HATMAL RIDMAL JAIN,MUMBAI V. ITO 19(1)(5), MUMBAI

ITA 8842/MUM/2025

AI Insights

The case involves Hatmal Ridmal Jain, the appellant, who contested a penalty under section 271(1)(c) of the Income Tax Act, 1961, for the assessment year 2012-13. The penalty was initially confirmed by the CIT(A) despite the appellant's delay in filing the appeal, which was attributed to various personal and technical challenges, including health issues and lack of familiarity with digital communication. The Tribunal noted a previous similar case involving the same appellant, where the delay was condoned and the matter was restored for fresh adjudication. The Tribunal decided to follow this precedent, emphasizing the need for substantial justice.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 848138 (ITAT-MUMBAI)
• Duration Of Justice: 3 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-03-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Mumbai
• Assessment Year: 2012-2013
• Appeal Filed On: 19-12-2025
• Other Referred Cases: Collector, Land Acquisition, Anantnag vs. MST Katiji and Ors.
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: HEMANSHU JOSHI
• Assessee Lawyers: VIMAL PUNMIYA
• Keywords: Condonation of delay; Set aside; Unexplained expenditure; Period of limitation; Time period of passing order
• Section: 147; 144; 271(1)(c)

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL “E” BENCH, MUMBAI BEFORE SHRI OM PRAKASH KANT, ACCOUNTANT MEMBER SHRI SANDEEP SINGH KARHAIL, JUDICIAL MEMBER ITA No. 8842/Mum./2025 (Assessment Year : 2012-13) Hatmal Ridmal Jain, 42/47, 2nd Carpenter Street, Nanubhai Desai Road, Girgaon, S.O. Mumbai - 400004 PAN : AAGPJ5228H ……………. Appellant v/s Income Tax Officer, Ward – 19(1)(5), Room No.502, Piramal Chambers, Lalbaug, Mumbai - 400012 ……………. Respondent Assessee by : Shri Vimal Punmiya Revenue by : Shri Hemanshu Joshi SR. DR Date of Hearing – 10/03/2026 Date of Order – 24/03/2026 O R D E R PER SANDEEP SINGH KARHAIL, J.M. The assessee has filed the present appeal against the impugned order dated 19/11/2025, passed under section 250 of the Income Tax Act, 1961 (“the Act”) by the learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi [“learned CIT(A)”], which in turn arose from the penalty order passed under section 271(1)(c) of the Act, for the assessment year 2012-13. 2. In this appeal, the assessee has raised the following grounds: - Printed from counselvise.com ITA No.8842/Mum/2025 (A.Y. 2012-13) 2 “1. On the facts and circumstances of the case and in law, The Ld. CIT(A) erred in confirming the penalty of Rs.7,32,410 under section 271(1)(c) of the Act for under reporting of income. 2. On the facts and circumstances of the case and in law, The Ld. CIT(A) erred in confirming the addition made by the Ld. AO without considering that the quantum appeal regarding AY 2012-13 was heard before the honorable ITAT and the matter has been set aside to the Ld. CIT(A) for fresh adjudication.” 3. We have considered the submissions of both sides and perused the material available on record. In the present case, at the outset, it is evident that the learned CIT(A) dismissed the appeal filed by the assessee on the ground of delay without adjudicating the grounds raised by the assessee against the penalty levied under section 271(1)(c) of the Act. 4. During the hearing, the learned Authorised Representative (“learned AR”), placed on record the affidavit sworn by the assessee, submitting the reasons for the delay in filing the present appeal, which reads as follows: – “• The original Assessment order u/s 144 r.w.s. 147 was passed on 28/11/2019 and the appeal against the said order before the C.I.T (APPEALS) was filed on 15th November 2023 (Delay of 702 days) and the appeal against the same before the Honorable Income Tax Appellate Tribunal has been filed.  I have learnt and am aware that during the course of the proceedings various notices were issued to me on my portal namely notice dated 31/3/2019 u/s 148, notice dated 16/10/2019 u/s 142(1). and final show cause notice u/s 147 dated 4/11/2019 all of which remained noncomplied on account of me having no knowledge about the same as I am not technically competent to understand the process. • Due to the aforesaid an ex-parte order dated 28/11/2019 was passed resulting into addition of Rs.26,02,600/- on account of unexplained expenditure. • Honourable ITAT condoned the above delay for AY 2012-13 vide order dated 21.03.2025 bearing appeal number 498/Mum/2025.  However the penalty proceeding were initiated and a penalty order was passed on 12.02.2022 and the appeal against the said order before the C.I.T (APPEALS) was filed on 29.01.2025 (Delay of almost 3 years) and the appeal against the same before the Honorable Income Tax Appellate Tribunal has been filed. Printed from counselvise.com ITA No.8842/Mum/2025 (A.Y. 2012-13) 3  Further I am a senior citizen, I am not very educated and have studied only till class 8th.  I am not at all well versed with using computers and internet and I was not aware of the income tax website. • I was also unaware of how to access and respond to communications sent to my registered email address. • My health has not been well since the past few years. •That this lack of technical proficiency severely hindered my ability to navigate and respond to the electronic communications and emails received from the Department during the faceless proceedings. • During this period when the notices from the Ld. AO were sent to me, I was also suffering from medical problems. • My shop was flooded with water and major papers lying in the office premises were destroyed. • Due to the aforementioned technological and health-related challenges, and water flooding in my office, I inadvertently missed the emails and notices sent by the Ld. AO.  My failure to respond to the Income Tax Department's notices or communications within the prescribed time frame was not deliberate but purely due to a lack of awareness and capability.  As soon as i came to know about the order passed by the Ld. AO, I subsequently through my CA/Consultant filed an appeal before the Commissioner of Income Tax (Appeals) [CIT(A)] against the said order of the Assessing Officer. Proceedings Before CIT(A): • That I subsequently filed an appeal before the Commissioner of Income Tax (Appeals) [CIT(A)] against the said order of the Assessing Officer. However, these proceedings before the CIT(A) were conducted in a faceless manner. • Ld. CIT(A) further passed the order without condoning the delay against which we have filed the present appeal. Non-Compliance with Notices: • That due to the aforementioned technological and health-related challenges, I inadvertently missed the emails and notices sent by the Ld. AO.  That my failure to respond to the notices was not intentional but rather due to genuine difficulties faced during this period. Appeal for Condonation: Printed from counselvise.com ITA No.8842/Mum/2025 (A.Y. 2012-13) 4 I respectfully submit this affidavit to the Hon'ble Authority, seeking condonation of the delay in filing of the appeal before the CIT(A). I assure you that the delay was neither wilful nor due to negligence but arose from circumstances beyond my understanding and capacity. Undertaking: I further undertake to ensure that I will comply with all statutory requirements promptly in the future and will take adequate measures to avoid any delays.” 5. The learned AR further submitted that in the appeal filed by the assessee in quantum proceedings for the year under consideration, wherein the appeal filed before the learned CIT(A) was dismissed on the ground of delay on account of similar reasons, the coordinate bench of the Tribunal vide its order dated 21/03/2025 passed in Hatmal Ridmal Jain v/s ITO, in ITA No. 489/Mum/2025, restored the matter back to the file of the learned CIT(A) for deciding the same on merits. 6. As is evident from the impugned order, the learned CIT(A) did not agree with similar submissions made by the assessee and dismissed the appeal filed by the assessee on the basis that the same is barred by limitation, without adjudicating the grounds of appeal on merits. 7. We find that the reasons stated by the assessee for seeking condonation of delay fall within the parameters for grant of condonation laid down by the Hon’ble Supreme Court in the case of Collector, Land Acquisition, Anantnag vs. MST Katiji and Ors., reported in 1987 (2) SCR 387. When substantial justice and technical considerations are pitted against each other, the cause of substantial justice deserves to be preferred. It is evident from the record that, in the present case, the assessee did not stand to benefit from the late filing of the appeal. Printed from counselvise.com ITA No.8842/Mum/2025 (A.Y. 2012-13) 5 8. Further, the coordinate bench of the Tribunal in the decision cited supra in assessee’s own case for the year under consideration in quantum proceedings, while restoring the appeal to the file of the learned CIT(A) for adjudication on merits, observed as follows: – “5. Considering the entire factual position as explained before us and also keeping in view, the principles laid down by Hon'ble Supreme Court in the case of Land Acquisition Collector Vs. Mst. Katiji & Ors., (1987] AIR 1353 (SC), wherein it has been held that where substantial justice is pitted against technicalities of none deliberate delay, then in that eventuality substantial justice is to be preferred. In our view the principle of advancing substantial justice is of 'prime importance'. Hence considering the fact that the assessee has justifiably and property explained the delay which occurred in filing the appeal the expression 'sufficient cause' is being liberally construed, therefore we are inclined to condone the delay in filing the appeal before CIT(A). 6. Since we have already condoned the delay, therefore we restore the matter back to the file of Ld. CIT(A) for deciding the same on merits after providing fair opportunity of hearing to both the parties. The assessee shall not seek any adjournment on frivolous grounds and shall remain cooperative during the course of proceedings. 7. Before parting, we make it clear that our decision to restore the matter back to the file of the Ld. CIT(A) shall in no way be construed as having any reflection or expression on the merits of the dispute which shall be adjudicated by the Ld. CIT(A) independently in accordance with law. 8. In the result the appeal filed by the assessee is allowed for statistical purposes.” 9. In view of the facts and circumstances of the present case, as noted above, and concurring with the findings of the coordinate bench, we are of the considered view that the assessee has proved sufficient cause for not filing the appeal before the learned CIT(A) within the prescribed limitation period. Accordingly, we are of the considered view that the said delay should be condoned. Hence, we deem it appropriate to set aside the impugned order and restore the matter to the file of the learned CIT(A) for consideration on merits, as per law, after condoning the delay in filing the appeal by the Printed from counselvise.com ITA No.8842/Mum/2025 (A.Y. 2012-13) 6 assessee. We order accordingly. Needless to mention, no order shall be passed without affording reasonable and adequate opportunity of hearing to the parties. The assessee is directed to appear before the learned CIT(A) on all dates of hearing as may be fixed without any default. As the matter is being restored to the file of the learned CIT(A) for adjudication on merits, the other grievances raised by the assessee in the present appeal do not call for adjudication at this stage, and therefore, the same are kept open. Accordingly, the grounds raised by the assessee are allowed for statistical purposes. 10. In the result, the appeal by the assessee is allowed for statistical purposes. Order pronounced in the open Court on 24/03/2026 Sd/-/- OM PRAKASH KANT ACCOUNTANT MEMBER Sd/- SANDEEP SINGH KARHAIL JUDICIAL MEMBER MUMBAI, DATED: 24/03/2026 Prabhat Copy of the order forwarded to: (1) The Assessee; (2) The Revenue; (3) The PCIT / CIT (Judicial); (4) The DR, ITAT, Mumbai; and (5) Guard file. By Order Assistant Registrar ITAT, Mumbai Printed from counselvise.com "