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Facts
The assessee, an employee of Titan Company Limited, resigned and started a tax consultancy profession. He filed his return of income for AY 2017-18, declaring salary and total income, and claimed a refund. The Assessing Officer (AO) proposed an addition of Rs. 7,95,861 due to an inconsistency between salary income in the return and Form 26AS.
Held
The Tribunal condoned the delay in filing the appeal before the CIT(A) considering the Covid-19 pandemic. Since the CIT(A) had not adjudicated the appeal on merits, the matter was restored to the CIT(A) for a fresh hearing.
Key Issues
Whether the delay in filing the appeal before the CIT(A) should be condoned and whether the CIT(A) should adjudicate the appeal on merits.
Sections Cited
139(1), 143(1)(a), 154, 246A, 249(2)
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Income Tax Appellate Tribunal, ‘B’ BENCH, CHENNAI
Before: HON’BLE SHRI MANOJ KUMAR AGGARWAL & HON’BLE SHRI MANU KUMAR GIRI
(िनधा�रणवष� / Assessment Year: 2017-2018) Jagannathan Baskar, Vs. The Income Tax Officer, H88, New ASTC Hudco, Ward -1, Mahalakshmi Nagar, Hosur Hosur 635 109. [PAN: ADQPB 9089F] (अपीलाथ�/Appellant) (��यथ�/Respondent) अपीलाथ� क� ओर से/ Appellant by : Shri B.B. Sathyamurthy, C.A., ��यथ� क� ओर से /Respondent by : Ms. D. Komali Krishna, IRS, CIT. सुनवाई क� तार�ख/Date of Hearing : 17.12.2024 घोषणा क� तार�ख /Date of Pronouncement : 20.12.2024 आदेश / O R D E R PER MANU KUMAR GIRI (Judicial Member)
This appeal filed by the assessee is directed against the order of the Ld. Commissioner of Income Tax(Appeals) Addl/JCIT(A)-4 Mumbai [CIT(A)] dated 14.08.2024 for Assessment Year 2017-18. 2. The registry has noted delay of 02 days in filing the appeal. Considering the period of delay, we condone the delay and admit the appeal for adjudication.
3. Brief facts of the case are that the appellant, was as employee of Titan Company Limited for part of the subject Assessment year. After resignation from employment during the subject Assessment year, he was engaged in the profession of tax consultancy services for part of the subject Assessment year The Appellant had filed his return of income under Section 139(1) of the Act, on 02 August 2017, offering income from Salaries of Rs. 25,56,189 and total income of Rs. 24,06,190 (after allowing deduction under Chapter VI-A of Rs. 150,000) to tax and claiming a refund of Rs. 54,560, representing excess of TDS Credit over the tax payable on returned income. The Ld. Assessing Officer sent Communication of Proposed adjustments under Section 143(1)(a) dated 20 February 2019 as under:-
‘’An addition Rs. 7,95,861 was proposed to the Salary income, on the basis that there is an inconsistency between salary income between the return of income and Form 26AS. The total salary amount reflecting in Form 26AS was inclusive of allowances exempt under Section 10 of the Act and the taxable components of the salary was already offered to tax in the return of income. Hence the appellant provided a response that the proposed adjustment should not be made, selecting an option from the available drop down in the income-tax portal. The appellant's response was not accepted, stating that income was reflected in the 26AS statement. In case of wrong deduction by the deductor, revised TDS return may be filed by the deductor’. The return of income was processed and intimation order under Section 143(1) dated 27 March 2019 was issued duly making an addition of Rs.7,95,861 to the Salary income and with consequent tax and interest computed thereon. The Appellant filed a rectification application under Section 154 of the Act dated 07 January 2021 and with the Centralized Processing Centre (CPC). The appellant had also filed a grievance in the income-tax portal on the same. The appellant was directed to file a rectification application with the jurisdictional assessing officer (JAO). Subsequently, the rectification application filed with the CPC was rejected. The Appellant filed a rectification application dated 14 February 2022 with the Ld. JAO, duly furnishing the copies of Form 16 issued by the employer and reconciling the salary income reflecting in the same to the salary income offered to the return of income, duly proving that the salaries chargeable to tax under the Act is already offered to tax. The Ld. JAO passed order under Section 154 of the Act dated 16 June 2023 declining the rectification petition that there is no mistake apparent from record. According filed an appeal before the ld. CIT(A). The appellant filed an appeal against the intimation under Section 143(1) read with Section 154 of the Act to the learned Joint Commissioner of Appeals (JCIT-(A))/ Commissioner of Appeals (CIT(A)) on 15 July 2024 (within 30 days from the date of order under Section 154), along with a petition for condonation of delay in filing the appeal, when the time allowed for the same is reckoned from the original date of the intimation order under Section 143(1) being 27 March 2019. The learned JCIT(A) did not admit the appeal for adjudication that there was no sufficient cause for delay in filing the appeal. Assessee further challenged the order u/s 143(1) of the Act before the ld.CIT(A) who has declared the appeal as non-est and not admitted the appeal for adjudication. Aggrieved, assessee is in appeal before us.
Before us, the ld. Counsel for assessee pointed out from the ld.CIT(A) order the back ground of the case which is as under:
‘’1.1 Jagannathan Baskar, the appellant, was as employee of Titan Company Limited (the employer) for part of the subject A.Y. After his resignation from employment during the subject A.Y., he was engaged in the profession of tax consultancy services for part of the subject A.Υ. 1.2 The Appellant had filed his return of income under Section 139(1) of the Income-tax Act, 1961 (the Act) on 02 August 2017, offering income from Salaries of Rs. 25,56,189 and total income of Rs. 24,06, 190 (after allowing deduction under Chapter VI-A of Rs. 150,000) to tax and claiming a refund of Rs. 54,560, representing excess of TDS Credit over the tax payable on returned income. 1.3 Communication of Proposed adjustments under Section 143(1)(a) dated 20 February 2019: An addition Rs. 7,95,861 was proposed to the Salary income, on the basis that there is an inconsistency between salary income between the return of income and Form 26AS. The total salary amount reflecting in Form 26AS was inclusive of allowances exempt under Section 10 of the Act and the taxable components of the salary was already offered to tax in the return of income. Hence the appellant recorded his objection to the proposed adjustment, selecting an option from the available drop down in the income-tax portal. The appellant's response was not accepted, stating that income was reflected in the 26A5 statement. In case of wrong deduction by the deductor, revised TDS retrn may be filed by the deductor, 1.4 The return of income was processed and intimation order under Section 143(1) dated 27 March 2019 was issued duly making an addition of Rs. 7,95,861 to the Salary income and with consequent tax and interest computed thereon. 1.5 The Appellant filed a rectification application under Section 154 of the Act dated 07 January 2021 and with the Centralized Processing Centre (CPC). The appellant had also filed a grievance in the income-tax portal on the same. The appellant was directed to file a rectification application with the jurisdictional assessing officer (JAO), Subsequently, the rectification application filed with the CPC was rejected. 1.6 Rectification application filed with Ld JAO The Appellant filed a rectification application dated 14 February 2022 with the Ld. JAQ, duly furnishing the copies of Form 16 issued by the employer (as downloaded from the TRACES Portal) and reconciling the salary income reflecting in the same to the salary income offered to the return of income, duly proving that the salaries chargeable to tax under the Act in already offered to tax. After multiple follow-ups on the rectification application with the office of the Ld. SAO from time to time, the Ld. JAO passed order under Section 154 of the Act dated 16 June 2023 declining the rectification petition that there is no mistake apparent from record 1.7 Aggrieved by the aforesaid intimation under Section 143(1) of the Act (read with Section 154 the assessee prefers to file the appeal before the commissioner of Income tax 1.8 As per section 249(2) of the Act, the appeal against the order passed by the assessing officer is to be filed within the period of 30 days from the date of receipt of such order. Therefore, the due date for filing the appeal expires on 26 April 2019 (30 days from the date of intimation order under Section 143(1). Hence, there is a delay in filing the appeal under section 246A of the Act. 1.9 In light of above backdrop, I have in ensuring paragraphs detailed our petition for condonation of delay in filing appeal under section 246A of the Act 2 Petition for condonation of delay in filing appeal under section 246A of the Act: We have enumerated below in detail the facts involved and the reasons for delayed filing of appeal under section 246A of the Act- 2.1 The Appellant had filed rectification applications with the CPC and the JAD and was expecting favourable disposal of the same. However the same were rejected. The IAD passed the rectification order rejecting the petition on 16 June 2023 2.2 In the given scenario, the Appellant is aggrieved by the intimation under Section 143(1) and the same have not been sorted out under alternative routes as of date. Hence, the Appellant prefers to appeal before your good self belatedly. I humbly pray your good self to condone the delay in filing the appeal under section 246A of the Act and admit our appeal for the subject AY. Further, I wish to state that the delay in filing the appeal under section 246A of the Act was on account of the bonafide belief that the grievance of the Appellant would have been addressed through the rectification application and the same is neither deliberate nor wilful pray that my request be considered favourably. In case, where your goodself is not an agreement with the plea above, I request that before taking any decision on this petition, an opportunity of being heard person or through video conference be granted for substantiation of the plea made in the interest of justice. I would be pleased to provide you with any further information/ clarification that your goodself may require in this regard.
Considering the substantive period of Covid-19 pandemic and reasons given by the assessee we condone the delay in filing appeal before the ld.CIT(A).
Since, the ld. CIT(A) has not adjudicated the appeal on merits, accordingly, the impugned order is set aside and the appeal is restored back to the file of Ld. CIT(A) for denovo hearing of appeal on merits. The Ld.CIT(A) shall proceed for fresh appeal hearing after affording proper opportunity of hearing to the assessee.
The assessee is directed to substantiate its case with all evidence, confirmations and documents, if any, forthwith without any fail, failing which ld.CIT(A) shall be at liberty to proceed with the disposal of appeal on merits as per law.
In the result, appeal filed by the assessee is allowed for statistical purpose.
Order pronounced in the open court on 20th day of December, 2024