Loading judgment…
Facts
The assessee filed a return declaring income of Rs. 6,55,880/-. The AO received information about a cash purchase of an extruder machinery for Rs. 33,60,000/-. The AO added this amount under section 69 and also disallowed Rs. 24,330/- under section 80C, assessing total income at Rs. 40,40,210/-.
Held
The CIT(A) rejected the assessee's appeal due to a delay of 56 days in filing, finding insufficient cause. The Tribunal held that substantial justice should be preferred over technicalities and allowed the appeal for statistical purposes, subject to a cost of Rs. 15,000/-. The matter was remitted back to the CIT(A) for adjudication on merits.
Key Issues
Whether the CIT(A) was justified in rejecting the appeal on grounds of delay without condoning it, and whether the Tribunal should condone the delay to allow for substantive justice.
Sections Cited
250, 69, 115BBE, 80C, 147, 144B, 249(3), 253(5)
AI-generated summary — verify with the full judgment below
Before: SHRI PAWAN SINGH & 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 30.08.2024 by the learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi [in short, ‘CIT(A)’] for the assessment years (AY) 2017-18.
The grounds of appeal
raised by the assessee are as under: “1. In law and in the facts and in the circumstances of the case, the order u/s 250 of the Act passed by the Ld. CIT(A) is arbitrary, erroneous, contrary to the provisions of law and on facts.
2. In law and in the facts and in the circumstances of the case, the Ld. CIT(A) has erred in rejecting the request of appellant for condonation of delay in filing appeal before Ld. CIT(A) even though there was sufficient cause for delay in filing appeal before Ld. CIT(A).
/AY.2017-18 Pankajbhai Devrajbhai Soliya 3. In law and in facts and circumstances of the case of the appellant, the Ld. CIT(A) has erred in not adjudicating the ground regarding addition made by AO for Rs.33,60,000/- on account of unexplained investment u/s 69 r.w.s. 115BBE of the Act when such addition is incorrect and liable to be deleted. The Ld. CIT(A) ought to have adjudicated the respective e ground and deleted the addition.
In law in the facts and circumstances in the case of the appellant, the Ld. CIT(A) has grossly erred in not adjudicating the ground regarding disallowance of deduction claimed u/s 80C for Rs.24,330/- when such deduction has been rightly claimed by the appellant. The Ld. CIT(A) ought to have adjudicated the respective ground and deleted the addition.
The appellant craves leave to add to alter, amend and / or withdraw any ground or grounds of appeal
either before or during the course of hearing of the appeal.”
3. The facts of the case in brief are that the assessee had filed his return of income for the AY.2017-18 u/s 139 on 14.10.2017, declaring total income at Rs.6,55,880/-. The Assessing Officer (in short, ‘AO’) received an information that assessee had purchased an extruder machinery for Rs.33,60,000/- from Nirinbhai of Vapi during the year under consideration. The payments for the above purchase were made in cash. The case was re-opened after following the due procedure laid down by the Act. In response to notice u/s 148 dated 30.07.2022, assessee filed the same return, declaring total income of Rs.6,55,880/-. The assessee was given various opportunities but assessee did not reply. Hence Rs.33,60,000/- was added u/s 69 of the Act. The AO also disallowed Rs.24,330/- u/s 80C of the Act. The AO assessed the total income at Rs.40,40,210/- against the returned income of Rs.6,55,880/- u/s 147 r.w.s. 144B of the Act.
4. Aggrieved by the order of AO, the assessee filed this appeal before the CIT(A). The CIT(A) observed that assessment order was passed on 27.03.2023, but the appellant had filed appeal on 22.06.2023, which was delayed by 56 days. The /AY.2017-18 Pankajbhai Devrajbhai Soliya appellant had acknowledged this delay in the Form No.35 but has not given any reasons for the delay. It was stated that affidavit will be filed at the time of hearing but nothing was submitted during appellate proceedings. The appeal may be admitted u/s 249(3) only if the appellant could successfully demonstrate that he had sufficient cause for not presenting appeal within the period of 30 days. The CIT(A) relied on various decisions which are at page 4 to 7 of the appellate order. He finally held that the appellant has not been able to demonstrate that sufficient cause existed for non-filing the appeal within due time. The appellant has neglected / omitted to assert his rights of appeal in a timely manner. Hence, request for condonation for delay was rejected and appeal was not admitted.
5. Aggrieved by the order of CIT(A), the assessee filed appeal before the Tribunal. The learned Authorized Representative (ld. AR) of the assessee has filed an affidavit where the assessee has stated that his e-mail Id was registered with the Income-tax Department, but he was not checking the e-mails received on the said Id on regular basis. Therefore, he could not pay attention to the communication of notices and orders received from the Department. The impugned order was found when staff of the assessee checked online ITBA portal. It is also submitted that there was no wilful non-compliance and only due to inadvertent mistake, the delay has occurred. The ld. AR submitted that assessee is now ready with all the details and he requested that one more opportunity may be given to plead case of the assessee on merit. He submitted that the delay is less than 2 months and it was neither deliberate nor intentional.
/AY.2017-18 Pankajbhai Devrajbhai Soliya 6. On the other hand, learned Senior Departmental Representative (ld. Sr. DR) of the revenue submitted that the delay has not been properly explained. If it is condoned, appropriate cost may be imposed on the assessee.
We have heard both the parties and perused the materials available on record. The CIT(A) has refused to condone the delay and held that the appeal is invalid and non-maintainable being out of time. Since the appeal was dismissed at the threshold, no comments were made on the merits of the case. The ld. AR filed an affidavit of the assessee where it is submitted that the delay was not wilful. The assessee does not check the registered e-mail Id regularly for which minor delay of less than 2 months occurred. Considering the facts of the case, we are of the view that the principles of natural justice would call for giving another opportunity of hearing to the assessee. The expression "sufficient cause" used in section 253(5) of the Act is sufficiently elastic to enable the Tribunal to apply the law which subserves the ends of justice. It has been held in a number of cases that when substantial justice and technical considerations are pitted against each other, the cause of substantial justice deserves to be preferred, for the other side cannot claim to have vested right in injustice being done because of a non- deliberate delay. Accordingly, we hold that the interests of justice would be met in case the CIT(A) adjudicates the case on merit subject to payment of cost of Rs.15,000/- (Rupees fifteen thousand only) by the assessee to the credit of the “Income Tax Appellate Tribunal Bar Association, Surat Bench, Surat” within two weeks from receipt of this order. Subject to payment of above cost, we set aside the order of CIT(A) and remit the matter back to the file of CIT(A) with a direction 4