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Facts
The assessee's appeal was dismissed ex-parte by the Ld. CIT(A) as the assessee did not respond to notices. The appeal was filed beyond the prescribed time limit with a condonation application, stating that the delay was due to the previous AR not informing the assessee of the hearing dates. The assessee is a proprietor and a senior citizen.
Held
The Tribunal condoned the delay in filing the appeal, acknowledging that the assessee and their current AR did not receive the notices from the Ld. CIT(A). The ex-parte order by the Ld. CIT(A) was found to be a violation of natural justice as it was not decided on merits.
Key Issues
Whether the delay in filing the appeal before the Tribunal should be condoned and if the ex-parte order passed by the Ld. CIT(A) on merits is valid.
Sections Cited
250(6) of the Income Tax Act, 1961
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Income Tax Appellate Tribunal, “C” BENCH, MUMBAI
Before: SHRI ABY T. VARKEY, JM & SHRI S RIFAUR RAHMAN, AM
O R D E R
PER ABY T. VARKEY, JM:
This is an appeal preferred by the assessee against the order of the Ld. Commissioner of Income Tax (Appeals)/NFAC, Delhi dated 31.12.2022 for the assessment year 2011-12.
At the outset, the Ld. AR brought to our notice that the impugned order of the Ld. CIT(A) is an exparte order because assessee didn’t respond to his two notices issued on 02.11.2022 & 18.11.2022. 3. The Ld. AR also brought to our notice that the appeal is time barred and assessee had filed condonation application for condoning two hundred (200) days delay in filing the appeal before this Tribunal; and that the assessee had filed an affidavit explaining the facts which led to the delay caused in filing of appeal. From the content of the affidavit, we note that the assessee is a proprietor of M/s. Priyanka International and is a senior citizen; and had entrusted his case to Shri V. N. Ahirekar & Co. (Mr. Hemant Shelar) to appear before the AO 2 A.Y. 2011-12 M/s. Priyanka International during assessment proceedings and the AO has passed the assessment order dated 30.12.2018 making two additions (i) on account of unsecured loan taken from Ms. MJ Processing to the tune of Rs.1,35,00,000/- and (ii) on account of various unsecured loan taken from various parties to the tune of Rs.1,72,63,071/-. Thereafter, the assessee entrusted the appeal to be filed to another person M/s. Chachra and Associates (Mr. Gulab Chachra). However, according to the assessee neither assessee nor Mr. Gulab Chachra received any notice/email/message in WhatsApp from NFAC (First Appellate Authority) prior to passing of impugned order dated 31.12.2022. And later on learnt that notices were erroneously sent to the previous Ld. AR (Mr. Hemant Shelar) who for reasons best known to him did not inform the assessee about the hearing of appeal and therefore, the Ld. CIT(A) has passed the impugned exparte order after issuing two notices to the earlier AR. According to the assessee only on 01.10.2023 while checking the present status of the appeal, he was astonished to know that the Ld. CIT(A) has dismissed the appeal vide order dated 31.12.2022. Thereafter, assessee immediately filed the appeal before this Tribunal. And therefore, pleads that delay caused was not intentional and therefore may be condoned.
Having gone through the averments made in the affidavit filed by assessee, we are inclined to condone the delay because the assessee or his Ld. AR (Mr. Gulab Chachra) did not receive any notices from the office of the Ld. CIT(A) instead of the notices were served on the Ld. AR who represented the assessee before the AO (Mr Hemant Shelar) who did not inform the assessee for reasons best known to him.
3 A.Y. 2011-12 M/s. Priyanka International Be that as it may, since the assessee was in the dark about appellate proceedings happening before the Ld. CIT(A), we are inclined to condone the delay in filing appeal before this Tribunal and proceed to hear the appeal.
Since it has been brought to our notice that the impugned order of the Ld. CIT(A) is an exparte order and since the Ld. CIT(A) had only issued two notices to the assessee and has not passed the order on merits, we find that there is violation of the natural justice as well as Ld. CIT(A) has not passed the order in accordance to section u/s 250(6) of the Income Tax Act, 1961 (hereinafter “the Act”). Therefore, we restore the appeal back to the file of the Ld. CIT(A) and direct him to decide the appeal on merits. The Ld. AR also brought to our notice that the assessee could not file the details before the AO about the unsecured loans of Rs.1.35 cr as well as of Rs. 1,72,63,071/-, and that the assessee intends to file additional evidence before the Ld. CIT(A) which liberty is given to assessee and the Ld. CIT(A) may call for remand report from the AO in accordance to Rules; and decide the appeal on merits in accordance to law after hearing the assessee.
In the result, the appeal of the assessee is allowed for statistical purposes.