Condonation of delay is justified when non-service of orders

Condonation of delay is justified when non-service of orders prevents timely filing of appeals.

Issue

Whether the Commissioner of Income-tax (Appeals) [CIT(A)] was legally justified in dismissing the assessee’s quantum and penalty appeals in limine (at the threshold) due to delays of 1,486 and 1,181 days, without evaluating the merits or providing an opportunity to apply for condonation, when the assessee claimed non-service of the underlying assessment orders during the transition to the faceless regime.

Facts

The case involves a dispute over quantum assessment and penalty orders issued under section 270A for the Assessment Year 2018-19.
The assessee filed appeals before the CIT(A) against both the assessment and the penalty orders.
The CIT(A) calculated a delay of 1,486 days for the quantum appeal and 1,181 days for the penalty appeal, subsequently refusing to condone the delay under section 249(3).
Both appeals were dismissed by the CIT(A) at the initial stage without an adjudication on merits and without giving the assessee an opportunity to file a formal application for condonation of delay.
The assessee contended that she never received the statutory notices or the final assessment orders.
She asserted that upon independently discovering the outstanding tax demand, she immediately obtained certified copies of the orders from the Jurisdictional Assessing Officer (JAO) and filed the appeals shortly thereafter.

Decision

The matter is decided in terms of a remand, and the case is restored to the file of the CIT(A).
The tribunal held that the massive delays deserved to be condoned because the assessee successfully demonstrated “sufficient cause” for the late filing.
It was observed that no bad faith (mala fides) or gross negligence could be attributed to the assessee, especially considering the systemic communication disruptions common during the tax department’s transition from a physical to a faceless assessment regime.
Consequently, the CIT(A)’s summary dismissal was set aside, and the lower appellate authority was directed to adjudicate both appeals fresh on their structural merits.

Key Takeaways

Substantive Justice Over Technicalities: Technical timelines should not be used to choke legitimate appeals if a taxpayer has a genuine reason for delay. Rules of limitation are designed to prevent stale litigation, not to disrupt valid claims.
Proof of Service is Mandatory: The timeline to count a delay for an appeal only begins from the date the order is legally and successfully served on the assessee, not from the date the order was printed or passed by the AO.
Transition Leniency: Revenue authorities must adopt a practical and liberal approach toward delay condonation when administrative transitions (such as moving from physical tracking to the digital Faceless Assessment Scheme) create communication gaps for ordinary taxpayers.

IN THE ITAT DELHI BENCH ‘G’

Ms. Neeta

Income Tax Officer

Vimal Kumar, Judicial Member
and Ramit Kochar, Accountant Member

IT Appeal Nos. 4666 & 4667 (Delhi) of 2026
[Assessment year 2018-19]

JUNE 24, 2026

Rupesh Sinha and Ms. Monalisa Maity, Advs. for the Appellant. Pramod Kumar, Sr. DR. for the Respondent.

ORDER

1. These two appeals in ITA No. 4666 & 4667/Del/2026 for assessment year 2018-19 has arisen from two separate appellate order(s) both dated 19.02.2026 passed by the learned CIT(A), NFAC, Delhi under Section 250 of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’) (DIN & Order No. ITBA/NFAC/S/250/2025-26/1086245748(1) and DIN & Order No. ITBA/ NFAC/S/250/2025-26/1086246139(1)), respectively. The Appeal in ITA No. 4666/Del/2026 is an appeal against quantum assessment, while appeal in ITA no. 4667/Del / 2026 is against penalty levied u/s 270A.

2. In both these appeals , the assessee is aggrieved by the decision of ld. CIT(A) not condoning the delay in filing appeal belatedly by the assessee with ld. CIT(A) by 1486 days in quantum appeal(1181 days delay in appeal against penalty order). The assessee duly explained the reasons for delay before ld. CIT(A) in Form No. 35, which in brief were that the assessee did not receive the notices at her current address during the course of the assessment proceedings, the assessment order passed by the AO was not received by the assessee. Thus, there was no service of the assessment order effected by the AO. Subsequently, when she came to know of the huge demand being imposed on her,she approached JAO for certified copy on 19.05.2025, and the same was furnished to the assessee by JAO on 20.05.2025. It was further stated in Form No. 35 filed before ld. CIT(A) that thereafter, the assessee filed an appeal with ld. CIT(A) on 18^th June, 2025. The ld. CIT(A) refused to condone the delay, and dismissed the appeal of the assessee. Thus, the ld. CIT(A) did not discuss the issues on merit and merely dismissed the appeal by not condoning the delay.

3. Still Aggrieved, the assessee has filed second appeal with the Tribunal. Heard both the rival parties.The assessee has filed an affidavit dated 22.06.2026 with the Tribunal, which is placed on record in the file explaining reasons for filing appeal belatedly with ld. CIT(A).

4. We have considered rival contentions and perused the material on record. It is observed that as per ld. CIT(A) , the appeal was filed belatedly by the assessee by 1486 days (1181 days in case appeal arising against penalty order), while the assessee is contending that she was not served with the assessment order. No Statutory notices during the course of assessment proceedings were served. The assessee when she became aware of the huge demand raised against her, immediately approached JAO on 19.05.2025, and collected certified copy of the orders on 20.05.2025. Then immediate steps were taken to file appeal with ld. CIT(A). This did not found favour with ld. CIT(A), who dismissed her appeal. She has now filed an affidavit dated 22.06.2026 with the Tribunal, in which she has averred that email Id given her in the income tax portal was of the CA i.e. Mr. Sanju Sharma , and she had engaged a part time accountant namely Late Shri Naveen Mehra who was associated with the aforesaid CA. They did not inform her of the income tax proceedings. The notices were not received by her nor assessment order was received. The notices were not uploaded on income-tax portal nor they were sent physically . It is further averred that Email was of CA who did not inform her about the income tax proceedings. There was also a change of address during first half of 2019, from Mandoli , Delhi to Shahadara, Delhi. No notice was received in these address. It is further averred in the affidavit that immediately on coming to know of the huge demand, the assessee approached JAO and obtained certified copy on 20.05.2025 , and filed the appeal on 18^th June, 2025 i.e. within 30 days. Thus, there is no delay in filing the appeal with ld. CIT(A), if the limitation time is calculated from the date of service of assessment order, but the ld. CIT(A) calculated limitation period from the date of assessment order. It is further averred that the assessee is serious in persuing the appeal , and huge prejudice and irreparable loss shall be caused to her, if the delay in filing the appeal with ld. CIT(A) is not condoned. The Ld. Sr-DR on the other hand submitted that notices were sent through email. The assessee did not filed any response during assessment proceedings. It was the responsibility of the assessee to have checked her email. The ld. Sr. DR further submitted that it was a face of transition from physical mode to faceless regime. We have gone through the material on record, and We have observed that the assessee has duly explained sufficient cause in filing appeal belatedly with ld. CIT(A). We have observed that the assessee duly mentioned in Form No. 35 that service of assessment order was effected on the assessee on 20.05.2025. Thus, the appeal was filed on 18^th June, 2025 i.e. within 30 days. The assessee has duly stated in Form No. 35 the circumstances under which the certified copy of the assessment order was obtained from JAO , and it is further stated that she will be filing separate condonation of delay application, explaining the circumstances with documentary evidences wrt to delay in filing the appeal. The ld. CIT(A) did not even issue any notice to the assessee requiring assessee to file application/affidavit for condonation of delay and/or documentary evidences, and straight way proceeded to dismiss the appeal of the assessee being unadmitted by invoking provisions of Section 249(3) of the 1961 Act. Principles of natural justice are clearly breached , and severe prejudice is caused to the assessee , as the assessee was non-suited and condemned by ld. CIT(A) without any opportunity being afforded nor any exercise to verify and unravel the truth was undertaken by ld. CIT(A). Now, the assessee has come forward and filed an affidavit explaining the delay in filing appeal with ld. CIT(A). We hold that the assessee has demonstrated sufficient cause, and we condone the delay in filing the appeal belatedly by the assessee before ld. CIT(A). More-so it was a transition phase from physical regime to faceless regime, notices/orders have only been sent by email as against earlier sending it by physical mode., there are bound to be some glitches and mishaps which requires liberal view in the initial switch over phase. When technicalities are pitted against advancement of substantive justice, courts will lean towards advancement of substantial justice , unless malice is at writ large or there is a gross negligence. We do not find any malice on the part of the assessee nor there appears to be gross negligence. The assessee is not likely to gain anything by filing appeal belatedly with ld. CIT(A). Reliance is placed on the judgment and order of Hon’ble Supreme Court in the case of Collector, Land Acquisition, Anantnag v. Mst. Katiji (SC)/1987(2) SCC 107 . We , therefore, condone delay of 1486 days(1181 days in appeal against penalty order) in filing the appeal belatedly by the assessee before ld. CIT(A) , and remit the matter back to the file of ld. CIT(A) to adjudicate both the appeals of the assessee on merits in accordance with law.The ld. CIT(A) will admit evidences filed by the assessee in its support. The ld. CIT(A) shall give proper opportunity of being heard to both the parties. Needless to say that proceedings before ld. CIT(A) are extension of assessment proceedings , and powers of ld. CIT(A) are co-terminus with the powers of the AO including power of enhancement. We clarify that we have not commented on the merits of the issue. Since , facts are similar in both the appeals except difference in the number of days delay, our order shall apply mutatis mutandis to both the appeals. Thus, we set aside both the orders passed by ld. CIT(A) both dated 19.02.2026 ,and remit the matter to the file of ld. CIT(A) for fresh adjudication on merits in accordance with law. We order accordingly.

5. In the result, both the appeals filed by the assessee are allowed for statistical purposes.