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Facts
The assessee-firm's appeal to the CIT(A) was dismissed ex-parte due to delay and non-compliance, which the assessee attributes to internal disputes among partners and the firm being dormant. The assessee also claims the reassessment proceedings under Section 147 and the addition made under Section 144 were erroneous. The appeal before the Tribunal was filed with a delay of 135 days.
Held
The Tribunal condoned the delay of 135 days in filing the appeal, accepting the assessee's explanation of internal partner disputes and the firm being dormant as a reasonable cause. The Tribunal also noted that the Revenue did not object to condoning the delay. The order of the CIT(A) was set aside, and the matter was restored to the CIT(A) for fresh adjudication.
Key Issues
Whether the delay in filing the appeal and non-compliance before the lower authorities due to internal disputes can be condoned, and whether the ex-parte order passed by the CIT(A) should be set aside to allow the assessee to be heard on merits.
Sections Cited
250, 144, 147, 148, 253(3)
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Before: MS SUCHITRA RAGHUNATH KAMBLE & SHRI BIJAYANANDA PRUSETH
आदेश / O R D E R
PER BIJAYANANDA PRUSETH, AM:
This appeal by the assessee emanates from the order passed under section 250 of the Income-tax Act, 1961 (in short, ‘the Act’), dated 12.06.2024 by the National Faceless Appeal Centre, Delhi/ Commissioner of Income-tax (Appeals) [in short ‘CIT(A)’] for the Assessment Year (AY) 2014-15, which in turn arises from the assessment order passed by Assessing Officer (in short, ‘AO’) u/s 144 r.w.s. 147 of the Act on 28.11.2019.
Grounds of appeal raised by the assessee are as under: “1) The delay in filing the appeal be condoned. 2) On the facts and circumstances of the CIT(A) has wrongly passed the ex- parte order and wrongly dismissed the appeal in limine.
3) The ‘a’ request your honour to provide one more opportunity to explain the case as the ‘A’ was prevented by sufficient cause for not appearing before the ld. CIT(A) and even A.O. has not considered the submission of the ‘A’. 4) The proceeding u/s 147/148 are bad-in-law and requires to be quashed. 5) The ld. AO has erred in making the addition of Rs.18,53,850/-. The ld. AO has not mentioned under which section of Income-tax Act, the addition is made. The AO has totally ignored the submission and findings in the original assessment proceeding. 6) The addition of Rs.18,53,820/- amounts to double taxation. 7) The ld. AO has erred in making the order u/s 144. 8) The ld. AO has totally ignored the fact that in past years he has accepted our accounting policy.”
The appeal filed by the assessee is barred by limitation by 135 days in terms of provisions of section 253(3) of the Act. The assessee has filed an affidavit giving reasons for delay in filing the appeal before the Tribunal. In the affidavit, the assessee stated that the firm of assessee is dormant and not doing any business since last many years. There were disputes amongst the partners in the group concerns and partners were not co-operating to each other in respect of the account and taxation matters of the firm. Hence, there was delay in filing appeal before Tribunal. The delay was neither wilful nor deliberate, but due to the circumstances beyond its control. The Ld. AR requested that in the interest of justice, the delay may be condoned and appeal may be decided on merit.
We have heard both the parties on this preliminary issue of delay in filing appeal. In the affidavit, it is submitted that there was a dispute amongst the partners of the assessee-firm and it was also dormant; due to which, the delay of 135 days occurred in filing appeal before the Tribunal. Considering all these facts, we find that delay was not deliberate and intentional, but it was due to internal disputes amongst the partners of the firm. The Ld. Sr-DR has also not raised objection to condone the delay. We, therefore, condone the delay of 135 days and admit the appeal for hearing.
Facts of the case in brief are that assessee-firm filed return of income on 30.11.2014 for AY 2014-15 declaring total income at Rs.14,02,850/-. Thereafter, assessment was completed u/s 143(3) on 29.12.2016 determining total income at Rs.59,82,250/-. The case was reopened within the meaning of section 147 of the Act and notice u/s 148 was issued on 31.03.2019. The assessee filed its return of income on 10.05.2019 declaring total income at Rs.14,02,850/-. Thereafter, the assessee was issued statutory notices and show cause notice which were not complied with. Hence, the AO passed the /AY.14-15 Raj Enterprise order u/s 144 r.w.s. 147 of the Act by making total addition of Rs.78,36,100/- including the addition made in the original assessment order. Aggrieved by the order of AO, assessee filed appeal before CIT(A).
The CIT(A) condoned the delay of 5 days in filing appeal before him. The CIT(A) issued three notices on 08.02.2021, 14.05.2024 and 28.05.2024, but there was no reply from assessee nor any request for adjournment. Therefore, the CIT(A) upheld the addition of Rs.18,53,850/- and dismissed the appeal by observing that assessee has not effectively pursued the appeal.
Aggrieved, the appellant has filed present appeal before the Tribunal. The Ld. AR submitted that due to dispute amongst the partners of assessee- firm, the appeal could not be pursued effectively before CIT(A). He requested that the order of CIT(A) may be set aside and the appellant should be given one more opportunity to plead its case on merit in the interest of justice.
On the other hand, Ld. Sr-DR for the Revenue would have no objection if the matter is restored back to the file of lower authority.
We have heard both the parties and perused the materials on record. There was delay in filing the appeal as well as non-compliance before the lower authorities due to dispute amongst the partners of assessee-firm. The Ld. AR of the assessee requested to set aside the order of CIT(A) and undertook that all the details would be filed before him if another opportunity is granted to the appellant. The Ld. Sr-DR has also no objection if the matter is /AY.14-15 Raj Enterprise restored to the file of CIT(A). In view of the above facts, we deem it proper to set aside the order of CIT(A) and restore the matter back to the file of CIT(A) for fresh adjudication after granting adequate and fair opportunity of being heard to the appellant. Accordingly, appeal of assessee is allowed for statistical purposes.
In the result, appeal of the assessee is allowed for statistical purposes. Order is pronounced under provision of Rule 34 of ITAT Rules, 1963 on 10/07/2025.