Shri. Kishor Tarachand Patil, Nashik V. Income-tax Officer, Ward - 2(2), Nashik

ITA 1461/PUN/2018

• Counselvise Citation: [2022] 105 COUNSELVISE.COM (IT) 9005 (ITAT-PUNE)
• Duration Of Justice: 3 year(s) 4 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-02-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2012-2013
• Appeal Filed On: 13-09-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: SANKET MILIND JOSHI
• Keywords: Condonation of delay; TDS
• Section: 144; 43B; 40(a)(ia)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH, ‘A’ PUNE – VIRTUAL COURT BEFORE SHRI S.S.VISWANETHRA RAVI, JUDICIAL MEMBER AND SHRI DR. DIPAK P. RIPOTE, ACCOUNTANT MEMBER आयकर अपील सं. / ITA No.1461/PUN/2018 िनधाᭅरण वषᭅ / Assessment Year : 2012-13 Shri Kishor Tarachand Patil, Flat No.102, Shree Anant Villa Appt., Near Deepak Laundry, Samartha Nagar, Nashik- 422007. PAN : AHRPP7621C Vs. ITO, Ward 2(2), Nashik Appellant Respondent आदेश / ORDER PER DR. DIPAK P. RIPOTE, AM : This appeal is against Commissioner of Income Tax (Appeals)-2, Nashik’s order dated 15.12.2016 for assessment year 2012-13. 2. There is a delay of 570 days in filing the appeal. The appellant filed condonation petition. In the condonation petition, the appellant submitted that the appellant had suffered due to slow down in business which resulted in huge outstanding of creditors. Due to financial pressure, health of the appellant also suffered. The appellant was under complete bed rest for more than 5 months around March, 2016. The appellant filed copy of medical certificate. The appellant also submitted that he was kidnapped by the creditors. Subsequently, there was a criminal case filed against the appellant. The appellant also filed FIR against the kidnappers. The appellant also filed copy of the FIR. The appellant was under police custody, when the bail petition was rejected by the Hon’ble Assessee by Shri Sanket Milind Joshi Revenue by Shri M. G. Jasnani Date of hearing 09-02-2022 Date of pronouncement 11-02-2022 ITA No.1461/PUN/2018 Shri Kishor Tarachand Patil 2 High Court and the Hon’ble Supreme Court. Based on all these facts, the appellant requested for condonation of delay. 3. The condonation application and affidavit has been considered. The reasons given by the appellant are valid and sufficient. We have gone through the condonation petition as well as the affidavit and have found that reasons specified therein are justified and that the delay cannot be attributed to the deliberate conduct of the assessee neither through intention nor through action. The reasons for delay in filing the appeal late were beyond the control of the assessee. 4. The Hon’ble Supreme Court in the case of Collector Land Acquisition Vs. Mst. Katiji & Ors. Date of Judgment 19/02/1987 has observed as under : Quote “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 con- doned 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.” ....Unquote 5. The Hon’ble Supreme Court has observed in the case of SENIOR BHOSALE ESTATE(HUF) vs. ACIT, CIVIL APPEAL NOS.6677-6690 OF 2010 : Quote “Unless that fact was to be refuted, the question of disbelieving the stand taken by the appellant(s) on affidavit, cannot arise.....”Unquote. 6. The Hon’ble Supreme Court in the case of Ramnath Sao AIR2002 SC1201 has held that acceptance of explanation furnished seeking condonation of delay should be the rule and refusal an exception, more so when no negligence or inaction or want of bona fide can be imputed to the defaulting parties. Taking a pedantic and hyper-technical view of the matter, the explanation furnished should not be rejected when stakes are high and/or ITA No.1461/PUN/2018 Shri Kishor Tarachand Patil 3 arguable points of facts and law are involved in the case, causing enormous loss and irreparable injury to the party. 7. Thus substantial justice is important than mere technicality. In this case the facts mentioned by the Appellant have not been rebutted by the revenue. Therefore, there was reasonable and sufficient cause for delay in filling appeal. In view of the matter, we condone the delay and proceed to hear the appeal on merits. 8. Grounds of appeal raised by the assessee are as under : “1] The learned CIT(A) erred dismissing the appeal filed by the assessee for non- attendance on the part of the assessee on the ground that the appellant was not interested in pursuing the appeal without appreciating that the said action of the learned CIT(A) was not justified in law and on facts. 2] The learned CIT(A) erred in confirming the action of the A.O. in making the addition of Rs.2,70,280/- by estimating the gross profit merely on the ground that the G.P. declared by the assessee in this year was lower than earlier years without appreciating that the said addition made by the A.O. on an ex-parte basis was not justified on facts and in law. 3] The learned CIT(A) erred in confirming the action of the A.O. in making the addition of Rs.3,00,000/- in respect of estimated deemed rental income u/s 23(4) of the Act without appreciating that the said addition made on ex-parte basis by the A.O. was not justified on facts and in law. 4] The learned CIT(A) erred in confirming the action of the A.O. in making the addition of Rs. 1,78,540/- on account of disallowance of interest u/s 36(1)(iii) without appreciating that the said addition made on ex-parte basis by the A.O. was not justified on facts and in law. 5] The learned CIT(A) erred in confirming the action of the A.O. in making the addition of Rs.1,11,21,321/- on account of disallowance made u/s 40(a)(ia) towards non-deduction of TDS in respect of labour charges, consultancy charges and rent expenditure without appreciating that the said addition made on ex-parte basis by the A.O. was not justified on facts and in law. 6] The learned CIT(A) erred in confirming the action of the A.O. in making the addition of Rs.4,16,763/- in respect of TDS provision disallowed u/s 43B without appreciating that the said addition made on ex-parte basis by the A.O. was not justified on facts and in law. 7] The learned CIT(A) erred in confirming the action of the A.O. in making the addition of Rs.75,704/- in respect of disallowance made towards penalty and legal charges debited to P&L A/c without appreciating that the said addition made on ex-parte basis by the A.O. was not justified on facts and in law. 8] The appellant craves, leave to add, alter, amend and delete any of the above grounds of appeal.” ITA No.1461/PUN/2018 Shri Kishor Tarachand Patil 4 9. In this case, the assessment order was passed on 17.03.2015 u/s 144 of the Income Tax Act assessing the income of Rs.1,35,83,348/- on returned income of Rs.12,20,740/-. In the assessment order, the addition had been made under following heads :- (i) Decreased profit ratio - Rs.2,70,280/- (ii) House property income - Rs.3,00,000/- (iii) Disallowance of interest - Rs.1,78,540/- (iv) Labour, Consultancy & Rent charges - Rs.1,11,21,321/- (v) Disallowance of penalty paid - Rs.75,704/- 10. The ld. CIT(A) vide order dated 15.12.2016 confirmed all the above additions. During the course of proceedings before the ld. CIT(A), the appellant failed to make any representation before the ld. CIT(A). The ld. CIT(A) had categorically mentioned that inspite of giving many opportunities, the appellant failed to produce any documents in support of his claim. 11. The ld. AR invited our attention to the notarized affidavit of the appellant. In the affidavit, the appellant has narrated the events taken place during the relevant years, mainly his illness, the pressure of creditors, slow down of his business which resulted into financial pressure. The appellant claimed that due to the unfortunate events in personal as well as professional life, he could not make proper representation either before the Assessing Officer or the ld. CIT(A). Therefore, the ld. AR humbly requested that the appellant may be given one more opportunity to represent proper facts of the case before the lower authorities. Therefore, the ld. AR pleaded that the case may be set-aside to the file of the Assessing Officer. 12. The ld. DR vehemently opposed the suggestion of ld. AR to set-aside the case to the file of the Assessing Officer. The ld. DR invited our attention to the orders of the Assessing Officer and the ld. CIT(A) which narrates the various opportunities given to the ITA No.1461/PUN/2018 Shri Kishor Tarachand Patil 5 appellant before passing the orders. Therefore, the ld. DR stated that more than sufficient opportunities has been provided to the appellant. 13. We heard both the sides and perused the records. It is a fact that the appellant failed to make proper representation before the Assessing Officer and the ld. CIT(A). The appellant claimed that the failure of the appellant was due to his illness and financial crisis. He also explained that his Authorized Representative died and he had to change the Authorized Representative. It is already mentioned that the appellant filed copy of FIR, copy of medical certificate and affidavit. In any judicial proceedings substantial justice is most important. Justice not only should be done but seen to be done. In this case, due to financial crisis in the hands of the appellant, the appellant could not make proper representation before the lower authorities. There is valid and sufficient reason for not making proper representation before the lower authorities. Therefore, in the interest of justice, we set-aside the order of the Assessing Officer with a direction to complete the assessment after giving opportunity to the appellant. The appellant shall coordinate with the Department in providing all the information before the lower authorities. The Assessing Officer will be free to make necessary enquiries and pass the de-novo assessment order. 14. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the Open Court on 11 th February, 2022. Sd/- Sd/- (S.S. VISWANETHRA RAVI) (DR. DIPAK P. RIPOTE) JUDICIAL MEMBER ACCOUNTANT MEMBER पुणे Pune; िदनांक Dated : 11 th February, 2022 Sujeet ITA No.1461/PUN/2018 Shri Kishor Tarachand Patil 6 आदेश की Ůितिलिप अŤेिषत/Copy of the Order is forwarded to: 1. अपीलाथŎ / The Appellant; 2. ŮȑथŎ / The Respondent; 3. The CIT(A)-2, Nashik; 4. 5. 6. The Pr.CIT-2, Nashik; DR, ITAT, ‘A’ Bench, Pune; गाडŊ फाईल / Guard file. आदेशानुसार/ BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण ,पुणे / ITAT, Pune