ITAT Restores Taxpayer’s Appeal, Condones 38-Day Delay Due to Hospitalization

The Income Tax Appellate Tribunal (ITAT), Bangalore Bench, has granted relief to taxpayer Smt. Hebsiba Daniel by restoring her appeal for fresh consideration after holding that there was genuine reason for delay in filing it.

This case is with regard to Assessment Year 2019-20. The Income Tax Department had once again reopened the assessment after it came to know that the taxpayer had bought foreign currency, remitted abroad and had received salary from an organisation by the name of International Justice Mission. Since she hadn’t even filed her income tax return, the AO thought that income had escaped assessment and issued a notice under Section 148 of the Income Tax Act.

The taxpayer filed her return and submitted certain documents after the notice. However, according to the AO, she failed to respond to later notices and did not provide sufficient evidence to support her claim that she had received Rs. 23,12,000 as gifts from her husband. The AO also treated the money used for purchasing foreign currency as unexplained expenditure under Section 69C of the Act.

The assessee preferred an appeal against the assessment before the CIT(A). She said she went to Canada for MBA and the foreign remittances were made for tuition fees and living expenses with the money she received from her husband and parents. She also filed supporting documents.

The appeal was filed 38 days late, however. The taxpayer said she was hospitalised and that’s why it took so long. The CIT(A) did not accept the explanation and dismissed the appeal on the ground of delay only without going into the merits of the case.

The matter then went to ITAT. At the hearing, the taxpayer’s representative claimed that the delay was minimal and due to genuine medical reasons. Medical certificates and related documents were also produced before the Tribunal.

On perusal of the records, the ITAT noted that the taxpayer was indeed admitted in hospital and the medical evidence supported her version. The delay was sufficiently explained, and the taxpayer had shown sufficient cause for not filing the appeal within the stipulated time, observed the Tribunal.

Therefore, the ITAT set aside the order of CIT(A) and condoned the delay and remand the matter to CIT(A) for fresh decision on the merits of the case. The Tribunal said that the taxpayer’s submissions and supporting documents must now be properly considered.

As a result, the taxpayer’s appeal was allowed for statistical purposes.