ITAT Condones 66-day Delay in Filing Appeal due to COVID Lockdown and CA's Preoccupation [Read Order]

The Bangalore bench of the Income Tax Appellate Tribunal (ITAT), condoned a 66-day delay in filing an appeal, noting the COVID-19 lockdown and the preoccupation of the assessee’s Chartered Accountant (CA) as sufficient cause for the delay.

Coming to the facts of the case, the Income Tax Officer (ITO) had assessed the assessee’s income at Rs. 8.74 lakh, against her declared income of Rs. 3.04 lakh. The difference of Rs. 5.7 lakh was added under Section 69A, treating her cash deposits during the demonetization period as unexplained. It was claimed by the assessee that the deposits were business receipts after paying farmers, but the AO rejected her explanation due to a lack of proper documentation.

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The assessee filed an appeal before the CIT(A) on 12.05.2020, delayed by 66 days from the statutory deadline. The assessee submitted that the delay was due to the late receipt of the assessment order on 06.02.2020, her CA’s preoccupation, and the subsequent nationwide COVID-19 lockdown imposed on 24.03.2020. The CIT(A) dismissed the appeal as time-barred without condoning the delay, prompting the assessee to approach the ITAT.

The ITAT observed that the CIT(A) had incorrectly calculated the delay from the date of the assessment order (05.12.2019) instead of the date of its service (06.02.2020). The tribunal noted that the 30-day appeal window under Section 249(2)(b) of the Act begins from the date of service, making the appeal due by 05.03.2020. The delay of 66 days included 15 days due to the CA’s busy schedule and the remaining period due to the lockdown, which the ITAT deemed beyond the assessee’s control.

The bench observed that the CIT(A) had failed to verify the service date mentioned in Form 35 and erroneously dismissed the appeal. The tribunal directed the CIT(A) to re-examine the merits of the case, particularly the addition of Rs. 5,70,000 under Section 69A of the Income Tax Act, after granting the assessee a fair hearing.

The ITAT comprising Prashanth Maharishi (Vice President) allowed the assessee’s appeal for statistical purposes.

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