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Income Tax Appellate Tribunal, DELHI BENCH ‘H’ NEW DLEHI
Before: SHRI ANIL CHATURVEDI & SHRI N.K. CHOUDHRY
PER N.K. CHOUDHRY, J.M.
These appeals have been preferred by the Assessee against the orders dated 19.05.2021, impugned herein, passed by the learned Commissioner of Income-tax (Appeals), National Faceless Appeal Centre, Delhi (in short “Ld. Commissioner”), u/s. 250 of the Income-tax Act, 1961 (in short ‘the Act’) for the assessment years2018-19 and 2019-20.
The facts and issues involved in the instant appeals are exactly similar except variation of days of delay in filing the appeals, thereforefor the sake of brevity, we are deciding ITA No. 848/Del/2021 as a lead case and the result of the same shall be applicable mutatis mutandis to ITA no. 849/Del/2021.
2 ITA Nos. 848 & 859/Del/2021
Brief facts, relevant for adjudication of the instant appeal are that in the instant case, an order u/s. 206C(6A)/206C(7) of the Act was passed by the Assessing Officer, wherein the Assessee was held to be in default without collection of tax at source as required u/s. 206 of the Act and consequently, the additions of Rs.8,57,070/- u/s. 206C(6A) and of Rs.94,667/- u/s. 206C(7) of the Act were made by the AO.
3.1 Against the said additions, the Assessee preferred first appeal before the ld. Commissioner and in column No. 15 of Form No. 35 described thereason of condonation of delay of 12 days in filing the appeal.
3.2 The prayer for condonation of delay made by the Assessee was rejected by the ld. Commissioner by dismissing the appeal as not maintainable on the ground that the appeal filed is not in conformity with the provisions of section 249(2) of the Act, as there is no sufficient cause for condonation of delay in filing the appeal. The concluding part of the impugned order is reproduced herein below for brevity and ready reference:
In the instant case, the appellant filed the appeal against the order U/s 206C(6A) of the Income Tax Act, 1961 was served upon the appellant on 15-03- 2019. The appeal was required to be filed within 30 days i.e. by 14-04-2019. However, it was belatedly filed on 26-04-2019. It is seen from columns 14 & 15 of the appeal memo that it had mentioned that his old CA refused to file the appeal citing that he is not well versed with the appellate matters and unable to file the appeal and thereafter, the assessee appellant rushed to new counsel for filing of appeal.Thus there is delay in filing of appeal.
3 ITA Nos. 848 & 859/Del/2021
9.1 The provisions of Section 249(3) lay down that an appeal may be admitted after the expiration of the said period, if the CIT(A) is satisfied that the appellant had sufficient cause for not presenting the appeal within that period.
9.2 There was a delay in filing the appeal. The appellant has stated the reasons in the appeal memo but not accompanied by any affidavit of the appellant and of the CA who has declined to file appeal, as reason stated by the appellant and thus delay is due to inadvertent omission on the part of his CA in taking appropriate action to file the appeal. These facts of the case suggest that the appellant has acted in a malafide manner or the reasons explained are only a device to cover an ulterior purpose. The explanation and the reason for delay must be bonafide and not merely a device to cover an ulterior purpose or an attempt to save limitation in an underhand way.
In the case of Senior Bhosale Estate (HUF) Vs Assistant Commissioner of Income Tax, the Hon’ble Apex Court allowed the condonation of delay in filing the concerned appeal pronouncing the principles behind condoning the delay in filing appeals before the Courts by applying section 5 of the Limitation Act, 1963. The Hon’ble Apex Court is of the view that the law of limitation is founded on public policy. The idea behind the law of limitation is not destroy the rights of the parties but to ensure that they do not resort to dilatory tactics and seek remedy without delay. The objection of the law of limitation is to keep alive the legal remedy with in a prescribed limited time but does not restrict courts to condone the delay in the interest of justice. There are certain genuine grounds which the courts may consider for the condonation of delay in cases where Appeals are filed after the expiry of period as laid down under the limitation Act, 1963. In the case of condonation of delay where the appeal was filed beyond the limitation of period, the courts are empowered to condone the delay, provided that the Appellant can prove his claim of inability to file the appeal within the prescribed period. Litigant must be able to demonstrate that there was “Sufficient Cause” which obstructs his action to file appeal in the prescribed time limit. Courts have also held that the expression “Sufficient Cause" shall receive liberal consideration for the sake of justice.
4 ITA Nos. 848 & 859/Del/2021
Thus, the condonation of delay is not automatic but is based upon on the facts of the case. Courts while condoning delays in filing appeals have power to examine the case and after ascertain the facts if delay was due to “Sufficient Cause” may condone the delay.
Considering the above discussion and facts, the appeal filed is not in conformity with the provisions of Sec 249(2) of the Act, and there is no sufficient cause for condonation of the delay in filing of the appeal, the present appeal is dismissed as not maintainable. Thus, the appeal filed by the appellant is dismissed as not maintainable.”
Against the dismissal of appeal on condonation of delay, the Assessee preferred the instant appeal.
Heard the parties and perused the material available on record.The Assesseeclaimed that after receiving the order dated 13.03.2019 passed by the Assessing Officer on dated 15.03.2019, approached his old Chartered Accountant, Shri Raj Kumar Arya, having office at MandiKalanwali for filing the appeal, who was handling the tax consultancy work of the Assessee for a long time, however, the said counsel refused to file the appeal on the ground that he is not well versed with the appellate matters. Thereafter, the Assessee immediately approached anew counsel,who ultimately filed the appeal, which resulted into delay of 12 days.
5.1 The ld. Commissioner while considering reasons qua delay in filling of the Appeal, observed that the reasons in the appeal memo not accompanied by affidavit of the appellant and of the CA who has declined to file appeal. These facts of the case suggest that the
5 ITA Nos. 848 & 859/Del/2021
appellant has acted in a mala fide manner or the reasons explained are only a device to cover an ulterior purpose.
5.2 We have given thoughtful consideration to the facts and circumstances of the case and reasons for delay in filling of appeal before the Ld. Commissioner and do not find any adverse material available on record against the Assessee’s contention. Hence considering the delay which is minuscule and settled principles to the effects, “when substantial justice and technical considerations are pitted against each other, cause of substantial justice deserves to be preferred. The primary function of a Court is to adjudicate disputes between the parties and to advance substantial justice. The power to condone the delay in approaching the Court has been conferred upon the Courts to enable them to do substantial justice to parties by disposing the cases on merit. The words "sufficient cause" under Section 5 of the Limitation Act should receive a liberal construction so as to advance substantial justice”, we are inclined to set aside the conclusion drawn by the ld. Commissioner in dismissing the appeal on the point of limitation.
Consequently the Assessee’s appeal under consideration is allowed and the case is remanded to the file of the ld. Commissioner for decision afresh, suffice to say while affording reasonable and proper opportunity of being heard to the Assessee.
TheAssesseeis also directed to cooperate with the proceedings and to appear as and when would be required by the ld. Commissioner.
5.3 Consequently ITA No. 848/Del/2021 is allowed.
6 ITA Nos. 848 & 859/Del/2021
In view of our decision in ITA No. 848/Del/2021, ITA no. 859/Del/2021 filed by the Assessee also stands allowed for statistical purposes.
In the result, both the appeals of the Assessee stand allowed for statistical purposes.
Order pronounced in the open court on 26/08/2022 Sd/- Sd/- (ANIL CHATURVEDI) (N.K. CHOUDHRY) ACCOUNTANT MEMBER JUDICIAL MEMBER
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