JAP AGRO FOODS PVT. LTD,VADODARA vs. THE DY.CIT, CIRCLE-1(1)(2) PREVIOUSLY ACIT, CIRCLE-1(1)(2), VADODARA

On a perusal of the record, we find that the explanation furnished by the assessee is reasonable and supported by an affidavit duly placed on record. The sequence of events clearly indicates that the delay arose due to genuine procedural confusion and pending rectification proceedings before the Department. The Hon’ble Supreme Court in the case Jap Agro Foods Pvt. Ltd. vs. DCIT Asst.Year –2011-12 - 3– of Collector, Land Acquisition v. Mst. Katiji & Others [(1987) 167 ITR 471 (SC)] has held that a liberal approach should be adopted while considering condonation of delay so as to advance substantial justice. The Hon’ble Court emphasized that when substantial justice and technical considerations are pitted against each other, the cause of substantial justice deserves to be preferred. Similarly, in N. Balakrishnan v. M. Krishnamurthy [(1998) 7 SCC 123], it was held that length of delay is not material, so long as the explanation is bona fide and not tainted with mala fides or dilatory intent.

In the present case, we are satisfied that the assessee was prevented by sufficient and reasonable cause from filing the appeal within the prescribed period. The delay of 603 days has been explained satisfactorily in light of the affidavit and the surrounding facts, and no mala fide intention or negligence can be attributed to the assessee. Accordingly, in the interests of substantial justice, we condone the delay of 603 days in filing of the appeal and admit the appeal for adjudication on merits.

The assessee has raised the following grounds of appeal:

The brief facts of the case are that the Assessing Officer vide order dated 26.03.2014 made additions to the returned income of the assessee Jap Agro Foods Pvt. Ltd. vs. DCIT Asst.Year –2011-12 - 4– and computed the income at Rs. 3,94,76,330/-. Further, the Assessing Officer also initiated penalty under Section 271(1)(c) of the Act for concealment of income and vide order dated 24.03.2017 levied penalty @ 300% of the tax sought to be evaded. Meanwhile, the assessee filed appeal before ITAT against quantum additions made by the Assessing Officer and vide order dated 03.03.2020 the ITAT gave substantial relief to the assessee and restricted the total additions to Rs. 1,92,56,204/-. The tax thereof was computed at a figure of Rs. 63,96,430/-. Further, vide order dated 13.10.2023, Ld. CIT(A) restricted the penalty @ 100% on the aforesaid amount of tax (Rs. 63,96,430/-) sought to be evaded by the assessee.

The assessee is in appeal before us against the aforesaid order passed by Ld. CIT(A).

Before us, the Counsel for the assessee has not disputed or made any arguments with regards to levy of penalty under Section 271(1)(c) of the Act with respect to the quantum additions of Rs. 1,92,56,204/- confirmed by ITAT. The Counsel for the assessee has not disputed levy of penalty on the aforesaid additions / disallowances confirmed by ITAT, consequent to which Ld. CIT(A) restricted the penalty to 100% of the tax sought to be evaded by the assessee with regards to those additions. The only and limited issue raised by the assessee before us was that subsequently, the Assessing Officer vide order dated 24.12.2025 had reduced the total income of the assessee to Rs. 1,43,86,094/- (in response to rectification application filed by the assessee) as against the income/additions of Rs. Jap Agro Foods Pvt. Ltd. vs. DCIT Asst.Year –2011-12 - 5– 1,92,56,204/- confirmed by ITAT. Accordingly, the prayer of the Counsel for the assessee is that the levy of penalty under Section 271(1)(c) of the Act should be restricted to the income of Rs. 1,43,86,094/- and not on the income figure of Rs. 1,92,56,204/- as computed by the ITAT (notably against which no further appeal has been filed by the assessee disputing the additions confirmed by ITAT). On perusal of the rectification order passed by the Ld. DCIT, Vadodara vide order dated 24.02.2025, it is seen that evidently the total income of the assessee was reduced on account on non-grant of carry forward of business losses from earlier years, which were omitted to be considered by the Assessing Officer, while passing the assessment order. Further, nothing has been pointed out before us that there was any error in the quantum of disallowances confirmed by ITAT amounting to Rs. 1,92,56,204/-. There is no allegation / averment on part of the Counsel for the assessee that there was any error in computing the disallowance / additions confirmed by ITAT while passing it’s order dated 03.03.2020 and accordingly, there is no dispute insofar as of the quantum of additions which have been confirmed by ITAT. Therefore, clearly the 154 order passed by the DCIT has not in any manner to reduced the taxable income on account of any computational error in the disallowances confirmed by ITAT with regards to quantum additions. As stated earlier, the assessee has not disputed the quantum additions confirmed by ITAT. Further, the assessee has also not disputed levy of penalty @ 100% with regards to these quantum additions confirmed by ITAT vide order dated 03.03.2020. Therefore, in view of the above facts, the Counsel for the assessee has not pointed out to any deficiencies / error in the order of Ld.