Appeal Granted for Re-Adjudication on Merits

The Tribunal allowed the appeal for statistical purposes, restoring the matter to the CIT(A) for re-adjudication on merits. The appeal was filed within the stipulated time as the assessment order was likely not served at the correct address. The Tribunal refrained from addressing the merits of the case and set it aside for fresh adjudication. The order was pronounced on 23.07.2018.

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Issues Involved:
1. Dismissal of the appeal by the CIT(A) due to late filing and refusal to condone the delay.
2. Examination of the addition made by the A.O under the head "unexplained cash credit" amounting to Rs. 18,24,500/-.
3. Consideration of whether the appeal should have been decided on merit rather than on technical grounds.

Detailed Analysis:

1. Dismissal of the Appeal Due to Late Filing and Refusal to Condoning the Delay:
The assessee filed an appeal against the CIT(A)-21, Mumbai's order dated 24.06.2014, which arose from the A.O's order under Sec.144 r.w.s. 263 of the Income Tax Act, 1961, dated 30.10.2006 for A.Y 2001-02. The CIT(A) dismissed the appeal due to late filing and did not condone the delay. The assessee argued that the delay was not intentional and cited the Supreme Court's proposition in the case of Improvement Trust V/S Ujagar Singh, where it was held that unless the delay is writ large and the assessee has a good case on merit, the delay should be condoned. The CIT(A) did not consider the merits and dismissed the appeal based on the technical fault of the assessee.

2. Examination of the Addition Made by the A.O Under the Head "Unexplained Cash Credit" Amounting to Rs. 18,24,500/-:
The assessee company, engaged in manufacturing marble slabs and tiles, filed its return for A.Y 2001-02 declaring a total income of Rs.Nil. The original assessment under Sec.143(3) was framed on 31.12.2003, accepting the returned income. The CIT-10, Mumbai, observed that the assessee had taken unsecured loans of Rs. 18,24,500/- from four parties without filing confirmations and noticed unsecured loans aggregating Rs. 38,70,982/- were not examined. The CIT-10 revised the assessment order, directing the A.O to make a fresh assessment. The A.O issued notices under Sec.143(2) and 142(1) but framed the assessment under Sec.144 r.w.s. 263 due to non-compliance by the assessee. The A.O added Rs. 18,24,500/- as unexplained cash credit under Sec.68. The assessee argued before the CIT(A) that the amount was brought forward closing balances of previous years. The A.O, in the remand report, confirmed that the amount was the closing balance of previous years and no new loans were taken during the year.

3. Consideration of Whether the Appeal Should Have Been Decided on Merit Rather Than on Technical Grounds:
The CIT(A) noted that the appeal was filed after six years from the date of the assessment order and dismissed it due to lack of evidence supporting the claim that the original assessment order was not received. The assessee contended that the original assessment order was not received and that the A.O had admitted in the remand report that the amount added as unexplained cash credit was the closing balance of previous years. The assessee argued that the assessment order was passed at a wrong address and was never communicated to the directors. The new directors of the assessee company came to know about the tax dues only after recovery proceedings. The affidavit of Smt. Snehlata Mahindra Kothari, a new director, supported the claim that the assessment order was never received. The Tribunal found that the assessment order was likely not served at the correct address and concluded that the appeal filed on 06.03.2013 was within the stipulated time.

Conclusion:
The Tribunal restored the matter to the file of the CIT(A) for re-adjudication on merits, as the assessment order was not served at the correct address, and the appeal filed by the assessee was within the stipulated time. The appeal of the assessee was allowed for statistical purposes. The Tribunal refrained from addressing the merits of the case, as the matter was set aside for fresh adjudication. The order was pronounced in the open court on 23.07.2018.

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