NAHSIK INDUSTRIES AND MANUFACUTERS ASSOCCIATION,NASHIK vs. INCOME TAX OFFICER, NASHIK

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ITA 2686/PUN/2025Status: DisposedITAT Pune30 July 2026AY 2016-178 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal condoned the delay of 2130 days, finding sufficient cause due to the circumstances explained by the assessee. The appeal was restored to the file of the CIT(A) for adjudication on merits.

What were the facts?

The assessee, a charitable trust, filed an appeal before the CIT(A) with a delay of 2130 days against an intimation under Section 143(1). The delay was attributed to disputes in the managing committee, appointment of an administrator, and the COVID-19 pandemic.

What were the issues?

Whether the delay in filing the appeal before the CIT(A) was due to a sufficient cause, and if so, whether the appeal should be admitted for adjudication on merits.

Which sections of the Income-tax Act were involved?

Section 143(1),Section 250,Section 5

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “B” BENCH, PUNE

Before: Dr. MANISH BORAD & SHRI PAVAN KUMAR GADALE

For Appellant: Shri Sanket Joshi
For Respondent: Shri Ajitesh Meena, JCIT
Hearing: 09.06.2026Pronounced: 30.07.2026

आयकर अपीलीय अधिकरण “बी” न्यायपीठ पुणे में । IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH, PUNE BEFORE Dr. MANISH BORAD, ACCOUNTANT MEMBER AND SHRI PAVAN KUMAR GADALE, JUDICIAL MEMBER

आयकर अपील सं. / ITA No.2686/PUN/2025 निर्धारण वर्ा / Assessment Year : 2016-17 Nashik Industries and ITO (Exemptions), Manufacturers Association, Ward-1, Nashik Vs. Plot No. 14, Satpur MIDC, Industrial Estate S.O. (Nashik), Nashik-422007 Maharashtra PAN-AAATN1763B अपीलार्थी / Appellant प्रत्यर्थी / Respondent Assessee by : Shri Sanket Joshi Department by : Shri Ajitesh Meena, JCIT Date of hearing : 09.06.2026 Date of Pronouncement : 30.07.2026 आदेश/ORDER PER DR. MANISH BORAD, ACCOUNTANT MEMBER :

This appeal at the instance of assesse pertaining to the A.Y. 2016-17 is directed against the order dated 10.09.2025 passed by ld. Addl/JCIT(A)-3, Delhi u/s 250 of the Income-tax Act, 1961 (in short ‘the Act’) dated 10.09.2025 which inturn is arising out of Intimation Order passed u/s 143(1) of the Act dated 17.05.2017. 2. Assessee has raised following grounds of appeal: “1) The leamed CIT(A) erred in dismissing the appeal in limine by refusing to condone the delay of 2130 days in filing the appeal against the intimation u/s 143(1) without appreciating that the

said delay had resulted due to a reasonable cause in case of the appellant and denial of adjudication on merits will result into irreparable loss to the beneficiaries of the appellant, which is a public charitable trust and therefore, the said delay same ought to have been condoned in the interest of justice. 2) The learned CIT(A) failed to appreciate that during the year in which the intimation u/s 143(1) was passed by the CPC, there were disputes in Managing Committee which led to appointment of Administrator by the Govt. to manage the activities of the appellant trust, who was not aware of the intimation passed by CPC and this fact came to the knowledge only in the year 2023 when newly appointed Managing Committee went through old records and the said claim was also substantiated by way of an Affidavit filed before CIT(A) and hence, in the absence of any evidence brought on record to disprove the above facts, the CIT(A) was not justified in not condoning the delay in filing appeal. 3) The learned CIT(A) ought to have appreciated that the adjustments made by the CPC u/s 143(1) without issuing any prior intimation about proposed adjustment, were apparently unjustified in law as well as on merits, and hence, the denial of adjudication of appeal on merits on the technical ground of delay was contrary to the ratio laid down by Hon'ble Supreme Court in the case of Inder Singh v. State of Madhya Pradesh [2025 Live Law (Supreme Court) 339] and various other decisions. 4) The appellant craves leave to add/ alter/ amend any of the grounds of appeal.”

3.

Brief facts as emanating from the record are that the assessee is a Public Charitable Trust registered under Bombay Public Trusts Act. Assessee derives rental income Interest from Fixed Deposits, Dividends from mutual funds, membership fees, directory, bulletin and calendar etc. For the year under consideration, assessee submitted its income tax return claiming deduction u/s.11(1)(a) of the Act. Assessee noted that there were certain errors in filing of the income tax return which needs to be rectified. As per the revised computation worked out by the assessee, the Gross Income works out to Rs.2,03,20,501/- and the Net taxable income is

Rs.7,60,452/-. However, CPC allowed deduction u/s.11(1)(a) of the Act to the extent of Rs.6,89,954/- only on the amount of Rs.45,99,690/- as against the allowable deduction on the gross income @15% which works out to Rs.30,48,075/-.

4.

Aggrieved assessee filed appeal before ld.CIT(A) but with an inordinate delay of 2130 days. Ld.CIT(A) dismissed the appeal as barred by limitation. Now the assessee is in appeal before this Tribunal. 5. At the outset, Ld. Counsel for the assessee submitted that the assessee has shown ‘sufficient cause’ for condonation of delay before Ld. CIT(A) who dismissed the appeal in limine without deciding on merit. Iti is further argued by counsel for the assessee that assessee has filed an affidavit giving detailed reasons as to why there was delay of 2130 days in filing the appeal before Ld. CIT(A). he drew the attention of the Bench to the reasons furnished by the assessee before ld.CIT(A) and submitted that delay deserves to be condoned. A prayer is made to restore the issues to the file of ld.CIT(A) as there was no adjudication on merits of the case.

6.

Ld. DR on the other hand vehemently argued supported the order of ld.CIT(A) and submitted that assessee has failed to show ‘sufficient cause’ for condonation of delay. Assessee has also failed to show any Bonafide reasons for such inordinate delay of 2130 days and therefore ld.CIT(A) has rightly dismissed the appeal of the assessee. 7. We have heard the rival submissions and perused the record placed before us. We first adjudicate the issue relating to delay of 2130 days before ld.CIT(A). For better appreciation of the issue for condonation of delay, we find that it is necessary to extract the

relevant portion of the impugned order of ld. CIT(A) wherein on due consideration of the explanation tendered by the assessee had dismissed the appeal as barred by limitation. Relevant portion of the order reads as follows : “6. Discussion & Decision: The Appellant was issued notice u/s 250 of the IT Act and in response to the notice, the appellant filed written submission. On the basis of written submission, statement of facts and the documents furnished along with form 35, the appeal is decided on merit. The intimation u/s 143(1) of the Income-tax Act, 1961 in the case of the appellant was passed by the AO(CPC) on 17.05.2017, wherein total income of assessee was calculated amounting to Rs. 38,53,800/- instead of NIL income as filed by the appellant in his ITR. Aggrieved by the said assessment, the appellant filed 1st appeal on 15.04.2023, thereby causing a delay of 2130 days in filing the appeal. 6.2 The appellant has submitted a request for condonation of the said inordinate delay and has contended the following as reasons, which is reproduced as under- 6.2.1 The intimation u/s 143(1) is dated 17.05.2017. Therefore, the due date of filing appeal was 16.06.2017. The appeal is being filed on 15.04.2023. Therefore there is delay of 2130 days in filing appeal. 6.2.2 This delay was due to the fact that there were disputes in the managing committee in F.Y. 2017-18 and the Administrator was appointed by Government Authorities from the year 2018. The administrator appointed by Government Authorities had not filed appeal probably as the managing committee was dissolved and administrator was not aware of the order passed u/s. 143(1) of the Act by CPC, Bengaluru. From March 2020 to 2022 there was COVID-19 Pandemic. Now, the new managing committee was appointed prior to three-four months after taking charge they have noticed that the refund of subsequent years were adjusted against the demand for A.Y. 2016 17. Therefore, after noting the facts the appeal is now being filed.

6.3 The explanation provided by the appellant has been carefully perused. It is observed that the reason cited above cannot be accepted, as ignorance of law is not a valid excuse for delay in filing appeal, as upheld consistently by judicial forums. 6.4 The Hon'ble Supreme Court in the recent case of Pathapati Subba Reddy (Died) by LRs. & Ors. vs. The Special Deputy Collector (LA) dated 08.04.2024 has laid down that:

Section 3 of the Limitation Act is mandatory in nature. No appeal can be entertained if filed beyond the prescribed period, unless covered under exceptions laid out in Sections 4 to 24. Section 5 provides discretionary power to condone delay only when "sufficient cause" is shown. Courts must balance substantial justice and statutory compliance, but discretion cannot be exercised arbitrarily or merely on sympathetic grounds. Even where "sufficient cause" is established, the delay may still not be condoned if negligence or lack of due diligence is evident. The Apex Court further held that delay cannot be condoned merely because some other similarly placed persons were granted relief and that each case must be judged independently based on its facts. STAY DEPAR 7. In the instant case, the delay of 2130 days is inordinate, and the reasons advanced by the assessee do not constitute "sufficient cause" within the meaning of Section 5 of the Limitation Act. The assessee's failure to act diligently and reliance on assurances from third parties reflect negligence and lack of bona fide. 8. In view of the above discussion, particularly in light of the law laid down by the Hon'ble Supreme Court and the facts of the present case, the application for condonation of delay stands rejected, and consequently, the appeal is hereby dismissed as being barred by limitation. 9. In result, appeal of the appellant is hereby dismissed.”

8.

Ld. CIT(A) while dismissing the appeal of the assessee has relied on the judgment of Hon’ble Supreme Court in the case of Pathapati Subba Reddy (Died) by L.Rs and Ors. Vs. The Special Deputy Collector (LA) dated 08.04.2024 2024 INSC 286 [Special Leave Petition (Civil)

No. 31248 OF 2018 in para 6.3 of the impugned order of Ld. CIT(A) as referred above.

9.

While examining the reasons furnished by the assessee in para 6.2.2 of the impugned order, we note that there exists ‘sufficient cause’ for condonation of delay. Assessee has submitted that there was disputes in the Managing Committee and the committee was dissolved. The period from March 2020 to March 2022 admittedly cannot be reckoned for counting the period of limitation in light of judgment of Hon’ble Apex Court on account of covid-19 pandemic outbreak prevailed all over the country and its restrictions. It was only on noticing the adjustment of refund for subsequent years, the entire facts came to light and the appeal could be filed with a delay of 2130 days.

10.

We further notice that the Revenue has not controverted the reasons furnished by the assessee and nothing has been brought on record before us that the said reasons are not correct. Thus, in light of above facts, we are satisfied that the explanation furnished by the seeking condonation of delay is bonafide and are genuine. There is nothing to show that assessee has not acted in a diligent manner or was negligent in presenting the matter before ld.CIT(A). Therefore, Adopting justice oriented approach and placing reliance on the judgments of Hon’ble Apex Court in the case of Collector, Land Acquisition, Anantnag & Anr. Vs. Mst. Katiji & Ors. reported in (1987) 2 SCC 107 and in the case of Inder Singh Vs. State of Madhya Pradesh judgment dated 21.03.2025 (2025 INSC 382) we condone the delay of 2130 days in filing the appeal before ld.CIT(A) and admit the appeal for adjudication.

11.

Since ld.CIT(A) has not adjudicated the issues on merits, we on considering the totality of the facts of the case and in the interest of justice, deem it proper to restore the issues to the file of the Ld. CIT(A)/ NFAC for adjudication of the issues on merit as contemplated u/s.250(6) of the Act. Needless to mention that ld.CIT(A) shall give reasonable opportunity to the assessee. Assessee is directed to update email and contact details on the ITBA portal. Assessee is also hereby directed to respond to the notices issued by the office of the ld. CIT(A)/ NFAC without seeking any adjournment under any pretext failing which the ld. CIT(A)/ NFAC is at liberty to pass appropriate order as per law. We hold and direct accordingly. Impugned order is set aside and the effective grounds raised by the assessee are allowed for statistical purposes.

12.

In the result appeal of the assesse is allowed for statistical purposes.

Order pronounced on this 30th day of July, 2026. (PAVAN KUMAR GADALE) (MANISH BORAD) JUDICIAL MEMBER ACCOUNTANT MEMBER पुणे /Pune; दिन ांक /Dated: 30th July, 2026. Satish

Digitally signed by Satish Kumar Madishetty Satish Kumar Madishetty Date: 2026.07.30 18:34:02 +05'30'

आदेश की प्रतिलिपि अग्रेपिि /Copy of the Order forwarded to:

1.

अपील र्थी / The Appellant. 2. प्रत्यर्थी / The Respondent. 3. The Pr. CIT concerned. 4. विभ गीय प्रतितनधि, आयकर अपीलीय अधिकरण, "बी "बेंच, पुणे / DR, ITAT, "B" Bench, Pune. 5. ग र्ड फ इल / Guard File. आिेश नुस र / BY ORDER, //// सह यक रजिस्ट्र र/

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