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Income Tax Appellate Tribunal, ‘C’ BENCH, CHENNAI
Before: SHRI V. DURGA RAO, HON’BLE & SHRI MANJUNATHA. G, HON’BLE
:-2-: 445 to 448/Chny/2023 these appeals are heard together and are being disposed off by this consolidated order.
At the outset, we find that there is a delay of 40 days in filing of all four appeals, for which a petition for condonation of delay in filing appeals along with affidavit explaining reasons for delay has been filed. The Ld. Counsel for the assessee, submits that the delay in filing of appeals is due to reasons beyond control of the assessee because the consultant who render service to the assessee in tax matters expired due to covid-19 infection and hence, no communication was received through him either in respect of posting of appeals or action taken there under. The assessee immediately after noticing no action from the consultant, taken steps to file appeals which caused delay of 40 days, but such delay is neither intentional or for deriving any undue benefit. Therefore, delay in filing of appeals may be condoned in the interests of justice.
The ld. DR present for the revenue fairly agreed that, the assessee being a Government deductor, delay caused in filing appeals may be condoned in the interest of advancement of substantial justice.
:-3-: 445 to 448/Chny/2023 4. Having heard both the sides and considered reasons given by the appellant for delay in filing of appeals, we find that reasons given by the appellant are bonafide and further comes under reasonable cause as provided under the Act for condonation of delay and thus, we condone the delay in filing of appeals and admit appeals filed by the assessee for adjudication.
The assessee has more or less raised common grounds of appeal
for all four assessment years. Therefore, for the sake of brevity, grounds of appeal filed for assessment year 2005- 06 in are reproduced as under: “1. The national faceless appeal centre is not justified in dismissing the appeal in limine, without condoning the delay of 1718 days.
2. The National faceless appeal centre is not justified in ignoring the contention of the appellant that the appeal filed with the delay was already condoned in the physical format of the appeal proceedings hitherto addressed so far.
3. The national faceless appeal centre omitted to construe the true purport the present appeal as between 2 limbs of the government, the one representing the union territory controlled by the federal government and the other the federal government itself, income tax department being part thereof.
4. The national faceless appeal centre is not justified in confirming the levy Rs. 5,22,591 towards alleged tax deducted at source in respect of compensation payments.
5. The national faceless appeal centre is not justified in confirming the charge of interest under section 201 (1A) in the sum of Rs. 5,95,571 in respect of compensations awarded towards acquisition of agricultural lands.
:-4-: 445 to 448/Chny/2023 6. In any event the order of the national faceless appeal centre is arbitrary capricious and made without due regard to the facts and circumstances of your appellants case and the law applicable there to ..
Your appellant craves the indulgence of the hon'ble income tax appellate tribunal to furnish additional grounds/additional evidence to further the cause of the appeal.
There is a delay of days in filing the appeal, for which a separate condonation petition is filed.
For these grounds and for such other grounds that may be adduced at the time of hearing it is sprayed that the order of the national faceless appeal centre be cancelled, and the appeal restored for adjudication on merits of the case.”
The brief facts of the case are that, the appellant is a Sub Collector (Revenue) North cum Land Acquisition Officer, Pondicherry. The appellant has paid compensation to various persons for the acquisition of land by the Government of Pondicherry for various development works without deduction of tax at source u/s. 194LA of the Income-tax Act, 1961 (hereinafter referred to as “the Act”). An order u/s. 201(1) and 201(1A) of the Act, was passed on 27.03.2008 and raised a demand for short collection of tax and interest thereon. The assessee filed an appeal against the order before the first appellate authority. The CIT(A) has called for remand report from the Assessing Officer to ascertain whether lands acquired by the appellant are agricultural lands or non-agricultural lands to apply provisions of section 194LA of the Act. The Assessing Officer submitted a detailed remand report on 21.06.2010 and :-5-: 445 to 448/Chny/2023 classified lands acquired by the appellant into agricultural lands and non-agricultural lands. The ld. CIT(A), allowed partial relief to the assessee on the basis of remand report submitted by the Assessing Officer. However, confirmed computation of short deduction of TDS and interest thereon, wherever the Assessing Officer stated that lands acquired by the appellant are non-agricultural lands. The assessee carried the matter in further appeal before the tribunal and the ITAT, vide their order dated 20.04.2012 in ITA No. 121 to 128/2012, set aside the order passed by the CIT(A) and restore the issue back to the file of the Assessing Officer for fresh adjudication after providing a reasonable opportunity of being heard to the assessee.
7. During second round of litigation, the Assessing Officer called upon the assessee to file necessary details of lands acquired and compensation paid to various persons. In response, the assessee vide letter dated 30.03.2014 submitted that when land was acquired by the Government, the classification of lands as per the revenue records were taken and wherever it was found that lands are agricultural in nature as per revenue records TDS has not been deducted. The :-6-: 445 to 448/Chny/2023 Assessing Officer, however was not convinced with the explanation furnished by the assessee and according to the Assessing Officer, certain lands has been developed into housing flats and thus, opined that lands acquired by the appellant are non-agricultural lands and thus, computed short deduction of TDS and interest thereon u/s. 201(1) and 201(1A) of the Act. Being aggrieved by the demands raised by the Assessing Officer, the appellant preferred Writ Petition before the Hon’ble High Court of Madras and the Hon’ble High Court of Judicature at Madras passed order dated 14.06.2018 and disposed off Writ Petition filed by the appellant with a liberty to move appellate authority challenging order passed by the Assessing Officer u/s. 201(1) and 201(1A) of the Act. Thereafter, the appellant has filed appeal before the CIT(A) on 11.01.2019 with a delay of more than seven months. The CIT(A) for the reasons stated in their appellate order dated 26.12.2022 dismissed appeal filed by the assessee in limine without condoning delay in filing of appeal, on the ground that the assessee could not explain reasons for delay in filing of appeal. Being aggrieved by the CIT(A) order, the assessee is in appeal before us.
:-7-: 445 to 448/Chny/2023 8. The Ld. Counsel for the assessee, submits that the ld. CIT(A) has dismissed appeals filed by the appellant in limine without condoning delay in filing of appeals, even though the assessee has explained reasons for such delay. Therefore, he submits that the delay in filing of appeals before the CIT(A) may be condoned and the issue may be restored to the file of the CIT(A) to decide the issue on merits.
9. The ld. DR, present for the revenue fairly agreed that the issue may be set aside to the file of the CIT(A) to decide the issue on merits.
We have heard both the parties, perused materials available on record and gone through orders of the authorities below. We find that the ld. CIT(A) dismissed appeals filed by the assessee in limine for delay in filing of appeals on the ground that, the assessee could not adduce reasons for not filing appeals within due date prescribed under the Act. We have gone through reasons given by the ld. CIT(A) in light of facts of present case and we find that the assessee being a government deductor was unable to pursue its case with appellate authorities by utmost care due to various reasons. However, there is no molafide intention or deliberate attempt :-8-: 445 to 448/Chny/2023 made by the appellant not to file any appeal to derive any advantage. Therefore, we are of the considered view that the CIT(A) ought to have condoned the delay in filing of appeals for advancement of substantial justice. Further, the issue involved in the present case is non-deduction/short deduction of TDS u/s. 194LA of the Act, for compensation paid to various persons for compulsory acquisition of lands. It was the argument of the appellant before the first appellate authority that lands acquired by the Government from various persons are agricultural lands on which provisions of section 194LA has no application. Therefore, in our considered view, when the Government has compulsorily acquired lands from various persons, the nature of lands needs to be ascertained from the revenue records for application of provisions of section 194LA of the Act. In the present case, the Assessing Officer on the basis of subsequent development in adjourning lands, came to the conclusion that the lands acquired by the appellant are non-agricultural lands and thus, the appellant ought to have deducted TDS u/s. 194LA of the Act. Since, the substantial issue involved in the present appeals is application of provisions of section 194LA of the Act for deduction of tax at source for compensation paid for compulsory acquisition of :-9-: ITA. Nos: 445 to 448/Chny/2023 lands, in our considered view, the CIT(A) should have condoned the delay in filing of appeals considering the nature of deductor to decide the issue involved on merits, more particularly, when the appellant had given sufficient and bonafide reasons for not filing appeals within the time allowed under the Act. Therefore, we set aside the order passed by the ld. CIT(A) for all four years and direct the CIT(A) to condone the delay in filing of appeals before the first appellate authority and adjudicate the substantial issue of applicability of provisions of section 194LA of the Act on payments made for compulsory acquisition of lands by the Government of Pondicherry.