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Facts
The assessee's appeal before the CIT(A) was dismissed ex parte without deciding on merits. The assessee sought condonation of delay, citing personal reasons like the death of his son and his wife's illness, and claimed he was unaware of the hearing notice. The CIT(A) found the assessee did not pursue the appeal and noted disdain for statutory notices.
Held
The Tribunal condoned the delay in filing the appeal, citing the assessee's personal hardships and the need for liberal interpretation of rules to secure justice. The Tribunal held that the CIT(A) erred by not deciding the appeal on merits and issuing a non-speaking order.
Key Issues
Whether the delay in filing the appeal should be condoned due to personal hardships of the assessee, and whether the CIT(A) erred in dismissing the appeal ex parte without deciding on merits.
Sections Cited
221, 143(2), 143(3), 44AD
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Income Tax Appellate Tribunal, LUCKNOW BENCH “A”, LUCKNOW
Before: SHRI KUL BHARAT & SHRI NIKHIL CHOUDHARY
PER KUL BHARAT, VICE PRESIDENT.: This appeal, by the assessee, is directed against the order of the Learned Commissioner of Income tax (Appeals)/National Faceless Appeal Centre (NFAC), Delhi dated 28.08.2023, pertaining to the assessment year 2015-16. The assessee has raised the following grounds of appeal: -
1. The Learned Commissioner of Income Tax (Appeals) was not justified and has erred in law, in passing the Appeal Order without giving opportunity of being heard to the Appellant as the appellant was unaware of the fact that any notice of hearing of appeal was issued as no post or courier has been received by him.
1. 2. The Learned Commissioner of Income Tax (Appeals) was not justified and has erred in Law and on facts of the case, in not deleting the additions of Rs.20,53,584 made out of opening balance of capital
The Learned Commissioner of Income Tax (Appeals) was not justified and has erred in Law and on facts of the case in not deleting the additions made of Rs 32,18,360 (Rs 35,00,000 - Rs 2,81,640) treating refundable advance receipt of Rs 30,00,000 under a contract and Rs 5,00,000 additions in capital out of drawings, as income. (Net Relief sought Rs. 32,18,360).
4. The Learned Commissioner of Income Tax (Appeals) was not justified and has erred in Law and on facts of the case in not deleting the additions made of Rs.1,82,164, which was already included in Rs 2,81,640 i.e. income offered to tax under section 44AD and should not be taxed again. (Net Relief sought Rs. 182,164) 5. The appellant craves leave to add or modify any one or more grounds of appeal
.”
2. During the course of hearing, it was noted that the appeal is barred by time. The assessee has filed an application seeking condonation of delay in filing of this appeal. Ld. Counsel for the assessee reiterated the submissions as made in the application seeking condonation of delay. In sum and substance, the contention of the assessee is that he did not receive the impugned order and came to know of the same, when the notice u/s 221 of the Income Tax Act, 1961 (“Act”, for short) dated 09.07.2024 was received on 14.07.2024 by Speed Post. It is further contented that the assessee had lost his only son, aged 36 years thus he was under state of mental shock. Further, the wife of the assessee was also diagnosed with suffering from serious illness in August, 2023 and the assessee was busy for the treatment of his wife. It is further contended that the assessee was not tech-savvy. It is submitted that the assessee has not obtained any undue advantage for the delay in filing the present appeal. He submitted that in order to secure the interest of justice, the delay may be condoned and appeal be admitted for adjudication.
Page 3 of 6 3. On the other hand, the Ld. Departmental Representative for Revenue opposed the submissions and contended that the assessee cannot take advantage of his negligence. Therefore, he submitted that the appeal may be dismissed on the ground of limitation alone.
We have heard the rival contention and perused the material available on record. It is noticed that the impugned order has been passed ex parte to the assessee. Ld. CIT(A) has not decided the issues on merits. It is also noticed that the assessee had taken multiple grounds before the Ld. CIT(A). It is well settled by the various judgments of the Hon’ble Apex Court that while considering the application seeking condonation of delay the Court/Tribunal should adopt a liberal approach to secure the ends of justice, the litigant should not be thrown out unless there is deliberate and gross negligence on his part. In the present case, the assessee had lost his only son and was under state of mental shock. Further, he was also under stress since his wife was diagnosed with serious disease. Therefore, looking to the facts of the present case, we are of the view that the bonafide reasons prevented the assessee for filing the present appeal within the prescribed time. We, therefore, respectfully following the judgment of the Hon'ble Supreme Court in the case of Collector of Land Acquisition Vs. MST. Katiji & Ors 167 ITR 471 (SC) hereby condone the delay and admit the appeal for adjudication.
The facts giving rise to the present appeal are that in this case, the assessee filed his return of income for the year under consideration through electronic mode declaring total income of the Rs.53,26,590/-. The case of the assessee was selected on Page 4 of 6 limited scrutiny through Computer Assisted Scrutiny System (CASS). The statutory notices were issued u/s 143(2) of the Act and duly served upon the assessee. In response thereto, the Authorized Representative of the assessee attended the proceedings and filed Power of Attorney. The Assessing Officer while framing the assessment disallowed the claim of the assessee made u/s 44AD of the Act thereby the AO made addition of Rs.32,18,360/- in this regard. Further, a sum of Rs.1,82,164/- claimed as exempt was also added in the income of the assessee. Thus, the Assessing Officer assessed the income at Rs.1,07,80,700/- against the returned income of the assessee of Rs.53,26,590/-. Aggrieved against this, the assessee preferred an appeal before the Ld. CIT(A), who dismissed the appeal ex parte to the assessee. Now, the assessee is in appeal before this Tribunal.
Apropos to the grounds of appeal, Ld. Counsel for the assessee contended that the Ld. CIT(A) has decided the grounds ex parte to the assessee and by way of non-speaking order. He contended that the Ld. CIT(A) has not decided the issue on merits of the case. He further contended that in the interest of justice, the impugned order may be set aside and the appeal may be restored to the file of the Ld. CIT(A) for the decisions afresh.
The Ld. Departmental Representative (DR) opposed the submissions and supported the orders of the lower authorities. He contended that the finding of lower authorities is justified since the assessee grossly failed to support his claim before the Assessing Authority. He contended that it was incumbent upon the assessee to file relevant evidences in support of his claim. In
Heard, the Ld. Representatives of the parties and perused the material available on record. It is undisputed fact that the Ld. CIT(A) has dismissed the appeal without going into the merits of the case. He has not decided the grounds raised by the assessee which in our view is not an appropriate approach. The Ld. CIT(A) ought to have adverted to the submissions made by the assessee through grounds of appeal and decided the matter by way of a speaking order. But the Ld. CIT(A) has dismissed the appeal by observing as under: - “7 The facts of the case as noted above are that the appellant has not pursued the appeal despite being granted opportunities as elaborated above. No details, documents or submissions have been provided to come to any conclusion other than those arrived at by the assessing officer in the assessment order. During the appellate proceedings the appellant was given opportunities to put forth his case, but he did not upload any response despite service of notice(s). Considering all the facts and the circumstances of the case no interference with the assessment order of the AO is called for. The appellate proceedings cannot be allowed to be held hostage by dilatory tactics on the part of the appellant and a complete disdain for statutory notices. Therefore, I find no infirmity in the assessment order passed by the assessing officer u/s 143(3) of the Act dated 28.11.2016.”
The above finding of the Ld. CIT(A), under the facts and circumstances of the present case cannot be sustained. Undisputedly, there is no discussion by Ld. CIT(A) on merit of the case. It has been well settled that the Ld. CIT(A) is expected to verify the claim of assessee independently and pass a speaking order on the issues raised by the assessee in his appeal. We, therefore, set aside the impugned order to secure the ends of justice. Therefore, the appeal is remitted back to Ld. CIT(A) for decision on merits. The assessee is hereby directed that he would co-operate in the proceedings before the Ld. CIT(A) and furnish the requisite details as and when called for proper adjudication Page 6 of 6 of the case. Grounds of appeal
of the assessee are allowed for statistical purposes.
10. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open Court on 08/07/2025.