Loading judgment…
Facts
The assessee's appeal was dismissed in limine by the CIT(A) due to non-representation, stemming from a delay in receiving hearing notices due to an outdated email address. The assessee claimed the delay was unintentional and sought condonation to argue the case on merits.
Held
The Tribunal condoned the delay, noting the Revenue's lack of objection. It found that the appeal was not adjudicated on merits by the CIT(A) and therefore remanded the matter back for a fresh hearing and adjudication on the grounds raised.
Key Issues
Whether the delay in filing the appeal should be condoned, and if the CIT(A) erred in dismissing the appeal without a decision on merits due to the assessee's non-representation.
Sections Cited
250, 143(3), 148, 147, 144B, 68, 69C
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, INDORE BENCH, INDORE
Before: SHRI B.M. BIYANI & SHRI UDAYAN DAS GUPTA
आदेश/ O R D E R
Per UDAYAN DAS GUPTA, J.M.:
This appeal is filed by the assessee against the order of the Ld. Commissioner of Income-Tax (Appeals), National Faceless Appeal Centre (NFAC) Delhi passed u/s 250 of the Income Tax Act, 1961 dated 21.02.2024, which has emanated from the order of the Assessing Officer dated 30.03.2022 passed u/s 143(3), National Faceless Assessment Centre, Delhi.
2. It is pointed out by the registry that the filing of this appeal is belated by 75 ( seventy five ) days . The assessee has filed an application for Page 1 of 7 AY 2014-15, condonation of delay by way of an affidavit . The Order of the CIT ( A ) was passed on 21st February, 2024, and the normal period of sixty days expires on 22nd April 2024, and the appeal has been filed on 6th July, 2024, which is delayed by seventy five days. The assessee has explained that the order from the office of the first appellate authority has not been received by him ( and in fact he has not been able to file any response to hearing notices issued from the CIT(A) office ) , due to the fact that he has given the email id in the memorandum of appeal in Form 35 as mdcrc31@rediffmail.com , which actually is the mail id of “Modern Dental College and Research Centre ”, situated at Indore, where the assessee was the chairman of the educational institution and as chairman he used to have access to the said mail box. He has filed a revised affidavit , to state that he has resigned from the college in June, 2023 , and as a result he lost his authority to access the mail box of the college , and since the appellate order was passed in February 2024, and might have been issued through the mail id stated in Form 35, the assessee did not receive the same and was unaware of the existence of the order itself. Subsequently, the counsel of the assessee looked into the portal sometime in the month of May, 2024, and it was discovered by him that the appeal order has been passed dismissing the appeal, and thereafter, necessary steps were taken by the assessee and his counsel to prepare and file the appeal , which has been filed belatedly by 75 days. He prays that since the delay was not wilful or intentional on his part ,
Page 2 of 7 be heard on merits.
2.1 The Ld DR did not object to the prayer of condonation of delay filed by the assessee. 2.2 As such , considering the facts narrated by the assessee in his affidavit , we condone the delay and admit the appeal for hearing on merits.
The grounds of appeal taken by the assessee in the memorandum of appeal are as follows:
“1. That, the learned CIT(A) grossly erred, both on facts and in law, in passing the ex-parte order without giving proper and effective opportunity of being heard to the appellant.
That, without prejudice to the above, the learned CIT(A) grossly erred in not adjudicating the appeal on merits of the case.
3. That, without prejudice to the above, the learned CIT(A) grossly erred, both on facts and in law, in confirming the action of the AO in issuance of the notice under s. 148 of the Income-Tax Act, 1961 and framing of the reassessment in pursuance thereof, which are quite unjustified, unwarranted and bad-in-law. 4.That, on the facts and in the circumstances of the case, the learned CIT(A) grossly erred, both on facts and in law, in confirming the action of the AO in framing the assessment and issuing the notice under s. 148 of the Act without having/recording any reason to believe that any chargeable income of the appellant for the assessment year under consideration had escaped to assessment.
That, without prejudice to the above, the learned CIT(A) grossly erred, both on facts and in law, in confirming the action of the AO in issuance of the notice under s. 148 of the Act, merely on suspicion, without forming any objective satisfaction and without having tenable reasons to believe that any income had escaped to assessment in terms of the provisions of section 147 of the Act.
6. That, without prejudice to the above, the learned CIT(A) grossly erred, both on facts and in law, in confirming the action of the AO, NFAC in determining the total income of the appellant u/s. 147 r.w.s. 144B of the Income-Tax Act, 1961 at Rs.1,10,84,790/-, as against the Returned Income of Rs.19,17,790/- thereby making an addition of Rs.91,67,000/-, which is quite unjustified, unwarranted, excessive, arbitrary and bad-in-law. 4.That, without prejudice to the above, the learned CIT(A) grossly erred, both on facts and in law, in confirming the action of the AO,NFAC for maintaining the addition of Rs.89,00,000/- in the appellant's income on account of alleged unsecured loan obtained by the appellant from some M/s. Jay Jyoti India Pvt. Ltd.
That, without prejudice to the above, the learned
Page 3 of 7 AY 2014-15, CIT(A) grossly erred, both on facts and in law, in confirming the action of the AO,NFAC for maintaining the addition of Rs.89,00,000/- in the appellant's income on account of alleged unsecured loan obtained by the appellant merely on the basis of some information allegedly gathered behind the back of the appellant in the cases of some other assessees and as also, without giving any effective opportunity of cross- examination to the appellant. 5 . That, without prejudice to the above, the learned CIT(A) grossly erred, both on facts and in law, in confirming the action of the AO,NFAC for maintaining the addition of Rs.89,00,000/- in the appellant's income without considering the material fact that the appellant had duly discharged his initial onus of proving the identity of the loan creditor, the genuineness of the transactions and creditworthiness of loan creditor beyond all doubts by producing all the necessary documentary evidences and none of the documents has been disproved by the esteemed office of the learned AO.
6 .That, without prejudice to the above, the learned CIT(A) grossly erred, both on facts and in law, in confirming the action of the AO,NFAC for maintaining the addition of Rs.89,00,000/- in the appellant's income by leveling baseless allegation that the appellant had obtained accommodation entry of Rs.89,00,000/- from M/s.Jay Jyoti India Pvt. Ltd. merely on the basis of some information without bringing any corroborative cogent adverse material on record to establish such bald allegations upon such lender company.
That, without prejudice to the above, the learned CIT(A) grossly erred, both on facts and in law, in confirming the action of the AO for maintaining the addition of addition of Rs.2,67,000/- in the appellant's income, on account of alleged payment of commission at 3 percent on the alleged accommodation entry of Rs.89,00,000/- in the form of unsecured loan from M/s. Jay Jyoti India Pvt. Ltd..
7. That, without prejudice to the above, the learned CIT(A) grossly erred, both on facts and in law, in confirming the action of the AO for maintaining the addition of Rs.2,67,000/- in the appellant's income, merely on his own guess work, surmises, whims and presumptions, without considering and appreciating the material fact that the appellant had genuinely obtained unsecured loan of Rs.89,00,000/- from the subject lender company and therefore, the appellant was neither required nor he had actually made any payment towards any commission.
8. That, the appellant further craves leave to add, alter or amend the foregoing ground of appeal as and when considered necessary.”
4. The brief facts of the case are that the assessee is one of the beneficiaries who has received accommodation entries amounting to Rs. 89,00,000/- during FY 2013-14 ( relevant to Asst year 2014-15 ) from one M/s Jay Jyoti India Pvt Ltd , which is a shell company as per information shared by the investigation wing . Regular assessment was completed u/s 143(3) on Page 4 of 7 AY 2014-15, 26/12/2016 on a total income of Rs.19,17,790/-, which was subsequently reopened by issue of notice u/s 148 of the Act 61 dated 31/03/2021 , after recording reasons and after obtaining approval from appropriate authorities.Subsequently, the re- assessment was completed by the AO u/s 147/ 144B of the Act 61 vide order dated 30/03/2022, after detail discussion and elaborate findings on the issues for which the assessment was reopened and total income was determined at Rs. 1,10,84,790/- ( after making an addition of Rs.89,00,000/- u/s 68 of the Act 61 plus an addition of Rs.2,67,000/- u/s 69C of the Act 61 ).
4.1 The matter was carried in first appeal and the Ld CIT ( A ) NFAC, has dismissed the appeal , in limine without adjudication on merits , in absence of any explanation or submission being filed and due to absolute non representation of the assessee, in response to notices issued by the appellate authority on four different dates of hearing , as evident from the appellate order.
4.2 Now the assessee is before the tribunal on the grounds contained in the memo of appeal . The Ld AR of the assessee submitted that notice of hearing issued by the Ld CIT ( A ) on various dates as evident from the appeal order has not been received by the assessee , because the assessee could not access the email box mdcrc31@rediffmail.com , which actually is the mail id of “Modern Dental College and Research Centre ”, from where the assessee has already resigned in June 2023, and the appeal in form 35 was filed earlier containing the email id of the college , and he also relied on the contents of the affidavit filed by the assessee ( which is already considered by us for the purpose of condoning the delay in appeal filing ) , to submit that the assessee was prevented by sufficient cause from representing the case because of non receipt of the hearing notices and he prays for one more
Page 5 of 7 AY 2014-15, opportunity to explain and argue his case before the first appellate authority, along with supporting papers.
The Ld DR relied on the order of the Ld CIT ( A ) .
We have heard the submissions and considered the materials on record and we find that the appeal has not been adjudicated on merits by the Ld first appellate authority on the grounds contained in the memo of appeal. Moreover, no submission or arguments has been filed by the assessee before the Ld CIT ( A ) , and in absence of any submission being filed the appeal is dismissed in limine and we are of the opinion that the assessee may be allowed one further opportunity to explain his case on the grounds contained in Form 35 on merits . 6.1 As such we remand the matter back to the Ld CIT ( A ) for a fresh hearing and adjudication of the grounds contained in the memo of appeal on merits , and the assessee , is also directed to file all necessary documents and submissions , he wishes to rely upon for the purpose of his arguments and to fully cooperate with the appellate authority for disposal of his appeal . Needless to say the assessee shall be provided reasonable opportunity of being heard .
As a result the appeal of the assessee is allowed for statistical purpose. Order pronounced in the open court on 24.01.2025.