Smt. Srujana Padma Vs ITO (ITAT Bangalore)
Filing Rectification U/s 154 First Is Valid Reason for Delay – Bangalore ITAT Revives Appeal in Demonetisation SBN Deposit Case
The Bangalore ITAT held that pursuing a rectification application u/s 154 before filing an appeal constitutes a valid and bona fide reason for delay in filing appeal before the CIT(A). Accordingly, the Tribunal condoned a 73-day delay and restored the matter back to the CIT(A) for adjudication on merits.
The assessee’s case had been selected for limited scrutiny to examine cash deposits during the demonetisation period. The AO partly accepted the assessee’s explanation for deposits but treated ₹5 lakh received in Specified Bank Notes (SBN) from M/s Rangaswamappa and Sons towards repayment of loan as unexplained money u/s 69A on the ground that the assessee was not authorized to receive SBN after 09.11.2016.
Instead of immediately filing appeal against the assessment order, the assessee first filed an application u/s 154 seeking rectification. After rejection of the rectification application, the assessee proceeded with filing appeal before the CIT(A), resulting in a delay of 73 days. However, the CIT(A) refused to condone the delay and dismissed the appeal.
The ITAT observed that the delay occurred because the assessee was bona fide pursuing rectification proceedings and thereafter took steps to file appeal after receipt of the rejection order. The Tribunal held that this explanation constituted sufficient cause and therefore the delay deserved condonation.
Accordingly, the Tribunal condoned the delay and remitted the matter back to the CIT(A) for fresh consideration in accordance with law without raising limitation objections.
FULL TEXT OF THE ORDER OF ITAT BANGALORE
