2024 (7) TMI 1488 - AT - Income Tax

Appeal against order of National Faceless Appeal Centre - Appeal dismissed by CIT(A) being barred by time - CIT(A) who dismissed the appeal on account of delay of 184 days in filing the appeal - HELD THAT - As in view of the decision of the Hon ble Supreme Court in suo moto writ petition 2022 (1) TMI 385 - SC ORDER the learned CIT(Appeals) was not justified in dismissing the assessee s appeal being barred by time, without discussing the issue on merit. Accordingly, considering the facts and circumstances of the present case and to sub serve the principles of natural justice, we are constrained to set aside the order of learned CIT(Appeals) and restore the matter to the file of learned CIT(A) for decision afresh on merits after affording adequate opportunity of being heard. Grounds are allowed for statistical purposes.

Summary

Issues:
1. Appeal against order of National Faceless Appeal Centre for AY 2019-20.
2. Dismissal of appeal by CIT(A) due to delay in filing.
3. Addition of Rs. 2,76,71,650 under "Income from Other Sources."
4. Denial of statutory deduction under section 57(iv) of the Income Tax Act.
5. Charging of interest under sections 234A and 234B of the Income Tax Act 1961.

Issue 1:
The appeal was directed against the order of the National Faceless Appeal Centre for the assessment year 2019-20. The assessee contended that the appeal was filed within the specified time frame as per the Hon'ble Supreme Court's directive in a specific case regarding the extension of the limitation period due to the COVID-19 pandemic. The assessee argued that the dismissal of the appeal by the CIT(A) on the grounds of delay was unjustified without considering the merits of the case. The Tribunal set aside the CIT(A)'s order and remanded the matter for a fresh decision on merits after considering the Supreme Court's directive and principles of natural justice.

Issue 2:
The CIT(A) dismissed the appeal due to a delay of 184 days in filing the appeal. The assessee argued that the appeal was filed within the extended period granted by the Hon'ble Supreme Court in light of the pandemic situation. The Tribunal found that the CIT(A) erred in dismissing the appeal solely on the basis of delay without discussing the case's merits. The Tribunal allowed the appeal for statistical purposes and remanded the matter to the CIT(A) for a fresh decision on merits after providing an opportunity to be heard.

Issue 3:
The addition of Rs. 2,76,71,650 under "Income from Other Sources" was contested by the assessee. The amount in question was received as interest under section 28 of the Land Acquisition Act, which was part of the enhanced compensation for the compulsory acquisition of agricultural land and claimed as exempt under section 10(37) of the Income Tax Act. The Tribunal did not delve into the merits of this issue but focused on the procedural aspect of the dismissal of the appeal by the CIT(A) based on delay.

Issue 4:
The assessee contended that even if the interest under section 28 of the Land Acquisition Act was taxable under "Income from Other Sources," the Assessing Officer erred in not allowing the statutory deduction of 50% of the interest as provided under section 57(iv) of the Income Tax Act. However, the Tribunal did not address this issue specifically in its judgment, as the primary focus was on the procedural aspect of the dismissal of the appeal.

Issue 5:
The charging of interest under sections 234A and 234B of the Income Tax Act 1961 was also challenged by the assessee. However, the Tribunal did not provide a detailed analysis of this issue in its judgment, as the main decision was to set aside the CIT(A)'s order and remand the matter for a fresh decision on merits. The appeal was allowed for statistical purposes, emphasizing the importance of natural justice and adherence to the Supreme Court's directive on limitation periods during the pandemic.