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Income Tax Appellate Tribunal, INDORE BENCH, INDORE
Before: SHRI B.M. BIYANI & SHRI PARESH M. JOSHI
आदेश/ O R D E R
Per B.M. Biyani, A.M.:
Feeling aggrieved by order of first-appeal dated 29.12.2023 passed by learned Commissioner of Income-Tax (Appeals)-NFAC, Delhi [“CIT(A)”] which in turn arises out of assessment-order dated 20.12.2019 passed by learned ITO-1(1), Indore [“AO”] u/s 143(3) of Income-tax Act, 1961 [“the Act”] for Assessment-Year [“AY”] 2017-18, the assessee has filed this appeal on following grounds:
Page 1 of 6 “1, On the facts and circumstances of the case and applicable law. Ld. CIT(A) erred in sustaining the assessment order passed u/s 143(3) which is contrary to the material on records and provisions of the Act, unjust and bad in law.
2. On the facts and circumstances of the case and applicable law Ld. CIT(A) erred in sustaining the addition made u/s 68 r.w.s. 115BBE o Rs.3,58,70,000/- towards the unsecured loan.
On the facts and circumstances of the case and applicable law the Ld. CI(A) erred in not giving reasonable opportunity of being heard.”
The Ld. DR for revenue has filed a written-application seeking adjournment in this case but during hearing he expressed to withdraw the adjournment request and proceed for hearing. Accordingly, the hearing is proceeded today.
3. The registry has informed that the present appeal has been filed on 04.09.2024 against impugned order dated 29.12.2023 of first-appeal passed by Ld. CIT(A), therefore the present appeal is delayed by 190 days and time- barred. Ld. AR for assessee submitted that the assessee-firm has filed an application for condonation of delay supported by an affidavit of its partner Shri Ratnesh Goyal. Referring to same, Ld. AR submitted that while conducting the proceedings of first-appeal, Ld. CIT(A) served notices dated 09.03.2020, 30.12.2020, 12.12.2022, 10.10.2023 and 24.11.2023 fixing hearings on 13.03.2020, 14.01.2021, 22.12.2022, 25.10.2023 and 11.12.2023 respectively to email id: Selot_Co@yahoo.co.in whereas the assessee had given email id: Manish.jain8687@gmail.com in Form No. 35 for giving notices. Copies of the notices downloaded from income-tax portal are Page 2 of 6 placed before bench. Ld. AR submitted that the assessee took note of first two notices dated 09.03.2020 and 30.12.2020 from portal of income-tax and filed adjournment application to CIT(A) but the subsequent notices dated 12.12.2022, 10.10.2023 and 24.11.2023 uploaded on income-tax portal and sent to wrong email id, did not reach to the knowledge of assessee which has resulted in non-compliance of same and led the CIT(A) to pass ex-parte order for non-prosecution of first-appeal by assessee. Ld. AR went further to submit that the AO, in the assessment framed, made two additions, viz. (i) addition of Rs. 1,72,00,000/- on account of unexplained capital introduced by partners in assessee-firm, and (ii) addition of Rs. 3,58,70,000/- on account of unexplained unsecured loans taken by assessee-firm. While passing ex-parte order of first-appeal, the Ld. CIT(A) has already deleted the first addition of Rs. 1,72,00,000/- on account of partners’ capital but, however, upheld the second addition of Rs. 3,58,70,000/- on account of unsecured loans. Ld. AR carried us to Para 4 of assessment-order to show that the assessee has filed A/c Confirmations of all loan creditors to AO and that all loans have been taken through banking channel. Therefore, the addition made by AO treating the unsecured loans as unexplained is not sustainable; thus the case of assessee has a strong merit. Ld. AR next submitted that against the action of CIT(A) deleting the first addition of Rs.
1,72,00,000/- on account of partners’ capital, the revenue filed appeal to Page 3 of 6 ITAT which was registered as and that appeal came for hearing on 01.08.2024 and on that day of first hearing, the assessee became aware of the impugned order having been passed by CIT(A) against assessee qua the second addition of unsecured loans. Ld. AR submitted that prior to 01.08.2024, the assessee had no knowledge of impugned order having been passed by CIT(A). Immediately, the assessee paid fee on 03.09.2024 and filed present appeal on 04.09.2024. This has only resulted in delayed filing of appeal. Ld. AR very humbly submitted that there is no lethargy, negligence, mala fide intention or ulterior motive of assessee in making delay and the assessee does not stand to derive any benefit because of delay. She submitted that the sole reason of delay is as explained by assessee in the affidavit and therefore the delay should be condoned having regard to the reason explained and in the interest of justice.
Ld. AR further requested to remand this matter to the file of CIT(A) for adjudication afresh on merits of the ground raised as re-produced above, more specifically the Ground No. 2 relating to addition on account of unsecured loans.
Ld. DR for Revenue instantly agreed to both prayers of Ld. AR i.e. for condonation of delay as well as remanding this matter to CIT(A). Ld. DR,
Page 4 of 6 however, prays that the assessee must be directed to make representation before CIT(A) without seeking unnecessary adjournment.
We have considered the explanation advanced by assessee and in absence of any contrary fact or material on record, the assessee is found to have a “sufficient cause” for delay in filing present appeal as narrated above.
We find that section 253(5) of the Act empowers the ITAT to admit an appeal after expiry of prescribed time, if there is a “sufficient cause” for not presenting appeal within prescribed time. It is also a settled position by Hon’ble Supreme Court in Collector, Land Acquisition Vs Mst. Katiji and others 1987 AIR 1353, 1987 2 SCC 387 that whenever substantial justice and technical considerations are opposed to each other, the cause of substantial justice must be preferred by adopting a justice-oriented approach. Thus, taking into account the provision of section 253(5), the decision of Hon’ble Supreme Court and the fair consent of Ld. DR for revenue, we take a judicious view, condone delay and admit appeal.
Further, we remand this matter back to the file of CIT(A) for adjudication afresh as agreed by parties. The CIT(A) shall give necessary opportunity of hearing to assessee and pass an appropriate order. The assessee is also directed to ensure participation in the hearings as may be fixed by CIT(A) and do not seek unnecessary adjournments failing which the Page 5 of 6 CIT(A) shall be at liberty to pass appropriate order in accordance with law.
Ordered accordingly.
Resultantly, this appeal is allowed for statistical purpose.
Order pronounced in open court on 28/04/2025