Lalit vs. ITO, Ward 1, Village Patla, P.O. Jaukhauli, Sonipat. Tehsil Rai, Sonipat - 131 001 (Haryana)

Parties Involved

Facts Summary

The appeal is filed by the assessee against the order of the Commissioner of Income-tax (Appeals)/National Faceless Appeal Centre (NFAC), Delhi for the ASSESSMENT YEAR 2019-20. The assessee argued that the appeal was time barred by 10 days but there was a reasonable cause for the delay. The issue relates to alleged cash payment to the builder. The Assessing Officer observed that there is escapement of income in the case of the assessee to the extent of Rs.28,40,800/- which comprised of cash payment of Rs.2,05,600/- and receivable of cash of Rs.26,35,200/-. The Assessing Officer obtained approval u/s 151 of the Act with the above said reasons to believe. However, while passing the order u/s 148A(d) of the Act, the escapement of income was reduced from Rs.28,40,800/- to Rs.22,00,000/- which include the cash transaction amounting to Rs.22 lakhs with Max Heights Township & Promoters Pvt. Ltd. It clearly shows that the Assessing Officer has got approval on the basis of alleged escapement of income. However on careful consideration of facts available on record, I observed that the Assessing Officer was never sure of total escapement of income at the time of obtaining approval u/s 151 of the Act. Even at the time of passing order u/s 148A(d) of the Act, he has reduced escapement of income to the extent of Rs.22,00,000/-. Therefore approval obtained u/s 151 of the Act is not proper reasons to believe.…

Legal Issues

• 1. Whether the delay in filing the appeal can be condoned?
• 2. Whether the approval obtained u/s 151 of the Act is proper reasons to believe?

Judgment Outcome

Decided in favour of Assessee.

Precedents Relied Upon

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