RAMBIR SHARMA,VPO LAJWANA KALAN vs. ITO, WARD-1, JIND, INCOME TAX OFFICE, JIND

In this appeal the appellant has raised the following grounds of appeal: 1. The Ld. CIT(A) erred in law and on facts in dismissing the appeal in limine by refusing to condone the delay of 203 days, ignoring the settled principle that procedural delays should not defeat substantial justice. 2. The Ld. CIT(A) failed to appreciate that the assessment order passed under section 144 itself suffers from serious infirmities and that denial of condonation has resulted in perpetuating an illegal and unjust assessment. 3. The authorities below erred in treating the cash deposits as unexplained under section 69A, without appreciating that the Appellant is a Business Correspondent Agent (BCA) and the deposits were made on behalf of the bank in the ordinary course of authorised banking business. 4. The Ld. Assessing Officer failed to conduct any enquiry or verification regarding the Appellant's authorisation as a BCA, nature of transactions, or the corresponding credits, rendering the addition arbitrary and unsustainable. 5. The entire addition of 13,81,87,060 is bad in law as the cash deposited does not represent income of the Appellant but is fiduciary cash handled for and on behalf of the bank.

During the course of hearing the Ld. AR submitted that there has been a delay of 203 days in filing the appeal before the Ld. CIT(A). However, Ld. CIT(A) did not condone the delay under section 249(3) of the Income Tax Act.

Ground No. 1 & 2 of the present appeal relate to the said issue which are being taken up first.

As per para 2.5 of the order of the Ld. CIT(A) the appellant gave reasons for delay in filing of appeal in Form No. 35 in Column 14. The Ld. CIT(A)in para 2.6 referred to the deficiency letter issued to the appellant requesting him to furnish formal condonation petition with reasons for delay and evidence of the same substantiating the reasons for delay. Since the same were not furnished, the Ld. CIT(A) considered the reasons mentioned in Form No. 35 as the reasons for delay in filing of the appeal which are reproduced hereunder : R/Sir That the assessee not knowing of legal provisions and I have requested my chartered accountant to preferred an appeal to the Hon’ble appellant Commissioner of Income Tax, they under took to do the need full soon after the rush of work of filling returns of Income. I say that delay is totally bona fied and unintentional. This is the reason for being late in presenting the said appeal. That the assessee had no intention to jeopardize the interest of the revenue by delaying the filling of the appeal. Your kind honor is very deeply requested to condon the delay in filling of said appeal considering the genuine hardship and critical circumstances being affected by the assessee. 6. The Ld. CIT(A) on page 7 held that statutory obligation to file the appeal in time is on the appellant and cannot be shifted to the Authorized Representative and rejected the request for condonation on the ground that the assessee failed to establish the sufficient cause under section 249(3).

During the course of hearing the Ld. AR reiterated the contentions before the Ld. CIT(A) and submitted that great injustice has been caused to the appellant as he has not been heard on merits and the appeal has been dismissed by the Ld. CIT(A) on technical grounds of delay.

The Ld. DR supported the order of the Ld. CIT(A) and submitted that such a long delay should not be condoned.

We have heard the rival contentions of both the parties and perused the material available on the record. As per Section 249(3) assessee is required to establish the existance of sufficient cause for not presenting in appeal within specified period. However the word sufficient cause has not been defined in the Act and has to be interpreted in the light of facts and circumstances of the case. As per the appellant the appeal could not be filed in time due to default on the part of his Chartered Accountant. It is seen that the assessment order in this case was also passed under section 144 of the Act, where the appellant did not comply with various notices issued by the AO from time to time. The addition has been made for unexplained cash deposits in bank account. It is also true that it was statutory obligation of the assessee to ensure compliance before AO and file the appeal within time before the Ld. CIT(A). However the appellant’s right of contesting the addition on merit and prayer for relief cannot be brushed aside merely on the ground of technicalities. The justice demands that the appellant should be given second chance of presenting its case on merits.

In the result, appeal of the Assessee is allowed for statistical purposes.