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Judgment
Per Raj Kumar Chauhan, Judicial Member:
The appeal is directed against the order dated 08.10.2025 of Ld. Commissioner of Income Tax (Appeals)/National Faceless Appeal Centre, Delhi [hereinafter referred to as the “CIT(A)/NFAC”] passed u/s 250 of the Income Tax Act, 1961 [hereinafter referred to as “the Act”] w herein the appeal of the assessee was dismissed on acco unt of delay in filing the appeal which was not co ndoned.
Brief facts as culled out is that on perusal of the information available on record with respect of cash deposit in the bank account of the assessee held with HDFC bank to the tune of Rs.85,65 ,000/- and the assessee having not filed the Income Tax retur n u/s 149 of the Act. The case of the assessee was reopened u/s 147 of the Act andassessment was completed u/s 147 r.w.s. 144/144B of the Act because the assessee has filed to comply the no tices issued on various dates. The assessee has no t submitted any response to the show-cause notice dated 23.03.2023. Accordingly the sum of Rs.85,65,000/- credited to his bank account was treated as unexplained mo ney and was added to the total income u/s 69 of the Act. The penalty proceedings has also proce eded.
Aggrieved, the impugned Assessment Order, the assessee filed appeal befo re the ld . CIT(A) who has dismissed the same on the ground on delay and has not decided the same on merit and the additio n was upheld.
Aggrieved by the order of the ld. CIT(A), the assessee filed appeal before us and raises the following grounds of appeal:
“1 . That on the facts and in the circumstanc es of t he appellant’s c as e, the l ear ned Natio nal Fac el ess Appeal Centre erre d both i n facts and in l aw by arbitrarily, prejudicially a nd mechanic ally rejecting the reques t for condonati on of delay in fili ng the appeal where the de lay in filing appeal was due to s ufficient c ause. Henc e t he mat ter to be remanded bac k t o Commissioner (Appeal s) to deci de afresh t o advanc e substantial j ustic e.
2.That on the facts and in the circumstanc es of t he appellant’s c as e, the l ear ned Natio nal Fac el ess Appeal Centre erre d both i n facts and in l aw by arbitrarily, prejudicially a nd mechanic ally rejecting the reques t for condonati on of delay in fil ing appeal bypassing a non-speaki ng order without appreciating the facts and reasons adduced by the appellant for the delay i n support of his prayer for condo nation, which were suf ficient caus e to condone delay, ther eby violating the pri nciples of nat ural justic e. Henc e matter to be remanded back to Commissi o ner (A ppeals) to deci de afres h issue of condonati on o f delay to advance substantial j ustice .
3.That on the facts and in the circumstanc es of t he appellant's c as e, the l ear ned Natio nal Fac el ess Appeal Centre erre d both i n facts and in l aw by arbitrarily, prejudicially a nd mechanic ally rejecting the reques t for condonati on of delay in filing appe al by not applying t he settled pri ncipl e of law t hat s ubstantial justice should prevail over t ec hnicalities and that the expression "s ufficie nt cause" under sec tion 249(3) should be liberal ly constr ued, as held by the Hon'ble Supre me Court in C ol lector, Land Acqui siti on v. MstKatiji&Ors. (1987) 167ITR 471 (SC). Hence matter to be rema nded bac k to Commissioner (App eals ) to decide afresh iss ue of condonati on o f delay to advance substantial j ustice .
4.That t he appellant prays that the Hon'bl e Tribunal may ki ndly c ondone the delay i n fili ng the appeal before the CIT(A), se t as ide the impugned ex-parte ass essme nt order passed under section 147 read with s ection 144 and 144B of the Income tax Act, 1961 and rest ore t he mat ter to the file o f the learned AU for decision on meri ts in accor dance wi th l aw.
Witho ut prej udice to Gr ounds 1 to 4,
5.That on the facts and in the circumstanc es of t he appellant's c as e, the l ear ned Natio nal Fac el ess Appeal Centre er red both in facts and in law in upholdi ng validity of ass ess ment witho ut appreciati ng t he fact t hat no DIN has been menti oned o n notice issued unde r section 148 of the Inc ome tax Act, 1961 for i nitiating assessment proc eedi ngs in contrav ention of CBDT Circula r No. 19/2019 dated 1 4.08.2019, rendering t he said notice invalid and void ab i nitio. Hence, assessment framed u/s 147 read with sec tion 144 and 144B is void ab i nitio and liable to be quashed.
6.That on the facts and in the circumstanc es of t he appellant's c as e, the l ear ned Natio nal Fac el ess Appeal Centre er red both in facts and in law in upholdi ng validity of ass ess ment where the notice u/s 148 issued by Jurisdictional Assessi ng Officer (JAO) i nst ead o f by a Fa celess Assessi ng Officer (FAO) as prescribed under section 151A. H enc e, the ve ry manner i n which assessment proceedi ngs had been i nitiate d in contraventio n of 151A of the Income Tax Ac t, 1961 itself vitiated the pr oceedi ngs is bad i n law, invalid, wi thout jurisdictio n and void ab i nitio and liable to be quashed. manner i n whic h assessment pr oceedi ngs had been initiated in contraventi on of 151A of the Incom e tax Act, 1961 itself vitiated the proc eedi ngs is bad i n l aw, invali d, without j urisdiction and voi d ab i nitio and liable t o be quashed.
7.That on the facts and in the circumstanc es of t he appellant's c as e, the l ear ned Natio nal Fac el ess Appeal Centre er red both in facts and in law in upholdi ng validity of ass essment wi t hout appreciati ng that no valid notice under section 148,142(1) and 144 of the Inc ome tax Act, 1961 was ser ved upon the ap pellant a s presc ribed u/s 282 of the Inc ome tax Act, 1961 rea d with R ule 127 of the Inc ome tax Rules, 1962 befo re completion of assessment proceedi ngs. H ence, assessment fra med u/s 147 witho ut proper service of no tice u/s 148,142(1) and 144 read with u/s 282 of the Income tax Act, 1961 is void ab i niti o and liable to be quas hed.
8.That on the facts and in the circumstanc es of t he appellant's c as e, the l ear ned Natio nal Fac el ess Appeal Centre er red both in facts and in law in upholdi ng validity of assess ment wher e the learned NFAC erred bot h i n fac t and i n law i n framing Best Judgment assessme nt u/s 1 47 r.w.s 144 / 144B at assessed income of Rs 85,65,000/-on account of non-compliance of s tat utory notices whi ch were served elec tr onically o nl y, without followi ng t he proc ess i n case of non-complianc e of e-notices as prescribed i n Standard operating pro cedure(SOP) issued u/s 144B for faci litati ng faceless ass ess ments. He nce, t he lear ned Nati onal Faceless Appeal Centr e erred in upholdi ng validity of fac el ess asse ss ment framed witho ut followi ng the procedur es of S OP is bad i n la w and liable to be quas hed.
9.That on the facts and in the circumstanc es of t he appellant's c as e, the l ear ned Natio nal Fac el ess Appeal Centre er red both in facts and in law in upholdi ng validity of ass essme nt u/s 147 read with section 144 and 144B by maki ng additi on o f Rs 85,65,000/-under s ecti on 69A on acco unt of cash deposited i n bank acc ounts as unex plained money, where t he said cas h deposite d were out of c as h available from cash withdra wal from the bank acco unt itself . Henc e, the addi tio n confi rmed by l ear ned Na tional Facel ess Appe al C entre under se ction 69A without c onsideri ng the r ecord available with it , is bad in law and liable to be deleted.
10.That the appellant craves leave to add, amend or alter a ny of the grounds of appeal at the tim e of appellate pr oceedings.”
We have heard the ld. AR and the ld. DR. The ld. AR at the very outset submitted that the impugned order has resulted into miscarriage of justice because the ld. CIT(A) has refused to condone the delay arbitrarily without considering the submissions made as there was sufficient cause for not filing the appeal o n time. The assesse has filed an affidavit before us, the contents of the same are extracted, as under:
6.It is therefore submitted that the impugned order be set aside and matter be restored to the file of the AO because the assessment order is also passed ex-parteas no no tice has been received by the assessee.
The ld. DR on the other hand supported the impugned order as well as the assessment o rder stating that the assessee has failed to comply the show-cause notice and has also not appeared before the AO.
We have considered the rival submissions and e xamined the record. Section 250(2)(a) lays down that the assessee has to be heard hearing has not more sine qua principle of natural justice which the Assessing Officer as well as the first appellate authority being quasi-judicial author ity are required to follow. It has been brought to o ur notice which may so that the no tice allegedly sent by the AO or by the ld. CIT(A) were duly served upon the assesse.There is no rebuttal of the contentsof the affidavit of the asse sseeas no contrary material has been submitted before us by the Revenue. In these given facts and circumstances, we are satisfied that passing of the ex-parte assessment order as well as sub sequent first appellate order has resulted into miscarriage of justice. For these reasons, the impugned order is no t sustainable and according ly set aside and the matter is restored to the Assessing Officer who shall decide the same afresh by giv ing opportunity of hearing. The assessee is d irected to file the material/document within a period of 60 days of this order.
In the result, the appeal of the assessee is allowed for statistical purpose.