M/S JYOTI SOLUTIONWORKS PVT. LTD,PUNE V. DCIT, CIRCLE 8, PUNE, PUNE

ITA 2317/PUN/2024

AI Insights

The case involves M/s. Jyoti Solutions Works Private Limited, which appealed against the order of the National Faceless Appeal Centre, Delhi, concerning the Assessment Year 2009-10. The appeal was directed against the addition of Rs. 88,40,074 to the assessee's income, which was alleged to be from bogus transactions. The Tribunal noted a significant delay in filing the appeal, attributed to the merger of the assessee with another company and oversight in updating the e-filing portal. The Tribunal, adopting a liberal approach due to the 'sufficient cause' shown, condoned the delay and admitted the appeal for adjudication on merits. The Tribunal found that the assessee had not been given a fair opportunity to present its case before the ld.CIT(A), leading to an exparte order. Consequently, the Tribunal restored the matter to the ld.CIT(A) for a fresh decision, emphasizing the need for a fair hearing.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 708422 (ITAT-PUNE)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-07-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Assessment Year: 2009-2010
• Other Referred Cases: Inder Singh Vs. State of Madhya Pradesh
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAMNATH P. MURKUNDE
• Assessee Lawyers: KISHOR B PHADKE
• Keywords: Condonation of delay; Set aside; Reasonable cause; Bogus purchase; Bogus
• Section: 142(1)

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES “A”, PUNE BEFORE DR.MANISH BORAD, ACCOUNTANT MEMBER AND SHRI VINAY BHAMORE, JUDICIAL MEMBER आयकर अपील सं. / ITA No.2317/PUN/2024 Assessment Year : 2009-10 M/s. Jyoti Solutions Works Private Limited, Block 102, MIDC Bhosari, Bhosari I.E. S.O., Pune 411026, Maharashtra PAN : AABCJ0011A Vs. DCIT, Circle-8, Pune Appellant Respondent आदेश / ORDER PER DR. MANISH BORAD, ACCOUNTANT MEMBER : This appeal at the instance of assessee pertaining to the Assessment Year 2009-10 is directed against the order dated 19.05.2023 of National Faceless Appeal Centre, Delhi passed u/s.250 of the Income-tax Act, 1961 (hereinafter also called ‘the Act’) arising out of the Assessment Order dated 19.03.2014 passed u/s.143(3) r.w.s.147 of the Act. 2. Assessee has raised following grounds of appeal : “1. The learned CIT(A) - NFAC erred in law and on facts in confirming addition made by the learned AO of Rs. 88,40,074/- on account of alleged bogus transactions and computing total assessed income at Rs.2,71,07,360/- instead of returned income of Rs.1,82,67,290/. Assessee by : Shri Kishor B Phadke Revenue by : Shri Ramnath P. Murkunde Date of hearing : 25.06.2025 Date of pronouncement : 14.07.2025 ITA No.2317/PUN/2024 M/s. Jyoti Solutions Works Private Limited 2 2. The learned CIT(A) erred in law and on facts in upholding the addition on account of alleged bogus transactions incurred amounting to Rs. 88,40,074/- without considering the detailed submission made along with documentary evidence to substantiate alleged bogus transactions vide physical submission before CIT(A)- 9, Pune made before 2019. Learned CIT(A) erred in observing that, the appellant could not file any submission/reply without appreciating that, the appellant has submitted relevant documents/information during appellate proceedings. 3. The learned AO & thereby learned CIT(A) erred in law and on facts in assuming jurisdiction under 147 of ITA, 1961 only on the basis of information received from sales tax department without having any reasons to believe for income escaped assessment. 4. The Learned IT Authorities in particular erred in making additions only on ground that so called parties with whom alleged transactions took place, were in black list of Sales Tax Department (VAT Department) and failed to appreciate that this is not sufficient reason for making the addition. 5. The learned IT authorities erred in law and on facts in not restricting the addition only on percentage of gross profit on alleged hawala purchases. 6. Appellant trust craves leave to add/modify/delete / amend all / any of the grounds of appeal.” 3. Registry has informed that there is delay of 480 days in filing the appeal before this Tribunal. Assessee has filed application for condonation of delay stating the reason that “due to merger of the transferor company with the appellant, updates on e-filing portal were glossed over and remained unattended. Also the communications were sent to the earlier tax consultant of the transferor company at [e-mail]. It was only on receiving the notices of recovery of outstanding demand that the assessee came to know about passing of the impugned order”. 4. We have heard the rival submissions and gone through the averments made in the condonation application. Hon’ble courts in plethora of judgments observed that when ITA No.2317/PUN/2024 M/s. Jyoti Solutions Works Private Limited 3 consideration of an appeal on merits is pitted against the rejection of a meritorious claim on the technical ground of the bar of limitation, the Courts lean towards consideration on merits by adopting a liberal approach towards ‘sufficient cause’ to condone the delay. The Court considering an application under section 5 of the Limitation Act may also look into the prima facie merits of an appeal. A liberal approach may be adopted when some plausible cause for delay is shown. Hon’ble Supreme Court in the case of Inder Singh Vs. State of Madhya Pradesh judgment dated 21.03.2025 (2025 INSC 382) condoned delay of 1537 days sub-serving the cause of justice. It was held so while observing that the appeal filed by the appellant with a delay was unintentional, much less due to any deliberate laches, and was well-explained by the State before the High Court. Hon’ble Court further held that in cases where the merits are significant, a more liberal approach may be adopted to allow for the examination of the case on its merits. Having gone through the averments made in the condonation application and considering the ratio laid down by the Hon’ble Court in the case of Inder Singh (supra), we are of the view that due to ‘reasonable cause’ assessee failed to file the appeal within the stipulated time. We therefore condone the delay of 480 days and admit the appeal for adjudication. 5. Before us, at the time of hearing, Ld. Counsel for the assessee requested for setting aside the issues raised on merit to the file of ld.CIT(A) as the assessee failed to make proper compliance before ld.CIT(A). Ld. Departmental Representative did not oppose to the request. ITA No.2317/PUN/2024 M/s. Jyoti Solutions Works Private Limited 4 6. We have heard the rival contentions and perused the record placed before us. Assessee is a Private Limited Company engaged in the business and return of income for A.Y. 2009-10 filed on 30.09.2009 declaring income of Rs.1,82,67,290/- Case reopened for A.Y. 2009-10 by issuance of notice u/s.148 of the Act followed by validly serving of statutory notices u/s.143(2) and 142(1) of the Act. Re- assessment proceedings were carried out and after making an addition of bogus purchase transaction of Rs.88,40,074/- income assessed at Rs.2,71,07,364/-. Aggrieved assessee preferred appeal before ld.CIT(A) but then failed to appear on nine occasions which also includes the notices of hearing issued during covid-19 pandemic outbreak prevailed across the country. Ld.CIT(A) has passed an exparte order on merits of the case dismissing the appeal of the assessee. 7. Before us, Ld. Counsel for the assessee filed paper book running into 173 pages which includes the Audited Financial statements, submissions filed before ld.CIT(A), Rectification Application against order u/s.250 and other documents for Amalgamation of the appellant with Jyoti Stampings and Assemblies Private Limited. 8. Considering the ‘reasonable cause’ and that the assessee was not able to get the information about the notices of hearing resulting into exparte order by ld.CIT(A), we in the larger interest of justice and being fair to both the parties deem it proper to restore all the issues raised in the instant appeal to the file of ld.CIT(A) for necessary adjudication. Needless to mention that ld.CIT(A) in the set-aside proceedings shall allow reasonable opportunity of hearing to the assessee. ITA No.2317/PUN/2024 M/s. Jyoti Solutions Works Private Limited 5 After considering the submissions made by the assessee, ld.CIT(A) shall decide the issues in accordance with the law. Assessee is directed to update latest email id and contact detail on ITBA portal. Assessee is also directed to remain vigilant and not to take adjournment unless otherwise required for reasonable cause. Impugned order is set aside and the effective grounds of appeal raised by the assessee are allowed for statistical purposes. 9. In the result, appeal of the assessee is allowed for statistical purposes. Order pronounced on this 14th day of July, 2025. Sd/- Sd/- (VINAY BHAMORE) (MANISH BORAD) JUDICIAL MEMBER ACCOUNTANT MEMBER पुणे / Pune; \u0001दनांक / Dated : 14th July, 2025. Satish आदेश क\u0002 \u0003ितिलिप अ ेिषत / Copy of the Order forwarded to : 1. अपीलाथ / The Appellant. 2. \u000eयथ / The Respondent. 3. The Pr. CIT concerned. 4. िवभागीय ितिनिध, आयकर अपीलीय अिधकरण, “A” ब\u0014च, पुणे / DR, ITAT, “A” Bench, Pune. 5. गाड\u0004 फ़ाइल / Guard File. आदेशानुसार / BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण, पुणे / ITAT, Pune "