JIGNESHBHAI ASHWINBHAI KAMDAR,RAJKOT V. ITO WD-1(1)(1), RAJKOT

ITA 361/RJT/2024

AI Insights

The case involves an appeal by Jigneshbhai Ashwinbhai Kamdar against the order of the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, for the assessment year 2015-16. The primary issues in the appeal were the additions made by the Assessing Officer (AO) based on entries in Form 26AS and unverified sundry creditors. The assessee contended that these additions were unjust as the reimbursements were already accounted under 'Labour Charge Income' and that the notices for the appellate proceedings were not properly served, leading to a violation of natural justice. The Income Tax Appellate Tribunal (ITAT) found that the delay in filing the appeal was due to non-receipt of the appellate order and incorrect email communication by the CIT(A), thus allowing the appeal for statistical purposes and remitting the matter back for fresh adjudication.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 472115 (ITAT-RAJKOT)
• Duration Of Justice: 5 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-11-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 08-10-2024
• Assessment Year: 2015-2016
• Appeal Filed On: 22-05-2024
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ABHIMANYU SINGH YADAV; LD.
• Assessee Lawyers: SUMIT SHINGALA; LD
• Keywords: Condonation of delay; Business income; Opportunity of being heard; Reasonable cause; Principle of natural justice; FORM 26AS
• Section: 143(3); 250; 68

Judgement Text

" आयकरअपील\tयअ धकरण,राजकोट\u0011यायपीठ,राजकोट। IN THE INCOMETAXAPPELLATE TRIBUNAL, RAJKOT BENCH: RAJKOT BEFORE DR. ARJUN LAL SAINI, ACCOUNTANT MEMBER And SHRI DINESH MOHAN SINHA, JUDICIAL MEMBER आयकरअपीलसं./ITA No. 361/RJT/2024 (\u000eनधा\u0012रणवष\u0012/Assessment Year: (2015-16) JigneshbhaiAshwinbhai Kamdar, Mahadev Vadi Main Road, Opp. Delights Icecream, Udhyog Nagar, Rajkot-360001, Gujarat Vs. The ITO, Ward- 1(1)(1), Rajkot \u0016थायीलेखासं./जीआइआरसं./PAN/GIR No.: AHTPK0183E (अपीलाथ\u001c/Appellant) (\u001d\u001eयथ\u001c/Respondent) \u000eनधा\u0012\u001fरतीक!ओरसे/Appellant by : Shri Sumit Shingala, Ld. A.R. राज\u0016वक!ओरसे/Respondent by : Shri Abhimanyu Singh Yadav, Ld. Sr. D.R. सुनवाईक!तार%ख/ Date of Hearing : 08/10/2024 घोषणाक!तार%ख/Date of Pronouncement : 11 /11 /2024 आदेश / O R D E R PER SHRI DINESH MOHAN SINHA, JUDICIAL MEMBER: This appeal filed by the assessee is directed against the order of Learned Commissioner of Income Tax (Appeals)[in short, “the Ld. CIT(A)”],National Faceless Appeal Centre (in short “NFAC”), Delhi order dated 29.12.2023for assessment year 2015-16. 2. The assessee has raised the following grounds of appeal:- “1) The Ld. AO has erred in law as well as in facts, in making addition aggregating to Rs.3,49,515/-, only on the basis of entries appearing in Form 26AS, and without considering that the said reimbursement receipts were already accounted under the head: Labour Charge Income. 2) The Ld. AO has erred in law as well as in facts, in making addition aggregating to Rs. 1,77,56,039/ towards Sundry Creditors appearing in Balance-sheet, merely for non-availability of Contra-Confirmation from sundry creditors, without considering: Page | 2 ITA No.361/RJT/2024 A Y:2015-16 i. That, notices sent during proceedings, were not delivered to the appellant; and ii. That, except contra-confirmation, all other possible details including, VAT Returns showing relevant purchases, VAT Assessment orders confirming Contents of VAT Returns, CST Form-C List etc., were submitted. 3) Principles of natural justice are violated, for i. The appellant did not receive any notices issued during the first appellate proceedings, which were directed to [e-mail]. despite of having specified [e-mail] in Form-35; and ii. No opportunity of being heard was provided through VC, during the course of first appellate proceedings. 3. At the outset, this appeal is time barred by 85 days by the assessee. The ld. AR filed an affidavit and requested for condonation of delay which is reproduced as below:- “1) I am the Individual-appellant in the case of 2nd Appeal to be preferred before Hon'ble ITAT, Rajkot, pursuant to passing of an ex-parte order u/s. 250, for AY 2015-16. I am aware of the facts and circumstances, and hence, I am competent to make this affidavit Historical Back Ground: 2) Original assessment was completed u/s. 143(3) vide order dtd. 17.11.2017, which was later on subjected to revision u/s. 263, whereby assessment was directed to be carried afresh in relation to Certain entries appearing in Form 26AS, and verification of sundry creditors. Accordingly, the assessment proceedings were initiated again in terms of order u/s. 263. The term 'assessment proceedings' referred hereinafter refers to the said fresh assessment proceedings. 3) Several notices came to be issued during the assessment proceedings, however, the I did not receive any of them in e-mail, except the last Show- cause notice, which was intimated to me otherwise also, whereupon the same was downloaded manually. Thus, only at the fag end of the proceedings, the I came to know of the charges leveled against me. 4. The Ld. AO proposed additions on two counts, namely a. Entries appearing in Form-26AS, aggregating to Rs.3,49,515/-, are not offered for Taxation; and b Sundry Creditors, aggregating to Rs 1,77,56,039/-, remained unverified, hence, were to be treated as income u/s. 68 5) By the time, I came to know of the charges, allegations and proposals for addition made in the SCN, only 2 days' time was left, within which it was impossible to request the sundry creditors to issue contra- Page | 3 ITA No.361/RJT/2024 A Y:2015-16 confirmations. However, the I submitted, all those details I could compile in that short time available 6) However, Id. AO made additions as proposed in the SCN, pursuant to which, First Appeal was preferred, by Filing Form-35 on 29-04-2022, vide Ack. No. 601351990290422. 7) In Form-35, the e-mail Address was mentioned as E-mail Address: [e-mail] However, all notices for hearing were directed towards [e-mail], none of which were delivered to me. 8) The Appeal before First Appellate authority came to be decided ex- parte, on 29-12-2023 for non-response to notices, and, again the order was directed to [e-mail], which never got delivered to me. 9) It is only, when the notices for penalty proceedings, came to be served on correct and present e-mail id i.e. [e-mail], the fact came fore that an ex-parte order u/s 250 is passed. 9) It is for the first time, the order u/s. 250, came to be served, by the Dep through E-mail Dtd. 29-04-2024, which contained the appellate order as its attachment Copy of the said e-mail ID is attached hereto 10) Thus, being aggrieved, the present appeal is being preferred, computing the time limit of 60 day from 29-04-2024, when the order u/s 250 is communicated for the first time. However, in case a different view would be taken, then computing the time limit of 60 days from the date of order ie. 29-12-2023, a delay of & 5 days would get caused, which 1, hereby pray to be condoned, for having sufficient and reasonable cause” The ld. A.R. submitted that the notice posted by ld. CIT(A) at wrong e-mail id. [e-mail]. A copy of the screenshot from the website of the Department has been produced before us. The notice issued on wrong e-mail id. The correct e-mail id is [e-mail]. The assessee came to know about the order when recovery was initiated against the assessee by the department; the assessee obtained copy of order on dated 29.04.2024 though E-mail id, the appellant immediately filed appeal before the Ld. ITAT, Rajkot. In view of the above submission, the delay in filing the appeal by the appellant is neither deliberate nor due to negligence on the part of assessee. The ld. AR prayed for one more opportunity may kindly to be granted to represent the case before the Lower Authority. Page | 4 ITA No.361/RJT/2024 A Y:2015-16 On the contrary, the ld. DR submitted that the assessee is negligent in pursuing the case. Even before the Ld. AO, the appellant did not appear before the authority in spite of several notices was issued time to time. However, only one notice was replied by the assessee before the Ld. AO. This shows the negligent attitude of the assessee. 4. We have heard both the parties and perused all the material available on record. We note that delay in filing the appeal before the Tribunal was due to non-receipt of the appellate order. We further note that there is typographical mistake in the office of ld. CIT (A). Because of that the notice and order were sent on e-mail address which was not correct e-mail id and the correct e-mail id mentioned in Form 35. Because of these reasons, the assessee should not be penalized. We find that there is a sufficient cause to condone the delay and admit the assessee’s appeal for hearing on merit. 5. The assessee is doing the business in the name of M/S RAVINE HITECH LUBRICANTS at Rajkot, A.Y. 15-16 the assessee filed return of income declaring net income of Rs. 13,61,760/- on dated 28-09-015. The assessment was finalized with an addition of Rs. 1,81,05,554 and income was assessed at Rs. 1,94,67,314 by order at 30-3-2022. 6. Feeling aggrieved by the order of Ld.AO dated 30-03-2022, the assessee filed an appeal before the ld. CIT (A). The ld. CIT (A) has dismissed the appeal by order dated 29-12-2023 with following observations:- “I find no reason to alter the action of the Ld. AO in making an additions of Rs. 3,49,515/- and Rs. 1,77,56,039/- on account of business income and unexplained sundry creditors u/s 68 of the Act respectively and the same are therefore upheld. Accordingly, grounds of appeal raised by the appellant are treated as dismissed.” 7. The assessee is in appeal before us. 8. The ld. AR submitted that because of notice sent on wrong e-mail id and no notice was served, upon the assessee that assessee prayed for an opportunity to produce the documents before the Authority. Hence, the matter may kindly Page | 5 ITA No.361/RJT/2024 A Y:2015-16 be remitted back for fresh adjudication before Ld. CIT(A). On the contrary, the Ld. Sr. DR. has relied on the order of Ld. CIT(A) and also objected to the prayer of the Ld. AR. 9. We have heard both the parties and perused all the materials available on record. It is noted that notice issued by the ld. CIT (A) was on wrong E-mail id. The screen shot of the website is placed on record. The correct E-mail id is mentioned by the assessee on Form 35. It is ([e-mail]). Since the appeal has been disposed ex-parte by the ld. CIT(A). We are of the view that one more opportunity should be given to the assessee to present his case before the ld. CIT(A) and remit the matter back to the file of ld. CIT(A) for fresh adjudication on merit after giving due opportunity of being heard to the assessee. The assessee deserves an opportunity to make submission of the case before the Authority. We further direct the assessee to submit relevant details/documents/evidences as required by the ld. CIT(A) for disposal of the assessee. 10. In the result, the appeal of the assessee is allowed for statistical purposes. Order is pronounced on 11 / 11/2024 in the Open Court. S Sd/- Sd/- (DR. ARJUN LAL SAINI) (DINESH MOHAN SINHA) ACCOUNTANT MEMBER JUDICIAL MEMBER Rajkot TRUE COPY *दनांक/ Date: 11 / 11 /2024 Copy of the Order forwarded to 1. The Assessee 2. The Respondent 3. The CIT(A) 4. Pr. CIT 5. DR/AR, ITAT, Rajkot 6. Guard File. By Order, Assistant Registrar/Sr. PS/PS ITAT, Rajkot Page | 6 ITA No.361/RJT/2024 A Y:2015-16 1. Dateofdictation 09.10.2024 2. DateonwhichthetypeddraftisplacedbeforetheDictatingMember 10.10.2024 3. OtherMember… 4. Date on which the approved draft comes to the Sr.P.S./P.S…………….. 5. DateonwhichthefairorderisplacedbeforetheDictatingMemberfor Pronouncement…… 6. Date on which the fair order comes back to the Sr.P.S./P.S……. 7. DateonwhichthefilegoestotheBenchClerk………………… 8. DateonwhichthefilegoestotheHeadClerk…………………………………... 9. The date on which the file goes to the Assistant Registrar for signatureon the order…………………….. 10. Date of Dispatch of the Order……………… "