Sri. Bileshivale Muddanna Govardhana Murthy, Bengaluru V. Assistant Commissioner of Income Tax, Central Circle-1(2), Bengaluru

ITA 76/BANG/2023

AI Insights

The case involves multiple appeals by the assessee, Sri Bileshivale Muddanna Govardhana Murthy, against the orders of the CIT(A) for the assessment years 2008-09 to 2014-15. The appeals were primarily concerned with the legality of the assessment orders passed under sections 143(3) r.w.s. 153A of the Income Tax Act, 1961, following a search operation. The assessee contested the application of section 153A instead of section 153C, arguing that the search was conducted in connection with another person. Additionally, the assessee challenged the ex-parte dismissal of his appeals and the taxation of agricultural income under 'Other Sources'. The ITAT found merit in the assessee's arguments regarding the delay in filing the appeals due to his imprisonment and mental distress, leading to the condonation of delay and remittance of the case back to the CIT(A) for a thorough re-examination.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 129787 (ITAT-BANGALORE)
• Duration Of Justice: 3 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-05-2023
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: A
• Next Hearing Date: 17-05-2023
• Assessment Year: 2008-2009
• Appeal Filed On: 12-02-2023
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Tax effect
• Section: 132; 143(3); 153A; 153C

Judgement Text

ITA Nos.76 to 82/Bang/2023 Sri Bileshivale Muddanna Govardhana Murthy, Bangalore IN THE INCOME TAX APPELLATE TRIBUNAL “A’’ BENCH: BANGALORE BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SMT. BEENA PILLAI, JUDICIAL MEMBER ITA Nos.76 to 82/Bang/2023 Assessment Years: 2008-09 to 2014-15 Sri Bileshivale Muddanna Govardhana Murthy No.96, Belishivale, Bidarahalli Hobli Doddagubbi Post Bangalore East Taluk Bengaluru 562 149 PAN NO : AIPPG7774E Vs. ACIT Central Circle-1(2) Bangalore APPELLANT RESPONDENT Appellant by : Shri Balasubramanyam, A.R. Respondent by : Shri Sankar Ganesh K., D.R. Date of Hearing : 18.05.2023 Date of Pronouncement : 18.05.2023 O R D E R PER BENCH: These appeals by assessee are directed against different orders of CIT(A) for the assessment years 2008-09 to 2014-15 dated 8.8.2022. Since the issue is common in all the appeals except figures, we reproduce herewith grounds of appeal in ITA No.76/Bang/2023 as follows: Grounds raised 1. That the impugned order is opposed to facts and law in so far as it is prejudicial to the interests of the Appellant ITA Nos.76 to 82/Bang/2023 Sri Bileshivale Muddanna Govardhana Murthy, Bangalore Page 2 of 9 2 The ld. CIT(A) erred in upholding the order passed by the ld. AO without appreciating the fact that a. The assessment order passed u/s 153A is bad in law and is liable to be quashed. b. Where search u/s 132 of conducted in connection with a person other than the Appellant then the Appellant is to be assessed as per the provisions of section 153C and not section 153A of the Income Tax Act, 1961. 3. That the action of the ld. CIT(A) in dismissing the appellant’s appeal ex parte is untenable and bad in law and in doing so he failed to appreciate the fac that the appellant had compelling circumstances that were beyond his control which prevented him from making necessary representation before the ld. CIT(A) 4. The action of the ld. CIT(A) is not justified in law and facts and circumstances as he ought to have adjudicated the appeal on its merits. 5. Without prejudice to Ground 2 and 3, the ld. CIT(A) erred in upholding the action of the AO in taxing agricultural income under the head ‘Other Sources’ in as much as he failed to appreciate that the same was backed with requisite documentary evidence and in doing so was not in line with the provisions under section 10(1) of the Income Tax Act, 1961. Tax effect: Rs.22,66,819/- plus applicable interest 2. Facts of the case are that the assessee is an individual filing these appeals against the assessment orders u/s 143(3) r.w.s. 153A of the Act dated 23.3.2016. Earlier a search action u/s 132 of the Act was conducted in the case of the assessee on 16.9.2008. In response to notice u/s 53A of the Act the assessee had filed a return of income on 20.12.2010 declaring a taxable income of Rs.66,60,000/- and agricultural income of Rs.7,32,000/-. This ITA Nos.76 to 82/Bang/2023 Sri Bileshivale Muddanna Govardhana Murthy, Bangalore Page 3 of 9 return was assessed u/s 143(3) r.w.s. 153A of the Act. In the assessment order dated 31.12.2010 a sum of Rs.10,53,333/- was added to the returned income. This addition pertained to income declared by the assessee in the course of search proceedings but not offered to tax in the return of income. Agricultural income was accepted as declared by the assessee. Thereafter, a fresh search action u/s 132 of the Act was conducted in the case of the assessee on 1.10.2013. Notice u/s 153A of the Act was issued on 5.11.2014 requiring the assessee to file a return of income. In response to the notice u/s 153A of the Act the assessee vide letter dated 30.9.2015 submitted that the original return of income filed on 20.12.2010 be treated as return of income in response to notice u/s 153A of the Act. The assessee has now been completed u/s 153A r.w.s. 143(3) of the Act. In the assessment order dated 23.3.2016 various additions have been made to the returned income. Against the additions in various assessment years, the assessee had earlier preferred appeals before ld. CIT(A), Bangalore and the ld. CIT(A) has dismissed all the appeals on this issue by ex-parte order dated 8.8.2022. Against this assessee filed appeals before this Tribunal. At the outset, it is noticed that there was a delay of 129 days in filing the appeals before this Tribunal as the assessee is required to file these appeals on or before 7.10.2022. However, these appeals were filed by the assessee on 13.2.2023. Thus, there was a delay of 129 days in filing all these 7 appeals before this Tribunal. The assessee filed condonation petition with affidavit stating as follows: ITA Nos.76 to 82/Bang/2023 Sri Bileshivale Muddanna Govardhana Murthy, Bangalore Page 4 of 9 ITA Nos.76 to 82/Bang/2023 Sri Bileshivale Muddanna Govardhana Murthy, Bangalore Page 5 of 9 ITA Nos.76 to 82/Bang/2023 Sri Bileshivale Muddanna Govardhana Murthy, Bangalore Page 6 of 9 ITA Nos.76 to 82/Bang/2023 Sri Bileshivale Muddanna Govardhana Murthy, Bangalore Page 7 of 9 2.1 Accordingly, the ld. A.R. prayed that these appeals may be admitted in the interest of justice and adjudicated on merit. 3. The ld. D.R. strongly opposed the admission of appeals. 4. We have heard the rival submissions and perused the materials available on record. Admittedly, in this case, assessee was in jail due to conviction in criminal case by the Hon’ble Karnataka High Court up to 11.8.2022 and he was able to secure bail from Hon’ble Supreme Court vide Criminal Appeal No.544 of 2020 dated 11.8.2022 and the assessee filed the appeals only on 13.2.2023. It was a case of the assessee that the assessee has been suffering from great mental agony during the period even after securing the bail from Hon’ble Supreme Court and not able to file appeal before this Tribunal within time allowed, which was not willful or deliberate in as much as the circumstance was beyond his control. In our opinion, the assessee has been in jail for long period and he has been under serious mental pressure and it is common that these matters may not take priority in these circumstances. Under section 253(5) of the Act, the Tribunal may admit the appeals filed beyond the period of limitation where it is satisfied that there was sufficient cause on the part of assessee for not presenting the appeals within the prescribed time. In the present case, the assessee has been under imprisonment for a criminal case originally for which Trail court acquitted him, on further appeal by State, he was convicted by Hon’ble High Court and the appeal was pending before Hon’ble High Court and during this period, he was in imprisonment for more than 6 years and First appellate orders passed ex-parte. In our opinion, there is a good and sufficient reason for not presenting the appeals before this Tribunal ITA Nos.76 to 82/Bang/2023 Sri Bileshivale Muddanna Govardhana Murthy, Bangalore Page 8 of 9 within prescribed time and there was no culpable negligence or malafide on the part of assessee in delayed filing of present appeals and he was not aware of the passing of these orders by ld. CIT(A) during his imprisonment and when he came to know about passing of orders by revenue authorities, he immediately took steps to consult the Counsel to file appeals before this Tribunal and filed the appeals on 13.2.2023. In our opinion, the substantial justice and technical considerations are pitted against each other, the cause of substantial justice deserve to be preferred and the assessee deserve to be heard on merit of the case. Therefore, in exercise of power u/s 253(5) of the Act, the delay in filing the present appeals is condoned as there was sufficient cause for not presenting appeals within the prescribed time and the appeals are hereby admitted for adjudication on merits. 4.1 The assessee has raised various grounds on merit of the addition made by lower authorities. Since the orders passed by ld. CIT(A) are ex-parte, we are not dwelling upon the issues on merit. We remit the entire issue in dispute before us to the file of ld. CIT(A) to pass fresh orders after giving opportunities of hearing to the assessee in accordance with law. 5. In the result, all the appeals of the assessee are partly allowed for statistical purposes. Order pronounced in the open court on 18 th May, 2023 Sd/- (Beena Pillai) Judicial Member Sd/- (Chandra Poojari) Accountant Member Bangalore, Dated 18 th May, 2023. VG/SPS ITA Nos.76 to 82/Bang/2023 Sri Bileshivale Muddanna Govardhana Murthy, Bangalore Page 9 of 9 Copy to: 1. The Applicant 2. The Respondent 3. The CIT 4. The CIT(Judicial) 5. The DR, ITAT, Bangalore. 6. Guard file By order Asst. Registrar, ITAT, Bangalore.