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Facts
An assessment order was passed against the assessee for AY 2019-20. The assessee initially challenged this order via a writ petition in the Delhi High Court, which was subsequently withdrawn. Following the withdrawal, the assessee filed an appeal before the CIT(A) with a delay of 35 days, which the CIT(A) dismissed solely due to the delay.
Held
The ITAT found that the assessee had sufficient and bona-fide reasons for the 35-day delay in filing the appeal before the CIT(A), stemming from the High Court writ petition. The Tribunal condoned the delay and remitted the matter back to the CIT(A) for a fresh decision on the merits of the appeal, after providing a proper opportunity of being heard to the assessee.
Key Issues
Condonation of a 35-day delay in filing an appeal before the CIT(A); validity of the assessment order and additions made under sections 68 and 115BBE; legality of the reopening of assessment under sections 147, 148, 148A(d), and 151A.
Sections Cited
147, 144B, 68, 115BBE, 148, 148A(d), 151A
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCH ‘A’: NEW DELHI
Before: SHRI S. RIFAUR RAHMAN & SHRI YOGESH KUMAR U.S.
This appeal is filed by the Assessee against the order of Ld.
CIT(A)/National Faceless Appeal Centre [“NFAC” for short], dated 16/07/2024 for the Assessment Year 2019-20.
The grounds of Appeal are as under: -
“1. That the order of the Learned National Faceless Appeal Center (NFAC) is arbitrary. biased and bad in law and in facts and circumstances of the case in so far as it confirms the additions made by the Assessing Officer.
(2) That the Learned National Faceless Appeal Center has grossly erred in not condoning the delay in filing the appeal despite the assesse having a reasonable cause in late filing of appeal before NFAC.
(3) In law and facts of the case, the Learned National Faceless Appeal Center has grossly erred in not condoning the delay in filing the Appeal of 35 days despite the Assessee submitting in response to deficiency letter issued by the NFAC that delay in filing of appeal was on account of initial advice of a senior counsel to file a writ before the Hon'ble Delhi High Court which writ was withdrawn on the advice of the High Court counsel.
(4) That the Learned National Faceless Appeal Center has grossly erred in law and facts of the case in ignoring the date of order of Delhi High Court in writ petition W.P.(C) 7057/2024 & CM APPL.29435/2024 dated 16.05.2024 in which the Hon'ble High Court had allowed the assesse to withdraw the writ and dismissed the writ as withdrawn on receipt of which order the appeal before NFAC was filed on 22.05.2024, i.e. within a week of the High Court Order by not treating the delay occurring due to a reasonable cause.
(5) Without prejudice to above grounds of appeal, Learned National Faceless Appeal Center has grossly erred in not affording a proper and meaningful opportunity to the assesse to furnish its submission violating the principles of natural justice rendering the order unsustainable in law and facts of the case on this count alone.
(6) That the Learned National Faceless Appeal Center has grossly erred in not adjudicating the Grounds of Appeal advocated by the Assessee.
(7) The NFAC has not adjudicated the ground of illegal reopening of assessment consequent to which the Assessment Order passed thereto is illegal and bad in law which deserves to be quashed.
(8) That in law and facts of the case, the reopening of assessment notice under section 148 and order under section 148A(d) having been issued/passed by the Assessing Officer and not the Faceless Assessment Unit contrary to the provisions of section 144B and section 151A of the Act is illegal bad in law.
(9) In law and facts of the case the reopening of assessment is illegal and bad in law for the reason that the reopening of assessment has been done mechanically without independent application of mind on receipt of information from DGGI, Gurugram
(GST) that the Assessee had made sale transactions with one of the entities investigated by DGGI, Gurugram (GST).
(10) That the Learned National Faceless Appeal Center has grossly erred in confirming the action of the AO in making trading addition of Rs. 6,97,39,038/- for purchases made from M/s RCI Industries and Technologies Limited as business income on presumptions, assumptions, conjectures and surmises ignoring the documentary evidences filed in support of the claim of the Assessee of movement of goods from the supplier to the assessee's customers which addition is not sustainable in law and facts of the case.
(11) In law and facts of the case, the Learned National Faceless Appeal Center has grossly erred in confirming the action of the AO in invoking the provisions of section 68 r.w.s. 115BBE of the Act to make an addition of Rs. 3,46,82,091/- as unexplained credit on conjectures, surmises, presumptions, and assumptions that the Assessee was engaged in providing accommodation entries in the form of sales without bringing on record any material or evidence to justify the same.
(12) In law and facts of the case, the National Faceless Appeal Center has grossly erred in confirming the action of the AO in invoking the provisions of section 68 r.w.s. 115BBE of the Act for the amount of sales consideration received from M/s RCI Industries and Technologies Limited through bank as unexplained credit on presumptions and assumptions without making any independent enquiry or discrediting the documentary evidences filed by the assessee during the course of assessment proceedings to demonstrate as to how the explanation of the assessee was unsatisfactory rendering the addition made illegal, bad in law.
(13) That the Learned National Faceless Appeal Center has grossly erred in confirming the action of the assesse in making the addition of Rs.3,46,82,091/- under section 68 r.w.s. 115BBE of the Act for receipt of sales consideration from M/s RCI Industries and Technologies Limited for sales made to it as unexplained credit ignoring the fact that the addition amounts to double addition as the sales for the above amount had been declared as income by the Assessee in its Audited Profit and Loss account which addition is unsustainable in law and facts of the case.
14) That the appellant craves leave to add, alter or delete the above grounds of appeal at the time of hearing.”
Brief facts of the case are that, an assessment order came to be passed on 18/03/2024 u/s 147 read with Section 144B of the Income Tax Act, 1961 (‘Act’ for short) at Rs. 11,20,96,009/- as against retuned income of Rs. 76,74,880/-. Aggrieved by the assessment order dated 18/03/2024, the Assessee preferred the Writ Petition(C) 7057/2024 & CM Appeal No.
29435/2024 before the Hon'ble High Court of Delhi. The said Writ Petition has been allowed to withdraw by the Hon'ble High Court of Delhi subject to rights and contention being kept open to be addressed in appropriate proceedings that may be instituted. After the disposal of the said Writ Petition, the Assessee preferred an Appeal before the Ld. CIT(A) with a delay of 35 days in filing the Appeal before the Ld. CIT(A). The Ld. CIT(A) dismissed the Appeal filed by the Assessee on 16/07/2024 for delay in latches. Aggrieved by the order of the Ld. CIT(A), the Assessee preferred the present Appeal on the grounds mentioned above.
The Ld. Counsel for the Assessee submitted that the Ld. CIT(A)
committed error in not condoning the delay in filing the Appeal though there was sufficient cause for condoning the delay. Thus submitted that the order of the Ld. CIT(A) deserves to be aside.
Per contra, the Ld. Departmental Representative relying on the orders of the Lower Authorities, sought for dismissal of the Appeal of the Assessee.
We have heard both the parties and perused the material available on record. It is seen from the order of the Ld. CIT(A) that there was a delay of 35 days in filing the appeal and the Assessee filed an application for condoning the delay contending that the Assessee had challenged the action of the Department before the Hon'ble High Court of Delhi in W.P. No.
7057/24 and the delay in filing the Appeal was not intentional, but for the bona-fide reasons. However, the Ld. CIT(A) dismissed the Appeal filed by the Assessee on the grounds of delay in latches. In our opinion, the Assessee has explained the sufficient reason for condoning the delay of 35 days in filing the Appeal before the Ld. CIT(A). The Ld. CIT(A) ought to have condoned the delay of 35 days in filing the Appeal and should have decided the Appeal on its merits. Thus, we condone the delay of 35 days in filing the Appeal before the Ld. CIT(A) and restore the matter to the file of the Ld.
CIT(A) to decide the Appeal of the Assessee afresh in accordance with law after providing opportunity of being heard to the Assessee.
In the result, the Appeal of the Assessee is partly allowed for statistical purpose.
Order pronounced in open Court on 07th November, 2024 Sd/- Sd/- (S. RIFAUR RAHMAN) (YOGESH KUMAR U.S.) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 07/11/2024 R.N, Sr. PS