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Facts
The appeal was filed by the assessee against an ex-parte order of the CIT(A) which was beyond the limitation period. The assessee's Chartered Accountant (CA) died due to COVID-19, and due to the assessee being uneducated and residing in a village, they were unaware of the proceedings until a recovery demand notice was issued.
Held
The tribunal held that the reasons provided by the assessee for the delay were sufficient cause. The ex-parte order of the CIT(A) was a violation of the principle of natural justice as the assessee was not given a proper opportunity to be heard. A cost of Rs. 2,000/- was imposed on the assessee.
Key Issues
Whether the delay in filing the appeal is condonable and whether the ex-parte order passed by the CIT(A) is valid.
Sections Cited
143(3)
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Income Tax Appellate Tribunal, “SMC”
Before: DR. ARJUN LAL SAINI
ORDER Per, Dr. Arjun Lal Saini, Accountant Member: The present appeal has been filed by the Assessee, against the order passed by the Learned Commissioner of Income Tax (Appeal), National Faceless Appeal, Centre (NFAC), Delhi [hereinafter referred to as “CIT(A)”] dated 01.11.2023, arising in the matter of assessment order passed u/s. 143(3) of the Income Tax Act, 1961 (here-in-after referred to as “the Act”) relevant to the Assessment Year 2017- 18.
2.The appeal filed by the assessee is barred by limitation of 666 days. The assessee has moved a petition requesting the Bench to condone the delay. The ld. Counsel A.Y. 2017-18 Dudabhai Maldebhai Antroliya for the assessee explained the reasons of delay stating that the chartered accountant (CA) who was handling the matter of the assessee was died due to covid 19 disease. After death of the CA of the assessee, the assessee was not aware about the status of the order of the ld. CIT(A). The assessee resides in a village and uneducated and therefore was not aware about passing the order of ld. CIT(A). After passing the order of ld. CIT(A), when the recovery demand notice was issued by the assessing officer, then only the assessee came to know about passing of the order of ld. CIT(A). Therefore, delay in filing the appeal has occurred because of the above reasons and hence ld. Counsel for the assessee requested the Bench that delay should be condoned and the matter may be restored back to the file of the A.O. for fresh adjudication.
3.On the other hand, ld. D.R. for the Revenue submitted that assessee has failed to explain the sufficient cause to condone the delay, therefore delay should not be condoned.
I have heard both the parties on this preliminary issue and noted that the assessee under consideration could not reach to the court, on time, to file the appeal because his CA expired due to covid -19 disease, and after the death of his CA, nobody had informed the assessee about the status of appeal before ld.CIT(A). The assessee is uneducated and did not know about the proceedings of the taxation. The assessee, came to know when the demand notice was received by him from the Department that the ld. CIT(A) has passed the ex-parte order. Therefore, I note that these are the sufficient cause/reasons to condone such huge delay. In Ramlal, & Chhotelal v. Rewa Coalfields Ltd. [(1962) 2 SCR 762), it was laid down that in showing sufficient cause to condone the delay, it is not necessary that the applicant has to explain whole of the period between the date of the judgement till the date 2 A.Y. 2017-18 Dudabhai Maldebhai Antroliya of filing the appeal. It is sufficient that the applicant would explain the delay caused by the period between the last of the dates of limitation and the date on which the appeal/application is actually filed. What constitute sufficient cause cannot be laid down by hard and fast rules. In New India Insurance Co. Ltd. v. Smt. Shanti Misra [AIR 1976 SC 237], the Hon`ble Supreme Court held that discretion given by Section 5 should not be defined or crystalized so as to convert a discretionary matter into a rigid rule of law. The expression "sufficient cause' should receive a liberal construction. In Inder Singh v. Kanshi Ram [AIR 1917 PC 156] it was observed that true quite for a court to exercise the discretion under Section 5 is whether the appellant acted with reasonable diligence in prosecuting the appeal. In Shakuntala Devi Jain v. Kuntal Kumari & Ors. [(1969) 1 SCR 10061, a Bench of three Judges had held that unless want of bona fides of such inaction or negligence as would deprive a party of the protection of Section 5 is proved, the application must not be thrown out or any delay cannot be refused to be condoned.
4.1 I note that the reasons given in the affidavit for condonation of delay were convincing and these reasons would constitute reasonable and sufficient cause for the delay in filing this appeal. Having heard both the parties and after having gone through the affidavit as well the delay condonation, application, I am of the considered opinion that in the interest of justice, the delay deserves to be condoned. I, accordingly, condone the delay.
On merit, at the outset itself, the ld. Counsel for the assessee assailed the impugned order by contending that the assessee could not represent his case before Ld. CIT(A) and the order being an ex-parte order, stood vitiated on account of violation of principle of natural justice. The Ld. Counsel for the assessee submitted 3 A.Y. 2017-18 Dudabhai Maldebhai Antroliya that notices were not issued to the assessee during the appellate proceedings, hence, the assessee could not appear, before ld CIT(A), therefore, the Ld. CIT(A) has passed the ex-parte order. Hence, the Ld. Counsel prayed the Bench that now assessee wants to submit some additional documents and evidences, therefore, matter may be restored back to the file of the assessing officer for fresh adjudication.
On the other hand, the ld. DR for the Revenue submitted that assessee was negligent in his approach and did not appear before the Lower Authorities, therefore a cost should be imposed on the assessee, on account of his non- compliance attitude.
I have heard both the parties and carefully gone through the submission put forth on behalf of the assessee along with the documents furnished and the case laws relied upon, and perused the fact of the case including the findings of the ld. CIT(A) and other materials brought on record. I note that in the assessee’s case under consideration, the assessment was carried out u/s 143(3) of the Act and the impugned order passed by the ld. CIT(A), is an ex- parte order and non-speaking order, therefore, I do not wish to make any comments on the merits of the grounds raised by the assessee.
Considering the above facts, I note that assessee has not given sufficient opportunity of being heard and could not plead his case successfully before the ld. CIT(A). I note that the ld. CIT(A) did not discuss the assessee’s case on merits based on the material available before him hence it is a violation of principle of natural justice. I note that it is settled law that principles of natural justice and fair play require that the affected party is granted sufficient opportunity of being heard to contest his case. However, on account of non-compliance attitude of the A.Y. 2017-18 Dudabhai Maldebhai Antroliya assessee, I impose a cost of Rs. 2,000/- on the assessee which should be deposited in the Prime Minister National Relief Fund. Therefore, without delving much deeper into the merits of the case, in the interest of justice, I restore the matter back to the file of Ld. Assessing officer for de novo adjudication and pass a speaking order after affording sufficient opportunity of being heard to the assessee, who in turn, is also directed to contest his stand forthwith. Therefore, I deem it fit and proper to set aside the order of the ld. CIT(A) and remit the matter back to the file of the assessing officer to adjudicate the issue afresh on merits. For statistical purposes, the appeal of the assessee is treated as allowed.
In the result, the appeal of the assessee is allowed for statistical purposes. Order is pronounced in the open court on 08/12/2025