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Facts
The assessee, Profex Technocrats Private Limited, filed its Income Tax Return for AY 2015-16 declaring NIL income from contract works. The Assessing Officer (AO) completed the assessment under Section 144, making additions for 12.5% of gross receipts and short-term capital gains, as the assessee failed to respond to notices. The CIT(A) dismissed the assessee's appeal as not maintainable, citing a delay of over five years in filing the appeal.
Held
The Tribunal acknowledged the assessee's argument that the delay in filing the appeal was due to technical issues with the ITBA portal, which was not enabled, and the non-upload of the assessment order. Considering these circumstances, the ITAT remitted the matter back to the Ld. CIT(A) with a direction to consider the assessee's condonation petition and then decide the appeal on its merits.
Key Issues
Whether the CIT(A) was justified in dismissing the appeal due to inordinate delay; whether the delay should be condoned given technical issues; and the validity of additions made under Section 144.
Sections Cited
144, 143(2), 129, 131, 133A
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, VISAKHAPATNAM “SMC” BENCH, VISAKHAPATNAM
Before: SHRI K. NARASIMHA CHARY, HON’BLE & SHRI S BALAKRISHNAN, HON’BLE
आदेश /O R D E R
PER SHRI S BALAKRISHNAN, ACCOUNTANT MEMBER:
This appeal is filed by the assessee against the order of Learned Commissioner of Income Tax (Appeals), National Faceless Appeal centre,
I.T.A.No.477/VIZ/2024 Profex Technocrats Private Limited Delhi [hereinafter in short “Ld.CIT(A)”] vide DIN & Order No. ITBA/NFAC/S/250/2024-25/1070067200(1) dated 01.11.2024 for the A.Y.2015-16 arising out of order passed under section 144 of the Income Tax Act, 1961 (in short „Act‟) dated 29.12.2017.
Briefly stated the facts of the case are that, Assessee-Company deriving income from business of Contract works, filed its return of income for the A.Y.2015-16 on 31.03.2017 declaring a total income at Rs. NIL/- The case was selected for Limited scrutiny under CASS for the reason of “Large business loss set off against other than heads of income”. Subsequently, notice under section 143(2) of the Act was issued and served on the assessee on 27.09.2016. Further, an opportunity of being heard under section 129 was given to the assessee vide letter dated 01.05.2017. In response, assessee has failed to comply with the notice and neither the assessee nor any Authorized Representative of the assessee attended. Thereafter, Ld. AO proceeded to complete the assessment under section 144 of the Act and determined the income of the assessee at Rs. 48,89,370/- by making addition of Rs. 14,76,440/- being 12.5% on gross receipts of Rs. 1,18,11,521/- and also added Short Term Capital Gains of Rs. 34,12,927/-.
Aggrieved by the order of the Ld. Assessing Officer [hereinafter in short “Ld. AO"], assessee filed an appeal before Ld. CIT(A). After considering the Page No. 2
I.T.A.No.477/VIZ/2024 Profex Technocrats Private Limited submissions of the assessee, Ld. CIT(A) dismissed the appeal as not maintainable as the appeal was filed late by more than five years.
Aggrieved by the order of the Ld. CIT(A), assessee is in appeal before us by raising the following grounds of appeal : -
1. The assessment is null and void as the Assessing Officer has done the assessment on issues which are beyond the scope of the issue for which the case is selected for limited scrutiny. Ground.
2. The CIT(Appeals), National Faceless Appeal Centre is not justified in confirming the additions made by the Assessing Officer, without giving any opportunity of hearing to the assessee. Ground 3. The CIT (Appeals), National Faceless Appeal Centre is not justified in dismissing the appeal as having been filed with inordinate delay and without deciding the grounds raised in appeal. Ground 4. The Assessing Officer is not justified in estimating the income of the assessee on the plea that the assessee has not responded to the notices, when the books of account are in the custody of the Assessing Officer, which have been taken into his custody on 09.03.2017 when the same were produced in response to notice under section 131 consequent to survey under section 133A on 08.03.2017 Ground 5 The Assessing Officer is not justified in not setting off of depreciation of Rs.40,15,502 claimed in the return of income from the income estimated at 12.5% of the gross receipts as per Form 26AS. Ground 6. The Assessing Officer is not justified in estimating the income at 12.5% without bringing on record comparable cases where such rate of income is adopted or derived. He did not even refer to the past assessment record of the assessee or the books of account which are in his custody since 09.03.2017 Ground 7. The gross contract receipts on which the profit is estimated are not correct. Form 26AS contains receipts which have been offered to tax in earlier years whereas tax is deducted at source by the payer during the previous year relevant to this assessment year and reported by the deductee in Form 26AS.Ground 8. All the above grounds of appeal are mutually exclusive and without prejudice to one another. Ground Page No. 3
I.T.A.No.477/VIZ/2024 Profex Technocrats Private Limited 9. The appellant craves leave to add to; alter; delete; modify all or any of the above grounds of appeal. Ground.”
5. At the outset, Ld. Authorised Representative [hereinafter “Ld.AR”] submitted that the TAB for filing the appeal was enabled on 01.02.2024. Further he also submitted that the assessment order passed under section 144 dated 29.12.2017 was not uploaded into the ITBA portal as on date. He therefore pleaded that due to this technical issue assessee has to file the appeal after a period of around five years. He prayed that the issue may be remitted back to the file of Ld. CIT(A) for considering the condonation petition and decide the case on merits.
Per contra, Ld. Departmental Representative [hereinafter in short “Ld.DR”] relied on the orders of the Revenue Authorities.
We have heard both the sides and perused the material available on record. Admittedly assessee has filed the appeal on 29.12.2023 with a delay of more than five years and has failed to file the application for condonation of delay along with Form – 35. The contention of the Ld.AR is that window was not open for filing the appeal and hence he could not upload the condonation petition. Further, the certified copy of the assessment order and the notice of demand were furnished to the assessee on 17.07.2023. Considering the facts and circumstances of the case, we remit the issue back to the file of the Ld.CIT(A) and direct the assessee to file the condonation petition. Ld. CIT(A)
Page No. 4
I.T.A.No.477/VIZ/2024 Profex Technocrats Private Limited is directed to examine the condonation petition and decide the case on merits based on the submissions made by the assessee.
In the result, appeal of the assessee is allowed for statistical purposes.
Order pronounced in the open court on 07th March, 2025.