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Facts
The assessee appealed against a CIT(A) order that confirmed an AO's addition of Rs. 13,10,205/- under Section 69A for unexplained bank deposits. The CIT(A)'s order was ex-parte due to non-prosecution by the assessee's previous counsel, and the appeal to the ITAT was delayed by 296 days due to the assessee's severe lower back pain, supported by medical certificates.
Held
The ITAT condoned the delay in filing the appeal, accepting the medical reasons, and considering Section 253(5) of the Act and Supreme Court's pronouncements. The matter was remanded back to the CIT(A) for a de novo adjudication on merits of the addition under Section 69A, providing the assessee a proper opportunity of hearing.
Key Issues
Whether the delay in filing the appeal should be condoned, and whether the ex-parte order passed by the CIT(A) regarding an addition under Section 69A should be set aside and the matter remanded for fresh adjudication.
Sections Cited
143(3), 253(5), 69A, Rule 34 of ITAT Rules, 1963
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Income Tax Appellate Tribunal, INDORE BENCH, INDORE
Before: SHRI B.M. BIYANI & SHRI UDAYAN DAS GUPTA
आदेश/ O R D E R
Per B.M. Biyani, A.M.:
Feeling aggrieved by order of first-appeal dated 19.12.2023 passed by learned Commissioner of Income-Tax (Appeals)-NFAC, Delhi [“CIT(A)”] which in turn arises out of assessment-order dated 28.12.2019 passed by learned ITO-2(1), Bhopal [“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 the grounds mentioned in Appeal Memo (Form No. 36).
On 27.01.2025, the assessee’s request for out-of-turn early hearing of this matter came up before this Bench with the reasoning that the impugned order is ex-parte and physical bench is running at present. After hearing both sides, the request was accepted and case was fixed for hearing on today. Accordingly, this matter has come up for hearing before us today and we proceed to hear and decide.
The registry has informed that the present appeal is delayed by 296 days and therefore time-barred. Ld. AR for assessee submitted that the assessee has filed an application for condonation of delay supported by an affidavit on stamp. In the application/affidavit so filed, the assessee has made averment that he had been suffering from a severe lower back pain for a very long period and took regular treatment. The assessee has also filed a chain of various medical certificates of Vidhyansh Ayurveda, Bhopal and Dr. Abhishek Jain, Bhopal, the treating hospital/doctors. Ld. AR very humbly submitted that the delay has occurred due to medical reason only, otherwise there was 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. He prayed to condone the delay in such Page 2 of 5 circumstance. Ld. DR for Revenue does not have any objection to the submission and prayer of assessee/Ld. AR. 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. 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) and the decision of Hon’ble Supreme Court, we take a judicious view, condone delay, admit appeal and proceed with hearing.
Ld. AR next submitted that the AO has made an addition of Rs. 13,10,205/- u/s 69A on account of unexplained deposits in bank a/c.
Thereafter, in first-appeal, the CIT(A) has passed ex-parte order for non- prosecution but the non-prosecution has happened because the earlier
Page 3 of 5 counsel of assessee did not take care and did not appear. He submitted that in the interest of justice, an opportunity must be given to assessee by restoring his matter at the level of CIT(A) so that the assessee can make representation and get the correct income assessed.
Ld. DR for revenue does not have serious objection to assessee’s prayer, he left the matter to the wisdom of bench.
After hearing both sides and perusing the impugned order, we find that the CIT(A) has passed ex-parte order and merely confirmed the AO’s order for non-prosecution. The assessee submits that the non-prosecution before CIT(A) was due to counsel’s reason but now the assessee has strong willingness to make adequate representation before CIT(A). We also find that the addition made by AO is of deemed income u/s 69A on account of unexplained deposits in bank a/c but this addition needs to be re-examined by CIT(A) from the evidences of assessee. In any case, if the matter is restored at the level of CIT(A), it would not prejudice the revenue’s interest in any manner, rather it would result in a better adjudication of assessee’s case. Therefore, we deem it fit to remand this matter back to the file of CIT(A) for a proper adjudication on merit after hearing assessee. The CIT(A) shall
Page 4 of 5 give necessary opportunity of hearing to assessee and pass an appropriate order uninfluenced by his earlier 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 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 / by putting on notice board as per Rule 34 of ITAT Rules, 1963 on 03/02/2025