VRUNDAVAN RESTAURANT,SURAT vs. INCOME TAX OFFICER, WARD - 1(2)(1) (NEW) WARD-1(2)(5), VADODARA (OLD), SURAT

IN THE INCOME TAX APPELLATE TRIBUNAL, SURAT BENCH, SURAT BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER AND Dr. ARJUN LAL SAINI, ACCOUNTANT MEMBER ITA No. 683/Srt/2023 (AY: 2009-10) (Physical hearing) Vrundavan Restaurant, I.T.O., (1)-U-2, Ashirwad Square, Udhna Ward-1(2) (1), Surat- Vs. Magdalla Road, Surat 395007- New, New, (2)- 39/1, 4th Floor, Vaibhav Ward 1(2)(5), Vadodara- Residency, Arunday Crossword Circle Old. Alkapuri, Alkapuri, Vadodara-390007 – Old. PAN No. AAGFV 8310 G Appellant/ assessee Respondent/ revenue

Assessee represented by Shri Rajesh Upadhayay, A.R. Department represented by Shri Vinod Kumar, Sr. DR Date of institution of appeal 09/10/2023 Date of hearing 19/12/2023 Date of pronouncement 19/12/2023 Order under Section 254(1) of Income Tax Act PER: PAWAN SINGH, JUDICIAL MEMBER: 1. This appeal by the assessee is directed against the order of National Faceless Appeal Centre, Delhi (NFAC)/learned Commissioner of Income Tax (Appeals) [in short, the ld. CIT(A)] dated 06/03/2023 for the Assessment Year (AY) 2009-10. The assessee has raised following grounds of appeal: “1. Ld. CIT(A), NFAC, Delhi has erred in law and on fact to decide appellant’s appeal ex parte and that to without verifying the fact that whether the notice of hearing is served upon the appellant? 2. Ld. CIT(A), NFAC, Delhi has erred in law and on fact to uphold AO’s reopening U/s 147 and issue of notice U/s 148 of the Act.

ITA No.683/Srt/2023 Vrundavan Restaurant Vs ITO 3. Ld. CIT(A), NFAC, Delhi has erred in law and on fact to uphold AO’s addition of Rs. 2,46,150/- being undisclosed expenditure out of firm’s undisclosed income for the year under appeal. 4. Ld. CIT(A), NFAC, Delhi has erred in law and on fact to uphold AO’s addition U/s 68 of the Act for Rs. 15,60,500/- on account of unsecured loan received from Shree Jaykumar K Shah. 5. Ld. CIT(A), NFAC, Delhi has erred in law and on fact to uphold AO’s addition U/s 41(1) of the Act for Rs. 41,34,164/- on account of cession of liability w.r.t. sundry creditors.” 2. Rival submission of both the parties have been heard and record perused. The learned Authorised Representative (ld. AR) of the assessee submits that there is delay of 157 days in filing appeal before this Tribunal. The assessee has filed affidavit for explaining the delay. The ld. AR of the assessee further submits that the impugned order was passed by the ld. CIT(A) on 06/03/2023, however, the assessee has not received order as she has not seen her e-mail. The consultant of assessee while checking the portal of his other clients, came to know that order in case of assessee has also been passed on 06/03/2023. The consultant immediately downloaded the impugned order and immediately filed appeal before the Tribunal. Non-filing of appeal in time was neither intentional nor deliberate but for the reasons that the assessee was not aware about passing of the impugned order. The assessee has good case on merit and is likely to succeed if one more opportunity is given to the assessee. 3. On merit of the case, the ld. AR of the assessee submits that the Assessing Officer as well as ld. CIT(A) passed the ex parte order without giving fair and reasonable opportunity to the assessee. The ld. CIT(A) confirmed the finding of Assessing Officer in a non-speaking order. Order 2

ITA No.683/Srt/2023 Vrundavan Restaurant Vs ITO of ld. CIT(A) is not in consonance with the mandate of Section 250(6) of the Income Tax Act, 1961. 4. On the other hand, the learned Senior Departmental Representative (ld. Sr. DR) for the revenue on the issue of condonation of delay, submits that the assessee is casual and no plausible or reasonable explanation is given for condoning such a long delay. The assessee does not deserve any leniency so far as delay is concerned. On the merit of addition, the ld. Sr. DR for the revenue submits that the assessee was given ample opportunity by the lower authorities, it is the assessee who has not availed such opportunity, therefore, even on merit, the assessee is not eligible for any relief. To support his view, the ld. Sr. DR for the revenue relied on the decision of Hon’ble Apex Court Civil Appeal No.7696 of 2021 in the case of Majji Sannemma @ Sanyasirao Vs Reddy Sridevi & Ors. 5. We have considered the submissions of both the parties and perused the contents of affidavit regarding condonation of delay. The main contention of ld. AR of assessee is that the delay is neither intentional nor deliberate for the reasons that there they have not checked their e-mail and that as soon as they checked the e-mail, realised that the order has been passed by the ld. CIT(A) and that immediately filed appeal before the Tribunal. The partner of assessee Parul Jaykant Shah has filed her affidavit to substantiate such contention. Considering the fact that there is no inordinate delay and the assessee has fairly accepted that the order was communicated only when they open their e-mail. We further find that the 3

ITA No.683/Srt/2023 Vrundavan Restaurant Vs ITO assessee is not going to be benefitted by filing appeal belatedly. Considering the fact that when the technical consideration and cause of substantial justice kept against each other, the cause of substantial justice must be prevailed. So far as objection of ld. Sr. DR for the revenue is concerned and reliance placed on decision of Hon’ble Supreme Court in Civil Appeal No.7696 of 2021 in the case of Majji Sannemma @ Sanyasirao Vs Reddy Sridevi & Ors., with utmost regard to the said decision, we find that facts of the present appeal are at variance. With utmost regard the ratio of the said decision, we find that in that case, the High Court has not observed that there was any sufficient cause explaining the huge delay of 1011 days. However, in the present appeal, the assessee categorically pleaded and shown sufficient cause for filing appeal belatedly. Thus, considering the facts and circumstances of the case, we condoned the delay in filing appeal. 6. We find that the Assessing Officer made various additions on account unexplained cash credit of Rs. 15,60,500/-, on account of unexplained expenditure of Rs. 2,46,150/- and on account of cessation of liability of Rs. 41,34,164/-. The action of Assessing Officer was upheld by the ld. CIT(A) in ex parte proceedings by not following the mandate of Section 250(6) of the Act. In our view, the substantial right of assessee is involved in the present appeal, therefore, keeping in view the principle of natural justice, the assessee is giving one more opportunity to explain the case on merit. Considering the fact the assessment order was passed under 4

ITA No.683/Srt/2023 Vrundavan Restaurant Vs ITO Section 143(3) r.w.s. 147 of the Act, therefore, we deem it appropriate to restore the issue back to the file of Assessing officer to decide the issue afresh in accordance with law. Needless to direct that before passing the order, the Assessing Officer shall grant opportunity of hearing to the assessee. The assessee is also directed to be more vigilant in future and not to cause further delay and seek adjournment without any valid reason and to furnish all the details and his submissions and evidences on various grounds of appeal raised by him, as soon as possible, if so desired without any further delay. In the result, the grounds of appeal raised by the assessee are allowed for statistical purposes. 7. In the result, this appeal of assessee is allowed for statistical purposes only. Order pronounced in the open court on 19th December, 2023. Sd/- Sd/- (Dr. ARJUN LAL SAINI) (PAWAN SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER Surat, Dated: 19/12/2023 *Ranjan Copy to: 1. Assessee – 2. Revenue - 3. CIT 4. DR By order 5. Guard File Sr. Private Secretary, ITAT, Surat