DIVISIONAL RAILWAY MANAGER,JAIPUR vs. ASSISTANT COMMISSIONER OF INCOME TAX (TDS), JAIPUR

आयकर अपीलीय अधिकरण] जयपुर न्यायपीठ] जयपुर IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES “B”, JAIPUR Jh jes'k lh 'kekZ] ys[kk lnL; ,oa Jh fot; iky jko] U;kf;d lnL; ds le{k BEFORE: SHRI RAMESH C SHARMA, AM & SHRI VIJAY PAL RAO, JM vk;dj vihy la-@ITA No. 1464/JP/2018 fu/kZkj.k o"kZ@Assessment Year :2010-11 cuke Divisional Railway Manager, A.C.I.T.(TDS), Vs. DRM Office, Near Jaipur Jaipur. Junction, Jaipur. TAN No. JPRD02777F vihykFkhZ@Appellant izR;FkhZ@Respondent vk;dj vihy la-@ITA No. 1467/JP/2018 fu/kZkj.k o"kZ@Assessment Year :2014-15 cuke Divisional Railway Manager, A.C.I.T.(TDS), Vs. DRM Office, Near Jaipur Jaipur. Junction, Jaipur. TAN No. JPRD02777F vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksj ls@ Assessee by : Shri Rajiv Sogani (CA) & Shri Rohan Sogani (CA) jktLo dh vksj ls@ Revenue by : Shri B.K. Gupta (CIT-DR) lquokbZ dh rkjh[k@ Date of Hearing : 28/01/2019 mn?kks"k.kk dh rkjh[k@ Date of Pronouncement : 11/02/2019 vkns'k@ ORDER PER: R.C. SHARMA, A.M. These are the appeals filed by assessee against the two separate orders of ld.CIT(A)-3, Jaipur dated 23/10/2018 for the A.Y. 2010-11 and 2014-15 respectively in the matter of order passed U/s 201(1) and ITA 1464 & 1467/JP/2018_ 2 DRM Vs ACIT 201(1A) of the Income Tax Act, 1961 (in short the Act). Following grounds have been taken by the assessee for the A.Y. 2010-11:

“1. In the facts and circumstances of the case and in law ld. CIT(A) has erred in not condoning the delay in filing the appeal. The action of ld.CIT (A) is illegal, unjustified, arbitrary and against the facts of the case. Relief may please be granted by condoning the delay in filing the appeal.

2. In the facts and circumstances of the case and in law ld. CIT(A) has erred in not adjudicating the appeal of the assessee on merits and rejecting the same on the technical ground. The action of ld.CIT (A) is illegal, unjustified, arbitrary and against the facts of the case. Relief may please be granted by deciding the appeal of the assessee on merits.

3. (a) In the facts and circumstances of the case and in law, the Id. AO has erred in creating a total demand of Rs. 3,69,81,060. The Id. AO has raised demand of Rs. 2,25,04,715 for short deduction of TDS and Rs. 1,44,76,345 towards interest on short deduction of TDS

(b) In the facts and circumstances of the case and in law, the Id. AO has erred in holding the assessee to be to be deemed in default for alleged non obtaining of the PAN numbers of respective employees and thereby holding the assessee liable to deduct TDS @ 20 percent as against the normal TDS obligation which was duly complied with by the assessee. The action of the ld. AO is illegal, unjustified, arbitrary, and against the facts of the case. Relief may please be granted by quashing the demand being illegal and without any basis.

add, amend, or alter any of the grounds on or before the hearing.”

The ld. CIT(A) dismissed the appeal on the plea that there was a delay in the filing the appeal without any reasonable cause.

4. It was argued by the ld. AR of the assessee that the office of DRM was not aware whether any order can be passed against it and whether such order is appealable and it came to know that such orders are appealable only when the department pressed for the payment of outstanding demand. The ld AR has invited our attention to the chronological dates of communication with the department with regard to short deduction of tax. The ld AR of the assessee has also invited our attention to the internal communication of the assessee to the senior employees for submitting PAN details, internal circulation of direction by assessee with respect to deduction of tax at source, with respect to furnishing information in order to avoid penal provisions. As per the ld

ITA 1464 & 1467/JP/2018_ 4 DRM Vs ACIT AR, the assessee has tried it best to get the required details so that wrongful demand raised by the department can be cancelled.

5. In support of his request for condonation of delay, reliance was placed on the following judicial pronouncements:

(i) Motilal Padampat Sugar Mills Co. Ltd. Vs. State of U.P. (1979) 118 ITR 326 (SC)

(ii) Collector, Land Acquisition Vs. Mst. Katiji & ors. (1987) 167 ITR 471 (SC).

(iii) M/s Hossana Ministries Vs. ITO(Exemptions) TC (Appeal) No. 3 of 2017 (Mad. H.C.)

(iv) Jayvantsinh N Vaghela Vs ITO (2013) 40 taxmann.com 491 (Guj). (v) CIT Vs. Sanmac Motor Finance Ltd. (2010) 322 ITR 309 (Mad). (vi) Prashanth Projects Ltd. Vs DCIT, IT Appeal No. 192/2014 (Bom H.C.) (vii) Midas Polymer Compounds Pvt. Ltd. Vs. ACIT (ITAT Cochin Bench) (viii) M/s Lahoti Overseas Ltd. Vs DCIT (ITAT Mum Bench)

ITA 1464 & 1467/JP/2018_ 5 DRM Vs ACIT

(i) In the case of K.G.N.M.M.W. Educational Research & Analysis Society Vs ITO [2015] 54 taxmann.com 329 (Jaipur - Trib.), it has been held by the Hon'ble Jaipur Tribunal that:

“In our considered view that the condonation petitions filed by the assessee and material available on the record, fail to invoke any confidence, fail to explain reasonable and sufficient cause for condonation of long delay of 347 days in filing these appeals . The assessee has to come clean with all the relevant facts, which happened in the period of one year. The assessee has to explain all the events and be specific in the dates. The depositions made in the C.A. affidavit remain uncorroborated and there is no affidavit from the said Shri Malik Parvej in support of the affidavit of C.A.. Thus, the vague affidavit given by the C.A. remains uncorroborated and unreliable. In the entirety of facts and circumstances of the case, we decline to condone the delay of 347 days in filing these appeals." It may be mentioned that in a recent decision dated 13.11.2018 (ii) in the case of Catholic Syrian Bank Ltd. Vs DCIT in to 345/Coch/2018 13.11.2018, the delay was not condoned by the Hon’ble Tribunal by observing that:

“The reason as come out from the condonation petitions filed by the assessee, as stated earlier, is that there was transfer of the officer who was handling the issue. We cannot accept such proposition as it cannot be considered as good and sufficient reason to condone the delay. It was submitted that the delay is to be condoned since the issue on merit covered in favour of the assessee. This submission

ITA 1464 & 1467/JP/2018_ 7 DRM Vs ACIT ignores the fact that the object of the law of limitation is to bring certainty and finality to litigation. This is based on the Maxim Interest reipublicae sit finis litium i.e. for the general benefit of the community at large, because the object is every legal remedy must be alive for a legislatively fixed period of time. The object is to get on with life, if you have failed to file an appeal within the period provided by the Statute. It is for the general benefit of the entire community so as to ensure that stale and old matters are not agitated and the party who is aggrieved by an order can expeditiously mover higher forum to challenge the same, if he is aggrieved by it.

As observed by the Apex Court in many cases, the law assist those who are vigilant and not those who sleep over their rights as found in the Maxim Vilil anti bus Non Dormientibus Jura Subveniunt”. In our opinion, merely because the assessee is not vigilant, it cannot follow that the assessee is bestowed with a right to the delay being condoned. We are conscious of the fact that the period of limitation should not come as an hindrance to do substantial justice between the parties. However, at the same time, a party cannot sleep over its right ignoring the statute of limitation and without giving sufficient and reasonable explanation for the delay, except its appeal to be entertained merely because the assessee is a Bank.

Appeals filed beyond a period of limitation have been entertained by us where the delay has been sufficiently explained such as in cases of bonafide mistake. Thus the assessee should be well aware of the statutory provisions and the period of limitation and should pursue its remedies diligently. It cannot expect their appeals be entertained because they are after all the assessee, notwithstanding the fact that delay is not sufficiently explained. Hence, the delay is not condoned and the appeals are unadmitted.

(iii) It may be mentioned that the Hon'ble ITAT, Hyderabad vide its order dated 09.09.2016 in the case of MiddiNarsaiah vs. DCIT [2016] 48 CCH 54 (Hyd. Trib.) has considered a number of judicial pronouncements while rejecting the application for condonation of delay and held as under:

ITA 1464 & 1467/JP/2018_ 8 DRM Vs ACIT

We are of the view that the reasons mentioned in the petition for condonation are not convincing as the reasons mentioned for delay in filing the appeal before the ITAT are that the assessee's attention was diverted due to criminal cases and pre-occupation in the business activities. The criminal proceedings were over by 06/03/2013 but the delay beyond this day is pure negligence on the part of the assessee, the delay of which cannot be condoned as per the reasons mentioned in the petition. In this connection, we refer to the following judgments:

………

4.5 Since, in the present case, the assessee could have very well avoided the delay by exercising of due care and attention at least after the month of March'2013, we are of the considered opinion that there exists no sufficient and reasonable cause for the delay of an inordinate period of 395 days and applying the principle laid down by Hon'ble Courts in the aforesaid decisions, we are not inclined to condone the said delay in filing the appeal before us. Accordingly, the appeal filed by the assessee is dismissed as barred by limitation.

Reliance is also placed on the following judicial pronouncements: 96 taxmann.com (496) (SC) 50 taxmann.com (446) Raj 180 taxman 476 (SC)

Therefore, in view of the above discussion, it was submitted by the ld. CIT-DR that since the assessee has failed to bring on record any sufficient cause for condonation of inordinate delay of about 31 months in filing appeal before the Ld. CIT(A), hence, the relevant ground of appeal may kindly be rejected and the appeal of the assessee be dismissed, accordingly.

ITA 1464 & 1467/JP/2018_ 9 DRM Vs ACIT

“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. The doctrine of equality before law demands that all litigants, including the State as a litigant, are accorded the same treatment and the law is administered in an even- handed manner. There is no warrant for according a step-motherly

ITA 1464 & 1467/JP/2018_ 10 DRM Vs ACIT treatment when the "State" is the applicant praying for condonation of delay. In fact, experience shows that on account of an impersonal machinery (no one in charge of the matter is directly hit or hurt by the judgment sought to be subjected to appeal) and the inherent bureaucratic methodology imbued with the note-making, file- pushing, and passing-on-the-buck ethos, delay on its part is less difficult to understand though more difficult to approve. In any event, the State which represents the collective cause of the community does not deserve a litigant non grata status. The Courts, therefore, have to be informed of the spirit and philosophy of the provision in the course of the interpretation of the expression "sufficient cause". So also the same approach has to be evidenced in its application to matters at hand with the end in view to do even-handed justice on merits in preference to the approach which scuttles a decision on merits.”

ITA 1464 & 1467/JP/2018_ 11 DRM Vs ACIT 11. In the result, appeals of the assessee are partly allowed for statistical purposes only. Order pronounced in the open court on 11th February, 2019.

Sd/- Sd/- ¼fot; iky jko½ ¼jes'k lh 'kekZ½ (VIJAY PAL RAO) (RAMESH C SHARMA) U;kf;d lnL;@Judicial Member ys[kk lnL;@Accountant Member Tk;iqj@Jaipur fnukad@Dated:- 11th February, 2019 *Ranjan आदेश की प्रतिलिपि अग्रेf’ात@ब्वचल वf जीम वतकमत वितूंतकमक जवरू vihykFkhZ@The Appellant-The Divisional Railway Manager, Jaipur. 1. izR;FkhZ@ The Respondent- The A.C.I.T.(TDS), Jaipur. 2. vk;dj vk;qDr@ CIT 3. vk;dj vk;qDr¼vihy½@The CIT(A) 4. विभागीय प्रतिनिधि] आयकर अपीलीय अधिकरण] जयपुर@क्त्ए प्ज्Aज्ए Jंपचनत 5. xkMZ QkbZy@ Guard File (ITA No. 1464 & 1467/JP/2018) 6. vkns'kkuqlkj@ By order,

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