THREE SEASONS EXIM LIMITED,KAKINADA V. INCOME TAX OFFICER, WARD-1, KAKINADA

ITA 94/VIZ/2025

AI Insights

The case involves Three Seasons Exim Ltd, which appealed against the order of the learned CIT (A) concerning the assessment year 2018-19. The appeal was initially delayed due to communication issues with their CA, who failed to respond adequately to notices and the impugned order from the CIT (A). The Tribunal found that the assessee was not aware of the CIT (A)'s order until a later date when they checked the IT Portal for another associated concern's case. The Tribunal accepted the reasons for the delay and remanded the case back to the CIT (A) for a fresh hearing, allowing the assessee to present their case with the relevant records and evidence.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 711936 (ITAT-VISAKHAPATNAM)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-07-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Assessment Year: 2018-2019
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: G.V.N.HARI; P. SANTOSH KUMAR; HENCE; HE
• Keywords: Condonation of delay; Set aside; Reasonable cause; Corroborative evidences; Bogus Share capital
• Section: 68

Judgement Text

" ITA No 94 of 2025 Three Seasons Exim Ltd Page 1 of 8 आयकर अपीलȣय अͬधकरण, ͪवशाखापटणम पीठ IN THE INCOME TAX APPELLATE TRIBUNAL Visakhapatnam “Division” Bench, Visakhapatnam Before Shri Vijay Pal Rao, Vice-President A N D Shri S. Balakrishnan, Accountant Member आ.अपी.सं /ITA No.94/Viz/2025 (िनधाŊरण वषŊ/Assessment Year: 2028-19 ) Three Season Exim Ltd KAKINADA PAN:AAFCT1751M Vs. Income Tax Officer Ward-1 KAKINADA (Appellant) (Respondent) िनधाŊįरती Ȫारा/Assessee by: Shri G.V.N. Hari, Advocate राज̾ व Ȫारा/Revenue by:: Dr. Satyasai Rath, CIT(DR) सुनवाई की तारीख/Date of hearing: 17/07/2025 घोषणा की तारीख/Pronouncement: 25/07/2025 आदेश/ORDER Per Vijay Pal Rao, Vice President This appeal filed by the assessee is directed against the order dated 29/02/2024 of the learned CIT (A)-NFAC Delhi, relating to A.Y.2018-19. 2. There is a delay of 291 days in filing the present appeal before this Tribunal. The assessee has filed a petition for condonation of delay which is also supported by an affidavit duly signed by the Director of the assessee company. The learned AR of Printed from counselvise.com ITA No 94 of 2025 Three Seasons Exim Ltd Page 2 of 8 the assessee has submitted that the assessee filed the appeal before the learned CIT (A) through one Shri P. Santosh Kumar, CA who happens to be the statutory auditor and Tax Consultant of the assessee company. In Form-35, the email ID of Shri P. Santosh Kumar, CA was given and therefore, all the communications including notice as well as the impugned order were sent by the learned CIT (A) to the email ID of Shri P. Santosh Kumar, CA which were not properly responded by the CA as it appears that in response to the notices, only Form-35 was enclosed. The learned AR of the assessee has further submitted that in the case of an associated concern M/s. Three Seasons Warehousing, the appeal filed by the assessee was dismissed by the learned CIT (A) vide order dated 26/09/2023. Thereafter, the said associated concern engaged Shri GVN Hari, CA for filing the appeal before the Tribunal at Visakhapatnam Bench. During the discussion with Shri GVN Hari, the Director of the assessee company mentioned the appeal of the assessee pending before the learned CIT (A) and also requested him to represent the assessee in the said appeal. The learned AR has further submitted that since Shri P. Santosh Kumar, CA stopped tracking the appeal proceedings, it was not in the knowledge of assessee about the impugned order dated 29/02/2024 passed by the learned CIT (A) and only when Shri GVN Hari, CA verified from the Income Tax Portal while taking a print out of the assessment order from the IT Portal, it was found that the impugned order was already passed on 29/02/2024. Thus, prior to 27/01/2025, the assessee did not Printed from counselvise.com ITA No 94 of 2025 Three Seasons Exim Ltd Page 3 of 8 have any knowledge or service of the impugned order and consequently, there is a delay of 291 days in filing the present appeal. Thus, the learned AR has submitted that the delay in filing the appeal is neither intentional nor deliberate but due to the reasons that the notices as well as the impugned order of the learned CIT (A) were communicated to the email ID of Shri P. Santosh Kumar, CA which were not communicated to the assessee. The learned AR has pointed out that due to multiple cases of the associated concerns, there was some confusion which led to the non-participation/tracking of the appeal proceedings in the case of the assessee by Shri P. Santosh Kumar, CA. Hence, he has pleaded that the delay in filing the appeal may be condoned and the appeal of the assessee be admitted for adjudication on merits. 3. On the other hand, the learned DR has opposed the condonation of delay and submitted that the delay of 291 days is an inordinate delay in filing the appeal and the assessee has failed to explain any reasonable cause for the delay. 4. We have considered the rival contentions as well as the relevant material available on record. The appeal before the learned CIT (A) was filed through Shri P. Santhosh Kumar, CA and in Form-35, the email ID of Shri P Santosh Kumar, CA was given. Thus, it is apparent that the notices issued by the learned CIT (A) as well as the impugned order were sent to the Email ID of Printed from counselvise.com ITA No 94 of 2025 Three Seasons Exim Ltd Page 4 of 8 Shri P. Santosh Kumar, CA who initially responded to the notices, but thereafter, no compliance were made to the notices issued by the learned CIT (A). This fact is also evident from the ex-parte order passed by the learned CIT (A). The assessee has explained that the appeal of the assessee as well as of the associated concerns were pending before the learned CIT (A) and due to the other appeals of the associated concerns, there might be some confusion in compliance with the notices issued by the learned CIT (A) and sent to the email ID of Shri P. Santosh Kumar, CA. Thus, it is clear that the assessee was not aware about the impugned order passed by the learned CIT (A), until when the present AR of the assessee logged into the Income Tax Portal for taking a print out of the assessment order and noticed that the impugned order was already passed by the learned CIT (A) on 29/02/2024. The assessee has given the reasons that only on 27/01/2025 when the appeal of the associated concern “Three Season Warehousing” was listed for hearing before the ITAT Vizag Bench, the assessment order of the assessee company was required to be filed and for that purpose, the AR of the assessee logged into the I.T Portal and found the impugned order passed by the learned CIT (A). Thus, the reasons explained by the assessee are based on the factual events and due to the non-participation of Shri P. Santosh Kumar, CA and consequential order passed by the learned CIT (A) sent to the email ID of the CA was not brought to the knowledge of the assessee has resulted the delay of 291 days in filing the present appeal. Accordingly, in the facts and Printed from counselvise.com ITA No 94 of 2025 Three Seasons Exim Ltd Page 5 of 8 circumstances of the case, we are satisfied that the assessee has explained a sufficient cause for the delay of 291 days in filing the present appeal, hence, the same is condoned. 5. The assessee has raised the following grounds of appeal: “1. The order of the learned CIT (A) is contrary to the facts and also the law applicable to the facts of the case. 2. The learned CIT (A) is not justified in deciding the appeal ex-parte without granting sufficient opportunity to the appellant. 3. The learned CIT (A) is not justified in sustaining the addition of Rs.20,46,500/- made by the Assessing Officer u/s 68 of the Act towards alleged unexplained share capital. 4. The learned CIT (A) is not justified in sustaining the addition of Rs.1,69,71,940 made by the Assessing Officer u/s 68 of the Act towards alleged unexplained unsecured loan. 5. Any other ground that may be urged at the time of appeal hearing”. 6. The learned AR of the assessee has submitted that due to improper representation before the learned CIT (A), the impugned order was passed ex-parte. He has reiterated the reasons for non-representation before the learned CIT (A) as explained for the delay in filing the present appeal and therefore, the learned AR has submitted that when the assessee was not aware about the notices issued by the learned CIT (A) which were sent to the email ID of Shri P. Santosh Kumar, CA who initially responded to the first notice but thereafter, stopped responding to Printed from counselvise.com ITA No 94 of 2025 Three Seasons Exim Ltd Page 6 of 8 the notices of the learned CIT (A) as well as bringing the status of the appeal proceedings to the notice of the assessee. Thus, the learned AR has pleaded that the assessee may be given one more opportunity to explain its case before the learned CIT (A). He has referred to the relevant documents filed as contained in the Paper Book running into 111 pages and submitted that the assessee has produced all the relevant record to show that the source of the share capital introduced by the persons. However, since there was no representation before the learned CIT (A), therefore, the relevant record could not be considered by the learned CIT (A) at the time of passing the impugned order. 7. On the other hand, the learned DR has submitted that despite sufficient opportunities given by the learned CIT (A), the assessee failed to produce the supporting evidence. He has relied upon the impugned order of the learned CIT (A). 8. We have considered the rival submissions as well as perused the relevant material available on record. The Assessing Officer has made an addition u/s 68 of the I.T. Act in respect of the share capital introduced which was challenged by the assessee before the learned CIT (A). The assessee filed the confirmation from the loan creditors and ledger a/c in the books of the assessee along with the bank a/c statement of the assessee showing the receipt of the amount from the subscribers to the share capital of the assessee. However, the learned CIT (A) has Printed from counselvise.com ITA No 94 of 2025 Three Seasons Exim Ltd Page 7 of 8 dismissed the appeal of the assessee for want of further submission as well as the details/evidence to substantiate the claim of the assessee. The learned CIT (A) has stated in the impugned order that there is an inadequate compliance on behalf of the assessee. The assessee has now explained the reasons for the inadequate compliance. Therefore, in the facts and circumstances of the case, when the assessee has filed the relevant record to explain the source of the share capital subscribed to by the parties as well as the genuineness of the transaction which requires to be verified. Accordingly, the impugned ex-parte order of the learned CIT (A) is set aside, and the matter is remanded to the record of the learned CIT (A) for fresh adjudication for considering the relevant details, record and evidences filed by the assessee after affording an appropriate opportunity of hearing to the assessee. We order accordingly. 9. In the result, appeal filed by the assessee is allowed for statistical purposes. Order pronounced in the Open Court on 25th July, 2025. Sd/- Sd/- (S. BALAKRISHNAN) ACCOUNTANT MEMBER (VIJAY PAL RAO) VICE-PRESIDENT Hyderabad, dated 25th July, 2025 Vinodan/sps Printed from counselvise.com ITA No 94 of 2025 Three Seasons Exim Ltd Page 8 of 8 Copy to: S.No Addresses 1 Three Seasons Exim Ltd, D.No.2-62-8, Peddireddi Vari Veedhi, Santhi Nagar, Kakinada-533004 A.P 2 Income Tax Officer Ward -1 Income Tax Office, Deepthi Towers, Main Road, Kakinada A.P 3 Pr. CIT - Vizag 4 DR, ITAT Visakhapatnam Bench 5 Guard File By Order Printed from counselvise.com "