SANJAY MOTIRAMJI MULEY,NAGPUR vs. ITO WARD (4)(3), NAGPUR
Facts
The assessee, a non-filer for AY 2008-09, sold an immovable property which led to the Assessing Officer initiating reassessment proceedings under Section 148, followed by assessment under Section 144 read with Section 147, computing a short-term capital gain of Rs. 39,51,400 under Section 50C. The assessee's appeal to the CIT(A) was dismissed as not maintainable due to substantial delay (over 5 years) in filing it, without adjudication on merits. The assessee then filed an appeal with the ITAT, which was also delayed by 244 days.
Held
The ITAT condoned the 244-day delay in filing the appeal before it. Considering the CIT(A) dismissed the appeal solely on the ground of delay without addressing the merits, the Tribunal found it appropriate to grant the assessee one final opportunity. The case was remanded back to the CIT(A) to reconsider the condonation of delay and then adjudicate the appeal on merits, subject to the assessee paying Rs. 2,000 as costs.
Key Issues
1. Whether the CIT(A) was justified in dismissing the assessee's appeal as not maintainable by rejecting the condonation of delay without adjudicating on merits. 2. Whether the assessee should be granted a further opportunity to explain the delay and have the appeal decided on merits.
Sections Cited
148, 142(1), 143(2), 144, 50C, 147
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “SMC” BENCH, NAGPUR
Before: SHRI PAVAN KUMAR GADALE
The assessee has filed appeal against the order dated 03/05/2024, passed by the learned CIT(A)/National Faceless Appeal Centre(NFAC), Delhi, dismissing the assessee’s appeal as not maintainable.
The grounds of appeal raised by the assessee are as under:–
“1. Whether on the facts and circumstances of the case, the learned CIT- (A) was justified in dismissing the appeal of the appellant by rejecting the condonation of delay without adjudicating on merits. 2. The appellant craves leave to add or alter any other ground that may be taken at the time of the hearing.”
There is a delay of 244 days in filing the appeal before the Tribunal. The learned Authorised Representative for the assessee (for short "the
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learned A.R.") referred to the Affidavit filed by the assessee explaining the reasonable cause where the assessee is not aware of the legal provisions of the Act and the delay is not deliberate act and prayed for condonation of delay. And the learned Departmental Representative has no specific objections. Accordingly, the delay is condoned and the appeal is admitted.
The Brief facts of the case are that, the assessee is a non–filer of the Income Tax Return for the assessment year 2008–09. The Assessing Officer has received information that the assessee has sold immovable property and the income was not offered to tax. The Assessing Officer has reason to believe that the income has escaped assessment and issued notice under section 148 of the Income Tax Act, 1961 (for short "the Act"). Further, notice under section 142(1) r/w section 143(2) of the Act along with questionnaire calling for the confirmation of unsecured loan, computation of income and property details. Since there was non–compliance by the assessee, the Assessing Officer considering the information available on record has invoked the provisions of section 144 of the Act and computed short term capital gain in respect of the immovable property adopting the guideline value as per SRO under section 50C of the Act and made addition of short term capital gains of Rs.39,51,400/- and passed the assessment order dated 11/12/2012, under section 144 r/w section 147 of the Act. Aggrieved by the order, the assessee filed appeal before the learned CIT(A).
In appellate proceedings, notices were issued to the assessee, but there was no proper compliance. Further, the learned CIT(A) found that
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there is a substantial delay in filing the appeal before the appellate authorities and dealt on the facts that the Assessing Officer’s order is dated 11/12/2012, whereas the appeal was instituted on 11/01/2018, and the assessee, in spite of providing adequate opportunities, has not explained the delay with sufficient cause and dismissed the appeal in limine as not maintainable. Aggrieved by the order of the learned CIT(A), the assessee has filed appeal before the Tribunal.
At the time of hearing, the learned A.R. submitted that the learned CIT(A) has erred in not considering the fact that the assessee is not aware of the provisions of the Income Tax and the delay was not a deliberate act and also the assessee has sold the immovable property and the income has to be treated as business income, whereas, the Assessing Officer has treated it as short term capital gain. Further the assessee has a good case on merits and prayed for granting of opportunity to substantiate the case with evidences and information before the lower authorities. Per–contra, the learned Departmental Representative relied on the order of the CIT(A).
Heard the rival submissions and perused the material available on record. The sole grievance of the assessee that the learned CIT(A) has dismissed the appeal as not maintainable by overlooking the fact that the assessee is not regularly filing the income tax return and is also not aware of the provisions of the Income Tax and the assessee has a good case on merits. On a perusal of the CIT(A) order, the appellate authority has provided opportunity to explain the sufficient case for the delay in filing the
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appeal and whereas there was no proper compliance by the assessee. Hence considering the facts and circumstances of the case, there can be various reasons for non–compliance by the assessee before the appellate authorities, which can be ruled out. Therefore, the assessee should be provided with one more opportunity of hearing before the learned CIT(A) to explain the sufficient cause with the condonation application for the delay and subsequently the CIT(A) adjudicate a fresh on merits subject to the assessee making payment of cost of Rs.2,000 (Rupees Two Thousand Only) to be deposited with the Income Tax Department within one month from the date of receipt of this order. And the assessee shall co–operate in submitting the information for early disposal of the appeal. And the grounds of appeal of the assessee are allowed for statistical purposes.
In the result, assessee’s appeal is allowed for statistical purposes. Order pronounced in the open Court on 07-10-2025.
Sd/- Sd/- PAVAN KUMAR GADALE JUDICIAL MEMBER
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Copy of the order forwarded to: (1) The Assessee; (2) The Revenue; (3) The PCIT / CIT (Judicial); (4) The DR, ITAT, Nagpur; and (5) Guard file. True Copy By Order Pradeep J. Chowdhury Sr. Private Secretary Sr. Private Secretary ITAT, Nagpur
