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Facts
The appellant, a society promoting education and literature, did not file an income tax return for AY 2019-20. The AO initiated assessment proceedings due to information about interest income of Rs. 21,37,898/-. The AO passed an ex-parte assessment order after the appellant failed to comply with notices.
Held
The Tribunal condoned the delay in filing the appeal, finding sufficient cause due to a change in Chartered Accountants and the notices being sent to an incorrect email address. The AO's order was set aside, and the matter was remitted for de novo adjudication.
Key Issues
Whether the ex-parte assessment order passed by the AO is valid, and whether the delay in filing the appeal should be condoned.
Sections Cited
148, 142(1), 147, 144, 144B, 10(23C)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, COCHIN BENCH
Before: SHRI INTURI RAMA RAO, AM
Assessment Year: 2019-20 State Institue of Childrens Literature .......... Appellant Sanskrit College Campus, Palayalam Thiruvananthapuram 695034 [PAN: AAJTS9037Q] vs. ITO, Ward - 1(3), Thiruvananthapuram .......... Respondent Assessee by: Shri Mathew Joseph, CA Revenue by: Smt. Leena Lal, Sr. D.R. Date of Hearing: 07.08.2025 Date of Pronouncement: 11.08.2025 O R D E R This appeal filed by the assessee is directed against the order of the National Faceless Appeal Centre, Delhi [CIT(A)] dated 28.02.2025 for Assessment Year (AY) 2019-20.
Brief facts of the case are that the appellant is a society setup by the Government of Kerala formed with the objective of promotion of education and literature, promote reading habits and promote affinity towards culture among children. No return of income was filed by the appellant society for AY 2019-20. Based on the information available in the IT portal that interest of Rs. 21,37,898/- was received by the appellant, the ITO, Ward-1(3), State Institue of Childrens Literature Thiruvananthapuram (hereinafter called "the AO") formed an opinion that income escaped assessment to tax. Accordingly, a notice u/s. 148 of the Income Tax Act, 1961 (the Act) was issued on 28.03.2023. The appellant society neither complied with the notice issued u/s. 148 nor u/s. 142(1) of the Act. In the circumstances, the AO passed best judgement assessment u/s. 147 r.w.s. 144 and 144B of the Act assessing the interest income of Rs. 21,37,898/- vide order dated 19.02.2024.
Being aggrieved, an appeal was filed before the CIT(A) contending that the income of the appellant is exempt u/s. 10(23C) of the Act. However, the CIT(A) had rejected the above contention in the absence of any evidence of approval u/s. 10(23C) of the Act.
Being aggrieved, the appellant is in appeal before this Tribunal in the present appeal.
At the outset, I find that there is a delay in filing the present appeal by 86 days. The appellant filed a petition seeking condonation of delay on the ground that the delay had occurred on account of change of Chartered Accounts, who are looking after the income tax affairs of the society. Hence, the delay is not willful or deliberate. Therefore, it is prayed that the delay in filing the appeal may be condoned and the appeal may be admitted for adjudication. Having regard to the averments made in the affidavit seeking condonation of delay, in the absence of any evidence contrary, I am State Institue of Childrens Literature of the considered opinion that the appellant society is prevented by sufficient reasonable cause in filing the appeal within the prescribed limit. Accordingly, I condone the delay and admit the appeal for adjudication.
During the course of hearing it is found that the order passed by the AO is exparte assessment order. It is stated that the appellant could not comply with the notices u/s. 148 or 142(2) of the Act as the hearing notices were sent to the email of the erstwhile Director which is not the official email ID of the appellant. In the circumstances, I remit the matter back to the file of the AO for de novo adjudication in accordance with law after affording reasonable opportunity of hearing to the appellant.
In the result, the appeal filed by the assessee stands partly allowed for statistical purposes.
Order pronounced in the open court on 11th August, 2025.