Loading judgment…
Facts
The assessee, a charitable trust, challenged an ex parte assessment order for AY 2018-19, where the AO added Rs. 32.83 lakhs by treating excess liability as income. The appeal to CIT(A) was delayed by 704 days, and CIT(A) dismissed it *in limine* for lack of an affidavit explaining the delay, despite the assessee claiming non-receipt of the assessment order.
Held
The Tribunal acknowledged the assessee's claim of non-receipt and the CIT(A)'s dismissal for procedural lapse. Considering that technical issues should not override fair justice, the Tribunal remanded the case back to CIT(A) to verify the email ID's activity and determine the genuineness of the delay, directing the assessee to file an affidavit.
Key Issues
Whether the CIT(A) was justified in dismissing an appeal *in limine* due to a 704-day delay without condoning it or properly investigating the assessee's claim of non-receipt of the assessment order via email.
Sections Cited
250, 143(2), 142(1), 144, 249(3), 282
AI-generated summary — verify with the full judgment below
सुनवाई की तारीख/Date of Hearing : 02/04/2025 उदघोषणा की तारीख/Date of Pronouncement : 07/04/2025 आदेश/Order PER LALIET KUMAR, J.M: This is an appeal filed by the Assessee against the order of the CIT(A)/NFAC, Delhi dt. 17/10/2024 pertaining to Assessment Year 2018-19. 2. In the present appeal Assessee has raised the following grounds:
1. That on the facts, circumstances and legal position of the case, the Worthy CIT(A), NFAC in Appeal No. NFAC/2017-18/10239381has erred in passing order dtd. 17.10.2024 in contravention of provisions of S. 250 of the Income Tax Act, 1961 (hereinafter referred to as "Act").
2. That on facts, circumstances and legal position of the case, Worthy CIT(A) has erred in dismissing the appeal filed by the appellant in limine even when the appellant had bonafide and reasonable cause which led to delay in filing of appeal before the Worthy CIT(A).
3. That on facts, circumstances and legal position of the case, Worthy CIT(A) has erred in confirming the addition made by the Ld. AO of Rs. 32,83,423/- by erroneously holding that the assets and liabilities of equal amount of Rs. 32,83,423/- as per Balance sheet of the appellant is taxable deemed income of the appellant.
4. That on facts, circumstances and legal position of the case, the order passed by Ld. AO and then by Worthy CIT(A)deserves to be quashed since the same has been passed without affording reasonable opportunity of being heard to the appellant.
2 3. Briefly the facts of the case are that the assessee is a charitable trust, filed its return for AY 2018-19 declaring a loss of Rs. 12,67,468. The case was selected for scrutiny under the e-assessment scheme to verify the taxation of accreted income. Despite notices under Sections 143(2) and 142(1) of the Income Tax Act, 1961, the assessee has failed to respond the same. The Ld. AO observed a mismatch between the trust’s claimed liabilities of Rs. 32,83,483 and the aggregate fair market value of its assets of Rs. 32,83,423. The AO treated the excess liability as income from other sources, the AO passed an ex parte assessment order under Section 144 on 16.04.2021, determining total income at Rs. 20,15,960 and raising a demand of Rs. 8,72,092.
Against the order of the AO the assessee went in appeal before the Ld. CIT(A) which is late by 704 days and the Ld. CIT dismissed the appeal for the reason that the assessee has not filed any affidavit explaining the delay.
Against the order of the Ld. CIT(A) the assessee is in appeal before us.
During the course of hearing the Ld. Counsel for the Assessee submitted that the assessment order was never physically served, and the trust became aware of it only through the reassessment order dated 22.03.2023. And regarding the delay filing in appeal before the Ld. CIT(A) the assessee submitted that the delay arose due to circumstances beyond their control, warranting condonation under Section 249(3).
Per contra, the Ld. DR relied on the order of the lower authorities.
We have heard the rival contention and perused the material available on the record. In the present case we find that the assessment order was sent to the assessee’s registered email id as per legal requirements under section 282. However, the assessee claims that they were unaware of it, which is raising doubts about whether the email id was active or regularly checked or not. Further the AR had filed the return of income for the subsequent year for A.Y. 2019-20 wherein different email id i.e; caankurjindal89@gmail.com has been mentioned. The appeal was dismissed by the Ld. CIT(A) mainly because no affidavit was provided by the assessee for the condonation of delay. However, technical issues should not outweigh fair justice if the appellant acted in good faith. We are of the opinion that in the interest of justice, we remand the matter back to the file of the Ld. CIT(A) and also direct the assessee to submit an affidavit explaining the reason for delay of 704day, including details about email