GEMOMOLOGICAL INSTITUTE OF INDIA, MUMBAI V. INCOME TAX OFFICER (EXEMPTION)_1(3), MUMBAI

ITA 4032/MUM/2023

• Counselvise Citation: [2024] 101 COUNSELVISE.COM (IT) 5648 (ITAT-MUMBAI)
• Duration Of Justice: 5 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-04-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 23-07-2024
• Assessment Year: misc
• Appeal Filed On: 08-11-2023
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Residential status; Bonafide belief; Period of limitation; Time period of passing order; Condonation of delay; Set aside
• Section: 68; 142(1); 143(1); 250; 143(2); 13

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “I”, MUMBAI BEFORE SHRI. PRASHANT MAHARSHI, ACCOUNTANT MEMBER AND SHRI. RAJ KUMAR CHAUHAN, JUDICIAL MEMBER ITA NO. 4032/MUM/2023 (A.Y: 2019-20) Shri. Vashu Bhagnani CTS 892-893, Pooja House, Juhu Tara Road, Mumbai – 400 049. PAN: AHUPB2450L Income Tax Officer (Int Tax) Ward 1(2)(1) Income Tax Officer (Int Tax) Ward 1(2)(1), Mittal Court, Nariman Point, Mumbai – 400021. (Appellant) (Respondent) Assessee Represented by : Shri. Vishal Shah Department Represented by : Shri. Harshad S. Vengurlekar (CIT-DR). Date of conclusion of Hearing : 15.04.2024 Date of Pronouncement : 24.04.2024 O R D E R PER RAJ KUMAR CHAUHAN (J.M.): 1. The assessee has instituted the present appeal for the A. Y. 2019-20 under section 253 of the Income Tax Act, 1961 . The Appellant has challenged the order dated 30.10.2023 of Learned Commissioner of Income Tax (Appeals) [hereinafter referred to as the “CIT(A)”], passed under section 250 of the Income Tax Act, 1961 [hereinafter referred to as “the Act”]. ITA NO. 4032/MUM/2023 (A.Y: 2019-20) Vashu Bhagnani Page No. 2 2. The brief facts which gave rise to the present appeal are as under: 3. That the original return of income for the A.Y. 2019-20 was e-filed by the assessee on 25.10.2019 declaring the total income of Rs. 66,73,550/-. The return was processed u/s. 143(1) of the Income Tax Act, 1961 and case was selected for complete scrutiny under CASS. A notice u/s. 143(2) of the Act dated 31.03.2021 was allegedly issued and the same was duly served on the assessee. By another notice u/s. 142(1) of the Act dated 22.09.2021, the assessee was asked to provide various details as mentioned in para 2 of the assessment order dated 02.09.2021. In response, the assessee made submissions partially alongwith letter dated 24.09.2021. After perusing the same, the assessee was once again requested to submit certain details on or before 29.09.2021 vide notice u/s. 142(1) dated 28.09.2021. 4. The assessee submitted the documents alongwith letter dated 29.09.2021 which were duly considered. A draft order u/s. 144(c)(2) of “the Act” was forwarded to the assessee on 30.09.2021 and the assessee was allowed 30 days time from the date of draft order dated 30.09.2021 to file its acceptance or to file its objections if any, as per provisions of section 144(c)(2) of the Act. 5. The assessee did not file any response to the draft order dated 30.09.2021. Thereafter, an amount of Rs. 36,00,00,000/- and Rs. 97,63,335/- was added to the total income of assessee as unexplained ITA NO. 4032/MUM/2023 (A.Y: 2019-20) Vashu Bhagnani Page No. 3 cash credits u/s. 68 of the Act as Income from other sources respectively. Penalty proceeding u/s. 270A of the Act for under reporting of income as well as under reporting of income in consequence of misreporting thereof was initiated. 6. The said assessment order was challenged u/s. 250 of Income Tax Act, 1961 before the Ld. CIT(A). The Ld. CIT(A) has also dismissed the appeal by rejecting the request of condoning the delay in filing the appeal before the Ld. CIT(A). 7. It is evident from the order dated 30.10.2023 of the Ld. CIT(A) that the Ld. CIT(A) has not considered the appeal on merit and has dismissed the same on the ground of delay. The order of the Ld. CIT(A) has been challenged on the following grounds: ! " #$ % % & " ! Without prejudice to the above, #$ & ' ( )*)# ITA NO. 4032/MUM/2023 (A.Y: 2019-20) Vashu Bhagnani Page No. 4 )* ( & )*)# ) + % & )*)# % ' ( & )*)# , , - #$. . #$$ , )" *" )*)#& % , .* *" )*)# ,/ +0 .'&**&**&*** +0 .' ! - '1 ! % ##*# #)*# ## #) % 23 2 ! 4- 5 5 3% )6 7 )*#1 8 - '1 , % % % 9 )*#$:#6 Ld. CIT(A) erred in not considering the fact that the Ld. AO disregarded the ; : ! - 6$ - #$. . Y )*#$: #6 ,/ +0 .'&**&**&*** +0 .' = > % ; - ! ; ITA NO. 4032/MUM/2023 (A.Y: 2019-20) Vashu Bhagnani Page No. 5 ? ,/ ! +0 "@&'.&..6 - 6@ 0 #&)*&"6&')* ! - 6' ! 8 % (5 5 ? & ! - 6@ A % & - )$ Y )*#1:#" ! - .@ B 8. The reason given by the Ld. CIT(A) for not condoning the delay in filing the appeal by the assessee are reproduced as given in para 5 is as under: 6 Delay in filing of the appeal 6 # & - #$. . #$$ . C 9 )*#":)* *) ## )*)# - #6' *) ## )*)# & : *) #) )*)# 8 % & .6 : )* #) )*)# & #1 : D & % - )6* *$ #* )*). ## #* )*).& ? ! & % )6 #* )*). - #$. . #$$ . *) ## )*)# , : & & % % & (03 )6 #* )*)# , , (03 % *' #) )*)#& ITA NO. 4032/MUM/2023 (A.Y: 2019-20) Vashu Bhagnani Page No. 6 ! 6 ) )$" ) & .* )$" . & & .* In the case of the appellant, there is delay of 18 days in filing of the e- appeal before the CIT(A). In respect of delay in filing of the appeal, the appellant submitted that the assessment order was uploaded on the portal but the AO did not e-mail the said order to him. On receipt of recovery notice on 06.12.2021, he downloaded the order from Income Tax website and appeal was filed. The reason given by the appellant are contradictory. On one hand, the appellant is stating that the order was not received in e-mail and on other hand he is stating that the assessment order was downloaded from Income Tax website after recovery notice was received. This fact itself show that the assessment order was already available on the I.T. portal and it could had been downloaded earlier also. The reasons for delay in filing of appeal are not reasonable and sufficient reason to condone the delay in filing of the appeal.” 9. We have heard the Ld. AR on behalf of the Appellant as well as Ld. DR on behalf of the Revenue. The Ld. AR on behalf of appellant argued that there was no deliberate delay in filing the appeal because the ITA NO. 4032/MUM/2023 (A.Y: 2019-20) Vashu Bhagnani Page No. 7 appellant could not know about the assessment order as the same was uploaded on the portal and the Ld. AO did not email the said order to the appellant/assessee and as such the assessment order was never received by the assessee. Secondly, it is argued that against the draft assessment order, the objections were filed before the DRP on 25 th February, 2021, but it was not communicated to the Ld. AO under bonafide belief that there would be automatic communication to the Ld. AO by the DRP. It is therefore strongly argued on behalf of the appellant/assessee that there was no deliberate or inordinate delay in filing the appeal before the Ld. CIT(A) and the end of justice required that the appeal of the appellant was required to be considered and decided on merit in order to impart substantial justice to the appellant/assessee. The Ld. AR therefore prayed that the Tribunal may be pleased to restore the matter to the Ld. CIT(A) for adjudication on merit. 10. The Ld. DR on behalf of the Revenue argued that the Ld. CIT(A) has considered the grounds of condonation of delay taken by the appellant after giving the thoughtful consideration to the same and has rightly rejected the appeal on the grounds of delay because there was no sufficient cause shown by the assessee/appellant which needed indulgence by the Ld. CIT(A) for condonation of delay. It is ITA NO. 4032/MUM/2023 (A.Y: 2019-20) Vashu Bhagnani Page No. 8 therefore vehemently argued on behalf of revenue that there is no merit in the appeal and the same deserves to be dismissed. 11. We have considered the facts and circumstances of the case alongwith argument advanced by both the parties. Section 249 Sub Section 3 of the Income Tax Act, 1961 provides that the Ld. CIT(A) may admit an appeal after the expiration of said period if its satisfied that the appellant has sufficient cause for not presenting within that period. 12. It is evident from the para 5 of the order of the Ld. CIT(A) that there was delay of only 18 days in filing the e-appeal before the Ld. CIT(A). The observation of Ld. CIT(A) for not considering the reasons given by the appellant as sufficient cause are reproduced as under as mentioned at para no. 5.2 of his order dated 30.10.2023. 5.2 “ & #1 : & , : , % *' #) )*)#& ! % % : ! % % % 3 B ITA NO. 4032/MUM/2023 (A.Y: 2019-20) Vashu Bhagnani Page No. 9 13. The above observation of the Ld. CIT(A) shows that the Ld. CIT(A) has adopted a hyper-technical approach while considering the grounds of condonation of delay in the case of the appellant. The right of appeal to the Ld. CIT(A) u/s. 248 is a statutory right granted to the appellant/assessee. The statutory right cannot be denied to an assessee unless there is inordinate delay or gross negligence on the part of the assessee. It is settled law that the rules and procedure is handmade of justice and the adjudicating authorities should not deny a statutory right of appeal on technical grounds. Para no. 61 of judgment of Hon’ble Supreme Court in the case of > + > E 5 > : % 5 ? E in Civil Appeal No. 9198 of 2019 order dated 22.3.2023 can be relied with profit. '# & ! A ! F G ? ! - ? ! ! & B Similarly, Para no. 29 and 31 of judgment of Hon’ble Supreme Court in the case of > 0 > ( 0> E , ITA NO. 4032/MUM/2023 (A.Y: 2019-20) Vashu Bhagnani Page No. 10 H E in Civil Appeal No. 5897 of 2015 order dated 09.10.2023 are relevant and reproduced herein: )" & ; % % > 8 % & & % & ! ! & > & ! & & & ! , & F ! G F ! G F ! G % % & % ? F ! G F ! G F ! G F ! G #6 & & & F ! G ; ? % F ! G ! % & & & ! & ! & ! & ITA NO. 4032/MUM/2023 (A.Y: 2019-20) Vashu Bhagnani Page No. 11 .# )# ( )*## 4 I & 0 & 4 & I ? , & % % ; % J> 4 3 % 5 #$ H % ( K % % & & & ! 8 % ! % % A 8 L & & & ! D & & % & % ! ! D & D & ! ! & & ! ITA NO. 4032/MUM/2023 (A.Y: 2019-20) Vashu Bhagnani Page No. 12 % % 0 > 8 ? % B 14. The appellant has alleged in ground no. 4 that there was no delay at all in filing the appeal before the Ld. CIT(A) because the appellant became aware of passing of the order only on 06.12.2021 and the appeal was filed with Ld. CIT(A) on 20.12.2021. It is further stated that there was no communication from any means regarding the date of passing of the order dated 02.12.2021 to the appellant. Therefore, the limitation period would start from the date of service of the order which happened on 06.12.2021. In response to the above averments on behalf of the appellant, the observation of the Ld. CIT(A) in para 5 of the order as discussed above, for not condoning the delay, does not appeal to the conscience of this Tribunal. The ground on which the appellant/assessee has sought condonation of delay in filing the appeal before the Ld. CIT(A), are perfectly cogent and justified in the given facts and circumstances of the case. Admittedly no individual communication was made regarding the passing of the assessment order to the assessee as the assessment order was uploaded on the ITA NO. 4032/MUM/2023 (A.Y: 2019-20) Vashu Bhagnani Page No. 13 department portal only. The assesee is non resident of India for the A.Y. 2019-2020. 15. In the facts and circumstances as discussed above and because of the law laid down by the Hon’ble Supreme Court in > + > E > 0 > ( 0> E , referred (supra), we are of the considered opinion that there was sufficient cause for condoning the delay of 14 days by the Ld. CIT(A). 16. For the above reasons, the impugned order of the Ld. CIT(A) is not sustainable in the eyes of law and accordingly set aside with the directions to the Ld. CIT(A) to restore the case of the appellant on the filing Ld. CIT(A) and dispose the same on merit after duly considering the material brought on record by the appellant before the Ld. CIT(A). The appellant/assessee shall present its case before the Ld. CIT(A) within 90 days of this order. 17. In the result, appeal filed by the assessee is disposed off in above terms. Order pronounced in the open court on 24 April, 2024 Sd/- Sd/- (PRASHANT MAHARSHI) (RAJ KUMAR CHAUHAN) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai / Dated 24.04.2024 I 7 3 & > ITA NO. 4032/MUM/2023 (A.Y: 2019-20) Vashu Bhagnani Page No. 14 Copy of the Order forwarded to: 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file. //True Copy// BY ORDER (Asstt. Registrar) ITAT, Mumbai