2023 (12) TMI 539 - AT - Income Tax

Condonation of delay in filing of appeal before CIT(A) - Assessment order passed ex-parte u/s 144 r.w.s. 147 - delay of approximately 33 months in filing the appeal before the Ld. Commissioner - Assessee mainly claimed that its director, who was mainly operating the business of the Assessee company was in fact detained by the Police in the jurisdiction of United Kingdom - HELD THAT - Considering as the Assessee s main Director/shareholder who was operating the Assessee company, in fact, was entangled in various litigations including detention in the jurisdiction of United Kingdom from March, 2018 to October, 2021 and, therefore, could not pursue the assessment proceedings, which resulted into passing the assessment order dated 27/12/2019 as ex-parte u/s 144 r.w.s. 147 of the Act. As the director, was in detention during the year 2019, 2020 2021 upto October, therefore, could not file the appeal before the Ld. Commissioner upto October, 2021. Further, after coming to India, took stock of the various proceedings and started pursuing the legal remedies and consequently on 22/12/2022 filed the appeal electronically before the Ld. Commissioner. Though there is gap of one year as the Assessee s director returned back to India in the month of October, 2021, but the appeal was filed only on 22/12/2022, therefore, the Assessee through tried to demonstrate the reasons for not filing the appeal in time before the Ld. Commissioner, however, something is lacking in the said claim of the Assessee, as the gap of one year is not convincing. If one consider the facts and circumstances in its entirety, then the claim of the Assessee seems to be genuine which requires lenient view; hence we, by considering the peculiar facts and circumstances as the assessment order dated 27/12/2019 was passed as ex-parte U/s 144 read with section 147 of the Act and thereafter from March 2020 onwards Covid-19 period was started and the Hon ble Apex Court excluded the period from March 15, 2020 to February 28, 2022 while computing the period of limitation for filing of any suit, appeal, application, or proceeding ; Ld. Commissioner decided the appeal filed by the Assessee in limine but not on merit; even otherwise no prejudice shall be caused to the Revenue Department if the case is directed to be decided on merit; substantial justice also demands that proper adjudication of the case is required to be done; hence, we are inclined to set aside the ex-parte order passed by the Ld. Commissioner and consequently, remanding the instant case to the file of the Ld. Commissioner or decision on merit, but subject to deposit of Rs. 51,000/- in the Prime Minister s National Relief Fund (PMNRF) within 30 days of receipt of this order

Summary

Issues involved:
The issues involved in the judgment are the confirmation of assessment order and imposition of penalty under section 271(1)(c) of the Income-tax Act, 1961 for the A.Y. 2012-13.

Confirmation of Assessment Order:
The Assessee appealed against the assessment order dated 27/12/2019 passed under section 144 read with section 147 of the Act. The Assessee failed to establish reasonable cause for the delay in filing the appeal before the Ld. Commissioner. The Assessee claimed that the delay was due to the detention of the main Director/shareholder in the United Kingdom from March 2018 to October 2021. The Assessee filed an appeal electronically on 22/12/2022 along with an application for condonation of delay. The Tribunal considered the peculiar facts and circumstances, including the impact of Covid-19, and set aside the ex-parte order, remanding the case to the Ld. Commissioner for decision on merit, subject to depositing Rs. 51,000/- in the Prime Minister's National Relief Fund within 30 days.

Imposition of Penalty:
The penalty was imposed based on the assessment order dated 27/12/2019, which was appealed by the Assessee. As the assessment order was set aside and remanded for fresh decision in the confirmation of assessment order issue, the penalty order was also set aside. The case was remanded to the Ld. Commissioner for reconsideration, subject to the same condition of depositing Rs. 51,000/- in the Prime Minister's National Relief Fund within 30 days. The Assessee was directed to be afforded a reasonable opportunity, with a warning that further default would not entitle them to any leniency.

Conclusion:
Both appeals filed by the Assessee were allowed in the specified terms for statistical purposes. The order was pronounced in the open court on 22/11/2023.