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2024 (9) TMI 449 - AT - Income TaxViolation of Order passed by the CPC u/s. 154 - Delay in filing appeal before the Ld. CIT (A) - violation of principles of natural injustice - rental income was taxed twice - under the head income from business and profession and income from house property - HELD THAT - CIT (A) has not decided the case on merit and rejected the appeal on the ground of delay in filing appeal, it would be in the interest of justice if the matter is sent back to the file of the CIT(A) to decide, on merit, the grounds of appeal filed by the appellant against the order u/s.154 passed by the CPC dated 14/02/2020 by condoning the delay considering the submissions made by the appellant. The matter is, thus, remanded back to the file of the CIT (A) to decide the issue on merit by providing reasonable opportunity of being heard to the appellant. The appellant is also directed to explain its case before the CIT (A). Appeal is allowed for statistical purpose.
Issues:
1. Appeal against Order u/s 154 of the Income Tax Act 2. Delay in filing appeal before the Ld. CIT (A) 3. Double taxation of rental income 4. Condonation of delay in filing appeal 5. Order passed by the CPC u/s 154 being bad in law Issue 1: Appeal against Order u/s 154 of the Income Tax Act The appellant filed an appeal against the Order of the Ld. CIT (Appeals) passed u/s. 250 of the Income Tax Act, challenging the addition of Rs. 52,69,230 to the total income. The appellant contended that the order passed u/s 154 was void ab initio and in violation of principles of natural justice. The rental income was erroneously categorized under "Income from Business and Profession" and "Income from House Property," leading to double taxation. The appeal raised independent grounds, seeking to rectify the mistake in the intimation order. Issue 2: Delay in filing appeal before the Ld. CIT (A) The appellant faced a delay of 704 days in filing the appeal, out of which 715 days were covered under Supreme Court orders and circulars. The appellant attributed the remaining delay to lack of knowledge about the rectification order passed by the Assessing Officer. Despite filing grievances, the delay was not condoned by the Ld. CIT (A) due to reasons related to the Covid-19 pandemic. The appellant argued that the delay was not deliberate and sought condonation based on substantial justice principles. Issue 3: Double taxation of rental income The rental income of Rs. 52,69,230 was taxed twice under "Income from House Property" and "Income from other Sources." The appellant argued that this double taxation was a clear mistake apparent from the record and should have been rectified u/s. 154 of the Act. The appellant contended that the order passed by the CPC was bad in law and in violation of principles of natural justice, seeking a decision on the merit of this issue by the ITAT. Issue 4: Condonation of delay in filing appeal The appellant sought condonation of the delay in filing the appeal, emphasizing that the delay was not deliberate or due to malafide intent. Citing relevant case laws, the appellant argued that substantial justice demanded a practical approach in condoning the delay. The appellant highlighted that the delay was due to bonafide reasons and reasonable cause, aiming to promote substantial justice. Issue 5: Order passed by the CPC u/s 154 being bad in law The appellant challenged the order passed by the CPC under section 154 of the Act, alleging that the rental income was taxed twice, leading to double taxation. The appellant requested the ITAT to decide this issue on merit, as the Ld. CIT (A) had not addressed this aspect and rejected the appeal based on the delay in filing. The ITAT remanded the matter back to the Ld. CIT (A) to decide on the merit of the grounds of appeal by condoning the delay and providing a reasonable opportunity for the appellant to be heard. This detailed analysis covers the various issues involved in the legal judgment, addressing the grounds raised by the appellant and the decisions made by the Ld. CIT (A) and the ITAT.
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