LAXMAN SHARMA,PATNA V. .NFAC, DELHI

ITA 337/PAT/2024

AI Insights

The case involves two appeals by Laxman Sharma against the orders of the Commissioner of Income Tax (Appeals) for the Assessment Years 2017-18 and 2018-19. The appeals were initially time-barred, but the Tribunal accepted the condonation of delay based on the circumstances presented, including illness of a partner and procedural delays in filing. The main issues in the appeals included improper calculation of taxable receipts, incorrect treatment of interest income, and inadequate notice of hearings. The Tribunal found that the assessee was not given a fair opportunity to present their case at the appellate level due to the non-receipt of notices, leading to the decision to remand the case for a fresh hearing.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 470770 (ITAT-PATNA)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-12-2024
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Assessment Year: 2018-2019
• Other Referred Cases: Shyam Bihari case reported in 345 ITR 283
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Condonation of delay; Business income; Reasonable cause; Principle of natural justice
• Section: 143(3); 250

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL “PATNA BENCH” PATNA (VIRTUAL HEARING AT KOLKATA) SHRI SONJOY SARMA, JUDICIAL MEMBER SHRI SANJAY AWASTHI, ACCOUNTANT MEMBER I.T.A. No. 336/Pat/2024 (Assessment Year 2017-18) & I.T.A. No. 337/Pat/2024 (Assessment Year 2018-19) Laxman Sharma, Buddha Colony, East Boring Canal Road, Patna - 800001 [PAN: AACFL2753K] .....................…...…………….... Appellant vs. Income Tax Officer, Ward 4(5), Patna ...............…..….................... Respondent Appearances by: Assessee represented by : None Department represented by : Ajay Kr. Shukla, JCIT (Sr. DR) Date of concluding the hearing : 19.12.2024 Date of pronouncing the order : 23.12.2024 ORDER PER SANJAY AWASTHI, ACCOUNTANT MEMBER: 1. This is a batch of two appeals for Assessment Years 2017-18 and 2018-19. ITA No. 336/Pat/2024 is time barred by 216 days and ITA No. 337/Pat/2024 is time barred by 206 days. The assessee has filed petition for condonation of delay which are similarly worded. For the sake of convenience, the condonation of delay petition filed for ITA No. 336/Pat/2024 is extracted as under: I.T.A. Nos. 336 & 337/Pat/2024 Laxman Sharma 2 “1. That, the CIT Appeal had passed order on 01.01.2024 under section 250 of the Income Tax Act for the assessment year 2017-18. The copy of order of ld. Commissioner of Income Tax Appeal, however, was served on income tax portal through online process. Therefore, there is delay of 16 days in filing appeal by appellant. 2. That, the appellant is a partnership firm and one of the partners who looks into legal affairs of the firm got ill as such, he was not aware about the order. Due to this reason appellant has not filed appeal on time. After recovery from illness appellant made contact with his advocate for filing appeal. Advocate took 10 days time in filing appeal. No intentional delay has been made from the part of the appellant rather delay has been made due to circumstances beyond the control of the appellant 3. That, the Hon'ble Apex Court has held in number of judgment that the court should take lenient view in condoning delay, if reasonable cause is shown and effort always should be made to decided the case on merit. In the present case, the cause is reasonable and order is factually illegal, as such, this is a fit case to condone delay.” 1.1 Considering the reasons given for delay in filing of two appeals, we deem it fit to condone the delay and admit these appeals for adjudication. 2. These two appeals emanate from the orders of Ld. Commissioner of Income Tax (Appeals) (hereafter ‘the Ld. CIT(A)’], passed u/s 250 of the Income Tax Act, 1962 (hereafter ‘the Act’), dated 01.01.2024 (ITA No. 336/Pat/2024) and 02.01.2024 (ITA No.337/Pat/2024). 2.1 For the sake of convenience ITA No. 336/Pat/2024 is being taken as a lead case, where it is proposed that both these appeals will be disposed of through a single order. The grounds of appeal in the lead case are as under: “1. For that the order passed by A.O is bad and illegal in view of the fact that the A.O has not calculated the taxable receipt properly nor had deducted royalty, VAT, Miscellaneous deductions etc. out of the gross contract receipt for making an estimate of income at the rate of 6 percent, as such, the computation of business income is excessive. 2. For that the addition made on account of interest in income from other source is unreasonable and arbitrary because the interest in question is business income in view of the order of the Hon'ble Patna High court in Shyam Bihari case reported in 345 ITR 283. 3. For that the assessing officer has not considered the fact that the assessee has not received refund rather the refund has been adjusted against the outstanding demand created in other assessment years. I.T.A. Nos. 336 & 337/Pat/2024 Laxman Sharma 3 4. For that the order under challenge is unjust, unreasonable and illegal in view of the fact that the appellant has made factual and legal submission in the statement of fact and ground of appeal as such, ld. commissioner ought to have disposed of the appeal on merit. 5. For that Id. CIT Appeal failed to appreciate that the service of notice was made online through online process on mail not by registered post or any other mode nor the CIT has ensured that the appellant in fact has received notice or not and without ensuring the proper service of notice order in question has been passed which per se is unjust and unreasonable and amount of violation of principal of natural justice. 6. For that the grounds taken herein above are not prejudicial to each other. 7. For that any other grounds may be taken at the time of hearing.” 2.2 In these cases the Ld. AO made certain additions u/s 143(3) of the Act which travelled up to the Ld. CIT(A), where as recorded in detail in the impugned orders, several opportunities given to the assessee for compliance or submissions were not responded to and hence both the impugned orders have been passed in an exparte manner. 3. Since, none appeared on behalf of the assessee, this matter was taken up for adjudication with the help of the Ld. DR. It is seen from the statement of fact that apparently the notices fixing the dates for hearing were not received by the assessee even though the same were sent on the e-mail mentioned by the assessee in the form of appeal. Be that as it may, the assessee could not make any presentation before the Ld. CIT(A) to enable him to be persuaded for accepting the assessee’s contentions in regard to the additions made. It is felt that, after perusal of the documents before us, the assessee deserves another chance to present his case before the First Appellate Authority and hence we remand this appeal back to the file of Ld. CIT(A) for fresh adjudication. The Ld. DR did not have any objection in case this matter was to be remanded back to the file of Ld. CIT(A). 4. The findings for ITA No. 336/Pat/2024 shall apply mutatis mutandis to ITA No. 337/Pat/2024 also. This appeal is also remanded back to the file of Ld. CIT(A) for fresh adjudication. I.T.A. Nos. 336 & 337/Pat/2024 Laxman Sharma 4 6. In the result, these two appeals filed by the assessee are allowed for statistical purposes. Order pronounced in the court on 23.12.2024 Sd/- Sd/- [Sonjoy Sarma] [Sanjay Awasthi] Judicial Member Accountant Member Dated: 23.12.2024. AK, PS Copy of the order forwarded to: 1. Laxman Sharma 2. Income Tax Officer, Ward 4(5), Patna 3. CIT(A)- 4. CIT- 5. CIT(DR) //True copy// By order Assistant Registrar, Kolkata Benches "