FAREES AHMED KHALIL AHMED SHAIKH,MUMBAI vs. ITO WARD-23(1)(1), MUMBAI

This appeal by the assessee is directed against the order of Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi [in short ‘the CIT(A)’] dated 21/08/2023,for Assessment Year 2015-16.

This appal emanates from penalty proceedings u/s. 271(1)(c) of the Income Tax Act, 1961 [in short ‘the Act’]. Consequent to addition of Rs.2.62 crores u/s. 69 of the Act in assessment order dated 28/03/2022 for Assessment Year 2015-16, the Assessing Officer levied penalty of (A.Y.2015-16) Rs.89,12,243/- u/s. 271(1)(c) of the Act vide order dated 23/09/2022. The assessee filed appeal before the CIT(A) against the said order. The appeal was time barred by 101 days. The CIT(A) dismissed the appeal of assessee in-limine without condoning the delay.

Shri K.Gopal appearing on behalf of the appellant/assessee submits that the assessee is a Non-Resident and is residing in UAE for the past several years. The assessee had given address of his father in the Income Tax Department for service of notice. His father had also shifted from the said given address. Since, the appellant/assessee had no income from any source in India, the appellant never filed return of income after he shifted to UAE. During the period relevant to Assessment Year under appeal, the assessee had purchased immovable property from income sourced in UAE. The said transaction triggered issuance of notice u/s. 148 of the Act. The said notice was not received by the assessee, hence, the assessee could not participate in the assessment proceedings. The Assessing Officer completed the assessment u/s. 147 r.w.s. 144 r.w. 144B of the Act vide order dated 28/03/2022. The penalty proceedings u/s. 271(1)(c) of the Act were also initiated against the assessee. The assessee was unaware of all these proceedings. The Assessing Officer vide order dated 23/09/2022 levied penalty u/s. 271(1)(c) of the Act. The said order was received by the watchman of the building where the father of assessee used to reside. He conveyed the said order to the father of assessee in Septermer, 2022 and, thereafter, the assessee came to know about the Income Tax proceedings against the assesssee including assessment and levy of penalty. Since, assessee was not residing in India he remotely from UAE co-ordinated to file appeal against the assessment order as well as against levy of penalty. In this process, filling of appeal got delayed by 100 days. The ld. Counsel for the assessee submitted that the delay in filing of (A.Y.2015-16) appeal before the CIT(A) was unintentional. The CIT(A) without appreciating the facts causing delay in filing of appeal dismissed the appeal of assessee in- limine. He further pointed that on merits the assessee has got a good case and prayed for restoring the appeal to CIT(A). He further informed that appeal against the assessment order is still pending for final disposal before the CIT(A).