SUMRAT SINGH,GURGAON V. ITO,WARD 4(1), GURGAON

ITA 2959/DEL/2024

AI Insights

The case involves Sumrat Singh, the appellant, who faced an assessment under section 148 of the Income Tax Act, 1961, for not filing an Income Tax Return for the Assessment Year 2018-19 despite having significant financial transactions. The Assessing Officer assessed his income based on unexplained investments and interest income, which were not contested due to the appellant's non-compliance during the assessment proceedings. The appellant's subsequent appeal to the CIT(A) was dismissed due to delay and non-prosecution, leading to the filing of this appeal. The Tribunal found procedural lapses in the handling of the appellant's case, particularly in the notification process and adherence to the principles of natural justice.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 474925 (ITAT-DELHI)
• Duration Of Justice: 4 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-10-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 24-09-2024
• Assessment Year: 2018-2019
• Appeal Filed On: 14-06-2024
• Other Referred Cases: Collector, Land Acquisition vs MST Katiji
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANINDER KAUR
• Assessee Lawyers: M.R. SAHU
• Keywords: Condonation of delay; Set aside; Opportunity of being heard; Reasonable cause; Period of limitation; Principle of natural justice
• Section: 148; 69

Judgement Text

" 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘G’: NEW DELHI BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER AND SHRI AVDHESH KUMAR MISHRA, ACCOUNTANT MEMBER ITA No.2959/Del/2024, A.Y. 2018-19 Sumrat Singh C/o. CA M R Sahu, House No. 651, 1st Floor Sector-10A, Near G. D. Goenka Public School, Gurgaon, Haryana PAN: EZEPS3667E Vs. Income Tax Officer, Ward 4(1), Gurgaon (Appellant) (Respondent) Appellant by Sh. M. R. Sahu, CA Respondent by Ms. Maninder Kaur, Sr. DR Date of Hearing 24/09/2024 Date of Pronouncement 24/10/2024 ORDER PER AVDHESH KUMAR MISHRA, AM This appeal for the Assessment Year (hereinafter, the ‘AY’) 2018-19 filed by the assessee is directed against the order dated 25.10.2023 passed by the Commissioner of Income Tax (Appeals)-National Faceless Appeal Centre [NFAC], New Delhi [hereinafter, the ‘CIT (A)’]. 2. Following grounds are raised in this appeal: - “1. That based on facts of the case, and provisions of law, it is humbly prayed before the Tribunal for condonation of delay in filling appeal around 170 days which was happened due to my old age and not being accustomed with the newly launched procedures for checking ITA No.2959/Del/2024 Sumrat Singh 2 Emails, thus it is humbly prayed that the delay may kindly be condoned and appeal may kindly be admitted for adjudication. 2. That based on facts of the case, and provisions of law, the CIT(A) erred in dismissing the appeal for not clearing the deficiency regarding delay in filling appeal pointed out by hivide notice dated 25/09/2023 which was transmitted to an unrelated EMAIL ID: [e-mail] not to the correct EMAIL ID: [e-mail] quoted in Form-35, thus the Principles of Natural Justice not followed, accordingly the assessee prays that the matter may kindly be remanded back to CIT(A) for fresh adjudication. 3. That based on facts of the case, and provisions of law, the CIT(A) erred in dismissing the appeal due to non-prosecution without appreciating the fact that sufficient opportunity of hearing was not allowed to the assessee, thus the Principles of Natural Justice not followed, accordingly the assessee prays that the matter may kindly be remanded back to CIT(A) for fresh adjudication. 4. That the assessee craves the right to amend, add, delete, replace, all or any of the grounds of appeal either during the course of hearing or at any time before hearing of this appeal.” 2.1 In nutshell, the appellant/assessee has challenged the impugned appellate order of the CIT(A) on the reasoning of violation of Principle of Natural Justice and non-adjudication of the grounds appeal on merit. 3. The brief facts of the case giving rise to this appeal are that the assessee’s case was reopened under section 148 of the Income Tax Act, 1961 (hereinafter referred to ‘the Act’) based on the information that the appellant/assessee who purchased mutual fund of Rs.20,33,561/- and received interest income of Rs.31,26,080/- from the Land Acquisition Officer, had not filed any Income Tax Return (hereinafter, the ‘ITR’) of the ITA No.2959/Del/2024 Sumrat Singh 3 relevant year. Thereafter, the Assessing Officer (hereinafter, the ‘AO’) issued various statutory notices to the appellant/assessee to explain that why the above-mentioned investment of Rs.20,33,561/- in the mutual fund and interest income of Rs.31,26,080/- should not be taxed as income. However, the appellant/assessee did not ensure any compliance during the assessment proceedings though the AO provided many opportunities of being heard as detailed on page No. 2 of the assessment order. Therefore, the AO assessed the income at Rs.51,59,641/- (the investment in mutual fund and interest income) The unexplained investment of Rs.20,33,561/- in mutual fund was taxed in accordance with the provisions of Section 69 r.w.s. 115BBE of the Act; whereas the interest income of Rs.31,36,080/- is taxed as income from other sources. Aggrieved, the appellant/assessee filed appeal after due date. There was delay of 160 days in filing the appeal before the Ld. CIT(A). The Ld. CIT(A) did not condone the delay and dismissed the appeal. The appeal was not decided on merit by the CIT(A). 4. This appeal is also delayed by 173 days. 5. At the outset, the Ld. Authorised Representative (hereinafter, the ‘AR’) prayed for condonation of delay on the reasoning that the appellant/assessee, a farmer, aged 71 years, was not well acquainted with the income tax matter and keeping in regular update of e-mail, ITBA/Income Tax system. Therefore, the delay had taken place. The Ld. ITA No.2959/Del/2024 Sumrat Singh 4 AR, placing emphasis on the decision of the Co-ordinate Bench in the case of Jitender Kumar, ITA No. 8568/Del/2023, prayed for condonation of delay as the appellant/assessee had not derived any benefit by filing the appeal after due date. For deciding the case on merit, the Ld. AR prayed for remitting the matter back to the AO on the reasoning that both the assessment and appellate orders were passed on ex-parte basis. 6. The Ld. Sr. Departmental Representative (hereinafter, the ‘Sr. DR’) with the help of facts mentioned in the assessment order and appellate order submitted that reasonable opportunities of being heard were provided to the appellant/assessee by the AO and the Ld. CIT(A) but the appellant/assessee tactfully ensured noncompliance to avoid the proper investigations. Hence, he prayed for upholding of orders of the lower authorities. 7. We have heard the rival contentions and have perused the material available on record. There is no dispute and is an admitted fact that there has been a delay in filing the present appeal by 173 days. There is also no dispute that under section 253(5) of the Act, the Tribunal may admit an appeal filed beyond the period of limitation where it is satisfied that there exists a sufficient cause on the part of the assessee for not presenting the appeal within the prescribed time. The explanation of the assessee therefore becomes relevant to determine whether the same reflects ITA No.2959/Del/2024 Sumrat Singh 5 sufficient and reasonable cause on its part in not presenting the present appeal within the prescribed time. In the instant case, the CIT(A) has passed ex-parte order. The assessee has not received any notice for hearing of the appeal as well as the order, in physical form, passed by the CIT(A). However, as soon as assessee came to know of subsequent penalty order being passed against him, he consulted his Counsel and filed the present appeal as per advice of the Counsel. 8. In case of Collector, Land Acquisition vs MST Katiji (Supra), the Hon'ble Supreme Court has held that the expression ‘Sufficient Cause’ employed by the legislature is adequately elastic to enable the Courts to apply the law in a meaningful manner to sub-serves the ends of justice that being the life-purpose of the existence of the institution of Courts. It was further held by the Hon’ble Supreme Court that such liberal approach is adopted on one of the principles that refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As against this, when delay is condoned, the highest that can happen is that a cause would be decided on merits after hearing the parties. Another principle laid down by the Hon’ble Supreme Court is 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. It ITA No.2959/Del/2024 Sumrat Singh 6 was also held by the Hon’ble Supreme Court that there is no presumption that delay is occasioned deliberately, or on account of culpable negligence, or on account of malafides. A litigant does not stand to benefit by resorting to delay. In fact, he runs a serious risk. 9. In the instant case, applying the same principles, we find that there is no culpable negligence or malafide on the part of the assessee in delayed filing of the present appeal and he does not stand to benefit by resorting to such delay more so considering the fact of the case. Therefore, in the factual matrix of the present case, we find that there exists sufficient and reasonable cause for condoning the delay in filing the present appeal and as held by the Hon’ble Supreme Court, where substantial justice and technical considerations are pitted against each other, the cause of substantial justice deserved to be preferred. 10. In light of aforesaid discussions, in exercise of powers under section 253(5) of the Act, we hereby condone the delay in filing the present appeal as we are satisfied that there was sufficient cause for not presenting the appeal within the prescribed time and the appeal is hereby admitted and is being decided accordingly. 11. The core issue raised by the appellant/assessee is that the Ld. CIT(A) has not provided any opportunity of being heard to him. The Ld. DR demonstrated that the appellate notices were sent on other e-mail viz ITA No.2959/Del/2024 Sumrat Singh 7 [e-mail] and not on; [e-mail] found duly mentioned in the Form-35. Accordingly, the Ld. AR contended that the impugned appellate order is against the principle of natural justice. 12. Without offering any comment on merit of the case and considering the facts of the case in entirety, we deem it fit to set aside the impugned order and remit the matter back to the file of the AO for de novo consideration. The appellant-assessee should ensure compliances during the set-aside proceeding before the AO. 13. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in open Court on 24th October, 2024 Sd/- Sd/- (VIKAS AWASTHY) (AVDHESH KUMAR MISHRA) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated:24/10/2024 Binita, Sr. PS Copy forwarded to: 1. Appellant 2. Respondent 3. PCIT 4. CIT(Appeals) 5. Sr. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI "