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Judgment
PERSHRI ANUBHAV SHARMA, JUDICIAL MEMBER:
This appeal is preferred by the assessee against the order dated 22.12.2025 of the Ld. National Faceless Appeal Centre, Delhi (hereinafter referred as Ld. First Appellate Authority or in short Ld. ‘FAA’) in DIN & Order No: ITBA/NFAC/S/250/2025-26/1083954266(1) arising out of the assessment order dated 13.03.2024 u/s 147 r.w.s 144 of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) passed by ACIT, Circle 43(1), Delhi for AY: 2016-17.
Heard and perused the record. The facts giving rise to this appeal are that the learned assessing officer has doubted the import transaction of Rs. 10,08,59,133/- and made the addition of the amount on account of fictitious purchases while assessee contented that no such transaction occurred. As the assessee went in appeal, in the Form 35 in the statement of facts, assesseehas mentioned that assessee was not doing any business in the partnership firm and has not filed a return in AY 2016-17 and also for the previous years. The case of the assessee was reopened and notices were issued on a premises bearing number B-3/351, Paschim Vihar, New Delhi, which was on rent and the firm was registered. However, this premises was vacated long back, and the assessee had not received any notices till that time. In August 2024, the assessee received a message from the landlord that they have received a WhatsApp notice, from present occupant about the demand and thereupon the assessee came to know of the fact of reopening and consequent passing of the order which was challenged before the learned First Appellate Authority. However, there, the appeal of the assessee has been dismissed on the basis that the same was filed with a delay, and accordingly, the assessee is in appeal before this Tribunal.
On 30.06.2026 after hearing contentions from both sides this Bench had expressed view that in the given facts and circumstances, the matter needs to be restored to Assessing Officer as the assesse claims that notices were not received in the assessment proceedings, thereby, leading to delay in receipt of the assessment order and the appeal when filed was to the understanding of assesse not barred by limitation. However, still ld. CIT (A) had dismissed the appeal observing there was a delay of 159 days.
This bench had expressed view that if there was a difference of opinion from the perspective of assesse and ld. CIT (A) with regard to delay, if any, then at least an opportunity of hearing or an opportunity to file an application for condonation of delay should have been given by ld. CIT (A) as no judicial or quasi judicial authority should pass an order to the prejudice of a litigant on an inference drawn independently and without confronting the litigant of the possible consequences.
However, ld. DR, Ms. RakhiVimal, had vehemently opposed and resisted the view expressed by the Bench and stressed that ld. CIT (A) had certainly given notice to the assesse for opportunity of hearing on the point of condoning the delay and the appeal was rightly dismissed by ld.CIT(A).
As the same did not appear to be coming forth from the impugned order of ld. CIT (A). Therefore, by order sheet entry, this Bench had directed ld. DR to ensure production of the records of ld. First Appellate Authority showing as to what all notices were issued and served on assessee by the ld. First Appellate Authority and what were response received in consequence to the same. The matter was thus kept as kept part heard. The report was to be filed positively on 13.07.2026.
However, on 13.07.2026, ld. DR didn’t put appearance and an application was filed seeking adjournmentciting reason that in compliance of order dated 30.06.2026 of this Bench unmasking of appeal record would need instructions of Higher Authority. As for convenience of Ld. DR, the hearing was adjourned to 27.07.2026 . Further this Bench clarified in order sheet that we only need copies of the all notices issued by CIT (A) /NFAC for giving assesse opportunity to file submissions. Specially, if Ld. CIT (A) /NFAC had directed assessee to file application for condonation of delay or sought explanation of delay. It was also mentioned that no further opportunity shall be given.
However, on 27.07.2026 also ld. DR had not put in appearance and an application was filed wherein again similar request as made on 13/07.2026 was made for adjournment on the basis that concern authorities have apprised absence of facility of unmasking the appeal record and further two weeks opportunity is sought.
This Bench already vide order dated 13.07.2026 had clarified that unmasking of the record of NFAC is not necessary and only thing that Bench has desired to file before Bench was notices, if any, issued and served by the ld. CIT/NFAC wherein assesse was called upon to specifically file an application to condonation of delay or to otherwise be given an opportunity of hearing on the delay in filing appeal. However, no such report has been filed. Though ld. AR has submitted at the date of initial hearing on 30.06.2026 that assesse was not called upon by any specific notice to file an application for condonation of delay or was not otherwise given opportunity of hearing of explaining the delay, yet for completeness we directed assesse to file an affidavit in this regard. The same was directed to be filed on or before 05.08.2026 and theorder was reserved.
In compliance of order dated 27.07.2026, the assesse has filed an affidavit and the contents of same are reproduced below:
“That am the partner of Shreenath Enterprises and, as such, am fully conversant with the facts and circumstances of the present appeal and competent to swear this Affidavit.
That the Appellant filed an appeal before the learned Commissioner of Income Tax (Appeals) [CIT(A)] / National Faceless Appeal Centre (NFAC) against the assessment order passed ex-parte under Section 147 of the Income Tax Act, 1961 for the Assessment Year 2016-2017.
That there was a delay of 159 days in filing the appeal with CIT (A) considering the date on which assessment order was issued. However, considering the date of assesse actually received the order i.e. on 11.09.2024, the appeal was filed on 18.09.2024 i.e. within 7 days of receipt of order.
That I have received four notices from the Ld. CIT(A) u/s 250 dated 10.10.2024, 02.11.2025, 04.12.2025 and 11.12.2025. In none of the notices the Ld. CIT (A) has asked to file an application for condonation of delay separately. The Submissions according to the grounds of appeal along with reason for delay in filling of appeal has been filed well with in the prescribed time.
That the learned CIT(A) dismissed the appeal in limine on the grounds of delay without condoning the same.
I hereby state on oath that no notice, show-cause query, or communication was issued or served upon the Appellant by the learned CIT(A) specifically calling for an explanation or offering an opportunity of hearing regarding the condonation of delay prior to the passing of the impugned order dated 22.12.2025.
That the dismissal of the appeal without affording a fair and reasonable opportunity to explain the reasons for delay is a direct violation of the principles of natural justice (audialterampartem). Had a notice been served, the Appellant would have provided all necessary evidence and justification for the delay.
That In view of the above facts, it is humbly prayed that the Hon'ble Tribunal may be pleased to take this affidavit on record, set aside the order of the learned CIT(A), and either condone the delay or restore the matter back to the file of the CIT(A) for adjudication on merits after providing a proper opportunity of being heard.”
In the light of aforesaid discussion of facts we are of considered view that the impugned order is not sustainable in law. All judicial and quasi judicial authority are supposed to ensure that they exhibit compliance of principles of natural justice in their proceedings and the orders passed thereupon. If ld. CIT(A) was of considered view that appeal was filed with any delay then assessee should have been called upon to explain the delay. In case there was no application the ends of justice could have been met only by letting the appellant an opportunity to file an application for condonation of delay and to deal with same on its merits. But to dismiss the appeal for being filed delayed, for not seeking condonotaiton of delay, which as per the understanding of assessee, was not there, which more warranted to give assesseean opportunity, cannot be sustained in law.
At the same time, with all humility, we like to bring on record and we will also will like to convey to senior officers of the department to ensure that ld. DR, appearing to represent the interest of revenue should not act as prosecutor and certainly not as persecutor. They should be advised to trust the higher wisdom of the Bench, in such matters, where, for the ends of justice and to adhere to the principle that justice must not only be done, but must also be seen to be done, the bench only intends to restore the issues back to ld. First appellate authority. When based on facts and circumstance, reflected in the From 35 itself, bench had indicated its view on first day of hearing, to remit the issues back to ld. CIT(A), then that would have served the purpose of hearing and would have certainly not led the matter to be unnecessarily prolonged, as reflected in the aforesaid proceedings reproduced by us.
At the same time during hearing of this appeal we have found that there seems to be some ambiguity that if this Tribunal, as last fact finding authority or otherwise in given facts and circumstances finds it necessary to pass any order, as it deems it, for disposal of an appeal and needs any information from the records of ld. Tax authorities below, and there is need of unmasking of certain records of faceless assessment or appeal, then there should be some mechanism to do so. Ld. DR, before us, had sought adjournment on basis that authorities have informed her that no such procedure exists. While to our mind denial of access to such records will only lead to drawing adverse inferences against the department. Thus this aspect also needs to be brought to the kind notice of Board.
In the light of aforesaid, we allow the appeal for statistical purposes. The issue for consideration of condonation of delay is resorted to the files of ld. CIT(A), with direction to proceed afresh in the light of aforesaid observations of this bench.
Registry is also directed to forward a copy of this order for kind appreciation of ld. CIT, DR(Admin), ITAT, Delhi Benches.