2020 (5) TMI 546 - AT - Income Tax

Non-prosecution by assessee - explained the facts of business, status of assessee, surrounding circumstances for non-appearance by assessee - HELD THAT - CIT(A) has sent three notices to the assessee through e-mail but same were not complied with and therefore the appeal of the assessee was dismissed for non prosecution. The assessee submitted that the assessee is an HUF where Karta is the proprietor of M/s. Chunnu Fashions. In fact, it is BM Sarin HUF who is the assessee. AO has passed an order in the name of M/s. Chunnu Fashions, the ld CIT(Appeals), in the statement of facts before him it is categorically stated that the assessee is an HUF, he also passed an order in the name of Chunnu Fashion. Even appeal before us is also filed in the name of Chunnu Fashions. In the total proceedings, the assessment order has never been framed on the correct persons i.e. BM Sarin HUF, but has been passed in the name of Chunnu Fashions. Karta of the HUF, Mr. BM Sarin is more than 70 years old and has closed his business. The notices were sent through emails but the assessee being a senior citizen could not look into those emails. He is not a computer literate and has no business as the business of the assessee was closed 5 years ago due to heavy losses. There is a genuine reason for not appearing before the ld CIT(A). It is also alarming that the assessment orders have been passed on non-existent party i.e. M/s. Chunnu Fashions which does not exists at all. In fact the assessment order and the appellate orders should have been in the name of BM Sarin HUF. This fact also deserves to be looked into. As before us also, appeal is filed in the name of M/s Chunnu Fashions incorrectly. We are correcting the title of appeal in the name of B.M. Sarin, HUF . Therefore, we set aside the order of the CIT(A) and sent it back for re-examination of the total facts by giving opportunity to the Assessee for hearing as the issue have not been decided on the merits of the case. Appeal of the assessee is allowed for statistical purposes.

Summary

Issues:
1. Non-attendance before the ld CIT(A) and other issues on merits.
2. Delay in filing the appeal before ITAT.

Analysis:
1. The first issue pertains to non-attendance before the ld CIT(A) and other issues on merits. The appellant raised concerns regarding non-attendance due to notices being sent to an email address that the senior citizen appellant could not access. The appellant highlighted reasons for business losses, emphasizing the inaction of the tax consultant, and requested condonation of non-attendance. The grounds of appeal included challenges to the order's legality, procedural compliance, disallowance of depreciation, and other expenses. The appellant argued for the allowance of depreciation, disputing the AO's disallowance based on symbolic possession by the bank. Additionally, the appellant contested the adhoc disallowance of various expenses without specific defects being pinpointed.

2. The second issue addressed the delay in filing the appeal before ITAT. The appellant filed the appeal 125 days after receiving the ld CIT(A)'s order, citing reliance on a tax consultant who failed to file the appeal and later abandoned the appellant. The appellant requested condonation of delay, attributing the late filing to discovering the delay only upon receipt of recovery notices. The ld DR opposed the condonation, asserting insufficient reasons for the delay. However, the ITAT considered the circumstances, noting that the appellant derived no benefit from the delayed filing. The ITAT ultimately condoned the delay, emphasizing the lack of benefit to the appellant from the delay.

In the final judgment, the ITAT acknowledged the dismissal of the appeal by the ld CIT(A) for non-prosecution due to non-compliance with notices sent via email. The ITAT identified discrepancies in the assessment order's naming of the appellant and the actual party, leading to a correction in the title of the appeal. Noting the genuine reasons for non-appearance and the incorrect naming of the appellant, the ITAT set aside the ld CIT(A)'s order and remanded the case for re-examination. The appellant was granted the opportunity for a fresh hearing to address all issues. Consequently, the appeal was allowed for statistical purposes, with the ITAT correcting the title of the appeal to reflect the actual appellant.