LAKHUBHAI NATHUBHAI SISODIYA,AHMEDABAD vs. ITO, WARD 3(2)(3), AHMEDABAD, CURRENT ITO WARD 3(1)(2), AHMEDABAD, AHMEDABAD

PER SIDDHARTHA NAUTIYAL - JUDICIAL MEMBER:

This appeal has been filed by the Assessee against the order passed by the Ld. Commissioner of Income Tax (Appeals), (in short “Ld. CIT(A)”),
National Faceless Appeal Centre (in short “NFAC”), Delhi vide order dated
14.12.2022 passed for A.Y. 2012-13. 2. The assessee has raised the following grounds of appeal:

“1. That the learned National Faceless Appeal Centre, Delhi has erred in law and facts by confirming the penalty of Rs.1,98,428/-, under section 271(1)(c) of the act, on account of concealment of income, and therefore the learned AO should be directed to delete the said penalty.

he has stated the assessee is 89 years of age and lacked familiarity with the newly introduced e-proceeding system, does not use email himself, and was unaware that the appellate order of the National Faceless Appeal Centre had been served on his son, who resides abroad and was preoccupied with business commitments. It was only in March 2025 that the assessee learnt about the dismissal of his appeal when penalty proceedings brought the matter to light, and the assessee promptly filed the present appeal upon receiving advice from a chartered accountant. On hearing the submissions and examining the facts, we are of the considered view that the substantial delay was neither deliberate nor negligent, but was due to genuine communication difficulties and the assessee’s advanced age. We are of the considered view that it would not be in the interest of justice to allow technical limitations to deprive an elderly taxpayer of his statutory right to appeal. Accordingly, in view of the hardship and inequity that would result from a rigid application of limitation, we hereby condone the delay of 763
days in filing the appeal

On merits:

income of Rs. 1,78,290/-. During the reassessment proceedings, the Assessing Officer noted that the assessee had purchased property during the year in which his share amounted to Rs. 8,75,000/-. Since no explanation or supporting documents were submitted by the assessee to explain the source of investment, the said amount was treated as unexplained under section 69
of the Act and added to the income of the assessee. Penalty proceedings under section 271(1)(c) were accordingly initiated for concealment of income.
During penalty proceedings, the assessee submitted that the addition was agreed to in order to buy mental peace and avoid prolonged litigation, and the entire demand raised was duly paid. The assessee argued that no penalty should be imposed on this basis alone and relied on various judicial precedents in support of his contention. The assessee submitted that no inaccurate particulars were filed, and the issue was debatable and involved assumptions by the Assessing Officer. The Assessing Officer considered the submissions of the assessee but found them to be untenable. It was noted that the assessee was liable to file a return under section 139 but failed to do so.
Upon reopening of the case, the total income was assessed at a figure of Rs.
10,53,290/-, which clearly exceeded the threshold requiring mandatory return filing. The AO held that the assessee deliberately failed to disclose his true income and had not filed any credible documentary evidence in support of investment in immovable property even during the course of penalty proceedings. The Assessing Officer observed that had the case not been reopened, the assessee would have succeeded in concealing the said income, and the addition was made only after it came to light during the reassessment proceedings. Hence, the AO held that this was a fit case for imposition of penalty under section 271(1)(c) for concealment of income. Accordingly,
Asst. Year –2012-13
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penalty under section 271(1)(c) was levied on the amount of Rs. 8,75,000/- which was treated as unexplained investment, and the penalty was computed in accordance with the provisions of the Act.

“The facts of the case and the grounds raised by the appellant have been considered carefully. It is noticed that there is a delay in filing of appeal. The appeal is to be filed within 30 days of the date of the service of the order. During the appellate proceedings, it is found from the Form No. 35, the appellant filed the appeal on 26.02.2022 whereas the date of order u/s 200A on 11.11.2021 and as per Form No. 35 date of service for order was 11.11.2021. As per the dates given in Form 35 it appears that the appeal is filed beyond the prescribed due date by 30 days. There is a lapse on the part of the assessee regarding filing of the appeal within stipulated time. This shows that there is a delay of filing of the appeal in terms of section 249 (2) of the Act. In such a situation section 249(2) of the Act envisages that there should be sufficient cause for not prosecuting the appeal within the period prescribed.

There is a substantial delay in the filing of appeal for which no reason was given by the appellant. The appellant has failed to explain the delay in filing appeal.”

furnishing of inaccurate particulars of income by the assessee. In the e‑proceeding dated 22 October 2019 before the Assessing Officer, the assessee had submitted that the ₹8,75,000/- investment in agricultural land was made by his friend, Mr. Jaydeepsingh Vijaysingh Dodhiya, to whom he had earlier provided a loan of ₹9,00,000/- from personal savings; a copy of the purchase deed and an undertaking from Mr. Dodhiya were also furnished.
The assessee had clarified that only ₹1,21,250/- out of the total ₹35 lakh payments were made in cash, with the rest via cheques from various banks with which the assessee held no account, clearly pointing out to the fact that the purchase was made on his behalf. The assessee sought an adjournment before the Assessing Officer due to a religious festival, which was not granted, and accordingly, the assessee had agreed to the addition merely to avoid hardship given his old age, holding only a 1/4th share in the joint property in question. The assessee submitted that the assessment and penalty orders were issued long after the transaction i.e. seven and ten years respectively, making it practically difficult to obtain necessary documentation. In light of these circumstances, he prayed for the full deletion of the penalty under section 271(1)(c).

Accordingly, in the interest of justice, we are of the view that the delay in filing the appeal before the CIT(Appeals) ought to have been condoned. The CIT(Appeals) should have allowed the assessee a reasonable opportunity to present his case on merits and allowed the assessee to bring complete facts on record, particularly when levy of penalty under section 271(1)(c) of the Act was in question. In view of the above, we set aside the order passed by the CIT(Appeals) and restore the matter to his file for fresh adjudication of the appeal on merits after condoning the delay. The CIT(Appeals) shall grant the assessee an opportunity of being heard and bring all available material on record and thereafter pass a reasoned and speaking order in accordance with law.

TANMAY, Sr. PSआदेश की Ůितिलिप अŤेिषत/Copy of the Order forwarded to :
1. अपीलाथŎ / The Appellant
2. ŮȑथŎ / The Respondent.
3. संबंिधत आयकर आयुƅ / Concerned CIT
4. आयकर आयुƅ(अपील) / The CIT(A)-
5. िवभागीय Ůितिनिध, आयकर अपीलीय अिधकरण, अहमदाबाद / DR, ITAT, Ahmedabad
6. गाडŊ फाईल / Guard file.

आदेशानुसार/ BY ORDER,

उप/सहायक पंजीकार (Dy./Asstt.