Reassessment on a different ground than the reopening reason was quashed; delay was also condoned for sufficient cause.

A liberal approach to delay condonation was applied because the assessee showed sufficient cause for the 314-day delay, and the delay was condoned. On reassessment, the recorded reason for reopening was capital gains computation under section 50C, but the final addition was made under section 69A as unexplained money. As the addition rested on a ground different and unrelated to the reason recorded for reopening, the reassessment lacked a sustainable legal foundation and was quashed. The assessee succeeded on both the preliminary limitation issue and the jurisdictional challenge to the reassessment.

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Issues: (i) Whether the delay of 314 days in filing the first appeal deserved condonation. (ii) Whether reassessment initiated for one basis could be sustained when the addition was ultimately made on a different and unrelated basis.

Issue (i): Whether the delay of 314 days in filing the first appeal deserved condonation.

Analysis: The explanation for delay was found to show circumstances beyond the assessee's control. A liberal approach to delay condonation was applied, with emphasis on advancing substantial justice where sufficient cause is made out.

Conclusion: The delay was condoned in favour of the assessee.

Issue (ii): Whether reassessment initiated for one basis could be sustained when the addition was ultimately made on a different and unrelated basis.

Analysis: The reassessment was initiated on the footing of capital gains computation by invoking section 50C, but the final addition was made under section 69A as unexplained money. Since the addition did not match the recorded basis for reopening, the reassessment lacked sustainable legal foundation. The issue was decided by applying the principle that reassessment cannot be upheld where the final addition rests on a ground different from the reason for reopening.

Conclusion: The reopening and the resulting addition were quashed in favour of the assessee.

Final Conclusion: The assessee succeeded on the preliminary delay issue as well as on the core jurisdictional challenge to reassessment, and the appeal was allowed.

Ratio Decidendi: Reassessment cannot be sustained where the ultimate addition is made on a ground different from the reason recorded for reopening, and delay may be condoned where sufficient cause is shown with a liberal approach.

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