LILESHWAR SAHU, KACHANDUR,KACHANDUR V. INCOME TAX OFFICER, WARD-1(3), BHILAI, DURG

ITA 448/RPR/2024

AI Insights

The case involves two appeals by Lileshwar Sahu against the orders of the Commissioner of Income Tax (Appeals), NFAC, Delhi, concerning the Assessment Year 2018-19. The appeals were directed against the orders under sections 250 and 271AAC(1) of the Income Tax Act, which were themselves based on the orders of the Assessing Officer under sections 147 r.w.s. 144 and 271AAC(1) respectively. The primary issues revolved around the proper service of notice, adherence to procedural requirements under section 249(3), and the legality of reassessment proceedings initiated by the ITO. The Tribunal found that the assessee was not properly served with the notice as he had opted out of email communication, leading to a decision to restore the matters to the CIT(A) for a fair hearing.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 106805 (ITAT-RAIPUR)
• Duration Of Justice: 1 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-11-2024
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Next Hearing Date: 18-11-2024
• Assessment Year: 2018-2019
• Appeal Filed On: 14-10-2024
• Other Referred Cases: Commissioner of Income-tax (Central) Nagpur Vs. Premkumar Arjundas Luthra (HUF) [2016] 69 taxmann.com 407 (Bombay)
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: MOHAN AGRAWAL
• Assessee Lawyers: YOGESH SETHIA
• Keywords: Condonation of delay; Set aside; Bonafide belief; Principle of natural justice
• Section: 147; 250; 201; 69A

Judgement Text

"आयकर अपीलीय अिधकरण, रायपुर Ɋायपीठ, रायपुर IN THE INCOME TAX APPELLATE TRIBUNAL RAIPUR BENCH, RAIPUR ŵी रिवश सूद, Ɋाियक सद˟ एवं ŵी अŜण खोड़िपया, लेखा सद˟ क े समƗ । BEFORE SHRI RAVISH SOOD, JM & SHRI ARUN KHODPIA, AM आयकर अपील सं. / ITA No: 447 & 448/RPR/2024 (िनधा[रण वष[ Assessment Year: 2018-19) Lileshwar Sahu, Ward No. 02, Bazar Para, Kachandur, Tahsil, Gunderdehi, Dist. Balod, 491223, C.G. V s Income Tax Officer, Ward-1(3), Aaykar Bhawan, Civic Center, Bhilai 490006, Chhattisgarh (Through NFAC) PAN: CCNPS084IL (अपीलाथŎ/Appellant) . . (ŮȑथŎ / Respondent) िनधाŊįरती की ओर से /Assessee by : Shri Yogesh Sethia, CA राजˢ की ओर से /Revenue by : Shri Mohan Agrawal, Sr. DR सुनवाई की तारीख / Date of Hearing : 18.11.2024 घोषणा की तारीख/Date of Pronouncement : 19.11.2024 आदेश / O R D E R Per Arun Khodpia, AM: The captioned two appeals pertains to the same assessee, directed against the order of Commissioner of Income Tax, NFAC, Delhi [in short “Ld. CIT(A)”], against the separate orders u/s 250 of the Income Tax Act for the Assessment Year 2018-19, dated 27.01.2024 and 16.05.2024, which in turn arises from the respective orders of the Assessing Officer, NFAC u/s 147 r.w.s. 144 dated 20.03.2023 and u/s 271AAC(1) dated 14.09.2023. 2 ITA No. 447 & 448/RPR/2024 Lileshwar Sahu vs ITO, Ward-1(3) 2. The grounds of appeal raised by the assessee in his both the aforesaid appeals are extracted as under: Grounds of appeal in ITA No. 447/RPR/2024 1. In the facts and circumstances of the case and in law, the Ld. Commissioner of Income-tax (Appeals), NFAC has erred in not admitting the appeal without adhering to the provisions of section 249(3) of the Income-tax Act, 1961. 2. In the facts and circumstances of the case and in law, the Ld. Commissioner of Income-tax (Appeals), NFAC has erred in deciding the appeal ex-parte without proper service of the notice as per provisions of the Act despite Appellant opting out for service of notice u/s. 250 of the Act through e-mail by stating \"No\" in the relevant column of form 35 and without deciding any of the grounds of appeal raised in form 35 and without following the principles of natural justice and against the principles of law decided in the case of Commissioner of Income-tax (Central) Nagpur Vs. Premkumar Arjundas Luthra (HUF) [2016] 69 taxmann.com 407 (Bombay). 3. In the facts and circumstances of the case and in law, the Ld. Assessing Officer has erred in initiating proceedings u/s. 147 r.w.s. 148, 149, 151 and 151A of the Income- tax Act, 1961 without fulfilling stipulated conditions. 4. In the facts and circumstances of the case and in law the initiation of reassessment proceedings by ITO-2(1), Bhilai is illegal and without jurisdiction because as per jurisdictional notification dated 15/11/2014 the jurisdiction lies with ITO-2(2), Bhilai. 5. In the facts and circumstances of the case and in law, learned Commissioner of Income Tax (Appeals), NFAC has erred in upholding order of learned Assessing Officer making addition of Rs. 1,35,89,000/- as unexplained money u/s. 69A of the Income-tax Act, 1961 and charging the same to higher rate of tax u/s. 115BBE of the Act. 6. The impugned order is bad in law and on facts. 7. The appellant reserves the right to add, alter, omit all or any of the grounds of appeal with the permission of the Hon'ble appellate authority. Grounds of appeal in ITA No. 448/RPR/2024 1. In the facts and circumstances of the case and in law, the Ld. Commissioner of Income-tax (Appeals), NFAC has erred in not admitting the appeal without adhering to the provisions of section 249(3) of the Income-tax Act, 1961. 3 ITA No. 447 & 448/RPR/2024 Lileshwar Sahu vs ITO, Ward-1(3) 2. In the facts and circumstances of the case and in law, the Ld. Commissioner of Income-tax (Appeals), NFAC has erred in deciding the appeal ex-parte without proper service of the notice as per provisions of the Act and without deciding any of the grounds of appeal raised in form 35 and without following the principles of natural justice and against the principles of law decided in the case of Commissioner of Income-tax (Central) Nagpur Vs. Premkumar Arjundas Luthra (HUF) [2016] 69 taxmann.com 407 (Bombay). 3. In the facts and circumstances of the case and in law, learned Commissioner of Income Tax (Appeals), NFAC has erred in upholding order of learned Assessing Officer imposing penalty of Rs.8,15,340/- u/s.271AAC(1) of the Income-tax Act, 1961. 4. The impugned order is bad in law and on facts. 3. Brief facts of the case as stated are that the assessee is an individual appointed as a business correspondence by Dena Bank (now merged with Bank of Baroda). The assessee is involved in making cash payment on account holders of Jandhan Account holders through POS machine after swiping their cards. The assessee gets commission income from the said activity, apart from income from pension and agricultural income. Elaborating facts and grievance, assessee had submitted an affidavit with a request for seeking condonation in delay filing of the appeal before the Tribunal. The application of assessee along with affidavit are extracted as under: 4 ITA No. 447 & 448/RPR/2024 Lileshwar Sahu vs ITO, Ward-1(3) 5 ITA No. 447 & 448/RPR/2024 Lileshwar Sahu vs ITO, Ward-1(3) 6 ITA No. 447 & 448/RPR/2024 Lileshwar Sahu vs ITO, Ward-1(3) 7 ITA No. 447 & 448/RPR/2024 Lileshwar Sahu vs ITO, Ward-1(3) 8 ITA No. 447 & 448/RPR/2024 Lileshwar Sahu vs ITO, Ward-1(3) 9 ITA No. 447 & 448/RPR/2024 Lileshwar Sahu vs ITO, Ward-1(3) 10 ITA No. 447 & 448/RPR/2024 Lileshwar Sahu vs ITO, Ward-1(3) 4. At the outset, it is brought to our knowledge that while filing the appeal before the Ld. CIT(A) in Form No. 35 towards the question regarding communication “whether notices/ communications may be sent on email?”, the assessee opted “NO”. with email ID provided by the assessee [e-mail]. It was the assertion by Ld. Counsel on behalf of the assessee that the assessee had never received any communication from the office of Ld. CIT(A). It is argued that the assessee was deprived off to submit any explanations towards the delay involved before the Ld. CIT(A). In fact, the assessee had filed Form No. 35 with date of service of order on 30.11.2023, whereas the assessment order u/s 147 r.w.s. 144 was passed on 23.02.2023. Such facts were never confronted to the assessee by the Ld. CIT(A) and had decided the appeal against the assessee invoking the provisions of section 249(2) r.w.s. 249(3). It was the submission that the assessee was under bonafide belief that his appeal is in time, therefore, no request for condonation of delay could have been filed by the assessee, also communication sent by the Ld. CIT(A) on email which was not the preferred mode of communication opted by the assessee, thus, the assessee was unaware about the appellate proceedings. Under such circumstances, it was the request that the assessee shall be provided with opportunity to represent his case before the Ld. CIT(A), placing all the contentions towards the reasons explaining the delay in filing of the appeal before the First Appellate Authority. 11 ITA No. 447 & 448/RPR/2024 Lileshwar Sahu vs ITO, Ward-1(3) 5. Ld. Sr. DR on the other hand, vehemently supported the orders of Ld. AO and Ld. CIT(A). 6. We have considered the rival submissions and perused the material available on record. Admittedly, in present case, it is found that the communication sent to the assessee by the office of Ld. CIT(A) are not validly served to the assessee. Assessee’s request in Form No. 35, where the assessee was allowed to select the mode of communication through email or not, the assessee opted “No”. From such facts, it can be safely presumed that the assessee was unaware about the proceedings before the Ld. CIT(A). Further, the delay in filing of the appeal was not in the knowledge of assessee, since the assessee was of the bonafide belief that the impugned assessment order was served by him on 30.11.2023. Thus, the assessee was unable to produce necessary explanations towards the delay involved in filing of the appeal before the Ld. CIT(A), therefore, a fair opportunity to represent, requires to be afforded to the assessee in the interest of substantial justice. Before us also, the appeal of assessee was delayed by 201 days and 91 days. However, as the matter is liable to be restored back to the files of Ld. CIT(A), considering the facts and circumstances of the present case, we find it justified to condone the delay involved in filing of the appeal before us for the reason that the order of appeal 12 ITA No. 447 & 448/RPR/2024 Lileshwar Sahu vs ITO, Ward-1(3) was also communicated to the assessee on email which was not preferred mode opted by the assessee. 7. In result, the quantum appeal of the assessee in ITA No. 447/RPR/2024 is set aside to the files of Ld. CIT(A), thus, partly allowed. In ITA No. 448/RPR/2024 [against the penalty order 271AAC(1)] 8. Since the quantum appeal of the assessee for the aforesaid year is restored back to the files of Ld. CIT(A), and the appeal against the penalty order u/s 271AAC(1) is consequential in nature, we find it appropriate to restore the appeal against the penalty order to the files of Ld. CIT(A) for fresh adjudication. 9. Needless to say, assessee shall be afforded with reasonable opportunity of being heard as per law in the set aside appellate proceedings for both the aforesaid appeals. 10. In the result, the appeals of the assessee in ITA No. 447 & 448/RPR/2024 are partly allowed, in terms of our aforesaid observations. 13 ITA No. 447 & 448/RPR/2024 Lileshwar Sahu vs ITO, Ward-1(3) Order pronounced in the open court on 19/11/2024. Sd/- (RAVISH SOOD) Sd/- (ARUN KHODPIA) Ɋाियक सद˟ / JUDICIAL MEMBER लेखा सद˟ / ACCOUNTANT MEMBER रायपुर/Raipur; िदनांक Dated 19/11/2024 Vaibhav Shrivastav आदेश की Ůितिलिप अŤेिषत/Copy of the Order forwarded to : आदेशानुसार/ BY ORDER, (Senior Private Secretary) आयकर अपीलीय अिधकरण, रायपुर/ITAT, Raipur 1. अपीलाथŎ / The Appellant- Lileshwar Sahu 2. ŮȑथŎ / The Respondent- ITO, Ward-1(3), Bhilai 3. आयकर आयुƅ(अपील) / The CIT(A), 4. The Pr. CIT, Raipur (C.G.) 5. िवभागीय Ůितिनिध, आयकर अपीलीय अिधकरण, रायपुर/ DR, ITAT, Raipur 6. गाडŊ फाईल / Guard file. // स×याǒपत Ĥित True copy // "