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Facts
The assessee filed appeals against two orders passed by the Commissioner of Income Tax (Appeals), NFAC, Delhi. There was a significant delay of 585 days in filing these appeals, attributed to the illness of the erstwhile chartered accountant who failed to attend to hearing notices. The assessee only became aware of the orders upon receiving recovery notices.
Held
The Tribunal condoned the delay in filing the appeals after finding sufficient cause. While acknowledging the ex-parte nature of the orders and the best judgment assessment under Section 144, the Tribunal, in the interest of justice, decided to restore the matter to the AO.
Key Issues
Whether sufficient cause exists for condoning the delay in filing the appeals, and whether the ex-parte orders passed due to non-compliance with notices should be set aside and restored to the AO for fresh adjudication.
Sections Cited
250, 144
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, ‘A’ BENCH, CHENNAI
Before: SHRI GEORGE GEORGE KAND MS PADMAVATHY S
आदेश/ O R D E R PER GEORGE GEORGE K, VICE PRESIDENT: These appeals filed by the assessee are directed two different orders of the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi, both dated 04.01.2024, passed under section 250 of the Income Tax Act, 1961 (hereinafter called ‘the Act’). The relevant Assessment Years are 2016-17 and 2011-12.
& 3140/Chny/2025 :- 2 -:
There is a delay of 585 days in filing these appeals. The assessee has filed a petition for condonation of delay and affidavit stating there in the reasons for belated filing of these appeals. The reasons stated is that, due to the illness of assessee’s erstwhile chartered accountant for a very long time, he failed to take note of the hearing notices and make proper representation before the lower authorities. It was further submitted that only on receipt of recovery notice on 11.10.2025, the assessee came to know about the order being passed by the First Appellate Authority. Subsequently, the assessee with the help and guidance of present chartered accountant filed the appeals before the Tribunal with delay. On perusal of the reasons stated, we find there is sufficient cause for delay in filing these appeals before the Tribunal. Hence, we condone the delay in filing the appeals and proceed to dispose off the appeals on merits.
At the very outset, we notice that the order passed by the First Appellate Authority (FAA) is ex-parte, since there was no compliance from the assessee to five notices issued from the office of the First Appellate Authority. Further, we also notice that the assessment has been completed on best judgment assessment u/s. 144 of the Act.
The Ld.AR for the assessee submitted that the order passed by the FAA is ex-parte and the assessment has also been completed on & 3140/Chny/2025 :- 3 -:
1. best judgment basis u/s.144 of the Act. The Ld.AR further submitted that due sudden fall in the health condition of assessee’s erstwhile chartered accountant, who was handling the assessee’s financial affairs failed to take note of the hearing notice and present before the FAA. The assessee came to know about the order being passed by the FAA only on receipt of the recovery notice. Since, the assessee has not represented his case before the AO and FAA, it was prayed in the interest of justice and equity, the issue may be restored to the files of the AO as a last opportunity for proper representation of his case.
The Ld.DR submitted that adequate opportunities were provided from the offices of the AO and the FAA and there is no violation of principles of natural justice. Therefore, it was prayed the appeal of the assessee may be dismissed.
We have heard rival submissions and perused the materials on record. The proceedings before the AO as well as the FAA was ex-parte, since the assessee did not respond to various notices issued. The Ld.AR submitted that the assessee’s erstwhile chartered accountant who was dealing with assessee’s financial affairs was ill for a very long time and hence, failed to take note of the hearing notices and represent before the FAA. We strongly deprecate the nonchalant attitude of the assessee in not responding to the notices issued from & 3140/Chny/2025 :- 4 -:
the offices of the FAA and the AO. However, in the interest of justice and fair play, we are of the view that the matter ought to be restored to the files of the AO with a condition assessee pays a cost of Rs.15,000/- each (Rupees fifteen thousand in each case) to be paid to Tamil Nadu State Legal Services Authority at the Hon’ble High Court of Madras. The amount of Rs.30,000/- shall be paid within a month’s time from the date of receipt of this order and assessee shall produce the receipt for the said payment before the AO. Accordingly, the matter is remitted to the files of the AO for fresh adjudication. The AO shall afford reasonable opportunity of hearing to the assessee. The assessee is directed to co-operate with the Revenue and shall not seek unnecessary adjournment. It is ordered accordingly.
In the result, the appeals filed by the assessee are allowed for statistical purposes.