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Facts
The assessee, a Non-Resident Indian, failed to file an Income Tax Return for AY 2015-16 despite depositing Rs. 50 lakhs cash and having Rs. 62,471 interest credit in his bank account. The AO made additions totaling Rs. 61,97,471 as unexplained money and income from other sources. The assessee filed an appeal against the AO's order belatedly before the CIT(A), who dismissed it in limine citing a 90-day delay and insufficient cause.
Held
The Income Tax Appellate Tribunal (ITAT) condoned the 90-day delay in filing the appeal before the CIT(A), acknowledging the assessee's explanation that he was a non-resident, notices went to spam, and he became aware only upon receiving physical penalty notices. The ITAT remitted the matter back to the CIT(A) to decide the appeal on merits, while also cautioning the assessee to cooperate.
Key Issues
Whether the CIT(A) was justified in dismissing the appeal in limine due to belated filing, and if the assessee's reasons for delayed filing constituted "sufficient and reasonable cause" for condonation of delay.
Sections Cited
147, 144, 144B, 249(4)
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Income Tax Appellate Tribunal, VISAKHAPATNAM BENCH, VISAKHAPATNAM
करदधतधकधप्रनतनिनर्त्व/ : Shri GVN Hari, Advocate Assessee Represented by रधजस्वकधप्रनतनिनर्त्व/ : Dr. Aparna Villuri, Sr. AR Department Represented by सुिवधईसमधप्तहोिेकीनतनि/ : 01/09/2025 Date of Conclusion of Hearing घोर्णध की तधरीख/ : 09/09/2025 Date of Pronouncement ORDER PER S. BALAKRISHNAN, AM:
This appeal filed by the assessee is directed against the order of the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi in DIN & Order No. ITBA/NFAC/S/250/2024- 25/1067366562(1), dated 06/08/2024 arising out of the order passed Moturu Chandra Sekhara Rao vs. ITO U/s. 147 r.w.s 144 r.w.s 144B of the Income Tax Act, 1961 (the Act), dated 07/01/2024 for the Asst. Year 2015-16.
At the outset, it is noticed that there is a delay of 47 days in filing the appeal before the Tribunal. In respect of the belated filing of the appeal, the assessee filed a petition for condonation of delay along with an affidavit and the relevant contents are scanned and pasted herein below:
Moturu Chandra Sekhara Rao vs. ITO 3. Considering the above reasons adduced by the assessee for filing of the appeal beyond the prescribed time limit with a delay of 47 days, we are of the considered view that there is a sufficient and reasonable cause that prevented the assessee in filing the appeal within the prescribed time limit. Therefore, we hereby condone the delay of 47 days and proceed to adjudicate the appeal on merits.
Brief facts of the case are that the assessee is an individual, Non- resident Indian. As per the information available with the Department, the Ld. AO observed that the assessee had deposited cash of Rs. 50,00,000/- in his bank account with Andhra Bank [now Union Bank of India]. The assessee is required to file the return of income as the amount of cash deposited is more than the prescribed limit however, the assessee did not file his return of income for the AY under consideration. Thereafter, the Ld. AO issued statutory notices to the assessee however, the assessee did not respond to the notices and therefore, show cause notice dated 20/12/2023 was issued. Even then, there was no compliance from the assessee. Therefore, the Ld. AO came to a conclusion that the assessee’s bank account was credited with Rs. 61,97,471/- which includes cash credit of Rs. 50 lakhs and interest credit of Rs. 62,471/-. The Ld. AO further observed that even after given multiple opportunities, the assessee failed to Moturu Chandra Sekhara Rao vs. ITO explain the source of total credit of Rs. 61,35,000/- [ Rs. 61,97,471 – Rs. 62,471] and also the assessee failed to offer the same for taxation by filing the return of income. Thus, the Ld. AO made addition of Rs. 61,35,000/- as unexplained money and Rs. 62,471/- as income from other sources thereby determining the total income of the assessee at Rs. 61,97,471/-. Aggrieved by the order of the Ld. AO, the assessee carried the matter in appeal before the Ld. CIT(A) in appeal belatedly.
On appeal, the Ld. CIT(A) dismissed the appeal of the appeal by holding that even though the assessee has admitted in Form 35 that there is a delay in filing the appeal, the assessee has not given any sufficient and reasonable cause for such delay. Thus, the Ld. CIT(A) dismissed the appeal of the assessee in limine. Aggrieved by the order of the Ld. CIT(A), the assessee is in appeal before the Tribunal by raising the following grounds of appeal:
1. The order of the Ld. CIT(A) is contrary to the facts and also the law applicable to the facts of the case.
2. The Ld.CIT(a) is not justified in dismissing the appeal in limine by invoking the provisions of section 249(4) of the Act.
3. The Ld. CIT(A) omitted to have deleted the additions made by the Assessing Officer in respect of cash deposits to the tune of Rs. 50 lakhs and other credits to the tune of Rs. 11,35,000/- and in respect of interest credit to the tune of Rs. 62,471/- under the head income from other sources without considering the explanation offered by the appellant.
4. Any other ground that may be raised at the time of hearing of the appeal.”
6. At the outset, the Ld. Authorized Representative [AR] submitted that the Ld. CIT(A)-NFAC ought to have considered the explanation of the assessee with respect to the condonation Moturu Chandra Sekhara Rao vs. ITO of delay in filing the appeal before the Ld. CIT(A)-NFAC as the assessee was prevented by a reasonable and sufficient cause ie., the appellant is not aware of the notices issued and orders passed. The appellant got the knowledge of the same only when penalty notices were physically received. The Ld. AR also further submitted that assessee being a non-resident was not aware of the mails received due to fact that it was delivered into the “Spam Folder”. The Ld. AR therefore submitted that the assessee could not respond to the notices. The Ld. AR also submitted that the delay of 90 days in filing the appeal is not on account of negligence or any deliberate act of the assessee. Ld. AR also submitted that without considering the explanation and the submissions of the assessee, the Ld. CIT(A)-NAFC dismissed the appeal of the assessee by denying the condonation petition filed before him. The Ld. AR therefore pleaded that the matter may be remitted back to the file of the Ld. CIT(A)-NFAC to decide the appeal on merits.
7. On the other hand, the Ld. Departmental Representative [DR] heavily relied on the orders of the Ld. Revenue Authorities. The Ld. DR further submitted that before the Ld. CIT(A)-NFAC if there is a delay, the onus is on the assessee to explain each day’s delay with proper evidence. The Ld. DR also Moturu Chandra Sekhara Rao vs. ITO submitted that since the assessee has not discharged his onus, the Ld. CIT(A)-NFAC has rightly dismissed the appeal of the assessee as inadmissible. In toto, the Ld. DR supported the decision of the Ld. Revenue Authorities and pleaded to upheld the decision of the Ld. AO.
We have heard both the sides and perused the material available on record as well as the orders of the Ld. Revenue Authorities. It is a fact that on being aggrieved by the addition made by the Ld. AO, the assessee preferred an appeal before the Ld. CIT(A)-NFAC belatedly. It is also a fact that with respect to the belated filing of the appeal, the assessee has explained his reasons by stating that the appellant is not aware of the notices issued and orders passed. The appellant got the knowledge of the same only when penalty notices were physically received and therefore the assessee the appeal could not be filed within the stipulated time before the Ld. CIT(A)- NFAC. In our considered opinion, the Ld. CIT(A)-NFAC ought to have considered the explanation given by the assessee for belated filing of the appeal and ought to have disposed of the appeal on merits. Instead, the Ld. CIT(A)-NFAC dismissed the appeal in-limine. In this situation, considering the facts and circumstances of the case we condone the delay of 90 days in