The assessee, Rahul M. Vadodariya, preferred an appeal before the Income Tax Appellate Tribunal (ITAT), Ahmedabad against the order of the Commissioner of Income Tax (CIT) passed for the assessment year 2011-12. ITAT directed fresh adjudication as there was delay in filing appeal by the assessee due to default of the assessee’s employee.
The assessee did not file return of income for the impugned year since his income was below the taxable limit. The assessee was a power of attorney holder of his relative Suryaben Jagdishbhai Patel for the performance of sale of her agriculture land in her absence and the seller. Suryaben J Patel entered into an agreement for sale of her agriculture land for a total consideration of Rs. 46,17,000/- and she received a sum of Rs. 30,00,000/- by six separate cheques, which were duly encashed by her. Thereafter, pursuant to her instructions, the assessee received the balance amount of Rs. 16,17,000/- in cash on her behalf as a power of attorney holder during the course of execution and registration of sale deed in favour of the purchaser.
The Sub-Registrar sent details of the sale arrangement to the department under the provisions of the Income Tax Act as AIR Information, on the basis of which the Assessing Officer issued notice of reopening assessment to the assessee. The assessee was asked to appear several times, but since he failed to appear, assessment was finalized on ex-parte, by treating the sum of Rs. 16,17,000/- as unexplained money of the assessee, u/s 69 of the Act.
Aggrieved by the order of Assessing Officer (AO) that the cash payments made by the purchaser is nothing but the benefit received by the assessee from the above transaction, which the assessee has not recorded or disclosed to the department, the assessee filed an appeal before the CIT, however, there was a delay of 67 days in filing appeal.The CIT however refused to condone delay in filing appeal on the ground that there is no sufficient or reasonable cause which prevented the assessee from filing appeal within the stipulated time.
The bench consisting of Pramod Kumar, Vice President and Siddhartha Nautiyal, Judicial Member observed that” the CIT should dispose of the appeal on merits. Therefore, in view of the above, the delay in filing the appeal before the Commissioner is being condoned and the matter restored to the first appellate authority to decide the appeal on merit after giving due opportunity of hearing to the assessee.”
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