Indra Devi vs ITO, Ward 43(1)

This appeal in ITA No. 4440/Del/2026 for assessment year 2015-16 has arisen from appellate order dated 19.02.2026 passed by the learned CIT(A), NFAC, Delhi under Section 250 of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’) (DIN & Order No. ITBA/NFAC/S/250/2025-26/1086219049(1).

In this appeal , the assessee is aggrieved by the decision of ld. CIT(A) not condoning the delay in filing appeal belatedly by the assessee with ld. CIT(A) by 166 days. The assessee duly explained the reasons for delay before ld. CIT(A) in Form No. 35/written submissions, which in brief were that the assessee did not receive the notices/assessment order at her current address due to change in her address, she was suffering from ill-health and being a single mother she is responsible for upbringing and welfare of her dependent child and that she was facing significant emotional, personal and financial constraints during the relevant period. Thus, it was contended that there was no service of the physical copy of the assessment order effected by the AO owing to change in address. It is the submission of the assessee in its appeal that Reassessment proceedings were conducted by the AO, and prima-facie manifest gross injustice is done wherein cost of acquisition of property is not allowed as deduction while computing capital gains , nor benefit of deduction u/s 54 for making investment in new residential property was allowed by the AO, mainly because the same happened to be an ex-parte proceedings. The ld. CIT(A) refused to condone the delay of 166 days in filing the appeal belatedly, and dismissed the appeal of the assessee. The assessee participated in appellate proceedings before ld. CIT(A) and filed written submissions, but the written submissions were not considered by ld. CIT(A) solely on the ground that the appeal is filed belatedly beyond the prescribed statutory time and the assessee is unable to show sufficient cause for delay, thus , the appeal was un-admitted by ld. CIT(A). The ld. CIT(A) did not discuss the issues on merit and merely dismissed the appeal by not condoning the delay.

Still Aggrieved, the assessee has filed second appeal with the Tribunal. None appeared for the assessee when this appeal was called for hearing before the Bench. The ld. Sr. DR was heard by the Bench.

We have considered the contentions of ld. SR. DR and perused the material on record. It is observed that as per ld. CIT(A) , the appeal was filed belatedly by the assessee by 166 days beyond the prescribed statutory time . As per version of the assessee , no Statutory notices during the course of assessment proceedings were served by the AO. The assessee has claimed that she was not served with the physical copy of the assessment order. There was a delay in filing appeal before ld. CIT(A), and reasons cited were that the assessee did not receive the notices/assessment order at her current address due to change in address, she was suffering from ill-health and being a single mother she is responsible for upbringing and welfare of her dependent child and that she was facing significant emotional, personal and financial constraints during the relevant period. It was further submitted before ld. CIT(A) that the assessee is serious in persuing the appeal , and huge prejudice and irreparable loss shall be caused to her, if the delay in filing the appeal with ld. CIT(A) is not condoned. The assessee also participated in appellate proceedings before ld. CIT(A) and filed written submissions. This did not found favour with ld. CIT(A), who dismissed her appeal filed by the assessee solely on the ground that the appeal is filed belatedly by the assessee by 166 days beyond statutory prescribed period. The Ld. Sr. DR submitted that the assessee did not participated in assessement proceedings , and ld. SR DR objected to the condonation of delay in filing appeal before ld. CIT(A). We have gone through the material on record, and We have observed that the assessee has duly explained sufficient cause in filing appeal belatedly with ld. CIT(A) by 166 days. The assessee has changed her address. The assessee has claimed that she was not aware of assessment proceedings. She was not served with notices/assessment order. When she came to know of huge demand, she was shocked, and took steps to file appeal with ld. CIT(A). The assessee participated in appellate proceedings before ld. CIT(A) and filed written submissions on merits of the issues which were not considered by ld. CIT(A), as he dismissed the appeal being un-admitted on the grounds that the appeal is filed belatedly beyond the prescribed statutory time period. Severe prejudice is caused to the assessee firstly by decision of ld. CIT(A) in not admitting the appeal on the grounds of being filed belatedly , and secondly by the decision of ld. AO in not allowing cost of acquisition on merits as well denial of benefit of deduction u/s 54 on merits, while computing capital gains chargeable to tax. We hold that the assessee has demonstrated sufficient cause as cited above in this order, and we condone the delay in filing the appeal belatedly by the assessee before ld. CIT(A). When technicalities are pitted against advancement of substantive justice, courts will lean towards advancement of substantial justice , unless malice is at writ large or there is a gross negligence. We do not find any malice on the part of the assessee nor there appears to be gross negligence. The assessee is not likely to gain anything by filing appeal belatedly with ld. CIT(A). Reliance is placed on the judgment and order of Hon’ble Supreme Court in the case of Collector, Land Acquisition, Anantnag v. Mst. Katiji & Ors. 1987(2) SCC 107. We , therefore, condone delay of 166 days in filing the appeal belatedly by the assessee before ld. CIT(A) , and remit the matter back to the file of ld. CIT(A) to adjudicate the appeal of the assessee on merits in accordance with law.The ld. CIT(A) will admit evidences filed by the assessee in its support. The ld. CIT(A) shall give proper opportunity of being heard to both the parties. Needless to say that proceedings before ld. CIT(A) are extension of assessment proceedings , and powers of ld. CIT(A) are co-terminus with the powers of the AO including power of enhancement. We clarify that we have not commented on the merits of the issue, and the ld. CIT(A) will adjudicate the appeal uninfluenced by any of our observation in this order. Thus, we set aside the order passed by ld. CIT(A) dated 19.02.2026 ,and remit the matter to the file of ld. CIT(A) for fresh adjudication on merits in accordance with law. We order accordingly.

In the result, the appeal filed by the assessee is allowed for statistical purposes.