ABDULREHMAN ABDULHAY BHANAPATEL,SURAT vs. ASSESSMENT UNIT INCOME TAX DEPARTMENT, WARD 2(3)(1), SURAT, SURAT

आदेश / O R D E R

PER BIJAYANANDA PRUSETH, AM: This appeal by the appellant emanates from the order passed under

section 250 of the Income-tax Act, 1961 (in short, ‘the Act’)dated 29.11.2023by

the Commissioner of Income-tax(Appeal),Surat [in short, ‘CIT(A)’], for the

Assessment Year (AY) 2014-15.

“1. The Learned CIT(Appeals) has erred in law and on facts of the case in not admitting the appeal of the assessee.

2.The appellant craves leave to add, amend or alter the grounds of appeal at the time of hearing, if need arise.”

31.03.2016 for AY.2014-15 was treated as invalid by CPC due to receipt of the

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ITR-V after due date. The assessee was treated as a non-filler. Subsequently,

based on the information from ITO – 1(3)(2), Surat, the case was reopened u/s

147 of the Act. After hearing the assessee, the Assessing Officer (in short, ‘AO’)

passed order u/s 147 r.w.s. 144B of the Act by making addition of

Rs.54,01,224/- u/s 50C of the Act.

The CIT(A) passed his order u/s 250 of the Act on 29.11.2023. In the order, he

hasdiscussed about the provisions of section 249(4)(b) of the Act that where

no return has been filed by the assessee, the assessee has to pay an amount

equal to the amount of advance tax, which was payable by him; otherwise,

appeal shall not be admitted. He verified Form 35 and found that the appellant

has not made payment of the amount equal to the advance tax, which was due

on his income. Since the appellant has not filed the return of income as well as

not paid the said amount of advance tax, which was payable by him, the

appeal filed by the assessee was not admitted.

Tribunal. The learned Authorized Representative (ld. AR) of the assessee raised

an additional ground about time barring nature of the order u/s 147 of the Act.

He also submitted that since the income of the assessee was below the taxable

limit, the assessee was not required to file income tax return u/s 139(1) of the

Act. Hence, question of payment of advance tax does not arise.In view of the

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above, the ld. AR submits that the appeal may be set aside directing the CIT(A)

not to invoke Section 249(4)(b) of the Act and decide the matter on merit.

DR) for the revenue has strongly relied on the orders of authorities below. He

submitted that the additional ground was not raised before the lower

authorities. He also submitted that the explanation given by the assessee

cannot be accepted.

record. Since the assessee has not filed ROI as well as not paid an amount

equal to the advance tax which was payable by it, the appeal was not admitted

by the CIT(A). It may be stated that if tax is being paid for same financial year

based on estimated income, it would be advance tax. If tax is being paid after

end of financial year, it would be self-assessment tax. When Department finds

that there has been under-assessment of income and resultant tax is due, it

computes the actual amount that ought to have been paid. This demand raised

on the person is called tax on “regular assessment”. Tax on “regular

assessment” is the tax which the taxpayer is required to pay against of notice

of demand from the Income-tax Department, normally u/s 156 of the Act. The

CIT(A) did not admit the appeal because the assessee had not paid an amount

equal to the advance tax, which was payable by it. The ld.AR has contended

that the assessee did not pay any advance tax as the income was below

taxable income. When total income is below taxable income during the year,

ITA No.20/SRT/2024/AY.2014-15 AbdulrehmanAbdulhayBhanapatel

question of payment of advance tax does not arise and provisions of Section

249(4)(b) of the Act arenot applicable. We find that similar issue had come up

for consideration before this Bench in ITA No.646/SRT/2023 in the case of

Ranajitbhai B. Patel vs. ITO, dated 28.11.2023, where following the decision of

co-ordinate Benches of Pune in the case of Hotel Sai Siddi (P.) Ltd. vs. DCIT

(2011) 13 taxmann.com 155 (Pune), it was held that when the assessee had

incurred loss while filing ROI and was not liable to pay tax an amount equal to

amount of advance tax as required u/s 249(4)(b), the assessee’s appeal was

liable to be admitted. Following the ratio of the decision cited above and

keeping in view that assessee was claiming that it had no taxable income, the

Tribunal restored the case back to the file of CIT(A) with a direction to admit

the appeal of the assessee and pass an order on merit. Facts of the present

case of the assessee are similar to the fact of the case cited above. In this case,

assessee has shown total income which is below taxable limit. Therefore, he

was not liable to pay any advance tax. The demand u/s 156 of the Act was on

account of regular assessment tax. Therefore, following the above decision, we

hold that the CIT(A) should have decided the issue on merits of the case.

Hence, the matter is restored to the file of CIT(A) with a direction to admit the

appeal of the assessee and pass an order on merit.He shall grant adequate

opportunity of being heard to assessee. The assessee is also directed to comply

with the notices issued by the AO and not to seek any adjournment

withoutvalid reason.

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Order is pronounced under provision of Rule 34 of ITAT Rules, 1963 on

13/05/2025.

Sd/- Sd/- (PAWAN SINGH) (BIJAYANANDA PRUSETH) JUDICIAL MEMBER ACCOUNTANT MEMBER Surat �दनांक/ Date: 13/05/2025 SAMANTA Copy of the Order forwarded to 1. The Assessee 2. The Respondent 3. The CIT(A) 4. CIT 5. DR/AR, ITAT, Surat 6. Guard File

By Order // TRUE COPY //

Assistant Registrar/Sr. PS/PS ITAT, Surat