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Facts
The assessee, an individual running a general store, filed appeals against orders of the CIT(A) for assessment years 2015-16 and 2016-17. The appeals were filed with a delay of 199 days. The assessee explained the delay due to a stroke and subsequent medical advice for bed rest.
Held
The Tribunal condoned the delay of 199 days in filing the appeals, citing reasonable and sufficient cause, and proceeded to adjudicate the appeals on merits. The Tribunal noted that both the Assessing Officer and the CIT(A) had passed ex-parte orders without providing adequate opportunity to the assessee.
Key Issues
Whether the ex-parte orders passed by the Assessing Officer and CIT(A) were justified, and whether the assessee should be given another opportunity to present their case.
Sections Cited
143(2), 142(1), 144, 69
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Income Tax Appellate Tribunal, VISAKHAPATNAM “DIVISION” BENCH, VISAKHAPATNAM
Before: SHRI LALIET KUMAR, HON’BLE & SHRI S BALAKRISHNAN, HON’BLE
आदेश /O R D E R
PER SHRI S BALAKRISHNAN, ACCOUNTANT MEMBER: 1. These appeals are filed by the assessee against different orders of Learned Commissioner of Income Tax (Appeals), National Faceless Appeal centre, Delhi
I.T.A.No.415 & 416/VIZ/2024 Kanthety Naga Rama Lakshmi Vara Prasad [hereinafter in short “Ld.CIT(A)”] vide respective DIN & Order No. as stated below:-
ITA No. & A.Y. DIN & Order No. Dated ITBA/NFAC/S/250/2023-24/1063040270(1) 20.03.2024 (A.Y. 2015-16)
ITBA/NFAC/S/250/2023-24/1059532900(1) 09.01.2024 (A.Y. 2016-17)
2. Since the grounds raised by the assessee for both these appeals are identical in nature, these appeals are being clubbed and a consolidated order being passed. We now take up the appeal in A.Y.2016-17 as a lead appeal.
This appeal is filed by the assessee against order of Learned Commissioner of Income Tax (Appeals), National Faceless Appeal centre, Delhi [hereinafter in short “Ld.CIT(A)”] vide DIN & Order No. ITBA/NFAC/S/250/2023-24/1059532900(1) dated 09.01.2024 for the A.Y.2016-17 arising out of order passed under section 144 of the Income Tax Act, 1961 (in short ‘Act’) dated 20.12.2018.
At the outset, it is noticed from the appeal record that there is a delay of 199 days in filing the appeal before the Tribunal. Explaining the reasons for belated filing of the appeal, the Ld. AR drew our attention to the affidavit filed by the Page. No 2
I.T.A.No.415 & 416/VIZ/2024 Kanthety Naga Rama Lakshmi Vara Prasad assessee along with a petition seeking for condonation of delay and read out the contents of the petition which is as under: - “1. The order of the learned Commissioner of Income Tax (Appeals), NFAC was passed on 09.01.2024. As such, the appeal against this order ought to have been filed on or before 09.03.2024. However, the appeal could be filed only on 24.09.2024 resulting in a delay of 199 days in filing the appeal.
2. The appellant is 57 years old and is suffering from Cardio-Vascular- Disease. In the third week of February, 2024, the appellant suffered from a mild stroke which was caused due to blocks in the arteries. He was put under medication and advised complete bed rest till 18.05.2014. As the condition. of the appellant was still sensitive, the doctor advised the appellant to take complete bed rest for further six months. The appellant was under treatment and bed rest during the period from 20.02.2024 to 15.09.2024 (copy of medical certificate is enclosed herewith). The appellant started feeling better from the second week of September 2024 onwards. As soon as the condition improved, the appellant took necessary steps and filed the appeal on 24.09.2024 3. Thus, the delay in filing the appeal was due to the reasons explained above which were beyond the control of the appellant. The delay was neither intentional nor deliberate. Therefore, the appellant prays the hon'ble ITAT to kindly condone the said delay of 199 days in filing the appeal and to pass appropriate orders in the interest of rendering substantial justice.”
On perusal of the contents of the affidavit filed by the assessee and medical certificate as well as the submission of the Ld. AR, we find that the assessee is prevented by a reasonable and sufficient cause in filing the appeal beyond the prescribed time limit with a delay of 199 days. Therefore, we hereby condone the delay of 199 days in filing the appeal before the Tribunal and proceed to adjudicate the appeal on merits in the following paragraphs.
Page. No 3
I.T.A.No.415 & 416/VIZ/2024 Kanthety Naga Rama Lakshmi Vara Prasad 6. Brief facts of the case are that, assessee is an Individual deriving income from business carried on in purchase and sale of pulses and grains under the name and style of M/s.Ramamani General stores, Machilipatnam. Assessee filed his return of income for the A.Y. 2016-17 on 14.10.2016 admitting a total income of Rs.5,35,198/-. The case was selected for limited scrutiny under CASS for the purpose of “whether value of exports and imports has been correctly shown in the return of income”. Subsequently, statutory notices under section 143(2) and 142(1) of the Act were issued and served on the assessee. In response, assessee has not submitted his reply and failed to submit the information as called for. Thereafter, notice dated 29.08.2018 issued stating that, if assessee does not comply with the said notice the assessment for the A.Y. 2016-17 would be completed ex-parte under section 144 of the Act. In response, assessee has not furnished any reply. Therefore, Ld. Assessing Officer [hereinafter in short “Ld. AO"] proceeded to complete the assessment by determining the income of the assessee at Rs. 7,31,25,576/- by making addition of Rs. 6,97,16,283 as unexplained investment and Rs.28,74,095/- towards estimated profit @5% of the value imported pulses and grains.
On being aggrieved, assessee preferred an appeal before Ld. CIT(A) but the assessee even after receipt of the hearing notices on various dates did not file any supporting documents on his contentions as per the grounds of appeal raised by him. The Ld.CIT(A) thus, dismissed the appeal of the assessee for non-prosecution.
Page. No 4
I.T.A.No.415 & 416/VIZ/2024 Kanthety Naga Rama Lakshmi Vara Prasad 8. On being aggrieved, assessee preferred an appeal before us by raising the following grounds of appeal: -
1. The order of the learned Commissioner of Income Tax (Appeals) is contrary to the facts and also the law applicable to the facts of the case.
The learned Commissioner of Income Tax (Appeals) is not justified in dismissing the appeal ex-parte.
3. The learned Commissioner of Income Tax (Appeals) ought to have held that the Assessing officer is not justified in making addition of Rs.6,97,16,283 u/s 69 of the Act towards unexplained investment in purchase value of pulses and grains imported and the incidental expenses.
4. The learned Commissioner Income Tax (Appeals) ought to have held that the Assessing officer is not justified in making addition of Rs.28,74,096 towards estimated profit @5% of the value of imported pulses and grains.
5. Any other ground that may be urged at the time of appeal hearing.”
At the time of hearing, Ld. AR submitted that Ld. AO and Ld.CIT(A) passed exparte order without providing adequate opportunity of being heard to the assessee, therefore, considering additions/disallowance made by the Assessing Officer, Ld.AR pleaded that the matter may be remitted back to the file of the Ld. AO in the interest of natural justice.
On the other hand, Ld. Departmental Representative [hereinafter in short “Ld.DR”] relied on the order of the Ld.CIT(A) and submitted that assessee has not utilized the opportunity provided by Ld.CIT(A). The Ld.CIT(A) thus, dismissed the appeal of the assessee for non-prosecution. Therefore, the order passed by Page. No 5
I.T.A.No.415 & 416/VIZ/2024 Kanthety Naga Rama Lakshmi Vara Prasad Ld.CIT(A) is exparte order and pleaded to confirm the orders passed by the Revenue Authorities.
We have heard both the side and perused the material available on record. On a perusal of the assessment order as well as the Ld.CIT(A) order, it is observed that even though the Ld. AO & Ld.CIT(A) provided opportunity on several occasions, assessee could not appear nor complied to the notices issued. Considering the prayer of the Ld.AR and totality of facts and keeping in view the additions / disallowance made by the Assessing Officer, following the principles of natural justice we are of the opinion that assessee shall be given one more opportunity to submit evidences substantiating his claim. Therefore, considering the facts and circumstances of the case and in order to meet the principles of natural justice, we are of the view that it is a fit case to remit the matter back to the file of the Ld. AO for fresh consideration by providing one more opportunity to the assessee and at the same breath we direct the assessee to cooperate with the proceedings before the Ld. AO without seeking unnecessary adjournments. Thus, the grounds raised by the assessee are allowed for statistical purposes.
In the result, appeal of the assessee is allowed for statistical purposes.
Page. No 6
I.T.A.No.415 & 416/VIZ/2024 Kanthety Naga Rama Lakshmi Vara Prasad (A.Y. 2015-16)
Coming to the appeal relating to A.Y. 2015-16, since the issues and facts in this case are identical, except for the impugned assessment year, Ld. AO has passed assessment order under section 143(3) of the Act, the decision taken in assessee’s case for the A.Y.2016-17 as in preceding paras shall mutatis mutandis, applicable to ITA No.415/VIZ/2024. Accordingly, appeal filed by the assessee is allowed for statistical purpose.
To sum-up, appeals filed by the assessee are allowed for statistical purposes.
Pronounced in the open Court on the date of conclusion of hearing on 21st January, 2025