ASHOK NAGAR CO-0P. HOUSING SOCIETY LTD.,MUMBAI vs. ITO 25(2)(1) & CIT (A), MUMBAI

IN THE INCOME-TAX APPELLATE TRIBUNAL, MUMBAI “A” BENCH, MUMBAI BEFORE SHRI ANIKESH BANERJEE, JUDICIAL MEMBER AND SHRI BIJAYANANDA PRUSETH, ACCOUNTANT MEMBER ITA No.468/MUM/2026 (AY: 2004-05) Ashok Nagar Co-Op. Housing vs. ITO 25(2)(1) & CIT (A) Society Ltd. Aayakar Bhavan, M. K. Road, Mumbai- 1, 2nd Floor, Jaihind Club Jaihind 400020. Society, N.S.Rd. No.11, Vile Parle(W), JVPD Scheme, Mumbai 400056. PAN/GIR No: AAAAA1953D (Appellant) (Respondent) Assessee by Shri Manish Desai, CA Revenue by Shri Surendra Mohan (Sr. DR) Date of Hearing 14.07.2026 Date of Pronouncement 21.09.2026 O R D E R PER BIJYANANDA PRUSETH, AM:

This appeal filed by the assessee emanates from the order passed under

section 250 of the Income-tax Act, 1961 (in short, ‘Act’) by the National Faceless

Appeal Centre [in short, ‘CIT(A)’], dated 28.04.2023 for the assessment year (AY)

2004-05. The appeal has been filed before the Tribunal on 20.01.2026 after delay

of 935 days.

“1. Regarding addition of Rs. 78.24,042/- as long Term Capital gains on Sale of Plot:

a) The Learned CIT(A) erred in confirming the addition of Rs. 78,24,042/- (Calculated at 6.6% of Total Long Term Capital gains of Rs. 11,85,46,085/-, 6.6% being the share of the Appellant in the plot of land) as Capital Gains on Sale of property in the computation of Income of the Appellant. 1

ITA No.468/MUM/2026 Ashok Nagar Co-Op. Housing Society Ltd

b) The learned CIT(A) has erred in confirming the ignorance of the facts by Leaned AO that the valuation of Rs. 11,88,43,200/- as determined by the Stamp Duty authorities cannot be the basis for determining the sale consideration.

c) The Learned CIT(A) has erred in confirming the ignorance of the facts by Learned AO that this plot was under acquisition by the Government of Maharashtra as the same was reserved for Recreation Ground, garden, Police Quarters as per Table 41(g) of the Development Control Regulations (DCR) 1991 and ignored letter dated 21.04.2003 of the Chief Engineer (9Dev. Plan), Municipal Corporation of Greater Mumbai confirming reservation of plot for public purpose, inter alia, Police Quarters.

d) The Learned CIT(A) has erred in confirming the ignorance of the facts by Learned AO that Home Dept. of the Government of Maharashtra had taken the possession of this plot in 1975 vide possession receipt dated 29/7/1975 issued by the Public Works and Housing Department of the Govt. Of Maharashtra.

e) The Learned CIT(A) has erred in confirming the non appreciation of the fact by Learned AO that provision of Section 50C cannot apply to sale of plot of land to the Government or where the Plot is reserved for a particular purpose by the Government and possession thereof taken by the Govt. of Maharashtra.

f) The Learned CIT(A) has erred in confirming the ignorance of the facts by Learned AO that the Officers of the Police Dept. proposed to form a co-op Hsg. Society. The proposed society entered into a memorandum of understanding on 25/1/2000 with 14 societies and the conveyance deed was executed between the said proposed society of the Police Officials and the 14 Societies on 14/5/2003 in respect of MOU dated 25/1/2000. 8) The Learned CIT(A) has erred in confirming the ignorance of the facts by Learned AO that the MOU in respect of the sale to the proposed society of Officers of the Indian Police Service (IPS) was entered into on 25.1.2000 whereas Section 50C of the Act was introduced with effect from 1.4.2003 and the subsequent Deed of Conveyance dated 14.05.2003 conveying the plot was only the fulfilment of a pre-existing obligation and hence cannot possibly be subjected to the rigors of section 50C of the Act which does not have a retrospective effect.

h) The Learned CIT(A) has erred in confirming the ignorance of the facts by Learned AO that the possession in respect of the above referred plot

ITA No.468/MUM/2026 Ashok Nagar Co-Op. Housing Society Ltd was already handed over to Home Department of the Government of Maharashtra in the year 1975.

i) The Learned CIT(A) has erred in confirming the ignorance of the facts by Learned AO that where a reserved plot is sold pursuant to possession being taken by a Government authority and/or where it can be used only for a public purpose like providing housing for Government (in the instant case for police quarters) there cannot be any leakage of revenue. Under the said circumstances and going by the mischief sought to be addressed, the provision of Section 50C of the Act cannot be made applicable on the instant case.

j) The Learned CIT(A) has erred in confirming the non appreciation of the fact by Learned AO that the value adopted or assessed by the Stamp Valuation Authority under sub section (2) exceeds the Fair Market Value of the plot on the date of transfer. A plot of land subject to reservation for a specified purpose cannot have a Fair Market Value equivalent to that of plot without encumbrances. Further in the instant case the encumbrance was use of plot for Police Quarters.

k) The Learned CIT(A) has erred in confirming the order passed by Learned AO without obtaining the valuation report as requested by the Appellant.”

application along with affidavit for condonation of delay in filing appeal before

the Tribunal. The application for condonation by the Chairman of the assessee

society is reproduced below for ready reference: “1. We wish to file an appeal against the order passed by commissioner of income tax CIT (A) dated 28-04-2023, for the AY 2004-05. This CIT (A) order was passed under section 250 vide DIN: ITBA/NFAC/S/250/2023-24/1052422256(1) and the assessment order was passed under section 143(3) r.w.s 147 and the assessment proceedings were initiated after passing order under section 263 of Income Tax Act, 1961.

ITA No.468/MUM/2026 Ashok Nagar Co-Op. Housing Society Ltd

condonation of delay is similar in content to that of the application reproduced

above. It is submitted in the application that the assessee was unaware of the

order of CIT(A) due to unforeseen circumstances and lack of proper notification.

The assessee became aware of the order of CIT(A) only after receiving

communication pertaining to the penalty proceedings. It is submitted that the

assessee has been diligent in monitoring its online portal and responding to all

communications. It is further submitted that the delay was neither intentional

nor deliberate but was caused by genuine lack of knowledge regarding the

passing and existence of the order.

ITA No.468/MUM/2026 Ashok Nagar Co-Op. Housing Society Ltd 5. On the other hand, the Ld. Sr. DR of the revenue has supported the order

of the CIT(A). He submitted that there was inordinate delay of 935 days in filing

the appeal before the Tribunal. The explanation of the assessee is of general

nature. The assessee has not given any explanation that there was “sufficient

cause” for not presenting the appeal within 2 months from the date of the

appellate order of the CIT(A).

delay. There is no dispute that there was delay of 935 days in filing the appeal

before the ITAT. The appellant submitted that the delay was not intentional and

deliberate. The Chairman of the assessee-society has filed an application for

condonation of the delay, supported by an affidavit, which has been reproduced

above. The reason given before the Tribunal is that the impugned order of the

CIT(A) was not intimated or uploaded. Only on receiving the notice for penalty

proceedings, the assessee came to know about the order of CIT(A) and thereafter,

promptly filed appeal before the Tribunal. The above reason could not be treated

as a “sufficient cause” in terms of provisions of section 253(5) of the Act for the

inordinate delay of 935 days. We find that the assessee has filed various replies

to the CIT(A) during the appellate proceedings. There is no reason as to why it did

not check the status of appeal after conclusion of hearing for such a long time.

We find that the Hon’ble Supreme Court in a number of decisions, namely, (i) P.

K. Ramachandran vs State of Kerala & Anr. (1997) 7 SCC 556, (ii) Pundik Jalam Patil 5

ITA No.468/MUM/2026 Ashok Nagar Co-Op. Housing Society Ltd vs. Executive Engineers, Jalgaon Medium Project, (2008) 17 SCC 448 and (iii)

Basawaraj and Anr vs. Special Land Acquisition Officer, (2013) 14 SCC 81, (iv)

Pathapati Subba Reddy (dies) By L. Rs. & Ors. Vs The Special Deputy Collector (LA),

SLP(C) No.31248 of 2018 (SC), dated 08.04.2024, held that condonation of delay

should not be granted only on the ground that ordinarily a litigant does not stand

to benefit by lodging an appeal late.

the law on the subject issue by stating that where a case has been presented in

the Court beyond limitation of time, the applicant has to explain as to what was

the “sufficient cause” which means an adequate and enough reason, which

prevented him to approach the Court within the limitation. In case a party is found

to be negligent, or for want of bonafide on his part in the facts and circumstances

of the case, or found to have not acted diligently or remained inactive, there

cannot be a justified ground to condone the delay.

the case of Pathapati Subba Reddy (dies) & Ors. vs. The Special Deputy Collector

(LA), in SLP (Civil) No. 31248 of 2018 (SC), the Hon'ble Supreme Court referred to

and discussed various decisions of Hon'ble Supreme Court and held as under:

“7. The law of limitation is founded on public policy. It is enshrined in the legal maxim “interest reipublicae ut sit finis litium” i.e. it is for the general welfare that a period of limitation be put to litigation. The object is to put an end to every legal remedy and to have a fixed period of life for every litigation as it is futile to keep any litigation or dispute pending indefinitely. Even public policy requires that

ITA No.468/MUM/2026 Ashok Nagar Co-Op. Housing Society Ltd there should be an end to the litigation otherwise it would be a dichotomy if the litigation is made immortal vis-a-vis the litigating parties i.e. human beings, who are mortals.”

Ors. vs. A. Krishnaiah Since Deceased by LRS., in Civil Appeal No. 317 of 2025,

dated 08.01.2025, has set aside the order of Hon’ble High Court of Karnataka in

WP No.7220 of 2014 wherein the Hon’ble High Court allowed the Writ Petition by

condoning the delay. The Hon’ble Supreme Court at para 13 observed as under:

‘13. We are at our wits end to understand why the High Court overlooked all the aforesaid aspects. What was the good reason for the High Court to ignore all this? Time and again, the Supreme Court has reminded the District judiciary as well the High courts that the concepts such as “liberal approach”, “Justice oriented approach”, “substantial justice” should not be employed to frustrate or jettison the substantial law of limitation.’

Ltd. vs. PCIT, (2025) 178 taxmann.com 257 (SC) dismissed the SLP against the

order of High Court that where the assessee contented that the delay was due to

negligence of the counsel to file appeal. The Madhya Pradesh High Court had

dismissed the appeal of the assessee. It was otherwise the duty of the assessee

to watch its affairs and there was gross negligence in the attitude to the assessee

in filing appeal and the assessee has not exercised any care to enquire about the

status of second appeal and tried to shift the responsibility towards his counsel.

The facts of the instant appeal are on weaker grounds and there was gross

negligence and inaction on part of the assessee. The assessee did not follow up

ITA No.468/MUM/2026 Ashok Nagar Co-Op. Housing Society Ltd the status of appeal after conclusion of hearing before the CIT(A). In view of the

facts of the case discussed above and respectfully following the authoritative

precedents cited supra, we find no reason to condone the inordinate delay of 935

days in filing appeal before the Tribunal in absence of any “sufficient cause”. The

appeal of the assessee is, accordingly, dismissed.

has been dismissed, the grounds on merit become academic in nature and do not

require adjudication.

Order is pronounced on 21.09.2026.

Sd/- Sd/- (ANIKESH BANERJEE) (BIJYANANDA PRUSETH) JUDICIAL MEMBER ACCOUNTANT MEMBER *Aniket Chand; Sr. PS MUMBAI Date: 21.09.2026 Copy of the Order forwarded to: 1. The Assessee 2. The Respondent 3. The CIT(A) 4. CIT 5. DR/AR, ITAT, MUMBAI 6. Guard File

By Order

Assistant Registrar ITAT, MUMBAI 8