THE JAGRITI NAGAR CO-OPERATIVE HOUSE BUILDING SOCIETY LTD,DELHI vs. INCOME TAX OFFICER, WARD 58(3), DELHI, DELHI

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ITA 4306/DEL/2026Status: DisposedITAT Delhi18 September 2026AY 2018-194 pages
AI SummaryRemanded

What did the Tribunal hold?

The ITAT held that the assessee had demonstrated 'sufficient cause' for the four-month delay in filing the appeal before the CIT(A). The Tribunal noted that the assessee had pursued a rectification under Section 154 of the Act before approaching the first appellate authority. Citing pronouncements from the Hon'ble Supreme Court in Collector Land Acquisition vs. Mst. Katiji & Ors. and Ram Nath Sao @ Ram Nath Sahu & Others vs Gobardhan Sao and Others, the Tribunal emphasized that acceptance of explanations for delay should be the rule and refusal an exception, especially when no negligence or want of bona fide can be imputed to the party. A pedantic and hyper-technical view should not be adopted, and the expression 'sufficient cause' should be liberally construed to subserve the ends of justice. Consequently, the delay of four months was condoned. The appeal was restored to the CIT(A) for adjudication on merits after affording the assessee a reasonable opportunity to present submissions. The issue of disallowance under Section 80P(2)(d) and exemption on collections from members was expressly left undecided by the ITAT, as the matter was remanded.

What were the facts?

The assessee, M/s The Jagriti Nagar Co-operative House Building Society Ltd., filed an appeal before the Income Tax Appellate Tribunal (ITAT) challenging the order of the Commissioner of Income Tax (Appeal) [CIT(A)] dated March 20, 2026, for Assessment Year 2018-19. The assessee's appeal before the CIT(A) was dismissed in limine due to a delay of four months in filing. The delay occurred because the assessee, a co-operative society, was advised by its tax consultant to first pursue a rectification petition under Section 154 of the Income-tax Act, 1961, before the Assessing Officer (AO). The AO had disallowed the assessee's claim for exemption on collections from members (Rs. 19,76,725/-) based on mutuality and a deduction under Section 80P(2)(d) on interest income (Rs. 2,66,519/-). The rectification petition was filed on April 30, 2025, and upon its dismissal, the assessee filed the appeal before the CIT(A).

What were the issues?

1. Whether the CIT(A) erred in dismissing the assessee's appeal in limine without condoning the delay in filing, contrary to the principles of natural justice and liberal interpretation of 'sufficient cause' under Section 5 of the Limitation Act, as applicable to appeals under the Income-tax Act, 1961? Assessee's Contention: The assessee argued that the delay of four months in filing the appeal before the CIT(A) was due to a bona fide pursuit of a rectification remedy under Section 154 of the Act, which was advised by tax professionals. The assessee contended that 'sufficient cause' for the delay was explained and that the appeal should be heard on merits, involving the limited issues of disallowance under Section 80P(2)(d) and exemption on collections from members based on mutuality. Revenue's Contention: The revenue argued that a Section 154 application is not an alternative remedy and that the assessee filed the rectification application on the last date of limitation for filing the appeal before the CIT(A), thereby praying for the dismissal of the assessee's appeal.

Which sections of the Income-tax Act were involved?

Section 154,Section 80P(2)(d)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH ‘SMC’ : NEW DELHI

Before: SHRI VIKAS AWASTHY

For Appellant: Shri S.K. Gupta, CA
For Respondent: Shri Manoj Kumar, Senior DR
Hearing: 23.06.2026Pronounced: 18.09.2026

2 ITA No.4306/Del/2026

3 ITA No.4306/Del/2026

4 ITA No.4306/Del/2026

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