PULLARAO PERUGU,ONGOLE V. ITO., WARD-1, ONGOLE

ITA 1132/HYD/2024

AI Insights

The case involves appeals by Pullarao Perugu against the orders of the Commissioner of Income Tax (Appeals), which were related to the assessment year 2017-18. The primary issues arose from the non-filing of income tax returns by the assessee, leading to a reassessment under Section 147 of the Income Tax Act, 1961, due to alleged unreported income from cash deposits. Following the assessee's death, his legal heir faced procedural challenges, including a significant delay in filing appeals, which were initially dismissed by the CIT(A) without condoning the delay. The Tribunal found merit in the legal heir's circumstances, including the sudden death and subsequent mental distress of the family, leading to the condonation of the delay and remanding the case for a fresh assessment.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 785715 (ITAT-HYDERABAD)
• Duration Of Justice: 11 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-10-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB-B
• Assessment Year: 2017-2018
• Appeal Filed On: 30-10-2024
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Condonation of delay; Set aside
• Section: 147; 148; 142(1)

Judgement Text

"आयकर अपीलीय न्यायाधिकरण में, हैदराबाद ‘बी’ बेंच, हैदराबाद IN THE INCOME TAX APPELLATE TRIBUNAL Hyderabad “B” Bench, Hyderabad श्री विजय पाल राि, माननीय उपाध्यक्ष एिं श्री मंजूनाथ जी, माननीय लेखा सदस्य SHRI VIJAY PAL RAO, HON’BLE VICE PRESIDENT AND SHRI MANJUNATHA G, HON’BLE ACCOUNTANT MEMBER आयकरअपीलसं./I.T.A.Nos.1132 and 1035/Hyd/2024 (निर्धारण वर्ा/ Assessment Year: 2017-18) Pullarao Perugu, R/o. Ongole. PAN : BFHPP8937E Vs. The Income Tax Officer, Ward – 1, Ongole. (अपीलार्थी/ Appellant) (प्रत्यर्थी/ Respondent) करदाता का प्रतततितित्व/ Assessee Represented by : Shri A. Srinivas, C.A. राजस्व का प्रतततितित्व/ Department Represented by : Shri Krishna Moorthy K. Sr.A.R. सुिवाई समाप्त होिे की ततति/ Date of Conclusion of Hearing : 27.10.2025 घोर्णध की तधरीख/ Date of Pronouncement : 29.10.2025 O R D E R PER MANJUNATHA G., A.M : Theses appeals filed by the assessee are directed against the separate orders of the learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre [in short “NFAC”], Delhi, dated 28.08.2024 passed under Sections 147 r.w.s 144 of Printed from counselvise.com 2 ITA Nos.1132 and 1035/Hyd/2024 Pullarao Perugu the Act and dated 14.08.2024 passed u/s 271AAC(1), respectively, relating to the assessment year 2017-18. 2. The brief facts of the case are that, the assessee had not filed his return of income for the assessment year 2017-18. The assessment has been reopened under Section 147 of the Income Tax Act, 1961 for the reasons recorded, as per which income chargeable to tax has been escaped assessment on account of cash deposits in current account to the extent of Rs. 1,49,87,400/-. Notice under Section 148 of the Act, dated 28-03- 2021 was issued and served on the assessee. Since there was no response from the assessee, notices under Section 142(1) of the Act, dated 03-12-2021 and 02-02-2022 were issued. The assessee neither filed his return of income nor furnished relevant details in response to the notices. Therefore, notice under Section 144(1)(b) of the Income Tax Act, 1961, was issued and proposed best judgment assessment. The assessee neither responded nor furnished the relevant details. Therefore, the A.O. completed the assessment under Section 147 r.w.s. 144 of the Act, dated 29-03- 2022 and determined the income of the assessee at Rs. 1,49,87,400/-. Printed from counselvise.com 3 ITA Nos.1132 and 1035/Hyd/2024 Pullarao Perugu 3. Aggrieved by the assessment order, the legal heir of the assessee filed an appeal before the Ld. CIT(A), and the said appeal was filed on 03.08.2023. The assessee had filed a petition for condonation of delay of 461 days in filing the appeal and explained that, his father Perugu Pullarao was expired on 19.05.2021, and because of this, the entire family members were mentally disturbed and could not file the appeal in time. The Ld. CIT(A) dismissed the appeal filed by the assessee in limine without condoning the delay on the ground that the reasons given in the affidavit filed for condonation of delay do not fall under the category of “sufficient cause” within the meaning of Section 249(3) of the Act. Thus, dismissed the appeal filed by the assessee. 4. Aggrieved by the order of the Ld. CIT(A), the assessee is now in appeal before us. 5. The learned counsel for the assessee Shri K. Srinivas, C.A, referring to the death certificate dated 18-09-2021, submitted that, the assessee was expired on 19-05-2021, whereas notice under Section 148 of the Act, was issued on 28-03-2021. Since the assessee was expired, there was no representation before the Printed from counselvise.com 4 ITA Nos.1132 and 1035/Hyd/2024 Pullarao Perugu A.O. Therefore, the A.O. passed the ex parte assessment order. Before the Ld. CIT(A), the legal heir of the assessee had filed an appeal with a delay of 461 days and explained the reasons, but, the Ld. CIT(A) dismissed the appeal in limine. Therefore, the learned counsel for the assessee submitted that, the delay in filing the appeal before the Ld. CIT(A) should be condoned and the matter may be remanded to the file of the A.O. for reconsideration. 6. The learned senior A.R. for the Revenue Shri Krishna Moorthy, fairly agreed that the matter may be remitted to the file of the A.O. for reconsideration. 7. We have heard both parties, perused the material available on record, and had gone through the orders of the authorities below. Admittedly, notice under Section 148 of the Act, was issued on 28- 03-2021, and the assessee was expired on 19-05-2021. Since the assessee was expired, there was no representation before the A.O., and the A.O. has passed an ex parte assessment order in the name of the deceased person. Before the Ld. CIT(A), Shri Perugu Girish Babu, the legal heir of the assessee filed an appeal with a delay of 461 days explaining the delay due to sudden death of his Printed from counselvise.com 5 ITA Nos.1132 and 1035/Hyd/2024 Pullarao Perugu father and his ill health. The Ld. CIT(A) dismissed the appeal filed by the assessee in limine without condoning the delay. In our considered view, since the assessee was expired within a short period of issuance of notice under Section 148 of the Act, and due to the sudden death of the assessee, his family members were not aware of the proceedings before the A.O., the appeal filed by the legal heir before the Ld. CIT(A) should have been condoned, and decided the issue on merits. Since the Ld. CIT(A) rejected the appeal filed by the assessee in limine without condoning the delay, even though the reasons given in the affidavit come under the category of “sufficient cause,” in our considered view, the delay in filing of appeal before the Ld. CIT(A) should be condoned. Thus, we condone the delay of 461 days in filing the appeal before the Ld. CIT(A). 8. Having said so, we further noted that, since the assessment proceedings before the A.O. are ex parte because of the sudden death of the assessee and the legal heir did not get reasonable opportunity of hearing, and further, the Ld. CIT(A) dismissed the appeal in limine without deciding the issue on merits, in our considered view, the matter needs to be set aside to the file of the Printed from counselvise.com 6 ITA Nos.1132 and 1035/Hyd/2024 Pullarao Perugu A.O. Thus, we set aside the order of the Ld. CIT(A) and remand the issue back to the file of the A.O. for reconsideration. The A.O. is directed to reconsider the issue after providing reasonable opportunity of hearing to the legal heir of the assessee. 9. In the result, the appeal of assessee in ITA No.1132/Hyd/2024 is allowed for statistical purposes. ITA No.1035/Hyd/2024 10. The present appeal filed by the assessee relates to the penalty levied by the A.O. under Section 271AAC(1) of the Income Tax Act, 1961, on the additions made towards cash deposits into the current account under Section 69A of the Income Tax Act, 1961. Once again, the assessee has filed an appeal through his legal heir before the Ld. CIT(A) with a delay of 286 days, and the Ld. CIT(A) dismissed the appeal filed by the assessee in limine without condoning the delay. Since there was sufficient cause for the legal heir for not filing the appeal before the Ld. CIT(A) in time, in our considered view, the delay of 286 days in filing of the appeal should be condoned. Thus, we condone the delay in the appeal filed before the Ld. CIT(A). Printed from counselvise.com 7 ITA Nos.1132 and 1035/Hyd/2024 Pullarao Perugu 11. We further noted that, since the appeal filed by the assessee on the addition made towards cash deposits in the current account has been set aside to the file of the A.O. for reconsideration, in our considered view, the penalty levied by the A.O. under Section 271AAC(1) of the Act, on the very same addition cannot survive at this stage. Thus, we set aside the order of the Ld. CIT(A) and restore the issue back to the file of the A.O. for reconsideration. The A.O. is directed to reconsider the issue of penalty under Section 271AAC(1) of the Act, after considering the issue remanded to the A.O. for reconsideration. 12. In the result, the appeal of assessee in ITA No.1035/Hyd/2024 is allowed for statistical purposes. 13. To sum up, both the appeals of assessee are allowed for statistical purposes. Order pronounced in the Open Court on 29th October, 2025. Sd/- श्री विजय पाल राि (VIJAY PAL RAO) उपाध्यक्ष /VICE PRESIDENT Sd/- (मंजूिधथ जी) (MANJUNATHA G.) लेखा सदस्य/ACCOUNTANT MEMBER Hyderabad, dated 29.10.2025. TYNM/sps Printed from counselvise.com 8 ITA Nos.1132 and 1035/Hyd/2024 Pullarao Perugu आदेशकी प्रनतनलनप अग्रेनर्त/ Copy of the order forwarded to:- 1. निर्धाररती/The Assessee : Pullarao Perugu, 11-82-2, Kolukula Road, Yeeragondapalem, Prakasam District – 523327, Andhra Pradesh. 2. रधजस्व/ The Revenue : The Assistant Commissioner of Income Tax, Circle 2(2), Hyderabad. 3. The Principal Commissioner of Income Tax, Hyderabad. 4. नवभधगीयप्रनतनिनर्, आयकर अपीलीय अनर्करण, हैदरधबधद / DR, ITAT, Hyderabad 5. गधर्ाफ़धईल / Guard file आदेशधिुसधर / BY ORDER Sr. Private Secretary ITAT, Hyderabad Printed from counselvise.com "