Ashok Kumar Shukla, Lucknow V. ITO 3(1), Lucknow-New

ITA 212/LKW/2023

AI Insights

The case involves Ashok Kumar Shukla, the appellant, who contested the order of the National Faceless Appeal Centre (NFAC) which had dismissed his appeal in limine due to a 63-day delay attributed to his illness (cervical spondylitis). The original dispute arose from an assessment for the year 2016-17 where the Income Tax Officer (ITO) made a substantial addition to the assessee's income under section 68 of the Income Tax Act, 1961, citing a substantial increase in capital. The ITAT found that the NFAC's refusal to condone the delay without a proper assessment of the severity of the assessee's condition was incorrect, leading to a miscarriage of justice.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 123022 (ITAT-LUCKNOW)
• Duration Of Justice: 3 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-10-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 15-10-2023
• Assessment Year: misc
• Appeal Filed On: 06-07-2023
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Principle of natural justice; Condonation of delay
• Section: 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH ‘B’, LUCKNOW BEFORE SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER AND SHRI ANADEE NATH MISSHRA, ACCOUNTANT MEMBER ITA No.212/Lkw/2023 Assessment Year: 2016-17 Ashok Kumar Shukla, 511/88, Purana Badshah Nagar, Lucknow. PAN: AQRPS 8764N Vs. Income Tax Officer-3(1), Lucknow - New (Appellant) (Respondent) O R D E R PER SUDHANSHU SRIVASTAVA, J.M.: This appeal has been preferred by the assessee against the order dated 11.05.2023 passed by the National Faceless Appeal Centre (NFAC), Delhi for Assessment Year (AY) 2016-17. 2. The brief facts of the case are that the assessee’s case was selected for scrutiny through CASS for the reason of substantial increase in capital. Earlier, the assessee had filed his return of income declaring net taxable income at Rs.3,95,040/-. Subsequently, the assessment was completed at a total income of Rs.71,35,160/- after making an addition of Rs.62,79,928/- Appellant by Shri Amresh Tripathi from the Office of Sh. Abhishek Khanna, C.A. Respondent by Shri Sanjeev Krishna Sharma, Addl. CIT (DR) Date of hearing 16/10/2023 Date of pronouncement 31/10/2023 I.T.A. No.212/Lkw/2023 2 as fresh introduction of capital u/s. 68 of the Income Tax Act, 1961 (hereinafter called the ‘Act’). Provisions of Section 115 BBE of the Act were also invoked. 3. Aggrieved, the assessee approached the ld. First Appellate Authority challenging the addition. Since the appeal before the NFAC was filed belatedly by 63 days, the assessee also filed an application for condonation of delay citing reason of cervical spondylitis. However, the NFAC did not condone the delay and dismissed the assessee’s appeal in limine. 4. Now the assessee has approached this Tribunal challenging the dismissal of appeal by raising the following grounds of appeal: “(1) Because the order passed by the Ld. CIT (A) is defective and is liable to be set aside as the appeal has been dismissed in limine due to the reason that the appeal was filed with a delay of only 63 days due to assessee being unwell and on bed rest. (2) Because the order passed by the Ld. Assessing Officer is defective and contrary to law and is liable to be set aside as addition has been made under section 68 whereas the Ld. Assessing Officer has neither verified nor even called for the verification of the books of accounts of the assessee. a) Because the order passed by the Ld. Assessing Officer is defective and contrary to law and is liable to be set I.T.A. No.212/Lkw/2023 3 aside as the assessment and addition has been made beyond the limited issue of "increase in share capital" (4) Because the order passed by the Ld. Assessing Officer is defective and contrary to law and is liable to be set aside as the addition pertains to proceeds from sale of land in the immediate previous year i.e. AY 2015-16 which was inadvertently declared in the ITR of AY 2016- 17. (5) Because the order appealed against is contrary to the fact, law and principles of natural justice. (6). The appellant prays that he may be allowed to add, amend, alter or forego any of the grounds at the time of hearing. (7.) Any other relief, which your good self may deem fit.” 5. At the outset, the ld. Authorized Representative submitted that the NFAC had rejected the assessee’s application for condonation of delay by observing that cervical spondylitis was not such a serious illness so as to completely prevent the assessee from filing the appeal in time. It was submitted that this observation of the NFAC was incorrect in as much as even cervical spondylitis can be very severe causing severe headaches, weakness, numbness and stiffness in neck, arms and legs, shoulders and hands and also impede the movement of the assessee as there could be lot of trouble in keeping the balance. The ld. Authorized Representative I.T.A. No.212/Lkw/2023 4 submitted that the denial by the NFAC of a proper opportunity of hearing had caused great miscarriage of justice and, therefore, the assessee should be provided with an opportunity to explain his case. 6. Per contra, the ld. Senior D.R. fairly agreed that the assessee may be provided with an opportunity to properly explain his case before the appropriate authority. 7. We have heard the rival submissions and have also perused the material on record. It is seen that the NFAC has dismissed the assessee’s appeal in limine by observing that the delay of 63 days in filing of appeal before it should not be condoned for the reason that the cervical spondylitis is not such a serious disease which would prevent an assessee from filing the appeal within the stipulated time and/or would prevent the assessee from engaging a counsel for the purpose of filing of the appeal. In our considered opinion, the ld. First Appellate Authority has grossly erred in not condoning the delay and thereby the assessee has lost his valuable right of being properly represented/heard. Under these peculiar circumstances, we deem it appropriate to restore the appeal I.T.A. No.212/Lkw/2023 5 to the file of the Assessing Officer with the direction to readjudicate the issue after giving proper opportunity to the assessee to present his case. 8. In the final result, appeal of the assessee stands allowed for statistical purposes. (Order pronounced in the open court on 31/10/2023) Sd/- Sd/- (ANADEE NATH MISSHRA ) (SUDHANSHU SRIVASTAVA) Accountant Member Judicial Member Dated: 31/10/2023 Aks Copy of the order forwarded to : 1. The Appellant 2. The Respondent. 3. Concerned CIT 4. The CIT(A) 5. D.R., I.T.A.T., Lucknow Asstt. Registrar