OM CERAMIC INDUSTRIES,MORBI vs. INCOME TAX OFFICE, WARD 1, MORBI, MORBI

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ITA 494/RJT/2025Status: DisposedITAT Rajkot30 October 2025AY 2020-215 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal condoned the delay in filing the appeal before the CIT(A). The Tribunal noted that the assessee had provided convincing reasons for the effective delay of 87 days, supported by case law. The Tribunal found that the assessee had not been given a sufficient opportunity to be heard by the CIT(A) and that the CIT(A) had not discussed the case on merits, which violated the principles of natural justice. Therefore, in the interest of justice, the Tribunal set aside the order of the CIT(A) and remitted the matter back to the CIT(A) for de novo adjudication on merits. The CIT(A) was directed to pass a speaking order after affording sufficient opportunity of being heard to the assessee, who was also directed to contest their stand forthwith. For statistical purposes, the appeal of the assessee was treated as allowed.

What were the facts?

The assessee, Om Ceramic Industries, filed an appeal against an order passed by the Commissioner of Income Tax (Appeal) (NFAC), Delhi, dated 29.07.2025. This order arose from an action taken by the Assessing Officer under Section 272A(1) of the Income Tax Act, 1961, for the Assessment Year 2020-21. The appeal before the ITAT was listed for hearing on 18.09.2025. The assessee did not appear for the hearing, nor did they request an adjournment. The Revenue's representative noted that the CIT(A) had passed an ex-parte order, dismissing the assessee's appeal without condoning a significant delay. The Revenue suggested remitting the matter back to the CIT(A) for fresh adjudication.

What were the issues?

1. Whether the delay in filing the appeal before the CIT(A) was sufficiently explained and ought to be condoned, considering the provisions of Section 5 of the Indian Limitation Act, 1963, and the principles of natural justice? Assessee's Contention: The assessee argued that the delay in filing the appeal before the CIT(A) was only 87 days, not 770 days as initially perceived. They cited a cardiac arrest of the Managing Partner, a change in auditor, and the festive/audit season as genuine reasons for the delay. They also highlighted their lack of educational background and unawareness of compliance timelines. The assessee relied on several Supreme Court judgments, including Collector, Land Acquisition, Anantnag and Anr. v. Mst. Katiji and Ors., Ramlal, & Chhotelal v. Rewa Coalfields Ltd., and New India Insurance Co. Ltd. v. Smt. Shanti Misra, emphasizing a liberal approach to condoning delay to achieve substantial justice. Revenue's Contention: The Revenue's representative invited attention to the ex-parte order of the CIT(A) which did not condone the delay and submitted that there was no discussion on merits, suggesting a remand for fresh adjudication.

Which sections of the Income-tax Act were involved?

Section 272A(1),Section 143(3),Section 271AAC(1)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “SMC”

Before: DR. ARJUN LAL SAINI

For Respondent: Shri Abhimanyu Singh Yadav, Ld. Sr. DR
Hearing: 18/09/2025Pronounced: 30/10/2025

Assessment Year: 2020-21 Om Ceramic Industries Income Tax Officer, wd – 1, 8-A, National Highway, Wankaner, Vs. Anand Nagar, Morbi – 363642 Morbi-363642 (Gujarat) PAN No.: AABFO6588L (अपीलाथ�/Assessee) : (��यथ�/Respondent) िनधा�रतीक�ओरसे/Assessee by : None राज�वक�ओरसे/Revenue by : Shri Abhimanyu Singh Yadav, Ld. Sr. DR सुनवाईक�तारीख /Date of Hearing : 18/09/2025 घोषणाक�तारीख /Date of Pronouncement : 30/10/2025 ORDER Per, Dr. Arjun Lal Saini, AM: 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 29.07.2025, arising in the matter of order passed by the assessing officer u/s 272A (1) of the Income Tax Act, 1961 (here-in-after referred to as “the Act”), relevant to the Assessment Year 2020-21.

2.

Notice of hearing of this appeal was sent to the assessee at the address given by the assessee in Form No.36. The said notice has not been returned unserved. Today when the case was called for hearing none appeared on behalf of the assessee nor any request for adjournment was made. It means that assessee is not interested in prosecuting this appeal. Hence the appeal filed by the assessee is heard, after hearing, learned DR for the revenue.

3. The ld. DR for the Revenue invited my attention to the order passed by the Ld.CIT(A), which is ex-parte order, wherein the Ld.CIT(A) did not condone the delay and dismissed the appeal of the assessee. The Ld.DR submitted that there is no discussion on merit by the Ld.CIT(A), therefore, matter may be remitted back to the file of the Ld.CIT(A) for fresh adjudication.

4. I have heard Ld. DR for the revenue, and noted that Ld.CIT(A) has adjudicated the issue on condonation of delay, where 770 days of delay were not condoned by the Ld.CIT(A), however, the effective delay in filing the appeal before the learned CIT (A), as per assessee, was 87 days only. I note that during the appellate proceeding, the assessee has submitted, before learned CIT(A), the petition for condonation of delay, which is reproduced below:

“1. Your honour may kindly appreciate that Ld. AO has passed order u/s 143(3) on 22.09.2022, which was served on 22.09.2022 and appeal before hon. CIT(A), was filed on 17.01.2023, hence there was delay of 87 days only.

2. Your honour may kindly appreciate that Ld. AO has passed order u/s 272A(1)(d) on 13.02.2023, which was served on 13.02.2023 and appeal before hon. CIT(A), was filed on 23.04.2025, hence there was delay of 770 days.

3.

Your honour may kindly appreciate that Ld. AO has passed order u/s 271AAC(1) on 13.02.2023, which was served on 13.02.2023 and appeal before hon. CIT(A), was filed on 23.04.2025, hence there was delay of 770 days.

4.

Your honour may kindly appreciate that while filing form 35 in condonation of delay it was mentioned that "Managing partner of the Firm was suffering from cardiac arrest and perform angioplasty during the period and thereafter the AR (CA) Auditor of the Firm has been changed. Festive and Audit season further added to delay in filing of appeal. Sir we all are not from the educated background and also unaware the compliance and also unaware the compliance and time line specified in the Act. We sincerely pray your honour to condone the delay 5. Your honor can analyse hat assessee is not having educational background and not aware of income tax proceedings and due to emergency health situation matter got further delayed.

6.

Hence we request your honour to condone the delay and consider our submission in true spirit and good faith and there was no ill motive behind filing appeal after due date there was a genuine reason behind that as also stated in form 35. In view of above facts, we kindly request your honour to condone delay in filing appeal. We invite your honours kind attention to some judicial observation The Supreme Court in the case of Collector, Land Acquisition, Anantnag and Anr.v. Mst. Katiji and Ors. AIR 1987 SC 1353 held as under: The legislature has conferred the power to condone delay by enacting Section 5 of the Indian Limitation Act of 1963 in order to enable the Courts to do substantial justice to parties by disposing of matters on 'merits'. The expression "sufficient cause" employed by the legislature Page 0795 is adequately elastic to enable the Courts to apply the law in a meaningful manner which sub-serves the ends of Justice that being the life-purpose for the existence of the institution of Courts. It is common knowledge that this Court has been making Court justify liberal approach in matters instituted in this court. But the message does not appear to have percolated down to all justifiably liberal approach in matters instituted in this other Courts in the hierarchy. And such principle it is realized that ordinarily by lodging an appeal late. Refusing meritorious matter being thrown out a litigant does not stand to benefit liberal approach is adopted on condone delay can result in a the very threshold and cause of Justice being defeated. As against this when delay is condoned the highest cause would be decided on merits after hearing that can happen is that the parties. 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 applicants/appellant has to explain whole of the period between the date of the judgement till the date of filing the appeal. It is sufficient that the applicant/appellant 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], 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. KuntalKumari&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. In Concord of India Insurance Co. Ltd. v. Nirmala Devi &Ors. [(1979) 3 SCR 694] which is a case of negligence of the counsel which misled a litigant into delayed pursuit of his remedy the default in delay was condoned. In Lala Mata Din v. A. Narayanan [(1970) 2 SCR 90], Supreme Court had held that there is no general proposition that mistake of counsel by itself is always sufficient cause for condonation of delay. It is always a question whether the mistake was bona fide or was merely a Page 3 of 5

devise to cover an ulterior purpose. In that case it was held that the mistake committed by the counsel was bona fide and it was not tainted by any mala fide motive In State of Kerala v. E.K. Kuriyipe&ors. (1981) Supp. SCC 721, it was held that whether or not there is sufficient cause for condonation of delay is a question of fact dependant upon the facts and circumstances of the particular case. In Smt. Milavi Devi v. Dina Nath (1982) 3 SCR 366], it was held that the appellant had sufficient cause for not filing the appeal within the period of limitation. This Court under Art.136 can reassess the ground and in appropriate case set aside the order made by the High Court or the Tribunal and remit the matter for hearing on merits. It was accordingly allowed, delay was condoned and case was remitted for decision on merits.”

5.

I have heard Ld DR and carefully gone through the submission put forth on behalf of the assessee along with the documents furnished and the case laws relied upon, by assessee during the appellate proceedings, before ld.CIT(A) and perused the facts of the case including the findings of the ld CIT(A) and other materials brought on record. I note that the assessee has explained sufficient cause during the appellate proceeding before the Ld.CIT(A) to explain the effective delay of 87 days, excluding 30 days of filing the appeal before learned CIT(A). The reasons for delay were convincing in nature, therefore, I condone the delay in filing the appeal before the Ld.CIT(A).

6. On merit, (and 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. 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. CIT(A) for de novo adjudication and pass a speaking order after affording sufficient opportunity of being heard to the assessee, who Page 4 of 5 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 ld. CIT(A) to adjudicate the issue afresh on merits. For statistical purposes, the appeal of the assessee is treated as allowed.

7.

In the result, the appeal of the assessee is allowed for statistical purposes.

Order is pronounced in the open court on 30/10/2025.

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