Kallu Ram Vs ITO (ITAT Raipur)
Summary: The Income Tax Appellate Tribunal, Raipur Bench, considered an appeal filed by Kallu Ram, a 94-year-old farmer earning agricultural and dairy income. The order records that the Assessing Officer reopened the assessment following bank cash deposits of Rs. 69 lakh and treated the amount as unexplained money under section 69A read with section 115BBE. The assessee challenged the adverse first appellate order before the Tribunal.
The appeal was delayed by 388 days. The assessee submitted an affidavit explaining his unfamiliarity with faceless appeals and online compliance. Considering his advanced age and finding no culpable negligence or mala fide intention, the Tribunal applied the substantial-justice principles laid down in the cited judgments and condoned the delay under section 254.
The Tribunal further found that the CIT(A) had failed to discuss the disputed issues in detail or provide adequate reasons for agreeing with the assessment order. It held that sections 250(6) and 251 require the first appellate authority to decide the issues on merits through a reasoned order, rather than dismissing an appeal for non-prosecution.
Accordingly, the Tribunal set aside the CIT(A) order and restored the appeal for fresh adjudication after providing the assessee an adequate opportunity of hearing. The Tribunal expressly refrained from deciding the merits of the cash-deposit addition and allowed the appeal for statistical purposes.
Cases Discussed
- H.L. Malhotra & Company Pvt. Ltd. Vs DCIT, Circle-12, New Delhi — Delhi High Court, ITA No. 211/2020 and CM Appeals 32045–32047/2020, 22 December 2020; condonation of non-deliberate delay.
- Collector, Land Acquisition, Anantnag & Anr. Vs Mst. Katiji and Others — (1987) 2 SCC 107; substantial justice and liberal construction of sufficient cause.
- N. Balakrishnan Vs M. Krishnamurthy — (1998) 7 SCC 123; principles of condonation of delay.
- Prem Kumar Arjun Das Luthra HUF — (2017) 291 CTR 614 (Bom.); obligation to dispose of first appeals on merits.
FULL TEXT OF THE ORDER OF ITAT RAIPUR
This appeal for Assessment Year (‘AY’) 2014-15 filed by the assessee is directed against order dated 09.06.2025 of the Commissioner of Income Tax (Appeals) [CIT(A)], National Faceless Appeal Centre (NFAC), Delhi, passed under section 250 of the Income Tax Act, 1961 (‘Act’).
2. Following grounds have been raised in this appeal:
“(1) That on the facts and in the circumstances of the case and in law, the notice u/s 143(2) of the Act dated 21/09/2018 is illegal and bad in law.
(2) That on the facts and in the circumstances of the case and in law the assessment order passed u/s 143(3) of the Act dated 28/12/2019 is illegal and bad in law.
3. That on the facts and in the circumstances of the case, the assessing officer as well as CIT(A), NFAC, Delhi erred in making/sustaining addition of Rs.48,81,500/- u/s 68 of the Income Tax Act, 1961 being sales made during demonetization period in SBNs.
4. That on the facts and in the circumstances of the case and in law, the assessing officer has made addition u/s 68 of the Act on the premise that the books of accounts are manipulated, however, failed to reject books of accounts and there is no application of section 68 in the instant case.
5. The appellant craves to add. Alter, amend OR DLEETE any of the above grounds of appeal during the course of appellate proceedings.
3. The relevant facts giving rise to this appeal are that the assessee, 94 years old, is a farmer. His incomes are from agriculture and dairy. He has never filed any Income Tax Return (‘ITR’) as his income is below the taxable limit. Based on the information that the assessee has deposited cash of Rs.69,00,000/-in his bank account during the relevant year, the Assessing Officer (‘AO’) issued notice under section 148 of the Act was on 31.03.2021. In response, the assessee filed his ITR on 21.09.2021 declaring income of Rs.4,29,210/-. The reopened assessment was completed under section 147 of the Act on 31.03.2022. The Ld. AO was not satisfied with the explanation of the assessee; therefore, he taxed the cash deposit of Rs.69,00,000/- under section 69A rws 115BBE of the Act. Aggrieved, the assesse filed appeal before the Ld. CIT(A) but did not succeed. Hence, the assessee is before us.
4. None attended on behalf of the assessee. However, an adjournment petition was filed, which was not acceded to. We heard Ld. Sr. DR, who not only objected the delay condonation of this appeal but also prayed for dismissal of the case.
5. This appeal is delayed by 388 days. The assessee has filed an application for condonation of delay along with an affidavit. As per the condonation application, the delay was not due to any negligence or lack of due diligence on the part of the assessee because the assessee was not in knowledge disposal of faceless appeal and on-line compliances. We take note of the fact that the assessee is 94 years old and not well acquainted with on-line communications. There is no dispute that under section 254 of the Act, the Tribunal may pass such order as it thinks fit. In case of HL Malhotra & Company Pvt. Ltd. Vs DCIT, Circle-12, New Delhi (ITA No. 211/2020 & CM Appeals 32045-32047/2020 dated 22nd December, 2020), the Hon’ble Delhi High Court has held that in absence of anything malafide or deliberate delay as a dilatory tactic, the Court should normally condone the delay as the intent is always to promote substantial justice following the Hon’ble Supreme Court decisions in the case of Collector, Land Acquisition, Anantnag & Anr. Vs Mst. Katiji and others (1987) 2 SCC 107 and N. Balakrishnan Vs M. Krishnamurthy 1998 (7) SCC 123.
6. The explanation of the appellant assessee therefore, becomes relevant to determine whether the same reflects sufficient and reasonable cause on his part in not presenting this appeal within the prescribed time. 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 is 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 merit 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 is 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. 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 this appeal as he does not stand to benefit by resorting to such delay. Therefore, in the factual matrix of the present case emerged from the affidavit and condonation petition, we find that there exists sufficient and reasonable cause for condoning the delay in filing this appeal.
7. In the interest of substantial justice, the delay in filing this appeal deserves to be condoned and this appeal be decided on merit. We do not see any prejudice which will be caused to the Revenue in deciding this appeal on merit. In light of aforesaid discussions, in exercise of powers under section 254 of the Act, we hereby condone the delay in filing this appeal as we are satisfied that there is sufficient cause for not presenting this appeal within the prescribed time.
8. We have heard both parties and have perused the material available on the record. We have taken note of the fact that the Ld. CIT(A) has not decided the appeal after discussing the issues in detail and his reasons for agreeing with the assessment order though he/she, as per provisions of section 250(6) of the Act, is obliged to dispose of the appeal in writing with well-reasoned order on each point of determination arisen for his consideration. It is evident from the perusal of section 251(1)(a), 251(1)(b) and Explanation of section 251(2) of the Act that the CIT(A) is required to apply his/her mind to all the issues which arise from the impugned order before him/her, whether or not the issues have been raised by the assessee before him/her. On cumulative consideration of the provisions of section 250(6) of the Act read with sections 250(4), 250(5), 251(1)(a), 251(1)(b) of the Act and Explanation of section 251(2) of the Act, it is evident that the CIT(A) is not empowered to dismiss the appeal for non-prosecution of appeal and is obliged to dispose of the appeal on merit. Reliance is placed on the decision of the Hon’ble Bombay High Court in case of Prem Kumar Arjun Das Luthra HUF, (2017) 291 CTR 614 (Bom.).
9. Considering the facts of the case, in the interest of justice, we, without offering any comment on merit of the case and in view of the above observation, find the impugned order deem fit to set aside and remand the matter back to the file of the Ld. CIT (A) for deciding the case afresh/denovo, in accordance with the law, after providing adequate opportunity of being heard to the assessee. We order accordingly. Needless to say that the appellant assessee has to cooperate in remitted appellate proceedings in this case.
10. In the result, the appeal of the assessee is allowed for statistical purposes as above.
Order pronounced in the open court on 27/10/2026.
