CHINTANBHAI LAVJIBHAI DANKHARA,SURAT vs. ITO, SURAT
Facts
The assessee's case was reopened under Section 147, leading to an addition of Rs. 20,14,000/- for unexplained investment in a house property. The original order was passed ex-parte as the assessee failed to participate in proceedings before the Assessing Officer and subsequently before the CIT(A). The assessee's appeal before the Tribunal was filed with a delay of 324 days.
Held
The Tribunal condoned the delay of 324 days, citing the assessee's sufficient cause, including a non-cooperative consultant, a recent family bereavement, and the disproportionate nature of the addition compared to the returned income. The Tribunal restored the issue to the Assessing Officer for fresh assessment after providing an opportunity of hearing.
Key Issues
1. Whether the delay of 324 days in filing the appeal should be condoned. 2. Whether the addition made under Section 69 was valid without proper adjudication of merits by the lower authorities.
Sections Cited
Section 147, Section 250, Section 44 AA, Section 69
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, SURAT BENCH “SMC”, SURAT
Before: SMT. ANNAPURNA GUPTA
IN THE INCOME TAX APPELLATE TRIBUNAL SURAT BENCH “SMC”, SURAT BEFORE SMT. ANNAPURNA GUPTA, ACCOUNTANT MEMBER I.T.A. No. 769/Srt/2025 (Assessment Year: 2012-13) Chintanbhai Lavjibhai Dankhara, Vs. Income Tax Officer, C-604, Laxmi Residency, Ward-3(2)(2), Nr. Gajera School, Katargam, Surat Surat-395004 [PAN No.AMUPD6338C] (Appellant) .. (Respondent) Shri Dinesh Ramani, CA Appellant by : Respondent by : Shri Ajay Uke, Sr. DR Date of Hearing 19.03.2026 Date of Pronouncement 23.03.2026 O R D E R The present appeal has been filed by the assessee against the order of the Ld. Commissioner of Income Tax (Appeals), (hereinafter referred to as “CIT(A)”), National Faceless Appeal Centre (in short “NFAC”), Delhi order dated 25.06.2024 passed under Section 250 of the Income Tax Act, 1961 (hereinafter referred to as the “Act”) and relates to Assessment Year (A.Y.) 2011-12.
The brief facts relating to the case are that the assessee’s case was reopened and the order passed under Section147 of the Act making addition of Rs. 20,14,000/- to the income of the assessee, being investment made in a house property the source of which remained unexplained. The order under Section 147 was passed ex-parte since the assessee failed to participate in the proceedings before the Assessing Officer.
ITA No.769/Srt/2025 Chintanbhai Lavjibhai Dankhara vs. ITO Asst.Year –2011-12 - 2 - 3. The matter was carried in appeal before the Ld. CIT(A) where again the assessee failed to prosecute the appeal and the Ld. CIT(A), therefore, confirmed the order passed by the Assessing Officer.
The assessee has now filed an appeal before us challenging the addition made to his income raising the following grounds of appeal:
“(1) The appellant most respectfully submits that there has been a delay of 324 days in filing the present appeal before the Hon'ble Tribunal. The delay was neither intentional nor due to negligence but was caused due to circumstances beyond the control of the appellant, that his Tax Consultant has not acted in professional manner and was careless in submitting explanations and information sought by the A.O. and C.I.T. (Appeal). Moreover, Tax Consultant dose not inform to the assessee about C.I.T. (Appeal)'s Order. The appellant prays that the delay may kindly be condoned in the interest of justice, equity, and fair play, as the appeal involves substantial legal issues that merit adjudication on merits. The appellant assures that there has been no malafide intent in the delay and has always been diligent in pursuing legal remedies. It is respectfully submitted that non-condonation would result in grave injustice and deprive the appellant of the right to appeal. Therefore, the appellant seeks the indulgence of the Hon'ble Tribunal to kindly condone the delay and admit the appeal for hearing. (2) The learned Commissioner of Income Tax (Appeals) erred in law and on facts in disposing of the appeal without adjudicating the validity and merits of the addition made by the Assessing Officer. The C1T(A) has mechanically sustained the addition solely on the ground that no submission was made by the assessee, thereby failing to discharge the quasi-judicial duty to examine the correctness of the assessment order. The impugned order is vitiated due to non-application of mind and absence of reasoned findings on the substantive issue, rendering it unsustainable in law. (3) The learned Assessing Officer erred in law and on facts in invoking the provisions of Section 69 of the Income Tax Act, 1961, to make additions towards alleged unexplained investments, despite the fact that the assessee is not required to maintain books of account under the provisions of Section 44 AA of the Act. The invocation of Section 69 is untenable in the absence of books of account, as the very foundation of unexplained investment under Section 69 presupposes a comparison with recorded entries in books. In the absence of such books, the addition made is arbitrary, lacks legal basis, and deserves to be deleted.
ITA No.769/Srt/2025 Chintanbhai Lavjibhai Dankhara vs. ITO Asst.Year –2011-12 - 3 - (4) The appellant respectfully reserves the right to amend, modify, alter, delete, or add to any of the grounds of appeal stated herein, and to raise additional grounds at the time of hearing or at any stage of the appellate proceedings, as may be deemed necessary for the proper adjudication of the appeal.” 5. The Registry has marked the appeal filed to be delayed by324 days. The assessee has filed an Affidavit before us explaining the reasons for the delay being the non-cooperative attitude of his consultant who was handling the matter before the CIT(A) and who did not inform the assessee of the passing of the CIT(A) order. Further, he became aware of the same only when he received notice of initiation of penalty proceedings against him. Before us Ld. Counsel for the assessee contended that the assessee is a small time business man who regularly filed his return of income. That he lost his father on 17.01.2024 i.e. during the pendency of appeal before the CIT(A) who passed his order on the 25.06.2024. Being overcome with grief he could not speak with the consultant and coupled with the fact that his consultant did not inform him of the passing of the CIT(A)’s order therefore, occurred a delay of 324 days in the filing of the present appeal. Ld. Counsel for the assessee stated that the assessee being a small time business man who had filed return for the impugned year of only Rs. 1,65,260/-, the addition of Rs. 20,14,000/- made to his income was grossly disproportionate and would cause gross prejudice to the assesse in terms of tax and interest recovered from him for the same without being heard at all. He further contended that even on merits the assessee had a good case since the impugned property had been purchased by taking loan from bank, the copy of the bank statement was filed before us. He, therefore, pleaded that the delay of 324 days in filing of the present appeal to be condoned and the matter being restored back to be decided afresh after giving due opportunity of hearing to the assessee.
ITA No.769/Srt/2025 Chintanbhai Lavjibhai Dankhara vs. ITO Asst.Year –2011-12 - 4 - 6. Ld. DR vehemently objected to the same.
I have heard both the parties. I am of the view that the assessee has adduced sufficient cause for the delay 324 days in filing appeal before us. The consequences of dismissing the assessee’s appeal for the technical consideration of delay are disproportionate to the implication of the same on the assessee on account of the huge addition being made to its income almost 20 times the returned income filed by the assessee being confirmed. The assesse having not being heard all along, I am of the view that interest of justice will be well served if the assessee is granted an opportunity of hearing before framing the assessment. In light of the same I condone the delay 324 days in filing of the present appeal and restore the issue to the file of the Assessing Officer to frame the assessment afresh after giving due opportunity of hearing to the assessee.
The appeal filed by the assessee is allowed for statistical purposes. This Order pronounced in Open Court on 23/03/2026
Sd/- Sd/- (ANNAPURNA GUPTA) ACCOUNTANT MEMBER Ahmedabad; Dated 23/03/2026 TANMAY, Sr. PS TRUE COPY आदेश की �ितिलिप अ�ेिषत/Copy of the Order forwarded to : अपीलाथ� / The Appellant 1. 2. ��थ� / The Respondent. 3. संबंिधत आयकर आयु� / Concerned CIT 4. आयकर आयु�(अपील) / The CIT(A)- 5. िवभागीय �ितिनिध, आयकर अपीलीय अिधकरण, सूरत / DR, ITAT, Surat 6. गाड� फाईल / Guard file. आदेशानुसार/ BY ORDER,
उप/सहायक पंजीकार (Dy./Asstt. Registrar) आयकर अपीलीय अिधकरण, सूरत / ITAT, Surat
