2023 (3) TMI 605 - AT - Income Tax

Condonation of delay - sufficient cause for not presenting appeal within that period - assessee is counting the period of limitation from this date, whereas the assessee is required to explain the delay from the date of its passing - HELD THAT - Whenever any explanation of the assessee falls for consideration about the delay in filing the appeal, then such explanation is to be appreciated with a justice oriented mind. However, we find that it is a shell company, which is trying to play with the Income Tax Authorities and the position of law. It has been filing the appeal only for the sake of filing otherwise not contesting the litigation and not justifying anything. After perusing the whole record, which has been brought to us, we are of the view that it is not a case where delay even if of any number of days deserves to be condoned. Therefore, we reject this application of the assessee and dismiss the appeal being time-barred.

Summary

Issues involved:
The issues involved in this case are the ex-parte assessment u/s 144 of the Income Tax Act, addition under section 14A of the Income Tax Act, appeal before the ld. CIT(Appeals), and the delay in filing the appeal before the Tribunal.

Ex-parte Assessment u/s 144 of the Income Tax Act:
The assessee filed a return but failed to provide explanations when the ld. Assessing Officer selected the case for scrutiny due to huge share application money and share premium. Consequently, an ex-parte assessment was conducted where the income of the assessee was determined based on the best judgment of the Assessing Officer. The ld. Assessing Officer made a significant addition of Rs. 1,34,69,80,000 without detailed discussion about the share applicants. Additionally, an addition was made u/s 14A of the Income Tax Act, disallowing expenditure related to earning alleged tax-free income.

Appeal before the ld. CIT(Appeals):
The assessee appealed against the assessment order before the ld. CIT(Appeals), which was also decided ex-parte. The ld. CIT(Appeals) discussed each share applicant and concurred with the ld. Assessing Officer's decision. Subsequently, due to the absence of the assessee, the appeal was heard ex-parte with the assistance of the ld. D.R.

Delay in filing the appeal before the Tribunal:
The impugned order was passed on 30.11.2017, but the assessee claimed to have known about it only on 15.03.2020. The assessee argued that the period of limitation should be counted from the latter date. However, the Tribunal noted that the assessee failed to explain the delay from the date of the order's passing. The Tribunal referred to legal provisions regarding condonation of delay and emphasized the need for a liberal interpretation of the term "sufficient cause." Despite the explanations provided, the Tribunal concluded that the delay in filing the appeal should not be condoned as the assessee appeared to be a shell company not genuinely contesting the litigation. Consequently, the Tribunal rejected the application and dismissed the appeal as time-barred.