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Unnatiben Suhitbhai Gajjar Vs ITO (ITAT Ahmedabad)
Extraordinary Delay of Over 3,100 Days Condoned with Costs; Matter Remanded for Adjudication: ITAT Ahmedabad
The Ahmedabad Bench (SMC) of the Income Tax Appellate Tribunal (ITAT) partly allowed the assessee’s appeal for AY 2010-11, condoned an exceptional delay of about 3,113 days in filing the first appeal, and remanded the matter to the CIT(A) for adjudication on merits, subject to payment of costs.
The assessee discovered an outstanding demand of ₹3.22 lakh only in June 2024, when it came to light that the CPC intimation under section 143(1) had erroneously doubled the business income from ₹5.98 lakh to ₹11.91 lakh. The original intimation dated 18.07.2016 was never communicated, and the assessee had remained outside Gujarat during the intervening years, leading to lack of awareness of the demand. On discovering the demand, the assessee promptly filed a rectification application under section 154, followed by a belated appeal.
While the CIT(A) dismissed the appeal on limitation, the ITAT held that:
- The delay, though inordinate, was not deliberate or mala fide;
- The assessee acted promptly upon gaining knowledgeof the demand; and
- There was a prima facie apparent mistakein computation (doubling of income), which the Revenue failed to explain.
Balancing equity and procedural discipline, the Tribunal condoned the delay subject to payment of ₹10,000 as costs to the Prime Minister’s Relief Fund, and restored the matter to the CIT(A) with directions to adjudicate the issues afresh on merits after granting reasonable opportunity of hearing.
Accordingly, the appeal was partly allowed for statistical purposes.
FULL TEXT OF THE ORDER OF ITAT AHMEDABAD
This is an appeal filed against the order dated 10-03- 2024 passed by ADDL/JCIT(A)-2, Bengaluru for assessment year 2010-11. 2. The grounds of appeal are as under:-
“1. On the facts and in the circumstances of the case and in law, the Ld. CIT(Appeals) dismissed appeal filed by appellant against the AO order u/s 143(1) of the income tax act, for delay in filling appeal due to unintentional mistake.
2. …
3. In the given facts and in Law, the learned Assessing Officer has erred in passing Order U/s. 143(1) of the Income Tax Act, 1961.
4. In the given facts and in Law, the learned Assessing Officer has erred in passing Order U/s. 154 of the Income Tax Act, 1961 as on 04/06/2024.
5. In the given facts and in Law considering principal of nature of justice, demand of Rs. 322380 levied be deleted and issued refund for recovered of wrong outstanding demand
6. Appellant craves leave to add or amend any grounds of appeal.”
3. The assessee filed return of income for assessment year 2010-11 and in response to outstanding demand of Rs. 3,22,380/-. The said demand was found by the assessee in the year June, 2024. The assessee noticed that the order of the CPC doubled the profit and gain business mistakenly from 5,98,300/- to 11,91,600/-. Order passed u/s. 143(1) dated 18-07-2016 was not communicated to the assessee and therefore assessee could not respond the same. Thus, the assessee filed belated appeal for approximately 3113 days before the CIT(A), thereby filing separate application for condonation of delay. The CIT(A) vide order dated 10-03-2025 did not reject the condonation of delay and dismissed the appeal of the assessee.
4. The ld. A.R. has categorically mentioned that the assessee has found out the outstanding demand in the month of June, 2024 and immediately filed rectification application u/s. 154 of the Income Tax Act, 1961. The assessee was not in the Gujarat State for the particular period from 2016 till 2024 and therefore could not attend the proceedings or found out the status of the return filed for assessment year 2010-11. The ld. A.R. submitted that the assessee has paid the outstanding demand and therefore the delay before the CIT(A) may be condoned and the matter remanded back to the file of the CIT(A).
5. The ld. D.R. vehemently opposed the condonation of delay.
6. Heard both the parties and perused all the material available on record. It is pertinent to note that the assessee has admitted that the delay was not deliberate but there is a substantial delay and because of that the assessee has shown the promptness once it has received outstanding demand and has filed the rectification application which was rejected on the ground of limitation and with the immediate precaution filed the belatedly appeal before the CIT(A). The reason given by the assessee that the assessee was not present in the Gujarat State and was under the impression that once the return filed and intimation should be checked upon in respect of the same were not aware of about these procedural aspects. Beside this, the Assessing Officer has calculated the profit and gain business income double which is not explained by the Revenue Department at any point of time. Thus, the delay before the CIT(A) though exorbitantly in the exceptional cases, the same is condoned with the cost of Rs. 10,000/- to be paid to the Prime Minister Relief Fund within the period of two weeks from the date of receipt of this order. The matter is remanded back to the file of the CIT(A) for proper adjudication of the issues. Needless to say, the assessee be given opportunity of hearing by following principles of natural justice.
7. In the result, the appeal is partly allowed for statistical purpose.
Order pronounced in the open court on 06-01-2026
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