SHAILENDRA KUMAR SINGH ,HARDOI V. ITO-3(2),HARDOI-1, HARDOI

ITA 795/LKW/2024

AI Insights

The case involves multiple appeals by the appellant, Shailendra Kumar Singh, against the orders of the Commissioner of Income Tax (Appeals) and the Assessing Officer, which included substantial additions to the appellant's income and penalties under various sections of the Income Tax Act. The appeals were consolidated due to their related issues concerning the assessment year 2021-22. The primary contention was the incorrect denial of condonation of delay by the CIT(A), which prevented the substantive evaluation of the appeals. The appellant argued that the additions made to his income were based on erroneous facts, such as the misattribution of a bank account and incorrect valuations of property and agricultural income. The Tribunal found merit in the appellant's arguments, particularly noting the lack of reasonable opportunity provided to the appellant by the Assessing Officer and the CIT(A).

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 471458 (ITAT-LUCKNOW)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-02-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2021-2022
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: REVENUE DID NOT EXPRESS ANY; ASSESSEE; SANJEEV KRISHNA SHARMA
• Keywords: Condonation of delay; Set aside
• Section: 144

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH “A”, LUCKNOW BEFORE SHRI KUL BHARAT, VICE PRESIDENT AND SHRI ANADEE NATH MISSHRA, ACCOUNTANT MEMBER IT(SS) A. Nos. 795 to 798/LKW/2024 Assessment Year: 2021-22 Shailendra Kumar Singh Subhan Khera Sandila, Hardoi- 241305. v. ITO-3(2) Hardoi-1 Uttar Pradesh-241305. PAN:CVQPS4275L (Appellant) (Respondent) Appellants by: Shri Naeem Khan, CA Respondent by: Shri Sanjeev Krishna Sharma, Addl. CIT(DR) O R D E R PER BENCH.: (A) Appeal vide ITA. No.795/LKW/2024 has been passed against the impugned appellate order dated 26.09.2024 of the Ld. Commissioner of Income Tax (Appeals) [“CIT(A)” for short] (DIN & Order No. ITBA/NFAC/S/250/2024-25/1069129639(1). Appeal vide ITA. No.796/LKW/2024 has been passed against the impugned appellate order dated 27.09.2024 of the Ld. Commissioner of Income Tax (Appeals) [“CIT(A)” for short] (DIN & Order No. ITBA/NFAC/S/250/2024-25/1069166658(1). Appeal vide ITA. No.797/LKW/2024 has been passed against the impugned appellate order dated 27.09.2024 of the Ld. Commissioner of Income Tax (Appeals) [“CIT(A)” for short] (DIN & Order No. ITBA/NFAC/S/250/2024-25/1069166297(1). Appeal vide ITA. No.798/LKW/2024 has been passed against the impugned appellate order dated 27.09.2024 of the Ld. Commissioner of Income Tax (Appeals) [“CIT(A)” for short] (DIN & ITA Nos. 795 to 798/LKW/2024 Page 2 of 9 Order No. ITBA/NFAC/S/250/2024-25/1069166539(1). For the sake of brevity and convenience, all the appeals are disposed of through this consolidated order. The grounds of appeal are as under: - ITA. No. 795/LKW/2024 (AY. 2021-22) 1. In consideration of the facts and Circumstances surrounding this case, along with the applicable legal principles, the order issued by the Learned CIT(A) in Lucknow incorrectly denied the request for condonation of delay. The Learned CIT(A) had the opportunity to thoroughly review the complete written submissions, particularly noting that the appellant does not has that bank account, which was initially cited as the basis for the addition. Additionally, there are other additions that have sufficient justification, as alleged by the Assessing Officer in the recorded reasons for the case. It would have been prudent for the Learned CIT(A) to acknowledge the significant injustice experienced by the appellant and to grant the condonation of delay. This would have permitted the appeal to be evaluated based on its substantive merits. 2. The Total Income reported amounts to Rs. 3,84,520.00. However, the assessment was conducted at a substantially inflated figure of Rs. 1,11,14,956.00. This discrepancy arises from specific additions and disallowances made by the Income Tax Department, based on a best judgment assessment, which is not true, a) An addition of Rs 28 07,400/was made in respect of cash deposit . Actual Facts: The cash transaction referenced above is associated with Bank Account Number 10540400000959 at the Bank of Baroda, Sandila Branch, located in Hardoi, Uttar Pradesh. It is important note that this account does not belong to the Appellant. Rather, it is the account of Sankosh Kumar Mahavidyalaya Samiti, which holds the PAN AAEAS2255E. We have included a bank letter that verifies these details. Consequently, we request the removal of the aforementioned addition. b) An addition of Rs 70,20,000/was made concerning the purchase of property. Actual Facts: The aforementioned property was acquired on October 17, 2020, for a total purchase price of Rs 65,00,000.00. The associated-stamp duly amounted of Rs 4,55,000.00, along with various court charges and additional fees in accordance with the regulations set forth by the state government. The financing for this acquisition Was secured through a loan from Bank of India for the amount of Rs 30,00,000.00, proceeds from the sale of 4 agricultural land totaling Rs 34,46,000.00, and an injection of personal capital for the remaining amount, Documentation pertaining to the loan, as well as the sale deed of agricultural land, has been attached along with bank statement for your review and reference, c) Disallowance of Rs 1,07,528/was made on account of disallowance of loss. Actual Facts: For the Assessment Year 2021-22, the appellant has submitted a return of income, wherein a loss of Rs. 1,07,528 has been claimed under the category of ‘Income from House Property’. In support of this assertion, an Interest Certificate has been included. ITA Nos. 795 to 798/LKW/2024 Page 3 of 9 d) Disallowance of Rs 30,614/was made on account of disallowance of deduction under chapter VI-A Actual Facts: The claim referenced above is valid, and supporting documentation has been included for your reference. e) An addition of Rs 7,54,892/was made with respect to agricultural income. Actual Facts: The appellant owns 18 bighas of agricultural land utilized for farming purposes. The aforementioned proceeds are directly associated with this land. Attached to this correspondence are bank transactions organized chronologically, along with cash receipts that serve as supporting documentation to validate our claim.” ITA. No. 796/LKW/2024 (AY. 2021-22) 1. In consideration of the facts and circumstances surrounding this case, along with the applicable legal principles, the order issued by the Learned CIT(A) in Lucknow incorrectly denied the request for condonation of delay. The Learned CIT(A) had the opportunity to thoroughly review the complete written submissions, particularly noting the appellant doesn’t has that bank account, which was initially cited as the basis for the Rs addition. Additionally, there are other additions that have sufficient justification, as alleged by the Assessing Officer in the recorded reasons for the case. It would have been prudent for the Learned CIT(A) to acknowledge the significant injustice experienced by the appellant and to grant the condonation of delay. This would have permitted the appeal to be evaluated based on its substantive merits. 2. The Total Income reported amounts to Rs. 3,84,520.00. However, the assessment was conducted at a substantially inflated figure of Rs. 1,11,14,956.00. along with penalty u/s 270A This discrepancy arises from specific additions and disallowances along with levy of penalty made by the Income Tax Department, based on a best judgment assessment, which is not true. a) An addition of Rs 28,07,400/was made in respect of cash deposit . Actual Facts: The cash transaction referenced above is associated with Bank Account Number 10540400000959 at the Bank of Baroda, Sandila Branch, located in Hardoi, Uttar Pradesh. It is important to note that this account does not belong to the Appellant; rather, it is the account of Sankosh Kumar Mahavidyalaya Samiti, which holds the PAN AAEAS225SE. We have included a bank letter that verifies these details. Consequently, we request the removal of the aforementioned addition. b) An addition of Rs 70,20,000/- was made concerning the purchase of property. Actual Facts: The aforementioned property was acquired on October 17, 2020, for a total purchase price of Rs 65,00,000.00. The associated stump duly amounted to Rs 4,55,000.00, along with various court charges end additional fees in accordance with the regulations set forth by the state government. The financing for this acquisition was secured through a loan from Bank of India for the amount of Rs 30,00,000.00, proceeds from the gale of 4 agricultural land totaling Rs 34,46,000.00, and an injection of personal capital for the remaining amount. Documentation pertaining to the loan, as well as the sale deed of agricultural land, has been attached along with bank statement for your review and reference. c) Disallowance of Rs 1,07,528/was made on account of disallowance of loss. Actual Facts: For the Assessment Year 2021-22, the appellant has submitted a return of income, whereas a loss of Rs, 1,07,528 has been ITA Nos. 795 to 798/LKW/2024 Page 4 of 9 claimed under the category of \"Income from House Property’. In support of this assertion, am Interest Certificate has been included. d) Disallowance of Rs 30,614/was made on account of disallowance of deduction under chapter V1-A Actual Facts: The claim referenced above is valid, and supporting documentation has been included for your reference, e) An addition of Rs 7,54,892/was made with respect agricultural income. Actual Facts: The appellant owns 18 bighas, of agricultural land utilized for farming purposes. The aforementioned proceedings are directly associated with this land, Attached to this correspondence are bank transactions organized chronologically, along with cash receipts that serve a supporting documentation to validate our claim.” ITA. No. 797/LKW/2024 (AY. 2021-22) 1. In consideration of the facts and circumstances surrounding this case, along with the applicable legal principles, the order issued by the Learned CIT(A) in Lucknow incorrectly denied the request for condonation of delay. The Learned CIT(A) had the opportunity to thoroughly review the complete written submissions, particularly noting that the appellant doesn’t has that bank account, which was initially cited as the basis for the Rs addition. Additionally, there are other additions that have sufficient justification, as alleged by the Assessing Officer in the recorded reasons for the case. It would have been prudent for the Learned CIT(A) to acknowledge the significant injustice experienced by the appellant and grant the condonation of delay. This would have permitted the appeal to be evaluated based on its substantive merits. 2. The Total Income reported amounts to Rs. 3,84,520.00. However, the assessment was conducted at a substantially inflated figure of Rs. 1,11,14,956.00. along with penalty u/s 272A(1)(d) This discrepancy arises from specific additions and disallowances along with levy of penalty made by the Income Tax Department, based on a best judgment assessment, which is not true. a) An addition of Rs 28,07,400/was made in respect of cash deposit . Actual Facts: The cash transaction referenced above is associated with Bank Account Number 10540400000959 at the Bank of Baroda, Sandila Branch, located in Hardoi, Uttar Pradesh. [t is important to note that this account does not belong to the Appellant; rather, it is the account of Sankosh Kumar Mahavidyalaya Samiti, which holds the PAN AAEAS2255E. We have included a bank letter that verifies these details. Consequently, we request the removal of the aforementioned addition. b) An addition of Rs 70,20,000/- was made concerning the purchase of property. Actual Facts: The aforementioned property was acquired on October 17, 2020, for a total purchase price of Rs 65,00,000.00. The associated stamp duty amounted to Rs 4,55,000.00, along with various court charges and additional fees in accordance with the regulations set fourth by the state government, The financing for this acquisition was secured through a loan from Bank of Indi for the amount of Rs 30,00,000.00, proceeds from the sale of 4 agricultural land totaling Rs 34,46,000.00, and an injection of personal capital for the remaining amount. Documentation pertaining to the loan, as well as the sale deed of agricultural land, has been attached along with bank statement for your review and reference. ITA Nos. 795 to 798/LKW/2024 Page 5 of 9 c) Disallowance of Rs 1,07,528/- was made on account of disallowance of loss. Actual Facts: For the Assessment Year 2021-22, the appellant has submitted a return of income, whereas a loss of Rs. 1,07,528 has been claimed under the category of ‘Income from House Property’. In support of this assertion, an Interest Certificate has been included. d) Disallowance of Rs 30,614/was made on account of 5 disallowance of deduction under chapter V1-A Actual Fact The claim referenced above is valid, and supporting documentation has been included for your reference. e) An addition of Rs 7,54,892/- was made with respect le agricultural income, Actual Facts: The appellant was 8 bighas of agricultural land utilized for farming purposes. The aforementioned proceeds are directly associated with this tang, Attached to this correspondence are bank transactions Organized chronologically, along with cash receipts that serve as supporting documentation to validate our claim. ITA. No. 797/LKW/2024 (AY. 2021-22) 1. In consideration of the facts and circumstances Surrounding this case, along with the applicable legal principles, the order issued by the Learned CIT(A) in Lucknow incorrectly denied the request for condonation of delay, The Learned CIT(A) had the opportunity to thoroughly review the complete written submissions, particularly noting that the appellant doesn’t has that bank account, which was initially cited on the basis for the addition. Additionally, there are other additions that have sufficient justification, as alleged by the Assessing Officer in the recorded reasons for the case. It would have been prudent for the Learned CIT(A) to acknowledge the significant injustice experienced by the appellant and to grant the condonation of delay. This would have permitted the appeal to be evaluated based on its substantive merits. 2. The Total Income reported amounts to Rs. 3,84,520.00. However, the assessment was conducted at a substantially inflated figure of Rs. 1,11,14,956.00, along with penalty u/s 271AAC(1) This discrepancy arises from specific additions and disallowances along with levy of penalty made by the Income Tax Department, based on a best judgment assessment, which is not true. a) An addition of Rs 28,07,400/was made in respect of cash deposit . Actual Facts: The cash transaction referenced above is associated with Bank Account Number 10540400000959 at the Bank of Baroda, Sandila Branch, located in Hardoi, Uttar Pradesh. It is important to note that this account does not belong to the Appellant; rather, it is the account of Sankosh Kumar Mahavidyalaya Samiti, which holds the PAN AAEAS2255E. We have included a bank letter that verifies these details. Consequently, we request the removal of the aforementioned addition. 3) An addition of Rs 70,20,000/was made concerning the purchase of property. Actual Facts: The aforementioned property was acquired on October 17, 2020, for a total purchase price of Rs 65,00,000.00. The associated stamp duty amounted to Rs 4,55,000.00, along with various court charges and additional fees in accordance with the regulations set forth by the state government. The financing for this & acquisitions was secured through a loan from Bank of India for the amount of Rs 30,00,000.00, proceeds from the sale of 4 agricultural land totaling Rs 34,46,000.00, and an injection of personal capital for the remaining amount. Documentation Pertaining to the loan, as well as the sale deed of ITA Nos. 795 to 798/LKW/2024 Page 6 of 9 agricultural land, has been attached along with bank statement for your review and reference. c) Disallowance of Rs 1,07,528/was made on account of disallowance of loss. Actual Facts: For the Assessment Year 2021-22, the appellant has submitted a return of income, whereas a loss of Rs. 1,07,528 has been claimed under the category of ‘Income from House Property’. In support of this assertion, a Interest Certificate has been included. d) Disallowance of Rs 30,614/was made on account of disallowance of deduction under chapter V1-A Actual Facts: The claim referenced above is valid, and supporting documentation has been included for your reference. c) An addition of Rs 7,54,892/was made with respect to agricultural income, Actual Facts: The appellant owns 18 bighas of agricultural land utilized for farming purposes. The aforementioned proceeds are directly associated with this land Attached to this correspondence are bank transactions organized chronologically, along with cash receipts that serve as supporting documentation to validate our claim.” (A.1) Appeal vide ITA. No.795/LKW/2024, pertains to assessment order dated 19.12.2022 passed by Assessing Officer under section 144 read with section 144B of Income Tax Appellate Tribunal, 1961 (“Act”, for short) whereby assessee’s income was determined at Rs.1,11,04,954/- as against the returned income of Rs.3,84,520/-. The assessee’s appeal against this was dismissed by the Ld. CIT(A) vide aforesaid impugned appellate order dated26.09.2024. Appeal vide ITA. No.796/LKW/2024, pertains to penalty levied by Assessing Officer under section 270A of the Act, amounting to Rs.92,084/-. The assessee’s appeal against this was dismissed by the Ld. CIT(A) vide aforesaid impugned appellate order dated 27.09.2024. Appeal vide ITA. No.797/LKW/2024, pertains to penalty levied by Assessing Officer under section 272A(1)(d) of the Act, amounting to Rs.40,000/-. The assessee’s appeal against this was dismissed by Ld. CIT(A) vide aforesaid impugned appellate order dated 27.09.2024. The appeal vide ITA. No.798/LKW/2024, pertains to penalty levied by Assessing Officer under section 271AAC(1) of the Act, amounting to Rs.6,34,937/-. The assessee’s appeal against this was dismissed by Ld. CIT(A) ITA Nos. 795 to 798/LKW/2024 Page 7 of 9 vide aforesaid impugned appellate order dated 27.09.2024. All the aforesaid four orders by Assessing Officer were passed exparte qua the appellant assessee. Further, all the aforesaid impugned appellate orders were also passed by Ld. CIT(A) exparte qua the appellant assessee. The Ld. CIT(A) dismissed the assessee’s appeal in limine, on grounds of limitation, by refusing to condone the delay in filing of the appeal in the office of the Ld. CIT(A). At the time of hearing before us, the Ld. Authorized Representative (“AR”, for short) for the Assessee submitted that the delay in filing of the appeal in the office of the Ld. CIT(A) beyond the time limit prescribed under section 249(2) of the Act was because of ‘Medical Reasons’. He, further, submitted that the Ld. CIT(A) rejected the assessee’s request for condonation of delay under section 249(3) of the Act despite the fact that the assessee was prevented by ‘sufficient cause’ due to compelling ‘Medical Reasons’, from filing of the appeal within the time limit prescribed under section 249(2) of the Act. He further submitted that the Assessing Officer passed the aforesaid orders without providing reasonable opportunity to the assessee. He also submitted that all the issues in dispute in the present four appeals may be restored back to the file of the Assessing Officer with the direction to pass afresh assessment orders in accordance with law, after providing reasonable opportunity to the assessee. He also gave firm assurance, at the time of hearing, in his oral submissions that the assessee will fully co-operate with the concerned authorities in expeditious completion of proceedings. The Ld. Sr. Departmental Representative (“DR”, for short) for Revenue did not express any objection to the submissions made by Ld. AR for Assessee. ITA Nos. 795 to 798/LKW/2024 Page 8 of 9 (B) We have heard both sides. We find on perusal of the records and after hearing both sides that the assessee was prevented by ‘sufficient cause’, due to compelling ‘Medical Reasons’, from filing the appeals in the office of the Ld. CIT(A) within the time limit under section 249(2) of the Act. We also find that the Assessing Officer passed the orders without extending reasonable opportunity to the appellant assessee. In view of the foregoing, and as representatives of both sides are in agreement with this; we set aside the aforesaid impugned appellate orders of the Ld. CIT(A), and we restore all the issues in dispute in these four appeals before us to the file of the Assessing Officer with the direction to pass denovo orders in accordance with law, after providing reasonable opportunity to the assessee. All the grounds of appeal in these four appeals before us are treated as disposed off in accordance with the aforesaid direction. (C) In the result, these appeals of the assessee are partly allowed for statistical purposes. Order pronounced in the open Court on 24/02/2025. Sd/- Sd/- [KUL BHARAT] [ANADEE NATH MISSHRA] VICE PRESIDENT ACCOUNTANT MEMBER DATED: 24/02/2025 Vijay Pal Singh, (Sr. PS) ITA Nos. 795 to 798/LKW/2024 Page 9 of 9 Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. DR 5. Guard File By order // True Copy// Assistant Registrar "