BHIKHABHAI SOMABHAI PATEL,SABARKANTHA V. THE ITO, WARD-1, HIMATNAGAR

ITA 2597/AHD/2025

AI Insights

The case involves Bhikhabhai Somabhai Patel, an illiterate agriculturist from Gujarat, who faced ex parte assessments and penalties under the Income Tax Act, 1961, for the assessment year 2018-19. The Income Tax Officer (ITO) added a substantial amount to Patel's income, which he contested, citing discrepancies in the reported interest income and his unfamiliarity with tax laws and electronic proceedings. The Commissioner of Income Tax (Appeals) dismissed his appeals as non-maintainable due to delays, which Patel attributed to his lack of access to technology and ignorance of tax obligations. The Tribunal found merit in Patel's explanations and condoned the delays, emphasizing the principles of substantial justice and the need to hear the assessee's case.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 839062 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-02-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2018-2019
• Appeal Filed On: 24-12-2025
• Other Referred Cases: Collector Land Acquisition Vs. Mst. Katiji & Others, N.Balakrishnan Vs. M. Krishnamurthy
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJKUMAR M VASAVDA
• Assessee Lawyers: S.N. DIVATIA; SAMIR VORA
• Keywords: Condonation of delay; Bonafide belief; TDS; FORM 26AS

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, AHMEDABAD BEFORE: SHRI SANJAY GARG, JUDICIAL MEMBER AND SMT. ANNAPURNA GUPTA, ACCOUNTANT MEMBER आयकर अपील सं./I.T.A. Nos. 2596 & 2597/Ahd/2025 (िनधा[रण वष[ / Assessment Year : 2018-19) Bhikhabhai Somabhai Patel Post: Kamalpur, Prantij, Dist: Sabarkantha, Gujarat- 383205 बनाम / Vs. ITO Ward-1, Himatnagar èथायी लेखा सं./जीआइआर सं./PAN/GIR No. : BXFPP3843P (Appellant) .. (Respondent) अपीलाथȸ ओर से /Appellant by : Shri S. N. Divatia & Shri Samir Vora, ARs. Ĥ×यथȸ कȧ ओर से/Respondent by : Shri Rajkumar M Vasavda, Sr. DR Date of Hearing 04/02/2026 Date of Pronouncement 18/02/2026 O R D E R PER ANNAPURNA GUPTA, AM: Both the appeals relate to the same assessee and pertain to the same Assessment Year (A.Y.) 2018-19. While one is against the order passed by the Ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (hereinafter referred to as “NFAC”) (in short “CIT(A)”), Delhi dated 14.11.2025 in quantum proceedings in assessment order passed under Section Printed from counselvise.com ITA Nos.2596 & 2597/Ahd/2025 [Bhikhabhai Somabhai Pate vs. ITO] A.Y. 2018-19 - 2 – 147 r.w.s. 144 r.w.s. 144B of the Income Tax Act, 1961 (hereinafter referred to as the “Act”), the other appeal lies against order of the Ld. CIT(A) confirming the levy of penalty under Section 270A of the Act on the addition made to the income of the assessee in the quantum proceedings. 2. Issues involved in both the appeals being interrelated they were taken up together for hearing and are being disposed of by this common order for the sake of convenience. 3. At the outset itself, Ld.Counsel for the assessee stated that the Ld.CIT(A) had dismissed both the appeals of the assessee as non-maintainable, not condoning the delay in filing the same. He pointed out that the quantum appeal of the assessee was delayed for filing by 901 days, while the penalty appeal was delayed by 715 days. He stated that the assessee had explained the delay to be on account of the fact that he was an illiterate agriculturist, non-filer of return, unaware of the technicalities of income tax law and also totally unfamiliar with the technology involved in conducting income tax proceedings electronically. That therefore he was unaware of the passing of the assessment order and became aware only when recovery notice was received by him. That however the explanation of the assessee was not found to be sufficient for explaining the delay by the CIT(A). 4. He pleaded, therefore, that the delay be condoned and the assessee be given a fair chance to argue his case on merits. Printed from counselvise.com ITA Nos.2596 & 2597/Ahd/2025 [Bhikhabhai Somabhai Pate vs. ITO] A.Y. 2018-19 - 3 – 5. We have gone through the orders of the authorities below. The orders reveal the assessee’s case to have been reopened for assessment, finding the assessee to have received interest on additional land compensation amounting to Rs.80,06,440/- and no return being filed by the assessee. The land of the assessee was acquired by the government for SUJLAM SUFLAM SPREADING CHANAL DIV NO 1, SABARKANTHA. All notices issued to the assessee remained unresponded and assessment accordingly was framed ex parte, without hearing the assessee, u/s. 144 of the Act. Tax demand including interest was raised on the assessee amounting to Rs.53,54,008/-. 6. Penalty was also levied on the said alleged underreported income of the assessee @ 200% of the tax on the said income, amounting to Rs.50,17,902/- 7. The assessee, thereafter, filed appeal to the CIT(A) mentioning in its Statement of Facts that the interest added was not in consonance with that reflected in its TDS statement in Form 26AS wherein interest income of Rs.40,03,230/- was reflected while the AO had added Rs.80,06,440/-. He also stated therein that as per law he was entitled to deduction of 50% of the interest u/s 57(iv) of the Act. 8. He further explained non participation in the assessment proceedings being on account of his rural, illiterate background, being an agriculturist and hence not required to file return of income thus not being familiar with tax laws and also the fact Printed from counselvise.com ITA Nos.2596 & 2597/Ahd/2025 [Bhikhabhai Somabhai Pate vs. ITO] A.Y. 2018-19 - 4 – that he had no access to internet and was also not registered on the income tax portal. He also contended that since tax was already deducted on the interest he was under the Bonafide belief that he was not required to file any return of income. His explanation as above mentioned in the statement of facts is as under: “1. The Appellant is an Individual who resides in a village and is involved in agriculture activities. The appellant has never filed income tax return as there was no income chargeable to tax. He has no access to internet and not able to check emails and had not even registered on filing portal. Therefore it was practically not possible to get the notices received on mails. Further the appellant had bona fide belief that the interest income received on compensation for acquisition of land has been received after deducting TDS, therefore he was not required to file the Income Tax return and tax had already been paid. Due to this genuine reason, notices sent by the AO could not be received and could not be replied by the appellant.” 9. Similarly, he explained the delay in filing of appeal for the same reasons in Form No.35 as under; “I, Bhikhather Somahal Patel PAN NO EXPPP3843P, residing at KAMALPUR PRANTU SABARKANTHA 383205 Gigarat, India respectfully submit as under 1. That I am a villager residing in a village doing agricultural activities only. I have never filed ty Income Tax retums earlier I have no access to emails or internet etc. and therefore was not able to receive any notice of orders and had no information about completion of the assessment and penalty orders by the faceless department I came to know about the same only after I received physical notices for recovery of demands of tax and penalty 2. That I have filed an appeal against the assessment order under Section 147 passed by the Assessing Officer, dated 13.03.2023, for the Assessment Year 2018 19 and against the penalty order dated 15.09 2023 for the AY 2018 19 Printed from counselvise.com ITA Nos.2596 & 2597/Ahd/2025 [Bhikhabhai Somabhai Pate vs. ITO] A.Y. 2018-19 - 5 – 3. As per the provisions of the Income Tax Act, the appeal should have been filed within 30 days of receipt of said orders. However, due to reason mentioned in para 1 above, I could not file the appeals before the due dates 4. However, the appeal has been fled on Actual Date of Filling resulting in a delay of days The delay occurred due to the masons mentioned in para 1 above. 5. The delay was neither deliberate nor intentional but due to genuine and unavoidable circumstances. 6. I respectfully pray that the delay may kindly be condoned in the interest of justice and my appeal be admitted for adjudication on merits. I have enclosed an affidavit affirming the facts stated above along with supporting documents.\" 10. Considering all the above, we find that the assessee had adduced sufficient cause for the delay in filing appeal. It is not denied that the assessee is an agriculturist whose land had been acquired for irrigation scheme of the government. The facts pleaded by him that he was never in the past required to file return of income and was not even registered on the portal of the Department has not been found to be false by the Ld.CIT(A). Nor the fact that he was an illiterate agriculturist residing in a village where there was no internet facility. The AO had conducted assessment proceedings electronically. The assesses contention therefore of unfamiliarity with tax laws and also that he never received the notices or for that matter the assessment order, appears to be plausible. 11. What weighs heavily in favour of condonation of delay is the fact that if the delay is not condoned the huge addition of Rs.80lacs made in the case of the assessee, who admittedly is a Printed from counselvise.com ITA Nos.2596 & 2597/Ahd/2025 [Bhikhabhai Somabhai Pate vs. ITO] A.Y. 2018-19 - 6 – poor agriculturist never having filed return in the past, would remain confirmed, that too without hearing the assessee at all and without even examining from the facts of the case whether the addition was justified as per law. The assessee would be burdened with tax liability exceeding Rs.50 lacs and similar amount of penalty would also be required to be paid by him. Thus, the assessee an agriculturist, who has always been protected from payment of taxes by the law makers, requiring no taxes to be paid on his meagre agricultural income, would be burdened with a tax liability of Rs.1 Cr., that too without the assessee being heard at all and without the issue at hand being examined in law as applicable to the facts of the case. Undoubtedly it is a classic case of gross injustice being meted out to the assessee by not condoning the delay in the filing of appeal to the Ld.CIT(A). 12. It is settled law that in matters of condonation of delay when substantial justice and technical considerations are pitted against each other, cause of substantial justice deserves to be preferred. Courts have considered that ordinarily a litigant does not stand to benefit by lodging an appeal late and by refusing the condonation of delay it can result in a meritorious matter being thrown out at the very threshold, defeating the cause of justice. Courts have been unanimous in holding that the word ‘sufficient cause’ as per section 5 of the Limitation Act should receive a liberal construction so as to advance substantial justice and that merely because there is some lapse of the litigant concerned, that alone is not enough to shut the door of justice to him. That as Printed from counselvise.com ITA Nos.2596 & 2597/Ahd/2025 [Bhikhabhai Somabhai Pate vs. ITO] A.Y. 2018-19 - 7 – long as the explanation of the assessee does not smack of malafides or it is not put forth as part of a dilatory strategy, the court must show utmost consideration and when there is reasonable ground to think that the delay was occasioned by the party deliberately to gain time, then the court should lean against acceptance of the explanation. We make a reference in this regard to the following observations of the of Hon’ble Apex Court in the case of Collector Land Acquisition Vs. Mst. Katiji & Others, 1987 AIR 1353: “1. Ordinarily a litigant does not stand to benefit by lodging an appeal late. 2. Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As against this when delay is condoned the highest that can happen is that a cause would be decided on merits after hearing the parties. 3. \"Every day's delay must be explained\" does not mean that a pedantic approach should be made. Why not every hour's delay, every second's delay? The doctrine must be applied in a rational common sense pragmatic manner. 4. When substantial justice and technical considerations are pitted against each other, cause of substantial justice deserves to be preferred for the other side cannot claim to have vested right in injustice being done because of a non- deliberate delay. 5. There is no presumption that delay is occasioned deliberately, or on account of culpable negligence, or on account of mala fides. A litigant does not stand to benefit by resorting to delay. In fact he runs a serious risk. 6. It must be grasped that judiciary is respected not on account of its power to legalize injustice on technical grounds but because it is capable of removing injustice and is expected to do so.” 13. Similarly, we would like to make reference to authoritative pronouncement of Hon’ble Supreme Court in the case of N.Balakrishnan Vs. M. Krishnamurthy (supra). It reads as under: Printed from counselvise.com ITA Nos.2596 & 2597/Ahd/2025 [Bhikhabhai Somabhai Pate vs. ITO] A.Y. 2018-19 - 8 – “Rule of limitation are not meant to destroy the right of parties. They are meant to see that parties do not resort to dilatory tactics, but seek their remedy promptly. The object of providing a legal remedy is to repair the damage caused by reason of legal injury. Law of limitation fixes a life-span for such legal remedy for the redress of the legal injury so suffered. Time is precious and the wasted time would never revisit. During efflux of time newer causes would sprout up necessitating newer persons to seek legal remedy by approaching the courts. So a life span must be fixed for each remedy. Unending period for launching the remedy may lead to unending uncertainty and consequential anarchy. Law of limitation is thus founded on public policy. It is enshrined in the maxim Interest reipublicae up sit finis litium (it is for the general welfare that a period be putt to litigation). Rules of limitation are not meant to destroy the right of the parties. They are meant to see that parties do not resort to dilatory tactics but seek their remedy promptly. The idea is that every legal remedy must be kept alive for a legislatively fixed period of time. A court knows that refusal to condone delay would result foreclosing a suitor from putting forth his cause. There is no presumption that delay in approaching the court is always deliberate. This Court has held that the words \"sufficient cause\" under Section 5 of the Limitation Act should receive a liberal construction so as to advance substantial justice vide Shakuntala Devi lain Vs. Kuntal Kumari [AIR 1969 SC 575] and State of West Bengal Vs. The Administrator, Howrah Municipality [AIR 1972 SC 749]. It must be remembered that in every case of delay there can be some lapse on the part of the litigant concerned. That alone is not enough to turn down his plea and to shut the door against him. If the explanation does not smack of mala fides or it is not put forth as part of a dilatory strategy the court must show utmost consideration to the suitor. But when there is reasonable ground to think that the delay was occasioned by the party deliberately to gain time then the court should lean against acceptance of the explanation. While condoning delay the Could should not forget the opposite party altogether. It must be borne in mind that he is a looser and he too would have incurred quiet a large litigation expenses. It would be a salutary guideline that when courts condone the delay due to laches on the part of the applicant the court shall compensate the opposite party for his loss.” 14. Considering the judicial decisions as above and noting that In the present appeals before us the assessee has adduced sufficient cause for the delay in the filing of appeal to the Ld.CIT(A) and further noting that gross injustice would result to the assessee if the delay is not condoned, Therefore, we condone the delay in the filing of both the appeals before the Ld.CIT(A) and restore the matters back to the file of the Ld.CIT(A) to decide Printed from counselvise.com ITA Nos.2596 & 2597/Ahd/2025 [Bhikhabhai Somabhai Pate vs. ITO] A.Y. 2018-19 - 9 – both the appeals afresh after giving due opportunity of hearing to the assessee. 15. In the result, both appeals of the assessee are allowed for statistical purposes. This Order pronounced on 18/02/2026 Sd/- Sd/- (SANJAY GARG) (ANNAPURNA GUPTA) JUDICIAL MEMBER ACCOUNTANT MEMBER Ahmedabad; Dated 18/02/2026 S. K. SINHA True Copy आदेश कȧ Ĥितिलǒप अĒेǒषत/Copy of the Order forwarded to : 1. अपीलाथȸ / The Appellant 2. Ĥ×यथȸ / The Respondent. 3. संबंिधत आयकर आयुƠ / Concerned CIT 4. आयकर आयुƠ(अपील) / The CIT(A)- 5. ǒवभागीय Ĥितिनिध, आयकर अपीलीय अिधकरण, अहमदाबाद / DR, ITAT, Ahmedabad 6. गाड[ फाईल / Guard file. आदेशानुसार/ BY ORDER, उप/सहायक पंजीकार (Dy./Asstt. Registrar) आयकर अपीलीय अिधकरण, अहमदाबाद / ITAT, Ahmedabad Printed from counselvise.com "