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Facts
The assessee filed an appeal before the ITAT with a significant delay of 577 days. This delay was attributed to the assessee specifically opting out of email communication in Form No. 35, yet the Ld. CIT(A) issued notices and orders electronically, leading to the assessee's unawareness of the proceedings.
Held
The Tribunal condoned the delay, finding sufficient cause due to the improper communication of notices. The Tribunal set aside the Ld. CIT(A)'s ex-parte order and restored the matter to the Assessing Officer for de novo adjudication, allowing the assessee to present evidence.
Key Issues
Condonation of delay due to non-receipt of email notices against assessee's explicit request; Remand of the case for de novo adjudication by the AO after an ex-parte dismissal by the CIT(A).
Sections Cited
144, 69A, 69B, 69C
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, Hyderabad A Bench, Hyderabad
Before: SHRI VIJAY PAL RAO & SHRI MADHUSUDAN SAWDIA
ORDER PER MADHUSUDAN SAWDIA, A.M.: This appeal is filed by Shri Suresh Madamanchi (“the assessee”), feeling aggrieved by the order passed by the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi (“Ld. CIT(A)”) dated 30/11/2023 for the Assessment Year (“A.Y.”) 2017-18.
vs. ITO 2. At the outset, it is noticed that there is a delay of 577 days in filing the present appeal before this Tribunal. The assessee has filed a petition for condonation of delay along with an affidavit explaining the reasons for such delay. The Learned Authorised Representative (“Ld. AR”) submitted that the assessee had filed Form No.35 before the Ld. CIT(A), wherein in the personal information section the assessee had specifically declined communication through email. The Ld. AR submitted that the assessee was not conversant with online proceedings and therefore had opted not to receive communications through email. It was submitted that despite the specific request made by the assessee in Form No.35 declining communication through email, the notices issued during the appellate proceedings as well as the order of the Ld. CIT(A) were communicated electronically and no physical notice was served upon the assessee. Consequently, the assessee remained unaware of the proceedings before the Ld. CIT(A) and also of the order passed by the Ld. CIT(A). It was further submitted that the assessee came to know about the passing of the appellate order only when the revenue initiated recovery proceedings for the outstanding demand. Immediately thereafter, the assessee made enquiries and approached tax consultants dealing with appellate matters before this Tribunal and thereafter filed the present appeal before the Tribunal on 30.08.2025. Due to the above circumstances, there occurred a delay of 577 days in filing the present appeal. The Ld. AR submitted that the delay was neither intentional nor attributable to any negligence on the part of the assessee. It was therefore
The Ld. AR further submitted that the assessee is a commission agent engaged in arranging sale of agricultural produce under licence granted by the Agricultural Market Committee, Warangal. The assessee collects agricultural produce from farmers and sells the same to traders on commission basis and deposits the sale proceeds in his bank account which are subsequently remitted to the farmers after deducting commission. However, without appreciating the nature of the assessee’s activity, the Learned Assessing Officer (“Ld. AO”) treated the entire bank receipts as income of the assessee. It was therefore submitted that the assessment is highly disproportionate and amounts to a high- pitched assessment, and therefore also the delay deserves to be condoned so that the matter can be adjudicated on merits.
Per contra, the Learned Departmental Representative (“Ld. DR”) opposed the condonation of delay and submitted that there is an inordinate delay of 577 days in filing the appeal and the assessee has not shown sufficient cause for such delay.
We have heard the rival submissions and perused the material available on record including the petition for condonation of delay and the affidavit filed by the assessee. We have also gone through the personal information section of Form No.35 filed by the assessee before the Ld. CIT(A), which is to the following effect:
On perusal of above, it is evident that the assessee had specifically mentioned that he was not willing to receive communication through email as he was not conversant with online proceedings. Despite such specific declaration, the notices during the appellate proceedings as well as the order of the Ld. CIT(A) appear to have been communicated electronically. No material has been brought on record by the Revenue to establish that the said communications were also served physically upon the assessee. In these circumstances, the explanation offered by the assessee that he came to know about the passing of the appellate order only when recovery proceedings were initiated by the revenue appears to be plausible. Immediately thereafter the assessee has approached tax consultants and filed the appeal before the Tribunal. It is well settled that while considering a petition for condonation of delay, the courts should adopt a liberal approach so that substantial justice is advanced. Further, we find that the Hon’ble Supreme Court in the case of Collector, Land Acquisition vs. Mst. Katiji (167 ITR 471) has held that when substantial justice and technical considerations are pitted against each other, the cause of substantial justice deserves to be preferred. In the present case, considering the facts and circumstances explained by the assessee and Page 4 of 8 Suresh Madamanchi vs. ITO particularly the fact that the assessee had specifically declined communication through email in Form No.35, we are satisfied that the assessee was prevented by sufficient cause from filing the appeal within the prescribed time limit. Therefore, in the interest of substantial justice, we deem it appropriate to condone the delay of 577 days in filing the present appeal and admit the appeal for adjudication on merits.
The assessee has raised the following grounds of appeal:
“1) The order of the learned CIT (A) is erroneous both on facts and in law; 2) The learned CIT (A) erred in deciding the appeal ex-parte without providing proper opportunity to the appellant herein; 3) The learned CIT (A) ought to have considered the fact that the total deposit made into the bank account was Rs.2,70,41,835/- and represents the business transaction; 4) The learned CIT (A) ought to have considered the fact that the appellant is a Commission Agent for the agricultural products and was operating from the Agricultural Market Committee, Warangal and received a commission of Rs. 17,06,736/- and after expenditure the net profit was Rs.5,35,755/-; 5) The learned CIT (A) ought to have directed the Assessing Officer to accept the income so admitted without making any addition of the amount deposited as the income assessable u/s 69A/69B/69C of the I.T. Act. 6) Any other ground/grounds that may be urged at the time of hearing.”
The brief facts of the case are that the assessee had filed an appeal before the Ld. CIT(A) for Assessment Year 2017–18 against the assessment order passed by the Ld. AO under section 144 of the Income Tax Act, 1961 (“the Act”) dated 14.12.2019. However, during the appellate proceedings before the Ld. CIT(A), the assessee could not comply with the notices issued by the Ld. CIT(A). Accordingly, the Ld. CIT(A) dismissed the appeal of the assessee and upheld the order passed by the Ld. AO. Page 5 of 8 Suresh Madamanchi vs. ITO 9. Aggrieved by the order of the Ld. CIT(A), the assessee is in appeal before this Tribunal. The Ld. AR submitted that, as explained while seeking condonation of delay, the assessee had specifically declined communication through email in Form No.35 filed before the Ld. CIT(A). It was submitted that the assessee is not conversant with online proceedings and therefore had requested that communications should not be made through email. However, despite such specific request, the Ld. CIT(A) issued notices only through email and no physical notices were served upon the assessee. As a result, the assessee did not receive any notice from the Ld. CIT(A) and consequently could not appear or comply with the notices issued during the appellate proceedings. The Ld. AR therefore submitted that the appeal of the assessee came to be dismissed by the Ld. CIT(A) without the assessee being able to prosecute the appeal on merits. The Ld. AR further submitted that the assessee could not place all the relevant documents before the Ld. AO in support of his claims during the assessment proceedings. Therefore, it was prayed that the matter may kindly be set aside to the file of the Ld. AO so that the assessee may be given an opportunity to place the necessary documentary evidence in support of his claims.
Per contra, the Ld. DR objected to the request for remand and submitted that adequate opportunity had already been provided to the assessee during the assessment proceedings as well as before the Ld. CIT(A). However, the assessee failed to avail such opportunities. The Ld. DR therefore submitted that Page 6 of 8
We have heard the rival submissions and perused the material available on record. From the record, it is noticed that the appeal of the assessee was dismissed by the Ld. CIT(A) on account of non-prosecution as the assessee did not respond to the notices issued during the appellate proceedings. The contention of the assessee before us is that in Form No.35 filed before the Ld. CIT(A), the assessee had specifically declined communication through email as he was not conversant with online proceedings. However, the notices during the appellate proceedings appear to have been issued through email and no physical notices were served upon the assessee. In these circumstances, the explanation offered by the assessee that he did not receive the notices issued by the Ld. CIT(A) appears to be plausible. Further, it is also the contention of the assessee that he could not produce all the relevant documents before the Ld. AO during the assessment proceedings in support of his claims. Considering the totality of the facts and circumstances of the case and in the interest of justice, we deem it appropriate to set aside the impugned order of the Ld. CIT(A) and restore the matter to the file of the Ld. AO for de novo adjudication. The Ld. AO is directed to examine the claim of the assessee afresh in accordance with law after providing adequate opportunity of being heard to the assessee. The assessee is also granted liberty to file all necessary documentary evidence in support of his claims. At the same time, the assessee is directed to co-operate
In the result, the appeal of the assessee is allowed for statistical purposes.
Order pronounced in the Open Court on 18th March, 2026.