V DINESH KUMAR ,BANGALORE vs. INCOME TAX OFFICER WARD-2(2)(2), BANGALORE

This appeal by the assessee is against the order dated28.02.2019 of the CIT(Appeals), Bengaluru-2, Bengaluru relating to assessment year 2013-14.

The assessee is an individual. For the AY 2013-14, the assessee filed return of income. The AO noticed from the ITS details that assessee had received compensation from Bangalore Metro Rail Corporation Ltd. (BMRCL) for compulsory acquisition of his land. The assessee had filed return of income declaring total income of Rs.2,86,710 for AY 2013-14 declaring income from house property, income from business and income from other sources. Long term capital gain on compulsory acquisition of land was not declared. The AO completed the assessment u/s. 144 of the Act (best judgment assessment) by order dated 18.3.2016 in which he brought to tax the entire sum received by assessee from BMRCL for compulsory acquisition of land.

Aggrieved by the addition, the assessee filed appeal before the CIT(Appeals). There was a delay of about 209 days in filing the appeal by the assessee before the CIT(Appeals). The assessee explained the reasons for the delay in filing the appeal in an affidavit. In the affidavit, the assessee had mentioned that assessment order dated 18.3.2016 was received by him on 21.3.2016 and the appeal ought to have been filed by him on or before 21.4.2016. The assessee, however, filed the appeal only on 16.11.2016 resulting in a delay of 209 days in filing the appeal. The assessee has claimed that he had given the assessment order to his AR to file the appeal before CIT(Appeals), but the AR’s father was not well and therefore the AR did not file the appeal. The assessee was also ill and undergoing treatment. Thereafter, the assessee has approached the present counsel and filed appeal before the CIT(Appeals).

The CIT(Appeals) did not dispute the facts stated in the affidavit and referred to a decision of the Hon’ble Madras High Court in the case of CIT v. Sanmac Motor Finance Ltd. 322 ITR 309 (Mad) wherein the Hon’ble Madras High Court took the view that if the explanation for the delay does not smack of malafides and is not by way of dilatory strategy, the court must condone the delay. According to CIT(A), the bonafides of assessee has to be seen. According to him, in the case of assessee, reasons given are not attributable to any bonafides and therefore the delay in filing the appeal should not be condoned.

Aggrieved by the order of CIT(Appeals), the assessee is in appeal before the Tribunal.

We have heard the rival submissions. The reasons given by the assessee before the CIT(Appeals) in the form of an affidavit for the delay in filing the appeal have not been disputed by the CIT(Appeals). In such circumstances, there existed bonafide reasons for not filing the appeal before the CIT(A) in time. In the circumstances, the CIT(A) should have condoned the delay in filing the appeal. In fact, the decision of the Hon’ble Madras High Court in the case of Sanmac Motor Finance Ltd. (supra) will support the plea of assessee in the facts and circumstances of the case for condonation of delay in filing the appeal. We therefore condone the delay in filing the appeal by the assessee before the CIT(Appeals). However, we direct the assessee to pay a sum of Rs.5,000/- (Rupees Five Thousand Only) as costs.

The order of the CIT(Appeals) is set aside and the CIT(Appeals) is directed to decide the appeal on merits after affording the assessee opportunity of being heard.

For statistical purposes, the appeal of assessee is treated as allowed.