BSM SHELTER ESTATE INDIA PRIVATE LIMITED ,INDORE vs. INCOME TAX OFFICER 1(3), INDORE

The registry has informed that this appeal is filed on 05.04.2024 against impugned order dated 09.02.2023 after a delay of 361 days beyond statutory period and therefore time-barred. Ld. AR for assessee submitted that the assessee has filed a condonation-application supported by an affidavit. Referring to Para 4 to 13 of condonation application, Ld. AR submitted that the delay has occurred due to the fact that the assessee’s previous counsel failed to keep the track of the assessee’s first-appeal before CIT(A) and did not attend hearings fixed by CIT(A) and even the counsel was not aware of the impugned order which was passed ex-parte by CIT(A). That the CIT(A) sent communication of impugned ex-parte order to the email id vinayverma543@gmail.com which belonged to Mr. Vinay Verma, director of assessee-company despite the fact that the assessee clearly denied email service by mentioning “No” against “Whether notices/ communication may be sent on email?” in Form No. 35 filed to CIT(A) and that no physical communication of impugned order was made to assessee. It is further submitted that the email id of director remains overloaded with thousands of emails relating to business of assessee due to which the communication of impugned order left unread. Subsequently, when the order dated 24.01.2024 passed by CIT(A) dismissing penalty-appeal of assessee was received, the assessee contacted earlier counsel and came to know that its quantum-appeal had already been dismissed ex-parte vide impugned order dated 09.02.2023. Thereafter, the assessee was in trust that the earlier counsel would take suitable legal action but, however, in the month of Page 3 of 10

Thus, it is submitted that the assessee was not at all aware about passing of ex-parte order by CIT(A) and fully dependent on earlier counsel handling the matter. Ld. AR pointed out that at Page 22 of Paper-Book, the assessee has also filed a copy of authorisation dated 22.03.2019 given by assessee to earlier counsel for representing its cases before CIT(A). Ld. AR submitted that these facts undoubtedly show that not only the non- representation before CIT(A) but also the delay in filing present appeal before ITAT is due to counsel’s lapse only. Ld. AR submitted that there is no deliberate lethargy, negligence, mala fide intention or ulterior motive of assessee in making delay and the assessee does not stand to derive any benefit because of delay. Accordingly, he prayed that in the interest of equity and justice and having regard to the view taken by Hon’ble Supreme Court in Collector, Land Acquisition Vs Mst. Katiji and others 1987 AIR 1353, 1987 2 SCC 387, the delay ought to be condoned in present case.

Ld. DR for Revenue strongly opposed the prayer of assessee. He submitted that the assessee itself is accepting that the email communication of impugned order was made by CIT(A) to director’s email id provided in Form No. 35, therefore there is no deficiency in the service of order by Page 5 of 10

In rejoinder, Ld. AR re-iterated that the assessee has specifically mentioned “No” for email communication in Form No. 35 which is evident from copy of Form No. 35 available in case-record. He pointed out that the assessee had to provide email id in Form No. 35 due to mandate of Form No. 35 but clearly denied email service in the option provided in Form No. 35 for the very reason that its email a/c remains overloaded with business emails and statutory communication should not remain missed or unattended.

We have considered rival contentions of both sides and perused the documents to which our attention has been drawn. We firstly find that the impugned order dated 09.02.2023 in quantum-appeal of assessee was passed by CIT(A) ex-parte to assessee for non-prosecution of the notices of hearing. Secondly, we find that the penalty-appeal of assessee has also been dismissed by CIT(A) by assigning the reason that the reply filed by assessee’s AR was in relation to the grounds raised in quantum-appeal despite the fact that the quantum-appeal had already been dismissed vide order dated 09.02.2023. The revenue cannot dispute both of these facts

The assessee further claims that when the penalty-appeal was dismissed by CIT(A) vide a subsequent order dated 24.01.2024, the assessee approached earlier counsel and trusted that the counsel shall take an appropriate measure in the matters but the earlier counsel still did not take suitable action which came to assessee’s notice subsequently when recovery proceedings were started by department in March, 2024. This resulted in a persisting delay of some days which was again due to lapse of earlier counsel. This claim of assessee for persisting delay of some days deserves credence having regard to the careless approach of counsel in handling appeals of assessee before CIT(A). Therefore, the facts of present case shows that there was a delay in filing present appeal due to negligence of earlier counsel and not attributable to assessee. The AR of assessee has cited certain judicial decisions in Case Law Paper-Book wherein the lapse of counsel has been considered as a ‘sufficient cause’ for condoning delay. We find that section Page 7 of 10

We next find that the CIT(A) has decided first-appeal ex-parte qua assessee for the reason that the assessee did not make any submission before him despite opportunities given. It is further observed that the CIT(A) has simply confirmed the order passed by AO and thereby upheld the additions but the grounds/issues raised by assessee in first-appeal requires an apt adjudication by CIT(A) on merit in accordance with provisions of 250(6) of the Act which provides “The order of the Commissioner (Appeals) disposing of the appeal shall be in writing and shall state the points for determination, the decision thereon and the reason for the decision.”. Ld. AR for assessee submits that the assessee is ready and willing to make representation before CIT(A) if an opportunity is given and hence prays that the present matter should be remanded to CIT(A) for an apt adjudication.

At this stage, we may mention that the assessee has also filed certain additional grounds claiming the same to be of legal nature and allowed to be admitted as per decision of Hon’ble Supreme Court in NTPC Vs. CIT (1998)

The registry has informed that this appeal had been filed on 05.04.2024 against impugned order dated 24.01.2024 after a delay of 12 days beyond statutory period and therefore time-barred. Ld. AR for assessee submitted that the assessee has filed a condonation-application supported by an affidavit according to which the reason of 12 days’ delay is the same as narrated for ‘persisting delay’ in i.e. after receipt of penalty-order, the assessee approached earlier counsel and trusted that the Page 9 of 10

The issue involved in this appeal is the penalty imposed by AO u/s 271(1)(c). The said penalty is based on quantum addition made in assessment-order. Since we have already remanded quantum-appeal to CIT(A), we also remand penalty-appeal in very same terms to CIT(A) for adjudication afresh.

Resultantly, these appeals are allowed for statistical purposes.