CIT(A) has to furnish reasonable cause for rejecting petition for condonation of delay: ITAT:

CIT(A) has to furnish reasonable cause for rejecting petition for condonation of delay: ITAT The appeals filed by the assessee are directed against different orders of the ld. Commissioner of Income Tax (Appeals) 10, Chennai both dated 01.03.2018 relevant to the assessment years 2010- 11 and 2011-12. The assessee are time barred by 277 days delay in filing the appeals before the Tribunal. Brief fact of the case are that the case was reopened for the assessment year 2010-11 manually for the aggregation of cash deposits of Rs. 1,17,46,900/- made in SB account with M/s. ICICI Bank Ltd. during the financial year 2009-10 as per AIR information. Notice under section 148 of the Income Tax Act, 1961 [“Act” in short] was issued on the assessee on 31.07.2014. Notice under section 142(1) of the Act was also issued on 15.05.2015. The assessee has not responded to various notices issued by the Assessing Officer. The Assessing Officer called for the bank statement from ICICI Bank and verified. Summon issued under section 131 of the Act to the assessee on 24.02.2016 and in response to the summon, the assessee appeared and recorded assessee’s statement and assessee’s answer given to question No. 8 is reproduced as under:

“the assessee was working in a shop at Burma Bazaar for a salary of Rs. 8,000/- p.m. during the year 2009-10 and the shop owner only made the entire cash transactions by using the assessee’s ATM Card and getting the signature in blank cheques. Assessee did not know anything about the cash transactions made during the year 2009-10. Since assessee was drawing a salary of Rs. 8,000/- p.m. in the shop, he has not filed any return of income for the Asst. Year 2010-11”.

By rejecting the above statement and considering various judgements, the Assessing Officer proceeded and concluded best judgement assessment under section 144 r.w.s. 147 of the Act dated 08.03.2016 assessing total income at Rs. 1,18,42,900/- by making addition under section 69A of the Act of Rs. 1,17,46,900/- as unexplained income from other sources. On an identical facts, similar addition was made under section 69A of the Act at Rs. 44,48,325/- for the assessment year 2011-12. On appeal, the ld. CIT(A) dismissed both the appeals by rejecting the condonation petition for the delay of 123 days and 126 days in filing the appeal for the assessment years 2010-11 and 2011-12 respectively. On being aggrieved, the assessee is in appeal before the Tribunal. The ld. Counsel for the assessee has reiterated the submissions as made before the ld. CIT(A) and vehemently argued that the assessee, being an illiterate, poor and layman fetching just Rs. 8000/- for survival has been awarded towards payment of huge tax of Rs. 68,61,250/- for the assessment year 2010-11 and Rs. 22,65,630/- for the assessment year 2011-12 do not have sufficient money to engage a counsel to represent his case before the ld. CIT(A) in time and thereby, the delay has been caused and prayed for condoning the delay of filing appeal before the ld. CIT(A) and delete the addition for both the assessment years. On the other hand, the ld. DR supported the orders of authorities below. As per ITAT, so far as condonation of delay in filing the appeals before the ld. CIT(A), the assessee has furnished reasons for the delay and prayed for condonation of delay and admit the appeals for adjudication on merits. However, on perusal of the appellate order, we find that in para 6, the ld. CIT(A) has concluded his observations in single line viz., “6. Delay in filing the appeal not condoned”. The ld. CIT(A) has not furnished any reason for rejecting the petition for condonation of delay in filing the appeal before the ld. CIT(A) for both the assessment years. Under the above facts and circumstances, we are of the considered opinion that the assessee was prevented by reasonable cause for the delay in filing the appeal before the ld. CIT(A) and accordingly, we condone the delay in filing the appeals before the ld. CIT(A) for both the assessment years 2010-11 and 2011- 12. On merits, the ld. CIT(A) has not adjudicated the issue for both the assessment years under appeal. On perusal of the assessment order, ITAT found that the Assessing Officer has rejected the statement given by the assessee, which is reproduced hereinabove. However, the Assessing Officer has not summoned the shop owner, who was stated to be operated assessee’s ATM Card and made bank transactions in the name of the assessee. Under the above facts and circumstances, ITAT remitted the matter back to the file of the Assessing Officer to verify as to whether the assessee’s salary has been credited into his bank account and summon the shop owner to ascertain the deposits belongs to the shop owner or not, record his statement, allow to cross examine the assessee, if required, and thereafter, decide the issue in accordance with law after allowing sufficient opportunity of being heard to the assessee. For Official Judgment Download PDF Given Below: