SARNATH CO-OP HOUSING SOCIETY LTD,DESAI ROAD vs. CIT (APPEAL), PIRAMAL CHAMBER

ITA 3207/MUM/2025Status: DisposedITAT Mumbai30 September 2025AY 2012-1318 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that the assessee had established sufficient cause for condoning the delay in filing the appeal before the CIT(A). The Tribunal noted that the revenue had not contradicted the assessee's affidavit filed to explain the delay. Citing the Supreme Court's decisions in Union of India vs. Jahangir Byramji Jeejeeboy and Collector, Land Acquisition vs. MST. Katiji & Ors., the Tribunal emphasized that a liberal approach should be adopted to do substantial justice and avoid meritorious matters being thrown out at the threshold. The Tribunal found the explanation for the delay to be bonafide and genuine, attributing it to circumstances beyond the assessee's control, including internal disputes and administrative disruptions. The Tribunal also noted that the issue of deduction of interest earned by a group housing society from its deposit with a cooperative bank was no longer res integra, having been decided in favour of the assessee by coordinate benches. Consequently, the Tribunal set aside the CIT(A)'s order, condoned the delay, and restored the case to the CIT(A) for disposal on merits. The assessee was directed to present its case before the CIT(A) within 90 days. The grounds raised by the assessee were allowed for statistical purposes.

What were the facts?

The assessee, Sarnath Co-Operative Housing Society Ltd., filed an appeal before the CIT(A) for Assessment Year 2012-13. The CIT(A) dismissed the appeal as barred by limitation, refusing to condone a delay of 3789 days. The assessee had filed a return declaring an income of Rs. 17,680, but an intimation under section 143(1) on 04-06-2014 computed total income at Rs. 9,60,668, disallowing Rs. 6,97,241 as 80P deduction. The assessee contended that the delay was due to prolonged disputes within the society regarding financial management, handover of records, and unauthorized occupation of space by an office bearer. These disputes led to administrative disruptions, including the society office remaining closed for a considerable period. The assessee also pointed to a similar delay in another appeal (ITA No. 2549/MUM/2025 for AY 2015-16) where the delay was condoned by the CIT.

What were the issues?

1. Whether there was sufficient cause for condoning the delay of 3789 days in filing the appeal before the CIT(A) for AY 2012-13, as required under Section 250 of the Income Tax Act, 1961? Assessee's Contention: The assessee argued that the delay was caused by significant internal disputes within the society, including disagreements over financial management, non-cooperation in record handover, and allegations of misuse of position by an office bearer. These disputes led to administrative paralysis and prolonged non-functional periods for the society's office, hindering timely statutory compliances. The assessee relied on an affidavit detailing these issues and pointed to a previous instance where a similar delay was condoned by the CIT in the assessee's own case. The assessee sought to refer the matter back to the CIT(A) for a decision on merits. Revenue's Contention: The judgment records no specific argument from the revenue regarding the condonation of delay or the merits of the case.

Which sections of the Income-tax Act were involved?

Section 250,Section 143(1)

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Income Tax Appellate Tribunal, MUMBAI BENCH “J(SMC

Before: SHRI OM PRAKASH KANT & SHRI. RAJ KUMAR CHAUHAN

PER RAJ KUMAR CHAUHAN (J.M.):

1.

This appeal is filed by the appellant/assessee against the order dated 27.02.2025 of Learned Commissioner of Income Tax (Appeals)/Addl/JCIT (A)-4, Hyderabad [hereinafter referred to as the “CIT(A)"], passed under section 250 of the Income Tax Act, 1961 [hereinafter referred to as "the Act”] for the A.Y. 2012-13, wherein the appeal of the assessee is dismissed being barred by limitation and the Ld. CIT(A) has refused to condone the delay stating that the assessee has failed to show sufficient cause for condonation of delay.

2.

The brief facts of the case are that, th

The order continues below.

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