SHREE TITHVA SEVA SAHKARI MANDLI LIMITED,TITHVA, WANKANER vs. INCOME TAX OFFICER WARD-1, MORBI
In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.
What did the Tribunal hold?
The Tribunal condoned the delay of 203 days in filing the appeal, finding that there were mitigating circumstances to exercise discretion in favor of the assessee. Regarding the merits, the Tribunal noted that the assessment was carried out under Section 143(3) and the impugned order by the Ld. CIT(A) was ex-parte and non-speaking. The Tribunal found that the assessee was not given sufficient opportunity of being heard and could not plead their case effectively before the Ld. CIT(A), constituting a violation of the principle of natural justice. The Ld. CIT(A) did not discuss the assessee's case on merits based on the available material. Therefore, without delving into the merits of the grounds raised, the Tribunal restored the matter back to the file of the Assessing Officer for de novo adjudication. The assessee was directed to contest their stand forthwith. A cost of Rs. 5,000/- was imposed on the assessee, to be deposited in the Prime Minister National Relief Fund, which the assessee had complied with. The order of the Ld. CIT(A) was set aside, and the matter was remitted back to the AO to adjudicate the issue afresh on merits after affording sufficient opportunity of being heard to the assessee. For statistical purposes, the appeal was treated as allowed.
What were the facts?
The assessee, Shree Tithva Seva Sahkari Mandli Limited, filed an appeal before the Income Tax Appellate Tribunal (ITAT), Rajkot Bench, for Assessment Year (AY) 2020-21. The appeal was directed against an order passed by the Commissioner of Income Tax (Appeals) [CIT(A)/NFAC], dated 21/06/2024, which arose from an assessment order passed by the Assessing Officer (AO) under Section 143(3) of the Income Tax Act, 1961, dated 19/09/2022. The assessee admitted that the appeal was filed belatedly by 203 days and sought condonation of the delay, citing reasons related to a dispute with their former tax consultant who allegedly did not relay notices and the appellate order. The revenue opposed the condonation of delay.
What were the issues?
1. Whether the delay of 203 days in filing the appeal before the ITAT should be condoned, considering the reasons provided by the assessee? Assessee's Contention: The assessee argued that the delay was unintentional and occurred due to reasons beyond their control, specifically the non-communication of notices and the appellate order by their former tax consultant. They relied on the Supreme Court's decision in Investment Trust v. Ujagarsingh and the Gujarat High Court's ruling in Gujarat State Fertilizers & Chemicals Ltd. (283 ITR 149) to advocate for a liberal and pragmatic approach in condoning delays, emphasizing that substantive rights should not be defeated by technicalities. Revenue's Contention: The revenue argued that the delay should not be condoned based on the reasons presented in the petition for condonation of delay. 2. Whether the ex-parte and non-speaking order passed by the Ld. CIT(A) vitiated the proceedings on account of violation of the principle of natural justice, and if so, whether the assessee should be granted another opportunity to contest the appeal before the first appellate authority? Assessee's Contention: The assessee contended that they could not represent their case before the Ld. CIT(A) because the responsible trustee was illiterate and unaware of e-filing and e-assessment proceedings. They further argued that the Ld. CIT(A) did not pass a speaking order as mandated by Section 250(6) of the Act, thus violating the principle of natural justice. They sought another opportunity to contest the appeal. Revenue's Contention: The revenue argued that since the assessee neither appeared before the AO nor the Ld. CIT(A), such a negligent assessee should not be given a second inning and the appeal should be dismissed. They suggested imposing a cost of Rs. 5,000/- on the assessee if the matter was restored to the lower authorities.
Which sections of the Income-tax Act were involved?
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, RAJKOT BENCH (SMC
Before: DR. ARJUN LAL SAINI
आदेश / O R D E R
PER DR. A. L. SAINI, AM: Captioned appeal filed by the assessee, pertaining to Assessment Year (AY) 2020-21,is directed against the order passed by the Learned Commissioner of Income Tax(Appeals), National Faceless Appeal Centre, Delhi [in short “the Ld. CIT(A)/NFAC”], dated 21/06/2024,which in turn arises out of an assessment order passed by Assessing Officer (in short ‘the AO”) u/s 143(3) of the Income Tax Act, 1961 (hereinafter referred to as “the Act”), dated 19/09/2022.
2. When the matter was called for hearing, the learned Counsel for the assessee at the outset submitted that the appeal has been filed by the assessee belatedly. The learned Counsel adverted my attention to the affidavit filed in this regard citing reasons for condonation of delay and urged for a benign view and sought
ITA 19-Rjt-2025 (AY 2020-21) Shri Tithva Seva Sahkari Mandali Ltd. v. ITO condonation of delay of 203 days in filing the appeal before the Tribunal.The contents of the said petition for condonation of delay, are reproduced below:
“With reference to the captioned subject, the appellant humbly states as under:
The appellate order u/s. 250 was passed on 21.06.2024. Accordingly, the appeal was required to be filed by 20.08.2024. The appeal is thus belated by 203 days.
The reason for non-compliance during the course of the appellate proceedings and the delay in filing this appeal is that the email ID of the appellant's old tax consultant was registered on the e-filing portal who was having a fee-related dispute with the appellant. All the notices were sent on his email ID. He neither informed the appellant regarding the notices issued u/s. 250 of the Act nor regarding the appellate order passed in the case of the appellant.
3. The appellant came to know about the appellate order passed in their case only upon recruiting a new tax consultant. Thus, after knowing about such an appellate order, the appellant contacted a firm of senior Chartered Accountants. In these circumstances, the appellant sought their guidance for further legal remedies. They advised the appellant to file an appeal with prayer for condonation of delay. Accordingly, under their guidance, this appeal is being filed by the appellant along with prayer for condonation of delay.
4. The delay is unintentional. The delay occurred due to reasons beyond reasonable control. Therefore, it is prayed that the case of the appellant deserves sympathetical considerations for condonation of delay. The appellant respectfully submits that the cause of justice demands that the appellant should be given a fair chance to present the case on merits.
On professional advice, the appellant wishes to state that the Courts and Tribunals have consistently held that in the matter of condonation of delay, a pragmatic and liberal approach should be taken. The Hon'ble Supreme Court held the same in the case of Investment Trust v. Ujagarsingh observing that unless malafide or negligence writ large, delay should be condoned and appeals should not be rejected on technical ground of delay and they should be ordinarily decided on merits.
The appellant may humbly submit that the Hon'ble Gujarat High Court has also considered this aspect of condonation of delay in case of Gujarat State Fertilizers & Chemicals Ltd. (283 ITR 149) and held that... "The position in law is well settled that an assessee should be granted due relief where it is due without standing on technicalities and the revenue must bear the established legal position in mind while dealing with applications seeking condonation of delay. It is necessary that liberal approach is adopted in such a matter so as to ensure that substantive rights are not defeated on the basis of technicalities or limitation."
In view of the above, the appellant humbly requests Your Honour to kindly condone the delay and admit the appeal on merits appreciating the above facts. For this act of kindness, the appellant shall remain obliged forever.”
ITA 19-Rjt-2025 (AY 2020-21) Shri Tithva Seva Sahkari Mandali Ltd. v. ITO
Learner Counsel for the assessee submitted before me that based on the contents of the above petition for condonation of delay, the delay should be condoned in the interest of justice, as the assessee has explained the sufficient cause and reason for the delay. However, on the other hand, ld. DR for the revenue submitted that delay should not be condoned, based on the reasons mentioned in the petition for condonation of delay.
I have heard both the parties. A perusal of the affidavit gives me an impression of existence of mitigating circumstances to enable me to exercise my discretion in favour of the assessee. Accordingly, the delay is condoned.
5. 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 Learned Counsel for the assessee submitted that assessee under consideration,( the responsible Trustee, of this trust) is illiterate and does not know the email- proceedings and e- assessment proceedings. Therefore, the assessee( trust) could not attend the hearings before the lower authorities. In addition to this, the ld. CIT(A) did not pass the order, as per the mandate of the provisions of section 250(6) of the Act. Therefore, the ld. Counsel for the assessee contended that in the interest of justice, another opportunity to contest the appeal before the Ld. first appellate authority may be granted to the assessee.
6. On the other hand, learned DR for the revenue submitted that assessee neither appeared before the assessing officer, nor appeared before the learned CIT(A), therefore, such negligent assessee should not be given second inning and appeal of the assessee should be dismissed. It is just wasting the time and resources of ITA 19-Rjt-2025 (AY 2020-21) Shri Tithva Seva Sahkari Mandali Ltd. v. ITO the authorities below, if the matter is restored back to the file of the lower authorities. Therefore, if the Bench wants to remit this issue back to the file of the lower authorities, then a cost of Rs.5000/- may be imposed on the assessee, which may be deposited in the Prime Minister national relief fund.
I have heard both the parties. 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. However, 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 assessee, I impose a cost of Rs.5000/- which is to be deposited, by the assessee in the Prime Minister national relief fund.
I note that assessee has deposited Rs.5000/ in the Prime Minister national relief fund and furnished the receipt before me. 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 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 ITA 19-Rjt-2025 (AY 2020-21) Shri Tithva Seva Sahkari Mandali Ltd. v. ITO 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 pronounced in the open court on 25 / 04 /2025.
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