ITAT Condones 608-Day Delay in Rs 79.28 Lakh Addition Dispute, Remands Case for Fresh Adjudication Citing Natural Justice:

The Income Tax Appellate Tribunal (ITAT), Chandigarh Bench, has condoned a delay of 608 days in filing an appeal by Sukhmani Society for Citizen Services for Assessment Year 2012-13. The Tribunal set aside the order of the Commissioner of Income Tax (Appeals) [CIT(A)] and restored the matter to the Assessing Officer (AO) for fresh adjudication.

The case arose from an assessment order passed under Section 144 read with Section 147 of the Income Tax Act, 1961, wherein the AO had made an addition of Rs 79.28 lakh under Section 69A of the Act. The aggrieved assessee filed an appeal before the first appellate authority, i.e., the CIT(A). However, the appeal was dismissed ex parte, meaning without hearing the case on its merits, citing the 608-day delay in filing the appeal.

Thereafter, the assessee approached the ITAT, submitting that the delay was unintentional and occurred due to bona fide reasons. It also stated that it was ready to submit the necessary documentary evidence to substantiate its case. The Revenue opposed the condonation, arguing that the assessee had been negligent in pursuing its legal remedy.

After considering the submissions, the ITAT observed that procedural or technical lapses should not prevent substantial justice where there is no deliberate inaction or mala fide intention. Considering the principles of natural justice and the need to provide a fair opportunity, the Tribunal held that "we condone the delay of 608 days, set aside the order of the Ld. CIT(A), and restore the quantum assessment back to the file of the Ld. Assessing Officer for a de novo assessment, subject to cost of Rs. 10,000/- which shall be deposited by the assessee within 30 days from the date of receipt of this order to the Poor Patient Relief Fund of PGI Hospital, Chandigarh, within 30 days from the date of receipt of this order. The proof of payment thereof shall be furnished by the assessee before the Ld. AO, upon which the Ld. AO shall proceed with the de novo assessment in accordance with law."

The Tribunal sent the case back to the AO for de novo adjudication. The assessee was directed to cooperate fully and provide all relevant evidence without seeking unnecessary adjournments. Since the penalty of Rs 24.49 lakh under Section 271(1)(c) was consequential to the quantum assessment, the ITAT also restored the penalty proceedings to the AO for fresh consideration based on the outcome of the quantum assessment. Both appeals were allowed for statistical purposes.