Prathmik Krashi Saka Shakari Samiti Chatholi Vs ITO (ITAT Indore)
Summary: The assessee, Prathmik Krashi Saka Shakari Samiti Chatholi, filed an appeal before the ITAT, Indore Bench under section 253 of the Income-tax Act, 1961 against the order of the CIT(A), which had rejected its first appeal without adjudicating the substantive grounds because of a delay of 336 days. The assessment for AY 2015-16 had been completed under section 147 read with sections 144/144B, determining total income at Rs 2,07,19,602/- against a nil return and making additions of Rs 2,04,02,708/- towards unexplained and unaccounted cash deposits, Rs 9,243/- towards contract receipts and Rs 3,07,651/- towards commission/brokerage. The assessee had initially approached the CIT(A) under section 246A, but the appeal filed on 10.05.2024 was treated as delayed by 336 days and was rejected after the CIT(A) declined to condone the delay under section 249(3).
Before the Tribunal, the assessee explained that its Chartered Accountant, Mr. Priyansh Agarwal, who was in possession of the relevant paper book, password and communications, had passed away on 01.10.2022. According to the assessee, this resulted in loss of access to crucial information and documents, while notices under sections 148, 142(1) and 144 had been received on the former counsel’s email account, resulting in non-participation in the assessment proceedings. The assessee subsequently retrieved the necessary information with assistance from Mr. Agarwal’s former employees and filed the first appeal together with an affidavit seeking condonation of delay. The Revenue representative concurred that the death of the CA had created difficulties before and after the assessment order. The Tribunal observed that the assessment order was ex parte in nature under section 144 and that the matter had not been adjudicated on merits.
It further noted that the CIT(A)’s order was also not a decision on merits because the first appeal had not been admitted. Taking a holistic view of the circumstances, including the undisputed fact of the CA’s death and the subsequent retrieval of records, the Tribunal condoned the 336-day delay, set aside the impugned CIT(A) order and remanded the matter to the CIT(A) to admit the appeal and adjudicate it afresh on a de novo basis by passing a detailed and speaking order. The assessee was directed not to seek adjournments on flimsy grounds and to proactively pursue the first appeal. The appeal was accordingly allowed for statistical purposes.
FULL TEXT OF THE JUDGMENT/ORDER OF ITAT INDORE
This is an Appeal filed by the Assessee under section 253 of the Income Tax Act 1961, [ herein after referred to as the Act for the sake of brevity] before this tribunal as & by way of a second Appeal. The Assessee is aggrieved by the order bearing Number :- ITBA / NFAC / S / 250 / 2025-26 / 1083484336(1) dated 09.12.2025 passed by the Ld. CIT(A) U/S 250 of the Act, which is herein after referred to as the “Impugned Order”. The Relevant Assessment Year is 2015-16 and the corresponding previous year period is from 01.04.2014 to 31.03.2015.
2. FACTUAL MATRIX
2.1 That as and by way of an Assessment Order made u/s 147 RWS 144/144B of the Act the total Income of the Assessee was computed and assessed at Rs 2,07,19,602/-. The ROI was at Rs NIL. An Addition of Rs 2,04,02,708/- was made in respect of unexplained & unaccounted cash deposit in the bank. Yet another addition of Rs 9,243/- was made in respect of contract receipt & of Rs 3,07,651/- on account of commission/brokerage as discussed. That the aforesaid Assessment Order bears Number:- ITBA /AST/S/147/2023-24/1052678924(1) & that the same is dated 09-05-2023 which is hereinafter referred to as the “Impugned Assessment Order” for the sake of brevity. The Assessee was Non-Compliant in the Assessment Proceeding & No ROI was filed u/s 139 & 148.
2.2 That the Assessee being Aggrieved by the aforesaid “Impugned Assessment Order” prefers the first appeal u/s 246A of the Act before the Ld CIT(A) who by the “Impugned Order” has dismissed the 1st appeal of the Assessee on the grounds & the reasons stated therein. The core grounds & the reasons for the dismissal of the 1st appeal was as under:-
“6. In view of the above facts and circumstances, the reasons advanced by the assessee for delay in filing the appeal are held to be insufficient, unsubstantiated, unreasonable and hence unacceptable. The appellant has failed to demonstrate reasonable cause or exceptional circumstances to warrant condoning the delay. Therefore, the condonation of delay in filing of the appeal is denied in the interest of justice, equity, and procedural discipline.
7. Having regard to above discussion and legal position, the delay of 336 days in filing of appeal in this case is not condoned as no “sufficient cause” has been shown u/s 249(3) of the Income Tax Act, 1961 for the appellant’s failure to file the appeal within the prescribed period of limitation u/s 249(2) of the Income Tax Act, 1961 r.w.s. of Limitation Act and hence the appeal sought to be instituted belatedly is hereby rejected.”
8. In the result, as delay in filing of appeal is not condoned, the appeal is not admitted and is rejected accordingly.”
2.3 That the Assessee being aggrieved by the “Impugned Order” has preferred the Instant Appeal before this Tribunal & has raised the following grounds of Appeal in the Form No:-36 against the “Impugned Order” which are as under: –
“1. The Ld. CIT(A) was not justified in not condoning the delay without considering the facts and circumstances of the Case.
2. The ld CIT(A) was not justified in confirming the addition of Rs. 2,04,02,708/- on account of unexplained money without considering the facts and circumstances of the case.
3. The Id CIT(A) was not justified in confirming the addition of Rs. 9,243/- in respect of contract receipt without considering the facts and circumstances of the case.
4. The Id CIT(A) was not justified in confirming the addition of Rs. 3,07,651/- in respect of commission/brokerage receipt without considering the facts and circumstances of the case.
5. The Appellant craves leave to add, amend OR modify any of the grounds of appeal.”
3. Record of Hearing
3.1 The hearing in the matter took place before this Tribunal on 19-08-2026 when the Ld AR for & on behalf of the Assessee appeared before us & interalia contended that the “Impugned Order” is bad in law, illegal & not proper. It therefore deserves to be set aside.
3.2 The Ld AR contended that there was a delay of 336 days in filling the first appeal before the Ld CIT(A). In the Form No:- 35 at column 14 & 15 it was stated that there is a delay & a condonation of delay application along with affidavit is attached as an attachment. The Ld AR then took us through Para 4 of the Impugned Order & stated that delay in filling the first appeal had happened due to the circumstances beyond control. The Assessee was unaware of the existence of “Impugned Assessment Order” as their CA “Mr. Priyansh Agarwal” who was in possession of all paper book including password passed away on 01-10-2022 & this unforeseen event left the society without access to crucial information & documents required for fimely processing of first appeal & after considerable efforts & with Assistance of Mr. Agarwal former employees the Assessee could retrieve the necessary information & proceeded to file 1st appeal albeit delay. The condonation of application was support by an affidavit. The Ld CIT(A) in the Impugned Order has held that while Impugned Assessment Order is dated 09.05.2023 & same was served on 09.05.2023 & the first Appeal ought to have been filed on 08.06.2023 but same was filed on 10.05.2024 hence delay of 336 days. It is also observed that CA Priyansh Agarwal had passed away on 01.10.2022. In addition Ld CIT(A) held that Affidavit was not sufficient as it lacks material details. The Ld AR stated that after the death of CA the Impugned Assessment Order dated 09.05.2023 came to be passed in an Exparte manner as due to death of CA Priyansh Agarwal they were Non-Participative as None of Notices u/s 148,142(1),144 etc could be replied as all had come on email of the ex-counsel Priyansh Agarwal. The Ld AR argued that a sympathetic view be taken. Per Contra Ld DR for & on behalf of the Revenue stated & submitted that he concurs with the views expressed by Ld AR as death of CA leads to several difficulties before & after “Impugned Assessment Order” & “Impugned Order” are passed to an assessee . The hearing was over & concluded.
4 Observations, Finding and Conclusions
4.1 We have to decide the legality, validity and proprietary of the “Impugned Order” basis records of the case & the rival submission canvassed before us.
4.2 We have carefully perused the records of the case and have heard the submissions.
4.3 We basis records of the case and after hearing and further upon examining the rival contentions of the Ld AR and the Ld DR canvassed before us are of the considered opinion that in the Impugned Order delay of 336 days has not been considered & condoned by the Ld CIT(A) & that the first Appeal was not admitted & was rejected accordingly. We find that “Impugned Assessment Order” is Exparte in nature u/s 144 of the Act & that the matter has not been Adjudicated & Adjudged basis merits. Even the “Impugned Order” strictly speaking is not on merits. While it is true that CA of the Assessee had died on 01.10.2022 the available records were collected & collated after his death. With the help of his ex-employee this fact is not in Dispute & Ld DR had concurred with this view of LD AR during the hearing. Under these facts & circumstances & further by taking a holistic view this Tribunal condones the delay before Ld CIT(A) & set aside the Impugned Order as & by way of remand back to the file of Ld CIT(A) with a direction to admit the appeal & adjudicate the matter afresh on Denovo basis, by passing a detailed & speaking order. The Assessee is simultaneously directed not to take any adjournment on any flimsy ground & to proactively pursue the first appeal on priority basis. Assessee cannot go in slumber mode.
4.4 In view of the above, we set aside the “Impugned Order” & remand the case back to file of the Ld CIT(A) on denovo basis, who shall now pass a speaking & well-reasoned order.
5. Order
5.1 In result the Impugned Order is set aside as and by way of remand back to the file of the Ld CIT(A) on denovo basis with directions as aforesaid.
5.2 In result, appeal are allowed for statistical purpose.
Pronounced in open court on 09.09.2026.
