PRAVINBHAI VALLABHBHAI KAKADIYA-HUF,SURAT V. ITO, WARD 2(3)(3), SURAT

ITA 907/SRT/2024

AI Insights

The case involves an appeal by Pravinbhai Vallabhbhai Kakadiya - HUF against the order of the Commissioner of Income Tax (Appeals), which confirmed the addition of Rs.1,26,08,851 as unexplained money under section 69A of the Income Tax Act, 1961. The Assessing Officer had initially made this addition due to the assessee's failure to respond to notices regarding the source of cash deposits and credit entries. The CIT(A) dismissed the appeal due to a significant delay in filing and lack of merit, as the assessee did not provide any submissions during the appellate proceedings. The Tribunal found that the delay in filing the appeal was justified and set aside the CIT(A)'s order, remitting the case back to the Assessing Officer for a fresh assessment after providing an adequate opportunity of hearing.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 26806 (ITAT-SURAT)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-01-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2017-2018
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MINAL KAMBLE
• Assessee Lawyers: P. M. JAGASHETH
• Keywords: Condonation of delay; Set aside
• Section: 144; 142(1); 250; 69A

Judgement Text

" IN THE INCOME-TAX APPELLATE TRIBUNAL, SURAT BENCH, SURAT BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER AND SHRI BIJAYANANDA PRUSETH, ACCOUNTANT MEMBER आयकर अपील सं./ITA No.907/SRT/2024 Assessment Year: (2017-18) (Physical Hearing) Pravinbhai Vallabhbhai Kakadiya – HUF, M-43, Ratnaprabha Co-op. Housing Society, Bharthana, Vesu, Surat - 395007 Vs. The ITO, Ward – 2(3)(3), Surat èथायीलेखासं./जीआइआरसं./PAN/GIR No: AANHP0960R (Appellant) (Respondent) Appellant by Shri P. M. Jagasheth, CA Respondent by Shri Minal Kamble, Sr. DR Date of Hearing 17/12/2024 Date of Pronouncement 10/01/2025 आदेश / O R D E R PER BIJAYANANDA PRUSETH, AM: This appeal by the assessee emanates from the order passed under section 250 of the Income-tax Act, 1961 (in short, ‘the Act’) dated 14.08.2024 by the learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi [in short, ‘CIT(A)’] for the assessment year (AY) 2015-16. 2. The grounds of appeal raised by the assessee are as under: “1. On the facts and in the circumstances of the case as well as the law on the subject, the learned Commissioner of the Income Tax (Appeals) has erred in confirming the action of the Assessing Officer in making addition of Rs.1,26,08,851/- on account of cash deposit and credit entries remain unexplained treated as alleged unexplained, money u/s.69A of the Income Tax Act, 1961. 2. On the facts and in the circumstances of the case as well as the law on the subject, the learned Commissioner of the Income Tax (Appeals) has erred in confirming the action of the Assessing Officer in initiating penalty proceedings u/s.271 AAC of the LT. Act, 1961. 2 ITA No.907/SRT/2024/AY.2017-18 Pravinbhai Vallabhbhai Kakadiya - HUF 3. On the facts and in the circumstances of the case as well as the law on the subject, the learned Commissioner of the Income Tax (Appeals) has erred in confirming the action of the Assessing Officer in levy interest u/s.234A/234B/234C/234D of the I.T. Act, 1961. 4. On the facts and in the circumstances of the case as well as the law on the subject, the learned Commissioner of the Income Tax (Appeals) has not offered adequate opportunities to hear the case and passed ex-parte order and hence the case may please be set aside and restored back to the CIT(A) or AO. 5. It is therefore prayed that the above addition may please be deleted as learned members of the tribunal may deem it proper. 6. Appellant craves leave to add, alter or delete any ground(s) either before or in the course of the hearing of the appeal.” 3. The appeal filed by assessee is late by 131 days in terms of provisions of section 253(3) of the Act. The learned Authorized Representative (ld. AR) filed an affidavit of the assessee where it is submitted that all notices during assessment proceedings were issued on the e-mail Id [e-mail], which was created by the old consultant for filing return of income. The said e- mail Id was not used for any correspondence. Since assessee was not aware about online Income-tax proceedings, he did not receive notices during assessment proceedings. Therefore, no reply should be given and ex parte order u/s 144 of the Act was passed, which was uploaded in the e-filing portal and e-mail Id of [e-mail]. Thereafter, Government of India announced lock-down and restrictions were applied. The Hon’ble Supreme Court also excluded the period from 15.03.2020 till 28.02.2022 in Suo Motu Writ Petition (Civil) No.3 of 2020. It was also submitted that the new consultant had put e-mail ID [e-mail] for communication before CIT(A) but the notices were issued on the old e-mail Id. Therefore, notices 3 ITA No.907/SRT/2024/AY.2017-18 Pravinbhai Vallabhbhai Kakadiya - HUF were not received and the CIT(A) passed an ex parte order. Thereafter, when the appellant came to know about order of CIT(A), steps were taken to file appeal before ITAT, which was delayed by 131 days. The ld. AR of the assessee submitted that the delay was neither intentional nor deliberate and it was due to circumstances beyond control of the assessee. He requested that in the interest of justice, the matter may be set aside and assessee should be given another opportunity to plead his case on merit. 4. On the other hand, learned Senior Departmental Representative (ld. Sr. DR) for the revenue submitted that the reasons given by the appellant are general in nature and appellant has not established sufficient cause for not filing appeal in time. He submitted that if the Tribunal decides to condone delay, appropriate cost may be imposed upon the assessee. 5. We have heard both the parties on this preliminary issue of delay of 131 days. The appellant has stated that all the notices were issued in the e-mail Id of the old consultant and not on the new e-mail Id given while filing the appeal. He has submitted copy of Form No.35 where e-mail Id is ‘[e-mail]’ but notices were issued on old email Id ‘[e-mail]’. He further submitted that due to Covid-19 pandemic, the Hon’ble Supreme Court had excluded period from 15.03.2020 to 28.02.2022. We find that the delay in filing the appeal was not inordinate and the reasons given by the appellant deserve sympathetic consideration because notices were issued in the e-mail of the old consultant and not in the e-mail Id given in Form No.35. Further, the Hon’ble Supreme Court has also excluded 4 ITA No.907/SRT/2024/AY.2017-18 Pravinbhai Vallabhbhai Kakadiya - HUF the period mentioned above. The expression \"sufficient cause\" used in section 253(5) of the Act is sufficiently elastic to enable the Tribunal to apply the law which subserves the ends of justice. It has been held in a number of cases that when substantial justice and technical considerations are pitted against each other, the cause of substantial justice deserves to be preferred, for the other side cannot claim to have vested right in injustice being done because of a non-deliberate delay. Hence, we condone the delay of 131 days and admit the appeal for hearing. 6. Facts of the case in brief are that the assessee filed return of income for AY.2017-18 on 28.03.2018, declaring total income of Rs.2,44,140/-. The assessee did not furnish details in response to the notices issued u/s 142(1) on four occasions. The assessee also did not respond to the show cause notice. Therefore, in absence of any reply, regarding source of cash deposits and credit entries of Rs.1,26,08,851/-, the Assessing Officer (in short, ‘AO’) added the same u/s 69A of the Act. The appeal filed by assessee against the assessment order was late by 591 days. The reasons given before CIT(A) was that assessee had not received the order and hence there was delay in filing appeal. The CIT(A) rejected the appeal at the admission level due to delay in filing appeal. However, he has also decided on merit and dismissed the appeal because assessee did not file any submission till conclusion of the appellate proceedings. He has confirmed addition of Rs.1,26,08,851/- u/s 69A of the Act because assessee did not produce any material during appellate proceedings to controvert the findings of the AO. 5 ITA No.907/SRT/2024/AY.2017-18 Pravinbhai Vallabhbhai Kakadiya - HUF 7. Aggrieved by the order of CIT(A), the assessee filed appeal before the Tribunal. The learned Authorized Representative (ld. AR) of the assessee submitted the affidavit for condonation of delay and requested that in the interest of justice, another opportunity may be granted to assessee to plead his case before the AO because the orders of lower authorities are ex parte. 8. On the other hand, the learned Senior Departmental Representative (ld. Sr. DR) for the revenue stated that the delay in filing appeal before CIT(A) is also not satisfactorily explained. He requested to dismiss the appeal of assessee. 9. We have heard both the parties and perused the materials available on record. The AO has passed the order u/s 144 of the Act after observing that assessee chose not to file any reply till passing of the order. The CIT(A) has refused to condone the delay in filing appeal before him and dismissed the appeal. He has also dismissed appeal on merit by observing that assessee did not file any reply during appellate proceedings, and hence the order of AO did not require any interference. We have already condoned the delay of 131 days in filing appeal before Tribunal by the assessee in para 5 of this order. The reasons given by assessee before CIT(A) was almost similar to the reasons given by the assessee before the Tribunal. Hence, following the reasons given by us at para 5 of this order, the order of CIT(A) is set aside and since orders of both AO and CIT(A) are ex parte, the matter is restored to the file of AO for fresh assessment, subject to payment of cost of Rs.10,000/- (Rupees ten thousand only) by the assessee to the credit of the ‘Income Tax Appellate 6 ITA No.907/SRT/2024/AY.2017-18 Pravinbhai Vallabhbhai Kakadiya - HUF Tribunal Bar Association, Surat Bench, Surat’ within two weeks from receipt of this order. Subject to payment of above cost, we set aside the order of CIT(A) and remit the matter back to the file of AO with a direction to pass fresh order in accordance with law after granting adequate opportunity of hearing to the assessee. The assessee is directed to be more vigilant and diligent and to furnish all the details and explanations as needed by the AO by not seeking adjournment without valid reasons. For statistical purpose, the ground is allowed. 10. Since, we have set aside the order of CIT(A), the other grounds become academic in nature and do not require adjudication. 11. In the result, appeal of the assessee is allowed for statistical purpose. Order is pronounced in the open court on 10/01/2025. Sd/- Sd/- (PAWAN SINGH) (BIJAYANANDA PRUSETH) JUDICIAL MEMBER ACCOUNTANT MEMBER Surat Ǒदनांक/ Date: 10/01/2025 SAMANTA Copy of the Order forwarded to: 1. The Assessee 2. The Respondent 3. The CIT(A) 4. CIT 5. DR/AR, ITAT, Surat 6. Guard File By Order // TRUE COPY // Assistant Registrar/Sr. PS/PS ITAT, Surat "