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Facts
The assessee appealed against the CIT(A)'s order, which had confirmed a penalty of Rs. 27,85,000 under section 271(1)(C) for furnishing inaccurate particulars related to a deduction claim under section 80IC. The CIT(A) had dismissed the assessee's appeal due to a 79-day delay without adjudicating on merits. Subsequently, the assessee filed an appeal with the ITAT, incurring a 2-day delay, for which condonation was sought due to intervening public holidays.
Held
The ITAT condoned the 2-day delay in filing the appeal before it, acknowledging the reasons provided. It noted that the CIT(A) had dismissed the appeal solely on account of a 79-day delay without addressing the merits of the penalty. Consequently, the ITAT set aside the CIT(A)'s order and remanded the matter back to the CIT(A) for re-adjudication on merits, granting the assessee a proper opportunity to present its case.
Key Issues
Whether the 2-day delay in filing the appeal before the ITAT should be condoned; and whether the CIT(A) was justified in dismissing the appeal solely on the ground of a 79-day delay without considering the merits of the penalty imposed under section 271(1)(C).
Sections Cited
271(1)(C), 80IC, 143(3), 250
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, CHANDIGARH BENCH, ‘A’, CHANDIGARH
Before: SHRI LALIET KUMAR & SHRI KRINWANT SAHAY
Order Per Krinwant Sahay, AM : Appeal in this case has been filed by the Assessee against the order dated 24.09.2024 passed by the Ld. Commissioner of Income Tax, Exemptions [‘(CIT(A)’]
Grounds of appeal, as raised by the Assessee are reproduced as under:
That the Impugned order is bad in law and contrary to the facts of the case. The Ld. Commissioner of Income Tax (Appeals),
1172-Chd-2024 2 NFAC, Delhi has not appreciated the facts and law in the correct manner and in accordance with the statute.
That the Ld. Commissioner of Income Tax (Appeals) has grossly erred in law and on facts to confirmed the penalty imposed under section 271(1)(C) of the Income Tax Act, 1961 amounting to Rs. 27,85,000/ for furnishing inaccurate particulars of Income in respect of claim of deduction under section 80IC whereas the issue itself was debatable at the time of filing of return. Hence the penalty imposed on that addition may be deleted.
On the facts and circumstances prevailing in the case and as per the provisions of the law, the learned CIT (Appeals) grossly erred in not condoning the delay of 79 days against the order passed under section 271(1) of the Income Tax Act, 1961 by the Ld. DCIT, Circle, Parwanoo irrespective of the fact that the assessee submitted required affidavit mentioning therein the reason for delay in filing the appeal before the Hon'ble CIT (Appeals). So your honour is requested to please condone the delay in filing of appeal before learned CIT (Appeals).
The Ld. CIT (Appeals), NFAC, Delhi grossly erred in not considering the appeal irrespective of the fact that the Original Order passed under section 143(3) of the Income Tax Act, 1961 by the DCIT, Circle, Parwanoo (against which the penalty has 1172-Chd-2024 3 been initiated) stands nullified after the decision of the Hon'ble Supreme Court in the case of M/s Mahabir Industries, Baddi vs. Principal Commissioner of Income Tax, decided on 18/05/2018 in favour of assessee.
The Ld. Commissioner of Income Tax (Appeals), NFAC, Delhi has not appreciated the facts of the case that penalty under section 271(1) has beer initiated on account of furnishing inaccurate particulars of Income in respect of claim of deduction under section 801C whereas the issue itself was debatable at the time of filing of return and later on decided in favour of assessee as mentioned in Point No 4 above.
The learned Commissioner (Appeals) ought to have seen that rejecting the appeal on technical grounds, the appellant is deprived of substantial justice as the same have been passed by overlooking the submissions and without giving reasons or controverting the basic facts and the law.
That the appellant craves leave to add any other ground of appeal
which may arise at the time of hearing.
1. 1. 1. 3. The Registry has pointed out that there is a delay of 2 days in filing of the appeal before the Tribunal. The Counsel of the Assessee has filed an application along with Affidavit on behalf of the 1172-Chd-2024 4 Assessee, making prayer for condonation of delay. The affidavit of the Assessee is as under: -
1172-Chd-2024 5
1172-Chd-2024 6
We have considered the reasons given in the Application / Affidavit and keeping in view the facts and circumstances mentioned therein, we are inclined to condone the delay.
The ld. DR did not have any objection for condonation of delay. Accordingly, the delay in filing of the appeal is hereby condoned and we proceed to decide the appeal on merit.
At the very outset, it has been submitted before the Bench by the ld. Counsel for the Assessee that the Ld. CIT(A) has dismissed the appeal because it was delayed by 79 days. The Ld. CIT(A) has not given any findings on merit, therefore, a prayer is made to remand the matter back to the file of the CIT(A).
Per contra, the ld. DR relied on the orders of the authorities below.
We have considered the findings given by the Ld. CIT(A) and the arguments made by the ld. Counsel for the Assessee as well as the ld. DR. We find that in the present case the Ld. Commissioner of Income Tax CIT(A) has not passed the order on merit on the basis of material available on record. Therefore, keeping in view the element of natural justice, we are inclined to remand it back
1172-Chd-2024 7 to the file of the CIT(A) to re-adjudicate the case on merit on the basis of material available on record. In view of this, the impugned order of the CIT(A) is set aside and the matter is restored to the file of the CIT(A) for decision afresh. Needless to say, that the ld. CIT(A) will give proper opportunity to the Assessee to present its case and to furnish necessary evidences and details. The applicant is also directed to present its case before the Ld. CIT(A) as and when called for and will not contribute in unnecessary delay in the hearing of the appeal.
In the result, the appeal of the Assessee stands allowed for statistical purposes. Order Pronounced on 11.2.2026. SD/- SD/-