SHREENATH BUILDERS AND DEVELOPERS,INDORE vs. ITO -1(1), INDORE, INDORE
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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:
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Shreenath Builders and Developers ITA No. 672/Ind/2024 - AY 2017-18
“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. 3. On the facts and circumstances of the case and applicable law the Ld. CI(A) erred in not giving reasonable opportunity of being heard.” 2. 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.
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
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Shreenath Builders and Developers ITA No. 672/Ind/2024 - AY 2017-18
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
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ITAT which was registered as ITA No. 44/Ind/2024 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,
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Shreenath Builders and Developers ITA No. 672/Ind/2024 - AY 2017-18
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
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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
Sd/- Sd/-
(PARESH M. JOSHI) (B.M. BIYANI) JUDICIAL MEMBER ACCOUNTANT MEMBER
Indore िदनांक/Dated : 28/04/2025 Patel/Sr. PS Copies to: (1) The appellant (2) The respondent (3) CIT (4) CIT(A) (5) Departmental Representative (6) Guard File By order UE COPYSr. Private Secretary Income Tax Appellate Tribunal Indore Bench, Indore
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