2018 (1) TMI 187 - AT - Income Tax

Condonation of delay - Held that - In the present appeal, the wilful negligence is established, therefore, the huge delay cannot be condoned, consequently, the appeal of the assessee is dismissed as not admitted.

Summary

Issues Involved:
1. Delay in filing the appeal.
2. Validity of the reasons for delay.
3. Assessment of the quantum proceedings.
4. Penalty proceedings under Section 271(1)(c) of the Income Tax Act.

Detailed Analysis:

1. Delay in Filing the Appeal:
The primary issue addressed was the delay of 609 days in filing the appeal before the Tribunal. The assessee's counsel argued that the delay was due to the earlier tax consultant not handing over the orders from the First Appellate Authority to the assessee. The Tribunal asked for evidence to support this claim, such as producing the tax consultant or an affidavit, which the assessee failed to provide.

2. Validity of the Reasons for Delay:
The Tribunal examined whether there was a bona fide reason for the delay. The assessee was actively contesting penalty proceedings, which are an offshoot of quantum proceedings, indicating awareness of the quantum proceedings' outcome. The Tribunal found no evidence that the order remained with the tax consultant without being communicated to the assessee. The Tribunal concluded that the delay was due to a conscious decision by the assessee and not due to any genuine difficulty or reason beyond the assessee's control.

3. Assessment of the Quantum Proceedings:
The assessee was engaged in trading and export of various items. A search and seizure action under Section 132(1) was carried out, followed by a survey action under Section 133A. The assessee's income declared in the return was treated as filed in response to the notice under Section 148. The assessment involved the rejection of books of accounts under Section 145(3) due to the assessee's involvement in issuing accommodation bills, leading to an addition of ?45,32,534 to the total income based on estimated consideration received for providing such accommodation entries.

4. Penalty Proceedings under Section 271(1)(c):
The penalty proceedings were initiated with the assessment order, and the assessee contested the same. The Commissioner of Income Tax (Appeal) partly allowed the appeal, estimating the income at 0.5% of the turnover. The assessee argued that there was no concealment of income and that penalties should not be levied on income estimated based on survey statements. The Tribunal noted that the assessee was aware of the quantum proceedings' outcome due to the penalty proceedings and found no valid reason for the delay in filing the appeal.

Conclusion:
The Tribunal dismissed the appeal due to the lack of bona fide reasons for the delay and the absence of evidence to support the assessee's claims. The Tribunal emphasized that the delay was a result of a conscious decision by the assessee and not due to any uncontrollable circumstances. The appeal was dismissed as not admitted.