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Income Tax Appellate Tribunal, HYDERABAD BENCHES “B”: HYDERABAD
Before: SHRI SATBEER SINGH GODARA & LAXMI PRASAD SAHU
IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES “B”: HYDERABAD (THROUGH VIRTUAL CONFERENCE) BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER and LAXMI PRASAD SAHU, ACCOUNTANT MEMBER ITA No. 1531/H/2019 Assessment Year: 2008-09 Manda Ilaiah (HUF), Vs. Asst. Commissioner of Hanamkonda. Income-tax, Circle – 1, PAN – AACHM 9377A Warangal (Appellant) (Respondent) ITA Nos. 1532 & 1533/H/2019 Assessment Year: 2011-12 & 2012-13 M.Ilaiah and Company, Vs. Asst. Commissioner of Hanamkonda. Income-tax, Circle – 1, PAN – AAPFM 1427L Warangal (Appellant) (Respondent) Assessee by: Shri A.V. Raghuram Revenue by: Shri Rohit Mujumdar Date of hearing: 15/03/2021 Date of pronouncement: 07/04/2021
O R D E R PER L.P. SAHU, A.M.: These appeals filed by the assessees are directed against CIT(A) - 3, Hyderabad’s separate orders, all dated 08/07/2019 involving proceedings u/s 221(1) of the Income Tax Act, 1961 ; in short “the Act”. Since identical
:- 2 -: ITA Nos. 1531 to 1533/Hyd/2019 Manda Ilaiah (HUF) and another, Hyderabad. issue is involved in these appeals, they were clubbed and heard together and, therefore, a common order is passed for the sake of convenience.
The common grievance raised by the assessees in these appeals is that the CIT(A) erred in dismissing the appeals on the ground of delay without giving proper opportunity to the assessees to put-forth their cases.
In all these cases, the AO levied penalty u/s 221(1) of the Act, against which the assessees preferred appeals before the CIT(A) with a delay of 330 days.
Before the CIT(A), the assessees filed petitions for condonation of the delay, however, the CIT(A) dismissed the appeals of the assessees in-limine on the ground that the assessees were unable to prove the ‘sufficient cause’ for delay in filing the appeals relying on the decision of the coordinate bench of ITAT, Hyderabad in the case of Maddi Narsaiah in ITA No. 554/Hyd/2014, order dated 09/09/2016.
Considered the rival submissions and perused the material facts on record. Before the CIT(A), the AR of the assessees made the following submissions for condonation of delay, which was extracted by the CIT(A) in his order at page 3 of his order:
:- 3 -: ITA Nos. 1531 to 1533/Hyd/2019 Manda Ilaiah (HUF) and another, Hyderabad.
“With reference to the above we submit the following few lines for your kind consideration. and necessary action. On the instructions of our above client we are filing this appeal for the above said assessment year contending the amount of penalty levied by the learned Assessing Officer under Section 221. The penalty order was received on 28/02/2018 and the due date for filing the appeal fell on 29/03/2018. However, as the karta M. Ilaiah, being a civil contractor, was out of station for about some days and the necessary digital signature could not be affixed by himself as he was away. In the meantime a search took place in the office and house of the M. Ilaiah. on 09-08-2018 and he in order to cooperate in The search proceedings along with his other staff were totally busy and this proceedings took quite a time. In this process the appeal could not be filed however once he was done with the search proceedings on 25/01/2019 this appeal is filed with his DSC. We therefore request your good selves to condone the delay of three thirty two days and admit the appeal and oblize.” By all possibilities, no one can deny that there is a delay in filing these appeals. In the given case, as submitted by the AR of the assessee before the CIT(A) that there were search proceedings at the relevant point of time, which caused the impugned delay in filing these appeals before the CIT(A).
5.1 The Hon’ble Madras High Court in the case of M/s Hosanna Ministries Vs. ITO, TC (Appeal) No. 3 of 2017, judgement dated 07/03/2017 wherein the Hon’ble Court has condoned the delay of 1902 days by relying on the judgement of the Hon’ble Supreme Court in the case of
:- 4 -: ITA Nos. 1531 to 1533/Hyd/2019 Manda Ilaiah (HUF) and another, Hyderabad. Collector, Land Acquisition Vs. MST. Katiju and others, [1987]167 ITR 471, wherein the Hon’ble Apex Court has held as under:
“3. The legislature has conferred the power to condone delay by enacting s. 5 of the Limitation Act of 1963 in order to enable the Courts to do substantial justice to parties by disposing of matters on "merits". The expression "sufficient cause" employed by the legislature is adequately elastic to enable the Courts to apply the law in a meaningful manner which subserves the ends of justice—that being the life-purpose of the existence of the institution of Courts. It is common knowledge that this Court has been making a justifiably liberal approach in matters instituted in this Court. But the message does not appear to have percolated down to all the other Courts in the hierarchy. 4. And such a liberal approach is adopted on principle as it is realized that: 1. Ordinarily, a litigant does not stand to benefit by lodging an appeal late. 2. Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As against this, when delay is condoned, the highest that can happen is that a cause would be decided on merits after hearing the parties. 3. "Every day's delay must be explained" does not mean that a pedantic approach should be made. Why not every hour's delay, every second's delay ? The doctrine must be applied in a rational common sense and pragmatic manner. 4. When substantial justice and technical considerations are pitted against each other, the cause
:- 5 -: ITA Nos. 1531 to 1533/Hyd/2019 Manda Ilaiah (HUF) and another, Hyderabad. of substantial justice deserves to be preferred, for the other side cannot claim to have vested right in injustice being done because of a non-deliberate delay. 5. There is no presumption that delay is occasioned deliberately, or on account of culpable negligence, or on account of mala fides. A litigant does not stand to benefit by resorting to delay. In fact, he runs a serious risk. 6. It must be grasped that the judiciary is respected not on account of its power to legalize injustice on technical grounds but because it is capable of removing injustice and is expected to do so.”
5.2 In the case of CIT Vs. K.F. Bioplant (P) Ltd., (Bom) 233 Taxman 74, wherein the Hon’ble Bombay High Court has held as under: “8. We have considered the application for condonation of delay keeping in mind the following observations of the Apex Court in State of M.P. v. Pradeep Kumar [2000] 7 SCC 372: 'It is true that the pristine maxim "Vigilantibus Non Dormientiobus Jura Subveniunt (Law assists those who are vigilant and not those who sleep over their rights). But, even a vigilant litigant is prone to commit mistakes. As the aphorism "to err is human" is more a practical notion of human behaviour than an abstract philosophy, the unintentional lapse on the part of a litigant should not normally cause the doors of judicature permanently closed before him . . .' This we counter-balanced by the likely prejudice to the other side on account of condoning the delay. We are of the view that in view of revenue's mistake the delay of 1845 days in taking out the present motion be condoned and we also set aside the order dated
:- 6 -: ITA Nos. 1531 to 1533/Hyd/2019 Manda Ilaiah (HUF) and another, Hyderabad. 7.11.2009 and restore the Appeal to the file of this Court. However, a mistake on the part of the revenue would have been averted if appropriate care had been taken by them. Thus, the lack of care which led to a mistake of 1845 days cannot be without costs. Therefore, the delay is condoned subject to the Appellant-revenue paying a cost of Rs.20,000/- to the respondent-assessee on or before 30.3.2015. Needless to state the appellant will also remove the office objections on or before 30.3.2015.”
In view of the ratios laid down by the Hon’ble Courts (supra) and in the interest of justice, we restore the matters back to the file of the CIT(A) with a direction to condone the delay in filing the appeals before him and decide the grounds of appeal of the assessees on merits. Accordingly, the CIT(A) is directed to afford reasonable opportunity of being heard to the assessees and thereafter decide the appeal on merits.
In the result, assessees appeals are allowed for statistical purposes in above terms. Pronounced in the open court on 7th April, 2021.
Sd/- Sd/- (S. S. GODARA) (L.P. SAHU) JUDICIAL MEMBER ACCOUNTANT MEMBER Hyderabad, Dated: 7th April, 2021. kv
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copy to : 1 Manda Ilaiah (HUF) 2 M Ilaiah and Company, C/o Shri AV Raghuram, Advocate, 610 Babukhan Estate, Basheerbagh, Hyderabad – 500 001. 2 ACIT, Circle – 1, Warangal 3 CIT(A) - 3 , Hyderabad 4 Pr. CIT – 3, , Hyderabad. 5 ITAT, DR, Hyderabad 6 Guard File.