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Facts
The assessee's appeal before the CIT(A) against a penalty order under Section 270A was dismissed due to a delay of 813 days. The assessee argued that there were sufficient causes for the delay and the penalty should not survive.
Held
The Tribunal set aside the impugned order levying the penalty. It was noted that the assessment order, which formed the basis of the penalty, had already been set aside by the Tribunal in a previous appeal, with a direction for a de novo assessment.
Key Issues
Whether the penalty order is sustainable when the underlying assessment order has been set aside and restored for fresh assessment, and whether the delay in filing the appeal should be condoned.
Sections Cited
249(2), 270A, 249(3), 147, 250(6), 5
AI-generated summary — verify with the full judgment below
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), New Delhi dated 14.11.2024, pertaining to the assessment year 2017-18. The assessee has raised the following grounds of appeal: -
1. On the facts and in the circumstances of the case and in law, the order of the Ld. CIT(A), NEAC, erroneously disallowed the condonation of delay, despite there being sufficient causes with the assessee for not filing the appeal in time as per Section 249(2) of the Income Tax Act, 1961, which obstructed his action to file the appeal within the time limit.
2. On the facts and in the circumstances of the case and in law, the order of the Ld. CIT(A), NFAC, erroneously disallowed the condonation of delay, hot acknowledging that the assessee was prevented by a reasonable cause from filing the appeal in time. The delay was not due to dilatory tactics, lack of bona fide, deliberate inaction, or negligence on the part of the appellant, who always acted diligently and remained active.
Page 2 of 4 3. On the facts and in the circumstances of the case and in law, the order of the Ld. CIT(A), NFAC, erroneous/disallowed the condonation of delay, failing to recognize that the term “sufficient cause” for condonation of delay should be interpreted liberally to advance substantial justice.
4. On the facts and in the circumstances Of the case and in law, the order of the Ld. CIT(A), NFAC, erroneously disallowed the condonation of delay, overlooking that the Income Tax Act, 1961, is a self-contained enactment and section 249(3) provides for condonation of delay at the discretion of the CIT(A), with sufficient cause for delay as envisaged in section 5 of the Limitation Act, 1963.
5. On the facts and in the circumstances of the case and in law, where the assessment is made net rate basis or presumptive basis, no penalty u/s 270(A) is liable.
On the facts and in the circumstances of the case and in law, the order of the Ld. CIT(A), NFAC, erroneously disallowed the condonation of delay, not acknowledging that there was no malafide or deliberate intention on the part of the assessee in filing the appeal with a delay of 827 days, and that the delay in filing the appeal within the limitation period under section 249(2) was due to sufficient causes.
On the facts and in the circumstances of the case and in law, the order of the Ld. CIT(A), NFAC, erroneously disallowed the condonation of delay, as the Ld. AO erred in reopening the assessment under section 147 of the Income Tax Act, 1961 because this return of income is filed at address of the assessee at Distt, Raebareli and assessment is made at the address of my Ex-Advocate Mr, Rakesh Mishra.
On the facts and In the circumstances of the case and in law, No any notice is issued by the Id. CIT(A) before dismissing appeal for condonation of delay u/s 249(3) of the Act, which is against the natural justice.
That the assessee craves leave for the addition, modification, and deletion of any other grounds of appeal
at the time of hearing.”
2. The facts giving rise to the present appeal are that the appeal filed by the assessee before the Ld. CIT(A) against the penalty order u/s 270A of the Income Tax Act, 1961 (“Act”, for short) was dismissed solely on the ground of limitation. It is recorded by the Ld. CIT(A) that there was a delay of 813 days treating such delay being inordinate dismissed the same. Aggrieved against this, the assessee is in appeal before this Tribunal.
3. At the time of hearing, the Ld. Counsel for the assessee contended at the outset that the assessee had also preferred Page 3 of 4 appeal against the quantum addition and the issue of quantum addition travelled up to level of Tribunal, the Tribunal had set aside the impugned order. Thereby, the assessment has been set aside and the assessment order is restored to the file of the Assessing Officer for passing denovo assessment order. Therefore, he submitted that the impugned penalty would not survive under the facts and circumstances of the present case.
On the other hand, the Ld. Departmental Representative (“DR”) supported the orders of the lower authorities.
Heard the Ld. Representatives of the parties. We find that the Tribunal in quantum appeal in for A.Y. 2017-18 vide order dated 22.01.2025, inter-alia, by observing as under: -
“(C) We have heard the rival parties and have gone through the material placed on record. We are of the considered opinion, in view of provisions of section 250(6) of the I. T. Act, that learned CIT(A) had statutory duty to pass speaking order on merits of the various grounds of appeal
. In further consideration of the submissions made by the representatives of both sides, the order of learned CIT(A) is set aside and issues in dispute regarding addition made in the assessment order, are restored back to the file of the Assessing Officer with the direction to pass de novo assessment order in accordance with law after providing reasonable opportunity to the assessee. (D) In the result, the appeal is partly allowed for statistical purposes.”
6. The fact that the order making impugned addition has been set aside and the issue in dispute regarding impugned additions have been restored back to the file of the Assessing Officer by the Tribunal. We, therefore, hereby set aside the impugned order levying the penalty with a liberty to the file of the Assessing Officer to decide the issue regarding levy of penalty afresh, after framing denovo assessment order in accordance with law. The grounds raised in the present appeal are allowed for statistical purposes.
Order pronounced in the open Court on 12/03/2025.