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Income Tax Appellate Tribunal, “A” BENCH : BANGALORE
Before: SMT. BEENA PILLAI & SHRI LAXMI PRASAD SAHU
Per Laxmi Prasad Sahu, Accountant Member
This appeal is filed by the assessee against the dated 28.3.2024 of the Addl./Jt.CIT(Appeals), Aurangabad for the AY 2015-16 on the following grounds:-
“1. The order passed by the learned Commissioner of Income Tax, NFAC, under section 250 of the Act is so far as it is against the Appellant is opposed to law, weight of evidence, probabilities, facts and circumstances of the Appellant's case.
2. The appellant denies itself to be assessed at Rs.39,67,931/- as against the NIL Income returned for the assessment year 2015- 16 under the facts and circumstances of the case.
3. Condonation of delay: (i.) The learned CIT(A) was not justified in failing to appreciate the reasons for delay in preferring an appeal against the intimation or the rectification and ought to have condoned the delay and adjudicated the matter on the merits of the matter, on the facts and circumstances of the case. (ii.) The learned CIT(A) failed to appreciate that the delay in filing the appeal, was due to circumstances beyond the control of the appellant, on the facts and circumstances of the case. 4. 8oP claim: (i.) The learned CIT(A) failed to appreciate that the adjustment of Chapter VIA, of section 8oP of the Act, U/s 143(1) of the act, was impermissible and thus the adjustment was contrary to the provisions of the Act, on the facts and circumstances of the case. (ii.) The learned CIT(A) ought to have allowed the claim of deduction U/s 8oP of the act, since the claim made in the return of income, was a proper claim, on the facts and circumstances of the case. 5. The appellant denies the liability to pay interest under section 234A, 234B and 234C of the Act in view of the fact that there is no liability to additional tax as determined by the learned assessing officer. Without prejudice the rate, period and on what quantum the interest has been levied are not in accordance with law and further are not discernible from the order and hence deserves to be cancelled on the facts and circumstances of the case. 6. The appellant craves to add, alter, amend, substitute, change and delete any of the grounds of appeal
7. For the above and other grounds that may be urged at the time of hearing of the appeal, the Appellant prays that the appeal may be allowed and justice rendered and the appellant shall be awarded cost in prosecuting the appeal and also order for the refund of institution fees as part of the cost.”
Briefly stated the facts of the case are that the assessee filed return of income on 24.9.2015 declaring income of Rs.39,67,931 and after claiming deduction under Chapter VIA, the taxable income was declared at NIL. The said return was processed u/s. 143(1) on 12.11.2015 denying the deduction claimed by the assessee and raised a remand of Rs.13,66,091. As per intimation u/s. 143(1) the due date for fling return of income is 30.9.2015. Against the intimation the assessee filed rectification application on 11.12.2015, but it was rejected and demand raised in intimation was the same. In the rectification order passed u/s. 154 it is saying that “return filed u/s. 139(4)”. The AO raise a demand notice on 26.12.2022 in various assessment years including the relevant assessment year too. Thereafter the assessee filed appeal before the First Appellate Authority (FAA) on 19.1.2023. Later on the case was migrated to NFAC in terms of CBDT Notification dated 29.5.2023. Thereafter notice was issued to assessee on 9.3.2024. In response to the notice, the assessee submitted reasons for delay in filing of appeal for 2995 days which is incorporated in the order of FAA. After receipt of the reasons for delay, the ld. FAA further issued notice on 18.3.2024 and he considering the reasons for delay in filing the appeal, he did not condone the delay and summarily rejected the appeal of the assessee without going into the merits of the case against which the assessee is in appeal before the ITAT.
The ld. AR reiterated the submissions made before the lower authorities and submitted affidavit dated 25.6.2024 stating the facts and explaining the reason and submitted that the assessee filed rectification application u/s. 154 against the 143(1) intimation which was rejected on 17.6.2016 and as the demand continued, later the CPC transferred the rectification right to AST on 18.3.2020 and this fact was not informed by the tax consultant and employee of the appellant to its Board of Directors nor even the jurisdictional AO has sent any letter/notice for rectification and demand raised on that date. The assessee came to know when a letter issued by the ITO, Ward 1 & TPS, Bagalkot dated 26.12.2022 in which demands for AY 2010-11, 2013-14, 2015-16, 2017-18 & 2018-19 are appearing and then the assessee came to know that appeal should have been filed before the ld. FAA an accordingly assessee proceeded to file appeal on 19.1.2023 in Form 35 and assessee has mentioned section 143(1) and stated the reason for delay filing in filing. He also relied on various judgments as under:-
i) Hon’ble jurisdictional High Court decision in CIT & Anr. V. ISRO Satellite Centre in of 2008. ii) Smt. Shakuntala Hegde v. ACIT, dated 25.4.2006. iii) Hon’ble High Court of Madras judgment in the case of CIT v. K.S.P. Shamugavel Nadar (1987) 30 Taxman 133 (Madras). iv) M/s. Midas Polymer Compounds Pvt. Ltd. v. ACIT in ITA No.288/Coch/2017 dated 25.6.2018. v) Anatek Services P. Ltd. v. ACIT, ITA No.102 of 2018 dated 11.2.2022, Hon’ble Bombay High Court judgment. vi) Collector, Land Acquisition v. MST. Katiji & Ors. (1987) 167 ITR 471 vii) Concord of India Insurance Co. Ltd. v. Smt. Nirmala Devi & Ors., 118 ITR 507. viii) Radha Krishna Rai v. Allahabad Bank & Ors. [2009] 9 SCC 733. ix) CIT v. West Bengal Infrastructure Development Finance Corporation Ltd. (2011) 344 ITR 269 (SC).
On the other hand, the ld. DR relied on the orders of lower authorities and submitted that the ld. CIT(A) rightly did not condone the delay of 2995 days in filing the appeal. The reasons for not filing appeal within time is very much casual and not explained with reasonable cause. The assessee itself accepted that even the rectification application u/s. 154 was rejected on 17.2.2016, thereafter the assessee had not reason to wait for filing further appeal and in the condonation petition the assessee has just mentioned history of transfer of right from CPC to AST which has nothing to do with filing of appeal. Accordingly he requested that the so long delay in filing appeal before the FAA should not be condoned. The ld. DR submitted that each case has its own facts for not filing appeal within the due date and therefore the case laws relied by the ld. AR are not applicable in the present facts of the case.
Considering the rival submissions, we noted that the assessee has filed return of income on 24.9.2015 and claimed deduction under Chapter VIA of Rs.39,67,931 which was not allowed against which the assessee filed rectification petition u/s. 154 on 11.12.2015 which was not accepted and order u/s. 154 was passed on 17.2.2016 and the demand was continued. Later on the CPC has transferred the rectification rights to AST on 18.3.2020. We note that in the order u/s. 154 the CPC has noted that return filed u/s. 139(4) of the Act. However the return is filed u/s. 139(1) on 24.9.2015 and the due date is 30.9.2015. Here the assessee filed appeal after the receipt of demand intimation dated 26.12.2022 by the jurisdictional AO for the above noted assessment years and we note that there is no demand u/s. 143(1), but there is demand for the impugned assessment year u/s. 154 order dated 17.2.2016 REF No. CPC/1516/U5/15424665898 & DIN- 2015201537079100543T for Rs.13,66,090 which is the same demand as raised in the intimation issued u/s. 143(1) dated 12.11.2015. However we note that assessee filed appeal before the Ld. FAA on 19.1.2023 after receipt of demand details which is placed at page 68 of PB , but there is no demand against 143(1) intimation as on the date of 26.12.2022. Therefore, as per our considered opinion, this appeal filed before the CIT(Appeals) as well as before us is not maintainable against the intimation u/s 143(1) of the Act.. Since the ld. AR submitted that there was bonafide belief for the assessee in filing appeal u/s. 143(1) and demand also continued u/s. 143(1), here the demand raised u/s. 143(1) through intimation has got merged with the order u/s. 154 passed on 17.2.2016. Therefore we give liberty to the assessee to file appeal against the order passed u/s. 154 dated 17.2.2016 within 30 days from the date of receipt of this order before the ld. FAA. The ld. FAA is directed to decide the issue on merits of the case, after giving reasonable opportunity of being heard to the assessee and assessee is also directed to substantiate its claim of deduction under Chapter VIA with cogent material.
In the result, the appeal of the assessee is dismissed as not maintainable.
Pronounced in the open court on this 16th day of August, 2024.