Case Law Details
Dharmendra Sumatichandra Sheth HUF Vs DCIT (ITAT Ahmedabad)
The case of Dharmendra Sumatichandra Sheth HUF vs. DCIT concerns an appeal filed by the assessee against an order issued by the Commissioner of Income Tax (Appeals) [CIT(A)] on July 30, 2024. The CIT(A) had dismissed the appeal on grounds of delay, citing the failure to condone a 28-day delay in filing the appeal. The assessee raised several issues, including the non-receipt of the hearing notice, the lack of an opportunity to be heard, and the brief response time given in faceless assessments. Additionally, the assessee questioned the additions made by the Assessing Officer (AO) under section 68 regarding unexplained credits in the form of unsecured loans and sundry creditors, which amounted to significant sums.
The appeal was initially filed due to the addition of Rs. 2,39,68,046 on sundry creditors and Rs. 95,00,000 on loan creditors under section 68 read with 115BBE of the Income Tax Act. The CIT(A) dismissed the appeal in limine without addressing the merits of these additions, relying solely on the procedural delay. In response, the assessee sought to have the delay condoned and the merits of the case reviewed. After reviewing the matter, the ITAT acknowledged the circumstances raised by the assessee and decided in favor of giving the appellant an opportunity to present their case. The Tribunal referred the case back to the AO for de novo assessment proceedings, allowing the matter to be reconsidered from the beginning. Thus, the appeal was allowed for statistical purposes, providing the assessee another chance to address the issues raised in the assessment.
FULL TEXT OF THE ORDER OF ITAT AHMEDABAD
This appeal has been filed by the Assessee against the order passed by the Ld. Commissioner of Income-tax (Appeals), National Faceless Appeal Centre [NFAC], Delhi (hereinafter referred to as “CIT(A)” for short), dated 30.07.2024 passed under Section 250 of the Income-tax Act, 1961 [hereinafter referred to as “the Act” for short], for Assessment Year (AY) 2020-21.
2. The Assessee has taken following grounds of appeal:-
“[A] Dismissal of appeal by not condoning the delay.
1. The learned CIT(A) erred in law and on facts by deciding the appeal ex- parte especially when the appellant was not served with the hearing notice dated 24/07/2024 on email and thus, the appellant was deprived of the opportunity of being heard.
2. The learned CIT(A) erred in law and on facts in not condoning the mere delay of 28 days in filing the appeal and thereby dismissing the appeal in limine.
3. The learned CIT(A) erred in law and on facts in not condoning the delay especially when the delay was not caused in order to delay the proceedings.
4. The learned CIT(A) erred in law and on facts in not condoning the delay especially when sufficient cause had arisen which had caused meager delay of 28 days in filing the appeal.
5. The learned CIT(A) erred in law and on facts in not condoning the delay especially when the case of the appellant was meritorious but the appellant was not provided an opportunity of being heard before the A. O.
6. The learned CIT(A) erred in law and on facts in not condoning the delay especially when the case of the appellant was meritorious but the appellant was not provided an opportunity of being heard before the A. O.
7. The learned CIT(A) erred in law and on facts in not condoning the delay especially when the assessee was always provided less than seven days’ time, in violation of the SOP for faceless assessment, to respond to the show cause notice issued by the Department.
8. The learned CIT(A) erred in law and on facts by not deciding the issue of the “Addition u/s. 68 read with 115BВЕ towards unexplained credit in the form of unsecured loan Rs. 95,00,000/-“ on merits & on the grounds of appeal raised before the Ld. CIT(A) and by not setting aside the addition made by the Ld. A. O.
9. The learned CIT(A) erred in law and on facts by not deciding the issue of the “Addition u/s. 68 read with 115BBE towards unexplained credit in the form of sundry creditors of Rs. 2,39,68,046/-“ on merits & on the grounds of appeal raised before the Ld. CIT(A) and by not setting aside the addition made by the Ld. A. O.”
3. In this case, the Assessment order has been passed by the Assessment Unit, Income-Tax Department on 09.2022 determining total income of the assessee at Rs. 3,34,68,046/-, against the returned income of Rs.(-) 5,88,84,943/-, by making additions of Rs.2,39,68,046/- on account of Sundry Creditors and Rs. 95,00,000/- towards Loan Creditors u/s. 68 r.w.s. 115BBE of the Act.
4. Aggrieved, the assessee filed appeal before the CIT(A) who dismissed the appeal of the assessee in limine, on grounds of limitation, without dealing with the grounds of appeal raised by the assessee on merit.
5. Aggrieved with the order of the CIT(A), the assessee has filed an appeal before the Tribunal.
6. Before us, the AR submitted that the ld. CIT(A) has not condoned the delay of 28 days in filing of the appeal and dismissed the appeal of the assessee and also the assessee has not received the show-cause notice from the AO. The ld. AR prayed that given an opportunity due compliance will be made by the assessee before the Assessing Officer. Having gone through the record before us, we find that the prayer of the ld. AR can be considered. Hence, in the interest of justice, the matter is referred to the Assessing Officer for initiation of the assessment proceedings de novo.
7. In the result, the appeal of the assessee is allowed for statistical purposes.
The order is pronounced in the open Court on 06.12.2024
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