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Income Tax Appellate Tribunal, PUNE BENCHES “A” :: PUNE
Before: DR.DIPAK P. RIPOTE & SHRI VINAY BHAMORE
ORDER PER DR. DIPAK P. RIPOTE, AM: These are two appeals filed by the Assessee against the two separate orders of ld.Commissioner of Income Tax(Appeal)[NFAC], under section 250 of the Income Tax Act, 1961 for A.Y.2015-16 and A.Y.2018-19; both dated 24.05.2024. Since the issue involved is common, both these appeals were heard together and decided by the common order.
1.1 We will take the A.Y.2015-16 as a lead case. The assessee has raised following Grounds of appeal :
1. On facts and circumstances prevailing in the case and as per provisions & scheme of the Income-tax Act, 1961 (‘The Act’) it be held that the appeal dismissed by ‘Ld. CIT(A)-NFAC’ owing to delay in filing form 35 is incorrect & inappropriate. Accordingly, the Ld. CIT(A)-NFAC be kindly directed to admit the appeal by condoning the delay in filing form 35.
2. Without prejudice to above grounds, on facts and circumstances prevailing in the case and as per provisions & scheme of the Income-tax Act, 1961 (‘The Act’) it be held that the appeal so dismissed by Ld. CIT(A)-NFAC’ owing to delay in tiling form 35 is without following the procedure as provided in the faceless appeal scheme and accordingly, the Ld. CIT(A)-NFAC be kindly directed to admit the appeal by condoning the delay in filing form 35.
3. Without prejudice to above grounds, on the facts and circumstances prevailing in the case and as per provisions & scheme of the Income-tax Act, 1961 (‘The Act’) it be held that the addition of cash deposit and time deposit so made u/s 68 and 69 of the Act is incorrect since the same is not the income of Appellant. Accordingly, the addition so made be kindly deleted and Appellant be granted just and proper relief in this regard.
4. Without prejudice to above grounds, on the facts and circumstances prevailing in the case and as per provisions & scheme of the Income-tax Act, 1961 (‘The Act’) it be held that the addition of interest income so made is incorrect since the same deductible u/s 80P of the Act. Accordingly, the addition so made be kindly deleted and Appellant be granted just and proper relief in this regard.
5. Without prejudice to above grounds, on the facts and circumstances prevailing in the case and as per provisions & scheme of the Income-tax Act, 1961 (‘The Act’) it be held that the assessment initiated and completed on a surrendered PAN is void- ab-initio. Accordingly, the assessment so made be kindly quashed and Appellant be granted just and proper relief in this regard.
6. The appellant prays to be allowed to add, amend, modify, rectify, delete, raise any grounds of appeal at the time of hearing.”
Submission of ld.AR : 2. Ld.AR filed a paper book. Ld.AR submitted that assessee had not received assessment order as it was sent on some other Email Id. Ld.AR submitted that as per the records, Assessee’s Email Id is :rajendratambake@gmail.com. The same Email Id is mentioned in the assessment order at page no.3 where Assessing Officer discussed about notices. However, Assessing Officer has not sent assessment order at the same Email Id, but erroneously sent the assessment order at kadolkar3421@gmail.com. Therefore, assessee has no knowledge regarding the assessment orders for both the years. The assessee got to know about the assessment orders only when recovery notices were issued. Assessee had filed reasons for delay with form No.35 to explain the Delay in filing appeal before the ld.CIT(A). The Ld.CIT(A) has reproduced part of the reason in the order. However, ld.CIT(A) dismissed the appeal of the assessee without condoning the delay. There was a delay of 251 days in filing appeal before the ld.CIT(A). Ld.CIT(A) had not asked assessee any question regarding the Delay during the Hearing conducted through Video Conference. Assessee had made elaborate submission on merits of the case.
However, ld.CIT(A) dismissed merely on Delay. There was a valid reason for Delay as Assessee had not received copies of assessment orders. Submission of ld.DR : 3. The ld.DR for the Revenue relied on the order of ld.CIT(A).
Findings &Analysis : 4. We have heard both the parties and perused the records. Assessee has filed copy of Affidavit at Page No.1-5 of the paper book. The relevant part of the Affidavit is reproduced here as under : “3) That the Society was earlier allotted a PAN considering it to be a Trust (AAJTS9863M) (hereinafter referred as an ‘Old PAN’). So as to correct this mistake, Society Surrendered this PAN and Applied for New correct PAN (AAZAS2470E). 4) That, said fact of Surrendering old PAN and seeking new PAN was duly informed to the then Ld. Assessing Officer vide letter dt. 05/09/2018. Accordingly, Ld. AO completed the Assessment for AY 2011-12 considering he society as an AOP (Assessment order dt. 10/09/2018). 5) That, all Income-tax compliances, including filing of ITR, for all subsequent years done under the New and Correct PAN. 6) That, upon receipt of notice u/s 148 of the Act, in March 2022, on Old surrendered PAN for AY 15-16 and AY 18-19, we informed our tax consultant to take care of the proceedings, and accordingly he filed ITR in response to said notices u/s 148 of the Act. 7) That, in the Month of July 2023, we received a physical communication from ITO Ward-1, ichalkaranji for recovering the Tax demand for AY 2015-16 and AY 2018-19. Said physical communication was sent to our consultant to take the necessary course of Action.
8) Further, in the Month of August 2023 we again received recovery notice, which was again sent to our consultant (on WhatsApp). 9) That, after receipt of above-mentioned recovery notices firstly in the month of July 2023 and then August 2023, we acknowledged that the certain demand has been raised against, the Society since Assessment Proceedings were not attended by the consultant. Moreover, we also got to know that the Assessment Orders were passed in the Month of March 2023 but said orders were not sent to our regular e-mail ID (raiendratambake@gmail.com) , but on (kadolkar3421@gmail.com). owing to which we were totally unaware of the fact that Assessment Order was passed till receipt of recovery notices. 10) In connection of tax demand and above notices, we were informed by the consultant that since notice was on incorrect PAN the proceedings are invalid and he further informed that Appeal shall be filed by him. 11) That, after discussion with our consultant, we were being given an impression that Appeal has been filed, since he had assured us that requisite action has been taken. 12) However, on 01/12/2023 our bank account was attached u/s 226(3) of the Act by Ld. ITO Ward-1, ichalkaranji, and when we sought clarification/reasons for the same from our consultant it came to our knowledge that still the Appeal wasn't filed by him. 13) That immediately thereafter, we asked our routine consultant and one another consultant to take necessary action, and then the Appeal got ultimately filed on 06th December 2023.”
It is observed that ld.CIT(A) has dismissed the appeal of the assessee on the Ground of Delay. We have perused the reasons filed by assessee for the delay. We are convinced that there was sufficient cause for delay. The substantial justice is more important than procedural delay. In these facts, we direct the ld.CIT(A) to condone the delay and decide the appeal of the assessee on merits of the case. Ld.CIT(A) shall provide proper and sufficient opportunity of hearing to the assessee. We have mentioned proper and sufficient opportunity specifically because it is observed from the records that ld.CIT(A) issued notice dated 27.04.2024 to the assessee scheduling personal hearings through video conferencing on 29.04.2024. Thus, hardly two days were provided to the assessee, whereas the Hon’ble Bombay High Court in the case of Assessee in Writ Petition No.3775/2024 had clearly directed that the notice for virtual hearing shall be issued minimum five working days in advance. The Assessee shall provide all the necessary documents before the ld.CIT(A). Accordingly, grounds of appeal raised by the assessee are allowed for statistical purpose.
In the result, appeal of the assessee is allowed for statistical purpose. therefore, our decision shall apply mutatis mutandis to this appeal also, accordingly, grounds of appeal raised by the assessee in are allowed for statistical purpose.
In the result, two appeals of the Assessee i.e.ITA Nos.1347 & 1348/PUN/2024 are allowed for statistical purpose. Order pronounced in the open Court on 23rd October, 2024.