Sujit Arun Taware Vs ITO (ITAT Pune)
The Income Tax Appellate Tribunal (ITAT), Pune, has allowed the appeal of Sujit Arun Taware against the order dated August 13, 2024, passed by the National Faceless Appeal Centre (NFAC), Delhi, concerning the Assessment Year 2014-15. The NFAC’s order had arisen from an Assessment Order dated March 29, 2022, passed under Sections 147 read with Sections 144 and 144B of the Income-tax Act, 1961.
At the outset, the Tribunal noted that the appeal was delayed by 38 days. The assessee submitted an affidavit explaining that the delay was due to a dispute with the previous tax consultant and the subsequent change of counsel. The assessee asserted that the delay was unintentional and not due to negligence. After reviewing the affidavit and finding no contradictory evidence, the Tribunal was satisfied that there was “reasonable cause” for the delay. In the interest of justice, the delay of 38 days was condoned, and the Tribunal proceeded to adjudicate the appeal on its merits.
The brief facts of the case indicate that the assessee, an individual, had not filed an income tax return for the assessment year in question. Based on information that the assessee had deposited cash of ₹35,30,000 and purchased immovable property worth ₹2,04,00,000, the Assessing Officer (AO) believed that income had escaped assessment. Consequently, notices under Sections 148/142(1) of the Act were issued, but there was no compliance from the assessee. In these circumstances, the AO completed the assessment under Section 147 read with Section 144 of the Act, making an addition of ₹2,39,30,000 under Section 68 of the Act.
Aggrieved by this, the assessee filed an appeal before the Commissioner of Income Tax (Appeals) [CIT(A)] with a delay of approximately four months. The ld. CIT(A) dismissed the appeal in limine, without condoning the delay. The CIT(A) observed that while courts have the power to condone delays if sufficient cause is shown, the reasons submitted by the appellant were not considered bona fide, and therefore, the delay was not condoned, leading to the dismissal of the appeal.
Now, the assessee was in appeal before the Tribunal. The assessee’s counsel argued that the ld. CIT(A) had failed to provide specific reasons for not condoning the delay. On the merits of the case, the counsel referred to the paper book and submitted that the reopening of the assessment was based on information from the Sub-Registrar. The counsel clarified that the assessee was the chairman of a housing cooperative society, and the land in question was purchased by the society at a cost of ₹1.02 crore, not by the assessee in his individual capacity. The assessee’s PAN was provided as he was the chairman representing the society during the purchase. The AO allegedly conducted the proceedings without verifying the purchase deed and made the addition under Section 68, which pertains to unexplained cash credits, whereas the issue was the purchase of property. Furthermore, the AO added double the purchase amount without any plausible explanation. Therefore, the counsel requested that the issues on merit be restored to the file of the Jurisdictional Assessing Officer for fresh adjudication.
The Departmental Representative (DR) vehemently supported the orders of the lower authorities.
The Tribunal noted that the assessee had not participated in the proceedings before either the AO or the ld. CIT(A), leading to ex parte orders. Upon reviewing the impugned order of the CIT(A), the Tribunal observed that neither had the assessee provided clear reasons for the delay, nor had the ld. CIT(A) given a reasoned finding under Section 250(6) of the Act for not condoning the delay. In this context, the Tribunal referred to the judgment of the Hon’ble Supreme Court in the case of Collector Land Acquisition Vs. MST Katiji (1987) 167 ITR 471 SC, which laid down principles for dealing with delays in filing appeals. These principles emphasize that a litigant generally does not benefit from delaying an appeal, that refusing to condone delay can lead to the dismissal of meritorious cases, that the explanation for delay should be considered pragmatically, that substantial justice should be preferred over technical considerations, and that there is no presumption of deliberate delay or culpable negligence.
In light of these principles, the Tribunal opined that the delay in the instant appeal deserved to be condoned and therefore condoned the delay before the ld. CIT(A). Consequently, without delving into the merits of the case, and considering the submissions of the assessee’s counsel, the Tribunal remitted the issues on merit to the file of the Jurisdictional Assessing Officer for de novo adjudication. The assessee was directed to remain vigilant and avoid seeking unnecessary adjournments. The finding of the ld. CIT(A) was set aside, and the effective grounds of appeal raised by the assessee were allowed for statistical purposes.
In the result, the appeal of the assessee was allowed for statistical purposes.
FULL TEXT OF THE ORDER OF ITAT PUNE
