SH. RAJ KUMAR CHAUDHARY,DELHI vs. ITO WARD-34(5), DELHI

3. That the learned Commissioner of Income Tax (Appeals) has grossly erred both in law and on facts in upholding the initiation of proceedings under section 147 of the Act and, completion of assessment under section 147/144/1448 of the Act without appreciating that the same were without jurisdiction and hence deserved to be quashed as such 3.1 That the learned Commissioner of Income Tax (Appeals) has failed to appreciate that notice issued u/s 148A(b) of the Act, under section 148 of the Act order u/s 148A(d) of the Act are also illegal, invalid and without jurisdiction and deserve to be quashed as such. 3.2 That the learned Commissioner of Income Tax (Appeals) has failed to appreciate that there was no tangible material on record in the form of specified information to suggest that income of the appellant had escaped assessment and in view thereof the Sh. Raj Kumar Chaudhary proceedings initiated are illegal, untenable and therefore unsustainable. 3.3That the learned Commissioner of Income Tax (Appeals) has failed to appreciate that non supply of information in accordance with clause (1) of Explanation 1 to section 148 of the Act even otherwise vitiates the notice u/s 148A(b) of the Act and order u/s 148A(d) of the Act. 3.4That the learned Commissioner of Income Tax (Appeals) has failed to appreciate that initiation of proceedings was mechanical and without any application of mind much less independent application of mind. therefore the notices issued u/s 148A(b) of the Act; and u/s 148 of the Act are invalid notice; and also order u/s 148A(d) of the Act was an invalid order and thus assumption u/s 147 of the Act was without jurisdiction. 3.5 That learned Commissioner of Income Tax (Appeals) has failed to appreciate that notice u/s 148A(b) of the Act was issued based on factually incorrect assumptions and presumptions and therefore such a notice being highly cryptic vague could not legally and logically be made a basis for assumption of jurisdiction and therefore deserves to be quashed as such. 3.6 That the learned Commissioner of Income Tax (Appeals) has failed to appreciate that notice u/s 148A(b) of the Act and, notice dated 25.3.2022 u/s 148 of the Act issued without validly complying section 151 of the Act were also without jurisdiction. 3.7That the learned Commissioner of Income Tax (Appeals) has failed to appreciate that notice u/s 148A(b) of the Act and order u/s 148A(d) of the Act are contrary to section 151A of the Act; and therefore the assumption of jurisdiction was not in accordance with law. 4That the learned Commissioner of Income Tax (Appeals) has further erred both in law and on facts in upholding an addition of Rs. 3,60,51,890/- representing alleged unexplained money and brought to tax u/s 69A of the Act read with section 115BBE of the Act. 4.1That while confirming the above addition, the learned Commissioner of Income Tax (Appeals) has failed to appreciate the factual substratum of the case, statutory provisions of law and as such, addition so made and sustained is highly misconceived, totally arbitrary, wholly unjustified and therefore, unsustainable.

5. That even otherwise the learned Commissioner of Income Tax (Appeals) passed the order without granting sufficient proper 3671 & 3670/Del/2025 Sh. Raj Kumar Chaudhary opportunity to the appellant and therefore the same is contrary to principle of natural justice and hence vitiated.

6. That the learned Commissioner of Income Tax (Appeals) has also erred both in law and on facts in upholding the levy of interest of Rs. ………………..u/s 234A of the Act, and interest of Rs. u/s 234B of the Act which are not leviable on the facts of the appellant. Prayers- It is therefore, prayed that it be held that assessment made by the learned Assessing Officer and sustained by the learned Commissioner of Income Tax (Appeals) deserves to be quashed as such. Furthermore, the addition made and upheld by the learned Commissioner of Income Tax (Appeals) alongwith interest levied be deleted and appeal of the appellant be allowed.”

ITA No.- 3670/Del/2025 “1. That the learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC) has erred both in law and on facts in sustaining the levy penalty of Rs. 21,63,113/- u/s 271AAC (1) of the Act in an order dated 10.1.2025 passed u/s 250 of the Act.

are dismissed as not maintainable and thereby appellant two appeals of AY 2018-19 as discussed above are dismissed as per facts available on record on merit, notwithstanding its dismissal in limine, consequent to rejection of appellant's plea for condition of delay in filing instant two appeals as lacking sufficient cause within the meaning of section 249(3) of the I.T. Act as discussed supra" is also not based on correct appreciation of facts on record and therefore unsustainable

3. That the learned Commissioner of Income Tax (Appeals) has further failed to appreciate that the impugned penalty order u/s 271AAC(1) of the Act has been passed without providing adequate opportunity of being heard and as such passed in violation of principles of naturaljustice.

4. That the learned Commissioner of Income Tax (Appeals) has failed to appreciate that inabsence of any specific show cause notice having been issued, the levy of penalty was otherwise wholly illegal.

5. That the learned Commissioner of Income Tax (Appeals) has failed to appreciate that penalty proceeding and quantum proceedings are distinct proceedings and therefore conclusion drawn in quantum proceeding cannot automatically be made a basis to levy penalty u/s 271AAC(1) of the Act.

6. That the learned Commissioner of Income Tax (Appeals) has failed to appreciate the factual matrix of the case of the appellant and evidence on record and conclusions thus drawn mechanically are wholly unjustified

7. That furthermore that since no valid satisfaction was recorded in the order of assessment, penalty levied was otherwise too not in accordance with law. Prayer- It is therefore prayed that the penalty levied of Rs. 21,63,113/-u/s 271AAC(1)) of the Act and sustained by the learned Commissioner of Income Tax (Appeals) may kindly be deleted and, appeal of the appellant be allowed.”

- 3671 & 3670/Del/2025 Sh. Raj Kumar Chaudhary ITA No.3671/Del/2025

2. First, we take up the quantum appeal. 2.1 There is a delay of 64 days in filing of both the appeal before us. In this regard, the assessee has filed an identical application dated 27.08.2025 for condonation of the delay for both the appeals along with the supporting affidavit of Shri Hari Narayan Pal, the Accountant of the assessee who as per the condonation petition and the affidavit had inadvertently omitted to notice the aforesaid order dated 10.01.2025 of the ld. CIT(A) on income tax portal. The relevant extract of the condonation application for is reproduced as under:-

“The assessee has been filed an appeal against the order of learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi, dated 10.1.2025 in ITA No.3671/D/2025. According to the statutory provisions contained in section 253 of the Act, the appeal has to be filed within sixty days of order dated 10.1.2025 passed by learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi, and as such the appeal was due to be filed by 11.3.2025 whereas the appeal has been filed on 03.06.2025 leading to a delay of 64 days.

3. It is thus respectfully submitted that there is plausible reason for the delay in filing of appeal. It is evident that instant delay was not caused on account of laches, malafide intention and gross negligence on the part of the applicant/appellant. Thus, since the circumstances stated above constitute sufficient cause, the applicant prays that delay in filing of appeal be condoned. The submission of the applicant is that technical considerations cannot and should not act as bar to the cause of substantial justice and in any case, there is no loss/prejudice to revenue. Reliance is placed on following judicial pronouncements: i) (1998) 7 SCC 123 N. Balakrishan v. M. Krishnamurthy “It must be remembered that in very case of delay, there can be some lapse on the part of the litigant concerned. That alone is not enough to turn down his plea and to shut the door against him. If the explanation does not smack of mala fides or it is not put forth as part of dilatory strategy, the court must show utmost consideration to the suitor. But when there is reasonable ground to think that the delay was occasioned by the party deliberately to gain time, then the court should lean against acceptance of the explanation. While condoning the delay, the court should not forget the opposite party altogether. It must be borne in mind that he is a loser and he too would have incurred quite large litigation expenses” [Emphasis Supplied]” ii) 167 ITR 471 (SC) Collector, Land Acquisition vs. Mst. Katiji & Ors. “The expression “sufficient cause” employed by the legislature is adequately elastic to enable the courts to apply the law in the meaningful manner which sub serves the needs to justice - that being the life - purpose of the existence of the institution of courts. It is common knowledge that this court has been making a justifiably liberal approach in matters instituted in this court. But the message does not appear to have percolated down to all the other courts in the hierarchy”.

4. Therefore, it is most respectfully prayed that delay in filing of the instant appeal may kindly be condoned and, applicant be provided fair, meaningful and proper opportunity to establish that the income returned is in accordance with law.”

- 3671 & 3670/Del/2025 Sh. Raj Kumar Chaudhary 2.2 The Ld. DR opposed the condonation application. 2.3 After hearing both the parties, we are satisfied with the explanation filed by the assessee for the delay in filing the above appeal. We, therefore, condone the delay and the appeal is admitted for hearing.

3.1 In absence of any response/explanation the AO passed an ex- parte order u/s 147 rws 144 rws 144B of the Act on 03/03/2023, making an addition of Rs 3,60,51,890/- u/s 69A of the act as unexplained cash deposit.

5.1 The explanation filed by the assessee for the delay in filing the appeal before the Ld. CIT(A) as referred in Para 4 of the Ld. CIT(A)’s order is reproduced as under:-

- 3671 & 3670/Del/2025 Sh. Raj Kumar Chaudhary "The appeal in this case is against the above order u/s 147 r.w.s 144 r.w.s 144B of the Act dt.03.03.2023. The appellant is an Individual Assessee is engaged in the business of Manufacturing of Machinery and machinery Parts in the name and style of M/s Titan Hydraulics (India) and engaged in the business of Manufacturing of Bread in the Name and Style of M/s Komal foods and earned Interest Income from Saving Account. During the Previous year 2018-19 relevant to A.Y 2018-19, Assessee had not filed the return of income due to his Poor health. Later, The reassessment proceedings were initiated u/s 148 of the Income Tax Act, 1961 (for short the Act) on the basis of information received from Canara Bank, that an amount of Rupees Three crore Sixty lakh fifty one thousand eight hundred ninety (Rs. 3,60,51,890/-) is credited in the bank a/c No. 4846261000011. AO had passed ex- parte order u/ s 147 of the Act on 03/03/2023, and made an addition of Rs 3,60,51,890/- u/s 69A of the act as unexplained cash credit The Impugned order was passed on 03.03.2023 and appeal is filing on 25/09/2023 there is delay of 177 days. There is no proof of service of impugned order to the appellant. As a matter of fact the receipt of order and statutory notices were denied by the appellant. The Assessee had not received any notice on the Mailing Address C-243, Sector-3, DSIDC INDL. Area, Bawana, New Delhi-110039. Notice may served on the Portal or email but assesse being a lay man not aware about the E proceeding facility on the portal, and also E Mail is of Professional and he did not tell assesse about such Notice. Hence notice under section 148 of the Act was not received by the assessee. The Appellant came to know about the impugned order only when Penalty Notice u/s 271AAC(1) was received in last week of August. Thus, this may be treated as sufficient cause for filing the appeal late. This resulted in delay of 177 days in filing the appeal. Affidavit of the appellant is enclosed.” (emphasis supplied by us)

5.2 The Ld. CIT(A) did not accept the explanation of the assessee for the delay in filing the appeal and dismissed the appeal of the assessee in limine and did not admit the appeal of the assessee. The Sh. Raj Kumar Chaudhary Ld. CIT(A), however, without any prejudice to the rejection of the assessee’s contention of delay plea resulting in the appeal being dismissed in limine, considered the appeal of the assessee for disposal on facts of the case as available on record and keeping in view the appellant’s claims/submissions as per law on merits.

5.3 The relevant extract of the order of the Ld. CIT(A) for not condoning the delay for both the appeals (the delay in respect of penalty appeal was of 64 days) is reproduced as under: - “4.1 However, on perusal of appellant, claim/contention as above on the inordinate delay of about six months and two months for assessment and related penalty appeals, apparently appellant is contending the delay as attributable to not receiving of any notices and orders from the AO to the mailing address of the appellant at C- 243, Sector-3, DSIDC INDL. Area, Bawana, New Delhi-110039 and the same are apparently served on the Income Tax portal/e-mail and with reference to the same the appellant further contends that the appellant being a lay man and not aware of the e-proceedings facilities and technical issues and accordingly contended that the appeal could not be filed as the same is not received at his physical mailing address is the contention of the appellant. Further in his submissions appellant contends that his professional also did not tell appellant about such notices and accordingly no such notice u/s. 148 is received by the appellant is the contention of the appellant. Further appellant contends that he came to know after receipt of penalty notice u/s. 271AAC of I.T. Act in August, 2023 and after that these two appeals are filed in September, 2023 last week and December, 2023 respectively. Appellant contentions to take plea in the guise of not serving physical notice at the mailing address is neither reasonable nor acceptable as justifiable Sh. Raj Kumar Chaudhary when the AO has indeed issued various notices u/s. 148, 142(1), 144B and final SCN etc to the appellant as per the due procedure on ITBA involving communication to the appellant on e-filing portal/e-mail as provided by the appellant as per due procedure and the same is clearly evidenced from the orders of AO involving assessment and related penalty. Further appellant contending that his professional has not brought to his notice of such proceedings of AO u/s. 148 of I.T.Act and accordingly requesting to condone the delay in filing of these appeals is not acceptable as it is the primary onus and responsibility of the appellant to persue the Income tax proceedings as per law as involving quasi judicial proceedings and could not adduce professional to follow up the same on behalf of appellant on such proceedings of AO. Further on perusal of penalty order, it is clearly noticeable that AO has made various attempts to serve the penalty notices as per law as reasoned in this assessment order and has finally served the same through “Whatsapp” with the assistance of verification unit ( VU) as per the due procedure of faceless scheme clearly establishes lack of appellant keenness to persue the Income tax proceedings of his own case and this also proves that the appellant is well conversant with the e- mail and other electronic communication as reasoned by AO in this penalty order as at para(3.6) and (3.7). Considering all these facts of case as brought out by the AO in the assessment order read with related penalty order etc, apparently appellant contentions to explain such an inordinate delay of six months in filing appeal against assessment order and again with delay of two months in filing appeal against penalty order even after knowing appellant non response before AO during proceedings and non filing of timely appeal against assessment order etc, clearly establishes the claims of the appellant in filing these appeals without adhering to statutory limits as per law as involving very casual/negligent approach of appellant to represent the assessment proceedings as well as filing of appeals as per law. Accordingly appellant contentions to condone the delay involved in filing these two appeals is neither reconcilable nor acceptable as per facts on record as contended by the appellant. In view of these facts of case and keeping in view the overall submissions/claims of the appellant and claim of delay as condonable as above, it is 3671 & 3670/Del/2025 Sh. Raj Kumar Chaudhary apparently a case of inordinate delay involving no specific circumstances warranting condonation of delay. Before the decision in the matter, can be taken on merits, it is necessary to decide whether the aforesaid reason constitutes sufficient causes to explain such an inordinate delay of about six months and two months respectively in filing the appeal and same discussed here under: ………………xxx…………….. 4.8 Under the above circumstances, it is constrained to hold that no material evidences/substantiations etc has been adduced by the appellant to successfully demonstrate that there was no negligence, inaction, or want of due diligence involved in the inordinate delay of about six months and two months respectively in filing of these instant appeals. Rather the submissions made display the contrary. In other words, no sufficient cause has been established by the appellant for the delay in filing these appeals. Consequently, the application for condonation of delay in filing the instant appeals is to be rejected as lacking 'sufficient cause' within the meaning of Section 249(3) of the I.T. Act. The appeal is therefore not admitted and proceeded with, and therefore dismissed in limine. However, without any prejudice to the rejection of appellant's condonation of delay plea resulting in appeal being dismissed in limine, appellant's appeal is considered for disposal on facts of case as available on record and keeping in view the appellant claims/submissions as per law on merits.”

- 3671 & 3670/Del/2025 Sh. Raj Kumar Chaudhary 8. We have heard the rival submissions and perused the material available on record. In this case, the assessee explained that he was not aware about the assessment proceedings in his case and the passing of the assessment order and he came to know about the assessment order only after the receipt of the penalty notice in August 2023. This fact was not contradicted by the Ld. CIT(A). In the given facts of the case the explanation of the assessee that he being a lay man and was not aware of e-proceedings is found to be acceptable. We therefore, condone the delay of 177 days in the filing of the appeal by the assessee before the Ld. CIT(A).

“2. That, on the facts and in the circumstances of the case AO was not justified in the treating the cash deposit of Rs.3,60,51,890/- in the bank account No.4846261000011 as unexplained cash deposit u/s 69A of the Act, without giving an opportunity of being heard to the assessee. As bank account No.4846261000011 was not belong to the assessee and was in the name M/s Humara Pump proprietorship firm of assessee son Ritendra Singh.” Sh. Raj Kumar Chaudhary 9.1 The ld. CIT(A) provided several opportunities as listed in para 5 of his order wherein the assessee filed submissions before the ld. CIT(A). The assessee submitted before the ld. CIT(A) that the said addition was not maintainable as the money deposited in the bank account was attributable to his son’s account and he was merely a name lender as a guarantor for loan/limit for the account and accordingly requested for the deletion of the same. However, the ld. CIT(A), on perusal of facts on record and the relevant AIR data filing of the bank and as no such corrections/revised filings being filed by the bank, held that such claim of the assessee was not backed up by supporting evidences. Accordingly, the ld. CIT(A) dismissed the appeal of the assessee on merits also. 9.2 Aggrieved with said order, the assessee is in appeal before us.

- 3671 & 3670/Del/2025 Sh. Raj Kumar Chaudhary 12.1 This certificate dated 18.11.2024 has been issued by the Bank after the completion of the assessment u/s 144/147 of the Act on 03.03.2023. Therefore, this contention of the assessee that the said bank account does not below to the assessee requires factual verification. We, therefore, set aside the orders of the AO and ld. CIT(A) and the restore the matter to the file of the AO to decide the issue de novo in accordance with the law. This appeal of the assessee is allowed for statistical purposes only.

- 3671 & 3670/Del/2025 Sh. Raj Kumar Chaudhary 13. This appeal is again delayed by 64 days. Similar facts has been stated as in the case of the earlier appeal. For the similar reasons, we condone the delay and admit the appeal for adjudication.

- 3671 & 3670/Del/2025 Sh. Raj Kumar Chaudhary 17. We have heard the rival contentions and perused the material available on record. The facts as stated by the assessee as highlighted above by the assessee before the Ld. CIT(A) has not been dealt by the Ld. CIT(A). After careful perusal of the same, we are satisfied that the assessee was prevented by sufficient cause for the delay in the filing of the appeal by 60 days. Accordingly, we condone the said delay.

- 3671 & 3670/Del/2025 Sh. Raj Kumar Chaudhary 19. In the result, both the appeals of the assessee are allowed for statistical purposes only.

Order pronounced in the open court on 30th December, 2025.