Sh. Harminder Singh, Jagraon V. ITO, Ward -2, Jagraon

ITA 42/CHANDI/2023

AI Insights

The case involves an appeal by Shri Harminder Singh against an ex-parte order passed by the CIT(A)-3, Ludhiana, which confirmed the AO's action of treating a cash deposit of Rs.49,40,750 as unexplained for the assessment year 2011-12. The appeal was initially delayed due to the assessee's frequent travels to the USA for family affairs and health issues, and the COVID-19 pandemic. The Tribunal found the delay to be due to bona fide reasons and admitted the appeal for hearing on merits, setting aside the matter to the AO for a fresh decision.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 127476 (ITAT-CHANDIGARH)
• Duration Of Justice: 3 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-05-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 17-05-2023
• Assessment Year: 2011-2012
• Appeal Filed On: 02-02-2023
• Other Referred Cases: Baba Saheb Rao Saheb Kobarne & ANR. vs Pyrotek India Private Limited & ORS
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: Y.K. SAXENA; AMANDEEP SAXENA
• Section: 147

Judgement Text

आयकर अपील य अ धकरण,च डीगढ़ यायपीठ , च डीगढ़ IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BENCH ‘A’ CHANDIGARH BEFORE: SHRI A.D.JAIN, VICE PRESIDENT AND SHRI VIKRAM SINGH YADAV, ACCOUNTANT MEMBER आयकर अपील सं./ ITA No. 42/CHD/2023 नधा रण वष / Assessment Year : 2011-12 Shri Harminder Singh, S/o Shri Kartar Singh, 100, VPO-Chachrari,Jagraon. बनाम VS The ITO, Ward-2, Jagraon. थायी लेखा सं./PAN /TAN No: AAACY0580C अपीलाथ /Appellant यथ /Respondent नधा रती क ओर से/Assessee by : Shri Y.K. Saxena & Shri Amandeep Saxena, CA राज व क ओर से/ Revenue by : Smt. Amandeep Kaur, Sr.DR तार"ख/Date of Hearing : 18.05.2023 उदघोषणा क तार"ख/Date of Pronouncement : 22.05.2023 आदेश/ORDER PER VIKRAM SINGH YADAV,A.M. This is an appeal file d by the assesse e against the ex-parte orde r pas se d by the ld. CI T(A)-3, Ludhia na date d 10.07.2019 pertaining to A sse ssment year 2011-21 whe rein the action of the Assessing officer in treat ing t he source of cash depos it amou nting t o Rs.49,40,750/- by treating the same as une xplaine d has be en confirme d. 2. At the outse t, it is no ted that t he re is a de lay in filing the present appe al. During the cours e of he aring, the ld. AR take n us throug h the application filed by the assessee see king ITA 42/CHD/2023 A.Y.2011-12 Page 2 of 12 condonatio n of delay in filing the present appeal by 1241 days. I t was submitte d that t he ld. CI T(A) has passed t he impugne d orde r on 10.07.2019 and the a ppe al has bee n file d with the Re gistry on 03.02.2023 wit h the de lay of 1241 days. It was submitte d that the parents of the assesse e and his e lde r brothe r are re sidents of USA from June, 2017 to Dece mbe r, 2022. The asse ssee had to go to USA frequently to atte nd to the family affairs as well as illness of his fat he r Sardar Kartar Singh which is evide nt fro m the copy of the his passport and t he Visa stamps of departure and arrival. It was further s ubmitt ed that afte r return from USA on 30.12.2022, the assessee had gone to his banker i.e . Bank of I ndia, Jagraon in the first week of January, 2023 to carry out certain banking transactions and there in, he was informe d that his bank account has be en att ached by the I ncome Tax Office r, Jagraon in terms of the order pas se d u/s 226(3). It was su bmit ted that subsequently, t he asse ssee sought the assistance of his Counsel and t he reafte r, on perusal of the I T Portal, it ca me to his notice t hat his appeal filed agains t the orde r passed by the AO dated 14.12.2018 has bee n dismissed ex- parte by t he ld. CI T(A), Ludhiana vide his orde r date d 10.07.2019. It was submitted that s ubsequently, the asse ssee with the assistance of his Cou nsel has filed the pres ent appeal on 03.02.2023. ITA 42/CHD/2023 A.Y.2011-12 Page 3 of 12 3. It was furthe r su bmit ted that during his brief stay in India from 23.02.2020 to 22.06.2020, from 11.01.2021 to 25.02.2021 and from 30.12.2021 to 08.03.2022, the asse ss ee remaine d confined to his village ho me in Chachrari in Te hsil Jagraon due to fe ar of Cov id. It was further submitte d that the Hon'ble Supre me Court in vie w of the Covid Pande mic has also e xte nde d the period of limitation fo r filing the appeals from time to time from 15.03.2020 to 28.02.2022. 4. It was, accordingly, submitte d that the delay which has happened in filing the present appeal is on acc ount of bonafide and s ufficient re asons as the asse ssee had no knowledge abo ut the passing of the orde r by the ld. CI T(A) and the fact t hat he was not physically pre sent in India and the copy of the order was also not se rved on him. It was, acc ordingly, submitted that the se are ge nuine and valid reasons which has resulte d in the de lay in filing of the present appeal and in the interests of subs tantial justice , e specially considering the fact that the order of the ld. CI T(A) has also be en passe d ex-parte qua the asses se e, the delay in filing t he pre se nt appeal may be condoned and the appeal be admitted for adjudica tion. 5. Pe r contra, the ld. DR submitted t hat the re is a substantial delay in filing the present appeal and mere non presence in the Country could not be a re ason for non filing of the pre se nt ITA 42/CHD/2023 A.Y.2011-12 Page 4 of 12 appeal. It was fu rthe r s ubmitte d that even before the ld. CI T(A), the assesse e has not appeare d which cle arly shows that the asse ssee was not diligent in pursuing its appe al eve n be fore the ld. CI T(A) and there after, the re is also a de lay in filing the present appeal be fore the Tribunal. 6. In the rejoinde r, the ld. Cou nsel for the asse ssee submitte d that as far as non appe arance before the ld. CI T(A) is concerned, the notice s were sent by Spee d Post by the office of the ld. CI T(A ) whic h we re ne ve r served upon the asse ssee for the reason that during the period from 24.06.2018 to 23.02.2020, the asse ssee was staying in USA as is e vident from the copy of the Passport and the arriv al and departu re stamps containe d the rein. 7. We have heard the rival submis sions and pu rus ed the material av ailable on re cord. The re i s n o d i s p u te t ha t t h e re h as b e e n a de l a y in fili n g t he p re s e nt a p p e a l a n d t he pe r i o d o f de la y a s a d mit t e d b y the a s s e s se e c o me s t o 1 2 4 1 d a y s w he re in t he o r d e r o f t he l d C I T( A ) is d a t e d 1 0 /09 /2 0 19 a n d t h e a p pe a l h as b e e n f ile d be fo re t he Tr ib u n a l o n 03 /0 2 /20 2 3 . Th e ex p la n a t i on o f t h e a s s e s s e e t h e re f o re be c ome s r e le v a n t to d e te rmi ne w he t he r t he s a me re fle c t s s u ff ic ie nt c a u se o n his pa r t i n no t p r e se nt in g t he p re s e n t a p pe a l w ith i n t h e p re s c r i be d t ime . ITA 42/CHD/2023 A.Y.2011-12 Page 5 of 12 8 . I n t he i ns t a nt c as e , t he a s se s s e e h a s c o n t e n de d th a t f ro m Ju l y 2 0 17 t o D e c e mbe r 2 0 2 2, t he a s se s se e ha s be e n re g u l a r ly t r a v e l li ng t o U S A t o a t te n d t o hi s f a mil y a ff a i rs an d t o t a ke c a re o f h is f a t h e r w h o i s no t k e e pi n g we ll a n d i s s u f fe ring fr o m s o me i ll n e s s a n d f o r t he pe r i o d he ha s s p e n t i n I nd i a , he i s mo s t ly c o nf in e d t o hi s v i l la g e h o me d ue t o s pre a d o f C o v i d p a nd e mic a n d t hu s u n a bl e t o a t t e n d t o h i s t a x a ff a i r s i nc lu din g t he p r e se nt a p pe a l . I t h a s be e n f u r t h e r c o nte nde d t ha t d u r i ng t hi s p e r i o d , hi s b a n k a c c o u n t w a s a ls o a t t a c he d b y t h e Re v e n ue a u t ho r i t i e s a n d a s s o o n a s h e wa s s e i ze d o f t h i s mat t e r a ft e r e n q u i r i ng f r o m hi s b a nk e r a n d la t e r o n, c o n s u lt i n g w it h h is C o u ns e l , he c a me t o k n o w t h a t th e o rde r h a s be e n p as s e d b y t h e ld CI T( A ) d i s p o s i n g o ff h is a p p e a l w he re t he o rde r p a s s e d by t h e A O ha s be e n c o n f ir me d a nd t h e t a x de ma nd h a s bee n s u s t a i n e d . I t w as s u b mit t e d t h a t a s he w a s t r a v e l li n g t o U S A , h e c o u ld n ’ t a t t e nd t o t h e p r o c e e d in g s b e f o re t h e l d C I T(A ) a n d e v e n , he d id n ’ t re ce i ve t he o r de r s o p a s s e d b y t he l d CI T( A ) a n d i t i s o n l y o n r e c e ip t o f i n fo r ma t i o n fr o m hi s b a n ker t h a t hi s b a nk a c c o u n t h as b e e n a t t a c he d, he t o o k s te ps to o bt a i n c o py o f t h e o r d e r p a ss e d b y t h e l d CI T( A ) a n d t h e r e a ft e r, h a s f i le d t h e pre se n t a p pe a l . 9 . W e f i nd t h a t t he pe r i o d o f de la y c o mpr i s e s o f pe r i o d o f C o v id 1 9 p a nd e m i c w h e re a ll a c t iv it ie s i n t he e c o nomy c a me t o ITA 42/CHD/2023 A.Y.2011-12 Page 6 of 12 a s t a n ds t i ll d u e t o na t io n a l l o c k d o w n a nd a p p r e c ia ti n g t he s a i d s i t u a t i o n, t he H o n ’ b le S u p re me C o u r t ha s t a k e n c o g ni z a nc e of t h e ma t t e r a nd h a s di r e c te d t o e x c l u de t he pe rio d du r in g t he C o v id l o c k d o w n w hi le c o mp u t in g t he li mi t a t i o n a n d re f e re nce c a n b e dr a w n t o i t s d e c i s i o n i n c a s e o f B a b a s a h e b Ra o s a he b K o b a r n e & A N R . V s P y r o t e k I n d ia P r iv a t e Limi t e d & OR S (Special Leave Petition (C) No. 2522/2022 dated 09/05/2022) w he re i n it w a s he l d a s u n de r : “Having heard the learned counsel appearing on behalf of the respective parties and having considered order dated 10.01.2022 passed by this Court in Miscellaneous Application No.21/2022 by which the following order was passed and order dated 04.01.2022 passed by this Court in SLP (C) No.17298/2021 in the case of Centaur Pharmaceuticals Pvt. Ltd. & Anr. Vs. Standford Laboratories Pvt. Ltd., the impugned order passed by the High Court is unsustainable. The operative portion of the order passed by this Court in Miscellaneous Application No.21/2022 reads as under - “ I. The order dated 23.03.2020 is restored and in continuation of the subsequent orders dated 08.03.2021, 27.04.2021 and 23.09.2021. It is directed that the period from 15.03.2020 till 28.02.2022 shall stand excluded for the purposes of limitation as may ITA 42/CHD/2023 A.Y.2011-12 Page 7 of 12 be prescribed under any general or special laws in respect of all judicial or quasi-judicial proceedings. II. Consequently, the balance period of limitation remaining as on 03.10.2021, if any, shall become available with effect from 01.03.2022. III. In cases where the limitation would have expired during the period between 15.03.2020 till 28.02.2022, notwithstanding the actual balance period of limitation remaining, all persons shall have a limitation period of 90 days from 01.03.2022. In the event the actual balance period of limitation remaining, with effect from 01.03.2022 is greater than 90 days, that longer period shall apply. IV. It is further clarified that the period from 15.03.2020 till 28.02.2022 shall also stand excluded in computing the periods prescribed under Sections 23 (4) and 29A of the Arbitration and Conciliation Act, 1996, Section 12 A of the Commercial Courts Act, 2015 and provisos (b) and (c) of Section 138 of the Negotiable Instruments Act, 1881 and any other laws, which prescribe period(s) of limitation for instituting proceedings, outer limits (within which the court or tribunal can condone delay) and termination of proceedings.” ITA 42/CHD/2023 A.Y.2011-12 Page 8 of 12 In that view of the matter, the period from 15.03.2020 till 28.02.2022 shall have to be excluded for the purposes of limitation as may be prescribed under any General or SPECIAL LAWS in respect of all judicial or quasi-judicial proceedings. The Commercial Courts Act, 2015 being a Special Law, the said order shall also be applicable with respect to the limitation prescribed under the Commercial Courts Act, 2015 also. In view of the above and for the reasons stated above and more particularly when the 120 days period expired in the present case on 09.05.2020 which was during the aforesaid period as prescribed by this Court in the aforesaid order, the High Court ought to have excluded the aforesaid period for the purpose of filing the written statement and ought to have permitted to take the written statement on record. The impugned judgment and order passed by the High Court refusing to condone the delay and take on record the written statement is hereby quashed and set aside. It is directed that the written statement, already filed, be taken on record and the same be considered in accordance with law.” 1 0 . I n v ie w o f t he a bo v e , t he pe r io d f r o m 1 5 .0 3 .2 0 20 t il l 2 8 .0 2 .2 0 2 2 s ha l l s t a n d e x c l u de d fo r t h e p u r p o se s o f li mi t a t i o n ITA 42/CHD/2023 A.Y.2011-12 Page 9 of 12 f o r t h e f i li ng t h e a p pe a l a nd e ffe c t iv e l y , t he s a id pe r io d n e e d n o t b e c o u nte d a n d ha s t o be e x c lu de d f o r w o rki n g ou t t he d e l a y in f i li n g t he p re s e nt a p pe a l . 1 1 . A s f a r a s pe r io d p r i o r t o 1 5 /0 3 /2 0 2 0 a n d p o s t 2 8 /02 /2 0 2 2 t i ll fi l in g o f p r e se nt a p p e a l i s c o nc e rne d, it i s no d o u b t t r u e t ha t t he a s s e s s e e wa s o u t s i d e t h e c o u n t ry a n d t r a v e ll i ng t o U SA t o a t t e nd t o h is f a mil y a f f a ir s fo r s u ff ic ie nt l o ng p e r i o d e x c e p t f o r s o me i n te r mi t t e n t pe r io d , h ow e ve r, t he f a c t t h a t he w a s t ra v e l li n g do e s n’ t t a k e a w a y h is ob l i g a t i o n t o a t t e nd t o t he t ax pr o c e e di n g s an d t h a t t o o , h i s o w n a p pe a l w hi c h h a s b e e n fi le d be fo re t he l d C I T( A ) . I t is n ot a c a s e w he re t h e a s s e s s e e h as p e r ma n e nt ly s hi ft e d t o US A a n d h a s no c o nn e c t i n t he C o u n t r y . H e co n t i nu e s t o h o ld t h e I nd i an P a s s po rt a nd i s t hu s o b l i g a t e d t o a b id e by t he l a ws o f t h e l and i nc lu d in g t he t a x l a w s . W h e re he c a n t r a v e l t o USA a nd a t t e n d t o t he fa mi l y a f f a i r s , w e a re s u re h e i s c o mp e te nt e n o u g h t o a t t e nd t o t he t a x p r o c e e d i ng s i n I n d ia . Me re l y fi lin g t he a p pe a l i s n o t e n o u g h t o s e e k s he lt e r f r om t h e t a x o b l ig at io ns o r t he c o ns e q ue nt t a x l ia b il i t y . O n c e t he a p pe a l i s fi le d, h e is e q u a l ly r e q u ire d t o a t t e n d t o t h e p r o c e e d i ng s b e fo re th e l d C I T(A ) a n d/o r a p p o i nt t he C o u n se l w h o c a n s e e k h is in s t ru ct i o n s a n d a t t e nd t o t h e p r o ce e d i ngs a n d fi le n e ce s s a r y d o c u me n t a t i o n /s u b mi s s i o n i n s u p p o r t o f t he g r o u nd s o f a p pe a l . ITA 42/CHD/2023 A.Y.2011-12 Page 10 of 12 I n t he in s t a nt ca s e , t he a p pe a l w a s f il e d o n 1 8 /0 1 /20 1 9 a n d d is p o s e d o ff b y t h e ld C I T( A ) o n 1 0 /0 7 /2 0 1 9 a n d in b e t we e n , t h r e e no t i ce s w e r e s e n t t hr o u g h s p e e d p o s t w h ic h r ema i ne d u n a t t e nde d. O nc e t he a ppe a l has b e e n d i s mi s s e d e x -pa r t e by t h e l d CI T( A ) d u e t o no n- p r o s e c u t io n a n d h is b a nk ac c o u nt ha s b e e n a t t a c he d b y t he R e ve nu e a u t h o r i t i e s , t he a s s e sse e h as w o k e n u p a g a in a n d fi l e d t he pr e s e n t a p pe a l t ha t t oo w i t h a s u b s t a n t i a l d e l a y. 1 2 . W e t he re f o re f in d t h a t t h e r e a re c l e a rl y l a t c hes a nd n e g l i ge n ce o n pa r t o f t he a s s e s s e e in no t f il i ng t he p r e se nt a p p e a l w i t h in p re s c ri be d t i me fra me . A t t he s ame ti me , w e b e l ie ve t ha t w he re t he a s s e s se e ha s c o me in a p p e a l be fo re t hi s Tr ib u na l , h e de se r ve s a n o p p o r t un i t y t o be he a r d o n me r i t s o f h is c a s e b e fo re t h e ma t t e r i s c o n s i g ne d t o r e c o rds . I n W r it P e t i t i o n N o . 7 8 3 o f 2 0 1 2 i n t he c a s e o f Sa n c h i t S o ft w a re a n d S o lu t i o ns P v t . Lt d V s . C o m mi s s io ne r o f I n c o me Ta x an d O t he r s , H o n' bl e B o mb a y H ig h C o u r t h e l d t h a t in a n y c i v i li z ed s y s t e m, t h e a s se s se e i s b o u nd t o p a y t h e t a x w hi c h he l ia b le u nde r t he l a w t o t he G o ve rn me n t . Th e G o v e r n me nt o n t he ot he r ha n d i s o b l ig e d t o c o l le c t o nl y t ha t a m o u nt t o t a x w hi c h i s le g a lly p a y a b l e b y a n a s s e s se e . The e n t ir e o b je c t o f t he admin i s t r a t i o n o f t a x i s t o s e c u r e t he Re v e n u e f o r t h e d e ve lo pme nt o f t he c o u n t r y a n d no t t o c h a rg e a s se s se e mo r e t a x t ha n w hic h is d ue ITA 42/CHD/2023 A.Y.2011-12 Page 11 of 12 a n d p a y a bl e b y t he a s se s se e . A s h e l d b y t h e H o n’ b le S u p re me C o u r t , wh e re s u bs t a n t ia l j u s t i c e a nd t e c h ni c a l c o nsi de r a t io ns a r e p it te d a g a i ns t e a c h o t he r , t he c a u s e o f s u b s t ant i a l ju s t i c e d e s e r ve d t o be p re fe r re d . The r e fo re , i n e xe r c is e o f po we r s u nde r s e c t i o n 2 53 ( 5 ) o f t h e A c t a n d in int e re s t o f s u b s t ant i a l ju s t ic e , w e he re b y c o n do ne t he de l a y in fi l in g t h e pre se n t ap pe a l s u b je c t t o c o s t o f R s 5 , 00 0 /- w h ic h s h a ll be d e p o s it e d i n P M N a t i o n a l R e l ie f Fu n d a n d e v ide nc e t he re o f s h o u ld b e b r o u g ht o n r e c o r d. I n l ig ht o f a f o r e s a i d d i s cu s s io n s , t he de lay i s c o n d o ne d a n d t h e a ppe a l i s he re by a d mi t t e d fo r a d j u d ic a t i o n o n me ri t s . 13. Further, it is note d that the AO has pas se d the orde r u/s 144 re ad with Se ction 147 date d 14.12.2018 whe rein an addition of Rs.49,40,750/- has bee n made for failure o n the part of the asse ssee to pro vide necessary e xplanation in respe ct of the source of cash deposits in his bank account maint aine d with Axis Bank Ltd. Further, even be fore the ld. CI T(A), though notices have bee n issued which we re not responde d to and which has resulted in e x-parte order so passed by the ld. CI T(A). We , there fore, find that both before the AO as we ll as be fore the ld. CI T(A), the addit ions have be en made and confirme d without cons idering the explanatio n whic h the assesse e may like to submit in s upport of the source of the cash deposit in his bank account maintained with Axis Bank. There fore, in the interest of ITA 42/CHD/2023 A.Y.2011-12 Page 12 of 12 substantial just ice and fair play, we believe that the as se ssee deserves one more opportunity and the matter is , accordingly, set aside to the file of t he AO to de cide the same afresh afte r prov iding re asonable opportunity to the as se ssee . Nee dle ss to say, the assessee shall file the ne ce ssary information and docume ntation in support of his claim explaining the source of the cash de posit and attend to the pro ce edings before the AO and ensure timely c ompletion of t he proce edings wit hout see king unnecessary a djournments in t he matte r. 14. In the result the appeal o f the asse ssee is allowe d fo r statistical purpos es. Order pronounced in the Ope n Co urt on 22 n d May,2023. Sd/- Sd/- (A.D.JAIN ) (VIKRAM SINGH YADAV) VICE PRESIDENT ACCOUNTANTMEMBER “Poonam” आदेश क琉 灹ितिलिप अ灡ेिषत/ Copy of the order forwarded to : 1. अपीलाथ牸/ The Appellant 2.灹瀄यथ牸/ The Respondent 3.आयकर आयु猴/ CIT 4.िवभागीय 灹ितिनिध, आयकर अपीलीय आिधकरण, च瀃डीगढ़/ DR, ITAT, CHANDIGARH 5.गाड榁 फाईल/ Guard File आदेशानुसार/ By order, सहायक पंजीकार/ Assistant Registrar