back to the CIT(A) for fresh adjudication on merits.
Key Issues
Whether the delay in filing the appeal before CIT(A) was sufficiently explained due to the pandemic and if the case should be remanded for fresh adjudication on merits.
Sections Cited
250, 147, 144, 144B, 148, 142(1), 194J, 194IA, 194H
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, PUNE BENCHES “A”, PUNE
Before: DR.MANISH BORAD & MS. ASTHA CHANDRA
आदेश / ORDER
PER DR. MANISH BORAD, ACCOUNTANT MEMBER :
The captioned appeal at the instance of assessee pertaining to A.Y. 2017-18 is directed against the order dated 19.11.2024 of National Faceless Appeal Centre, (NFAC), Delhi passed u/s.250 of the Income Tax Act, 1961 (in short ‘the Act’) arising out Assessment Order dated 27.03.2022 passed u/s.147 r.w.s.144 r.w.s.144B of the Act.
When the case was called for, none appeared on behalf of the assessee despite due service of notice of hearing. With the assistance of ld. Departmental Representative we proceed to adjudicate the appeal exparte qua the assessee.
Brief facts emanating from the record are that the assessee is an individual deriving business as well as Agricultural income but did not file the return of income for A.Y. 2017-18. Based on the information available in AIMS Module of ITBA data, assessee has carried out the following transactions :
(a) The assessee has deposited cash of Rs.1,17,36,291/- in current account. (b) The assessee has received professional or technical fees of Rs.63,193/- on which TDS has been deducted u/s.194J. (c) The assessee has made payment in respect of transfer of immovable property of Rs.20,27,681/- on which TDS has been deducted u/s.194IA. (d) The assessee has withdrawals cash of Rs.3,51,961/- from current account. (e) The assessee has received commission or brokerage of Rs.2,75,400/- on which TDS has been deduction u/s.194H.
Since the assessee did not file the return, Ld. Assessing Officer was of the view that the above transactions remained unexplained. Case reopened by way of issuance of notice u/s.148 of the Act. Statutory notices u/s.142(1) were issued to the assessee but there was no response from the side of assessee. In the circumstances, Ld. Assessing Officer concluded the best judgment assessment u/s.144 r.w.s.147 of the Act assessing the total income of the assessee at Rs.40,12,353/- by making following additions :
(i) Addition of Rs.5,25,000/- on account of unexplained cash deposit in the bank during demonetization period. (ii) Addition of Rs.11,21,079/- as business income.
(iii) Addition of Rs.63,193/- on account of receipt of professional/technical fees.
(iv) Addition of Rs.2,75,400/- on account of commission/brokerage. (v) Addition of Rs.20,27,681/- on account of payment in respect of immovable property.
Aggrieved assessee preferred appeal before ld.CIT(A) with a delay of 401 days. It was contended that assessee is a resident of small town in Shirpur and is not conversant with e-mails and Income Tax portals. As such, he was unaware of the notices and passing of impugned exparte orders against the assessee. Ld.CIT(A) did not condone the said delay and dismissed the appeal filed by the assessee as inadmissible.
Now the assessee is in appeal before the Tribunal assailing the impugned order.
We have heard the ld. Departmental Representative and perused the record placed before us. We on perusal of the record find that assessment order in the instant case was passed on 27.03.2022. Notice u/s.148 of the Act was issued on 28.03.2021 and notices u/s.142(1) were issued on 11.11.2021 and 28.12.2021 respectively. No doubt, these notices fell during covid-19 pandemic outbreak prevailed across the country. Delay period was covered by the decision of Hon’ble Supreme Court in the case of Cognizance for Extension of Limitation, In re (2022) 441 ITR 722 (SC) dated 10.01.2022, wherein, the limitation prescribed by various statutes was suo motu extended on account of difficulties faced by the citizens of the country on account of Pandemic Covid-19. Assessee vide Grounds of appeal No.2 and 3 contended that notices were served on email pertaining to erstwhile tax consultant during covid-19 period which went unnoticed. In view of the aforesaid reasons, we are of the view that there was ‘reasonable cause’ which prevented the assessee to file the appeal within the stipulated time and ld.CIT(A) ought to have condoned the delay. Assessee would have not gained anything by filing the appeal with delay. Considering the above and in light of judgment of Hon’ble Supreme Court in the case of Collector Land Acquisition Vs. MST Katiji (1987) 167 ITR 471 SC we condone the delay of 401 days in filing of appeal before ld.CIT(A) and admit the appeal for adjudication.
Since assessee has not participated in the proceedings before ld.CIT(A) and has not produced any documents to substantiate the allegation of cash deposit, sale of immovable property etc., we in the larger interest of justice deem it proper to give one more opportunity to the assessee. We therefore remit the issues raised by the assessee on merit to the file of ld.CIT(A) for necessary adjudication. Assessee is at liberty to produce adduce evidence/documents in his support. Ld.CIT(A) shall call for a remand report if necessary from the Ld. Jurisdictional Assessing Officer and after considering the submissions of assessee pass a speaking order as contemplated u/s.250(6) of the Act. Assessee is directed to provide its updated email address and contact details to the Department to facilitate effective communication of notices through the ITBA portal. Assessee is further advised to exercise due diligence and avoid seeking adjournments except for bonafide and justifiable reasons. In this view of the matter, impugned order is hereby set aside and the effective grounds of appeal raised by the assessee are allowed for statistical purposes.
In the result, appeal of the assessee is allowed for statistical purposes.
Order pronounced on this 16th day of June, 2025.