2024 (5) TMI 146 - AT - Income Tax

Condonation of delay in filling appeal before CIT(A) - CIT(A) dismissing the appeal of the assessee in-limine - non condoning the delay in filing the appeal - AO has served all the notices to the old address of the assessee - HELD THAT - It is stated that the assessee came to know of the assessment order only when he came to know about the lien marked in his bank account. Thereafter the assessee could file before CIT(A) even though the covid pandemic was continuing. In view of the above explanations given by the assessee we are of the view that there was reasonable cause for the assessee in filing the appeal belatedly before CIT(A). Accordingly we are of the view that the Ld CIT(A) was not justified in not condoning the delay. Considering the explanations given by the assessee we condone the delay in filing the appeal before Ld CIT(A). Assessment of property purchased - percentage of assessee share - Since the ld CIT(A) has not adjudicated the appeal of the assessee on merits normally all the issues need to be restored to his file for adjudicating them on merits. However it is submitted that the share of the assessee in the property purchased was only 20% while the entire value of property has been assessed in his hands by the AO. Further it is the submission of the assessee that he has paid only a sum of Rs. 40.00 lakhs during the year under consideration. Thus we notice the facts relating the addition also require detailed examination. Hence we find merit in the prayer of Ld A.R. Accordingly we restore all the issues to the file of the AO for examining them afresh after affording adequate opportunity of being heard.Appeal of the assessee is allowed.

Summary

Issues involved: Appeal against dismissal of appeal by ld. CIT(A) without condoning delay in filing, assessment u/s 144 r.w.s. 147, delay in filing appeal due to COVID-19, lack of opportunity before AO, restoration of issues to AO for fresh examination.

Issue 1: Dismissal of appeal without condoning delay

The assessee challenged the order of ld. CIT(A) which dismissed the appeal in-limine without condoning the delay in filing the appeal. The assessee argued that there was a reasonable cause for the delay as they were not aware of the assessment order until a lien was created on their bank account. The ITAT held that the delay should be condoned as the assessee had valid reasons for the delay, especially considering the impact of the COVID-19 pandemic on filing procedures.

Issue 2: Lack of opportunity before AO

The assessee contended that they did not have a proper opportunity to present their case before the Assessing Officer (AO) as notices were sent to their old address, and the property in question had been sold before the assessment. The ITAT acknowledged that the assessee was not given a fair chance to explain their case before the AO, leading to a lack of proper assessment. Consequently, the ITAT decided to restore all issues to the AO for a fresh examination to ensure the assessee's rights to be heard and provide necessary explanations.

Issue 3: Restoration of issues to AO for fresh examination

The ITAT observed that the AO had assessed the entire value of the property in the hands of the assessee, even though their share was only 20%. Additionally, the assessee had only paid a portion of the property cost during the relevant year. Therefore, the ITAT directed the restoration of all issues to the AO for a detailed reevaluation, emphasizing the need for a thorough examination of the facts and the assessee's explanations. The assessee was instructed to cooperate fully with the AO for the prompt resolution of the reassessment proceedings.

In conclusion, the ITAT allowed the appeal of the assessee, emphasizing the importance of providing a fair opportunity for the assessee to present their case and have their issues examined properly. The decision highlighted the significance of considering valid reasons for delays in filing appeals, especially in exceptional circumstances like the COVID-19 pandemic.