TaxTMI 
TaxTMI 
2026 (3) TMI 482
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.... 194/Mum/2025, the Co-ordinate Bench vide order dated 15.10.2025 recalled the ex-parte order dated 13.01.2025 and restored the appeal for adjudication on merits. The appeal is therefore being adjudicated afresh in the present proceedings. Condonation of Delay 3. At the outset, we take up the petition filed by the assessee seeking condonation of delay in filing the present appeal before the Tribunal. The impugned order passed by the learned CIT(A)is dated 12.11.2021 and the appeal before the Tribunal was required to be filed on or before 11.01.2022. The present appeal has been filed on 25.08.2023, resulting in a delay of 591 days. 4. The learned Authorised Representative (AR) submitted that the delay occurred on account of circumstances beyond the control of the assessee and drew our attention to the petition for condonation of delay dated 20.02.2026 and the supporting affidavit sworn by the assessee. It was submitted that the order dated 12.11.2021 passed by the learned CIT(A) was an ex parte order and neither a physical copy of the appellate order nor any notice of hearing, whether physical or virtual, was received by the assessee. Consequently, the disposal of the appeal....
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....refusal to condone the delay would result in denial of the statutory right of appeal without adjudication on merits. 10. It is well settled that the expression "sufficient cause" appearing in section 253(5) of the Act should receive a liberal construction so as to advance substantial justice. The Hon'ble Supreme Court in Collector, Land Acquisition vs. Katiji (167 ITR 471) has laid down that a pragmatic approach should be adopted in condoning delay and that ordinarily a litigant does not stand to benefit by lodging an appeal belatedly. 11. In the present case, the explanation that the order came to knowledge only in July 2023 and that thereafter steps were taken to file the appeal is supported by sworn affidavit and there is no material placed by the Revenue to controvert the same. The Department has merely opposed condonation on the ground of length of delay, which by itself cannot be a decisive factor. The length of delay is not material so long as the explanation is found to be bona fide and reasonable. 12. Considering the totality of the facts and circumstances of the case, particularly the fact that the delay is supported by affidavit and that no mala fide intention i....
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....lish that the stamp duty valuation had been challenged before the appropriate authority. The CIT(A) therefore confirmed the addition of Rs. 13,23,600/- made under section 43CA. 18. Aggrieved by the order of CIT(A), the assessee is in appeal before us raising following grounds of appeal: 1. Hon. CIT Appeal has erred in confirming the action of the Learned Assessing Officer in making the Addition by way extending the scope & gambit of section 41 (1) of the Income Tax Act, 1961 without considering the fact that the said amount of Rs. 574420 /= were never fall within the scope of Addition & Dis-allowance u/s 41 (1) of the Income Tax Act, 1961. 2. Hon. CIT Appeal has erred in confirming the action of the Learned Assessing Officer in considering that no separate Ad-hoc dis-allowances of Rs. 240000/= [ 8% on Rs. 30,00,000/= ] were required for business income declared & falling within the scope & gambit of section 44AD of the Income Tax Act, 1961 3. Hon. CIT Appeal has erred in confirming the action of the Learned Assessing Officer in making the Addition by way extending the scope & gambit of section 43CA of the Income Tax Act, 1961 without considering the fa....
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....rned CIT(A). 23. We have considered the rival submissions and perused the material on record. The only surviving issue is the addition of Rs. 13,23,600/- made by the Assessing Officer under section 43CA and sustained by the learned CIT(A). 24. It is not in dispute that the assessee transferred one flat during the year for a stated consideration of Rs. 45,00,000/- and that the value adopted by the stamp valuation authority (as per Index-2) was Rs. 58,23,600/-, resulting in a difference of Rs. 13,23,600/-. 25. Equally, it is an admitted and recorded position that the assessee offered business income under the presumptive scheme of section 44AD. The Assessing Officer himself has noted the relevant facts in para 2.3 of the assessment order, reproduced below (as placed before us): "The assessee has offered income u/s 44AD from the proprietary concern business M/s.V.D. Chandan. Other than this the assessee has income from rent and interest. Vide letter dtd.11.10.2016, the assessee has informed the nature of business as builder and developer. During the year, there was sale of Rs. 45,00,000/-. The turnover is shown at Rs. 58,23,600/-. The copy of sale agreement dtd.29.7.....
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....iness profits under the normal computation framework. 30. Both section 44AD and section 43CA are deeming provisions operating in the field of computation. When two deeming provisions overlap, we must harmonise them in a manner that gives effect to both, avoids double counting, and preserves the integrity of the statutory scheme. 31. On a harmonious construction, the correct approach is as follows: i. If the assessee's business income is being computed under section 44AD, then "turnover or gross receipts" becomes the base for deeming profits. ii. If section 43CA is attracted, its effect can, at best, be to determine the appropriate "turnover/gross receipts" for the purpose of section 44AD, by adopting the stamp duty value in place of stated consideration. iii. Once turnover is so adopted and presumptive profits are computed as a percentage thereof, there is no further scope to make a separate addition of the differential amount, because the business profits stand statutorily determined under section 44AD on the adopted turnover. 32. In short, section 43CA can influence the base (turnover) for section 44AD, but it cannot be used to create a second ....