MESERS KASHMIR ROAD LINES,JAMMU vs. THE DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE, JAMMU

M/s Kashmir Road Lines, Vs. The Deputy Commissioner of Plot No. 46 Transport Nagar, Income Tax, Central Circle Jammu Jammu [PAN No: AAGFK 4609M] (Appellant) (Respondent) Appellant by : Sh. Padam Bahl (Ld. C.A.) Respondent by: Sh. Charan Dass (Ld. D.R.) Date of hearing: 22.09.2020 Date of pronouncement: 22.09.2020 ORDER PER N.K. CHOUDHRY, JM:

This appeal has been preferred by the Assessee against the order dated 12-04-2018 impugned herein passed by the Ld. CIT(A)-5, Ludhiana u/s. 250(6) of the Income Tax Act, 1961 (hereinafter called as the ‘Act’) whereby the Ld. CIT(A) dismissed the appeal of the Assessee, on non-prosecution.

2.1 Ld. D R refuted the claim of the assessee and submitted that delay is long in period and hence not condonable. 2.2 Having heard the parties on the issue of delay in filling of the appeal. The law is well settled by the Higher Courts that while dealing with the application for condonation of delay, the Court has to see the conduct of the party and plausible and sufficient cause for non-filing of the statutory appeal within time.

2.3 The Apex Court in Collector, Land Acquisition, Anantnag v. Mst. Katiji (1987) I LLJ 500 SC, analyzed the provisions of law qua limitation Act and held that the expression 'sufficient cause' employed by the legislature in the Limitation Act is adequately elastic to enable the Courts to apply the law in a meaningful manner which sub-serves the ends of justice-that being the life purpose for the existence of the institution of Courts. It was further observed that a liberal approach is requires to be adopted on principle as ordinarily a litigant does not stand to benefit by lodging an appeal late. Further 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 3 Kashmir Road Lines v. Dy. CIT cause would be decided on merits after hearing the parties. The Apex Court further held that when substantial justice and technical considerations are pitted against each other, cause 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. It must be grasped that 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.

2.4 The Apex Court in N. Balakrishnan Vs. M. Krishnamurthy 2008(228) ELT 162(SC), the Apex Court, while condoning the delay of 883 days in filing an application for setting aside the ex parte decree held "That the purpose of Limitation Act was not to destroy the rights. It is founded on public policy fixing a life span for the legal remedy for the general welfare. The primary function of a Court is to adjudicate disputes between the parties and to advance substantial justice. The time limit fixed for approaching the Court in different situations is not because on the expiry of such time a bad cause would transform into a good cause. The object of providing legal remedy is to repair the damage caused by reason of legal injury. If the explanation given does not smack mala fides or is not shown to have been put forth as a part of a dilatory strategy, the Court must show utmost consideration to the suitor."

The Apex Court further held that It is axiomatic that condonation of delay is a matter of discretion of the Court. Section 5 of the Limitation Act does not say that such discretion can be exercised only if the delay is within a certain limit. Length of delay is no matter, acceptability of the explanation is the only criterion. Sometimes delay of the shortest range may be uncontainable due to a want of acceptable explanation whereas in certain other cases, delay of a very long range can be condoned as the explanation thereof is satisfactory. Once the Court accepts the explanation as sufficient, it is the result of positive exercise of discretion and normally the superior Court should not disturb such finding, much less in revisional jurisdiction, unless the exercise of discretion was on wholly untenable grounds or arbitrary or perverse. But it is a different matter when the first Court refuses to condone the delay. In such cases, the superior Court would be free to consider the cause shown for the delay afresh and it is open to such superior Court to come to its own finding even untrammelled by the conclusion of the lower Court."

4 Kashmir Road Lines v. Dy. CIT

A court knows that refusal to condone delay would result foreclosing a suitor from putting forth his cause. There is no presumption that delay in approaching the court is always deliberate. This Court has held that the words "sufficient cause" under Section 5 of the Limitation Act should receive a liberal construction so as to advance substantial justice vide Shakuntala Devi Jain Vs. Kuntal Kumari [AIR 1969 SC 575] and State of West Bengal Vs. The Administrator, Howrah Municipality [AIR 1972 SC 749]. It must be remembered that in every case of delay there can be some lapse on the part of the litigant concerned. That alone is not enough to turn down his plea and to shut the door against him. If the explanation does not smack of mala fides or it is not put forth as part of a dilatory strategy the court must show utmost consideration to the suitor. But when there is reasonable ground to think that the delay was occasioned by the party deliberately to gain time then the court should lean against acceptance of the explanation. While condoning delay the could should not forget the opposite party altogether. It must be borne in mind that he is a looser and he too would have incurred quiet a large litigation expenses. It would be a salutary guideline that when courts condone the delay due to laches on the part of the applicant the court shall compensate the opposite party for his loss.

2.5 The Apex Court in Nand Kishore v. State of Punjab (1995) 6 SCC 614, under the peculiar circumstances of the case condoned the delay of about 31 years, in approaching the apex Court and held that it must be remembered that in every case of delay there can be some lapse of the litigant concerned. That alone is not enough to turn down the pleas and to shut the doors against him. If explanation does not smack mala fide or does not put forth as a dilatory strategy, the Court must show utmost consideration of such litigant.

The Apex Court in the case of N. Balakrishnan (supra), clearly held that the length of delay is immaterial, it is the acceptability of the explanation and that is the only criteria for condoning the delay. The primary function of a Court is to adjudicate disputes between the parties and to advance substantial justice. It is well settled that bonafide lis cannot be thrown out on the basis of legal technicalities and it is utmost duty of the Courts to adjudicate the same. As it is well settled that the period of delay is not relevant for considering the 5 Kashmir Road Lines v. Dy. CIT application for condonation of delay. What is required to be seen as to whether a party seeking condonation of delay has made out a “sufficient cause or not”.

Coming to the instant case. We have perused the affidavit 2.6 filed by the previous counsel of the assessee who deposed that though appeal was prepared and appeal papers have been handed over to his Assistant for deposit of appeal Fee and filling before ITAT, Amritsar after getting signed by the assessee, however due to complete oversight, the same could not been done and ultimately filed belatedly though local Counsel Sh. Padam Behal Ld. C.A. and consequently resulted into delay of 124 days.

The Assessee has demonstrated the bonafide reasons and sufficient cause for non-filling of the appeal within the time limit. The contention of the assessee is supported by the affidavit of the previous counsel and even we could not find any material contrary and/or adverse to the claim of the assessee, therefore explanation offered and cause shown qua delay of 124 days in filling of the instant appeal seems to be bonafide, reasonable, sufficient and unintentional, hence deserves to be condoned. Consequently the same stands condoned.

6 Kashmir Road Lines v. Dy. CIT

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We also feel it appropriate to direct the Assessee/Appellant to extend its full co-operation and participation in the appellate proceedings before the Ld. CIT(A) as and when would be required and in case of default, the assessee shall not be subjected to any leniency.