ITAT Directs CIT(A) to Condone 55-Day Delay in Appeal Filed Over Rs. 37.46 Lakh Deduction Claim, Despite Nil Income Declaration [Read Order]

The Income Tax Appellate Tribunal (ITAT), Pune Bench, has directed the Commissioner of Income Tax (Appeals) CIT(A) to condone a 55-day delay in appeal. The appeal contested the denial of a deduction claim of Rs. 37.46 lakh under Section 80P of the Income Tax Act, 1961, despite the company declaring nil income for the assessment year 2020-21.

Endurance Systems (I) Pvt. Ltd., a cooperative society based in Aurangabad, had filed its income tax return on January 7, 2021, showing nil income while claiming a deduction of Rs. 37,46,860 under Section 80P. The case was selected for scrutiny, and statutory notices under Sections 143(2) and 142(1) were issued. However, the assessee failed to respond to these notices, leading the Assessing Officer to complete the assessment ex parte under Section 144 and disallow the deduction.

The assessee later filed an appeal before the CIT(A) but with a delay of 55 days. The CIT(A) dismissed the appeal without condoning the delay. Aggrieved by this decision, Endurance Systems approached the ITAT. During the hearing, no representative appeared for the assessee, and the tribunal proceeded ex parte after hearing the Departmental Representative.

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After examining the records, Manish Borad (Accountant Member) noted that the CIT(A) had dismissed the appeal solely on the grounds of delay without considering the merits of the case. The tribunal observed that justice would be better served if the delay was condoned and the appeal was decided on its factual and legal merits. Accordingly, the ITAT set aside the CIT(A)'s order and restored the matter to the CIT(A) with a direction to condone the 55-day delay and adjudicate the appeal afresh.

The tribunal allowed the appeal for statistical purposes, emphasizing that its decision was based on the totality of facts and in the interest of justice.

To Read the full text of the Order CLICK HERE

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