SONA MANTRI ,MUMBAI vs. DCIT, CIRCLE 17(1), MUMBAI

आयकर अपीलीय अिधकरण, मुंबई पीठ�, मुंबई INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCHES, MUMBAI BENCH: A

BEFORE SMT. BEENA PILLAI, JUDICIAL MEMBER AND SHRI JAGADISH, ACCOUNTANT MEMBER

ITA 1196/MUM/2026 िनधा�रण वष�/Assessment Year: 2016-17) SONA MANTRI DCIT, CIRCLE 17(1) B-1705, WHISPERING HEIGHTS KAUTILYA BHAVAN, BKC MINDSPACE CHINCHOLI BANDRA EAST Vs. BUNDER ROAD, MALAD MUMBAI-400051, (WEST), MUMBAI-400064, MAHARASHTRA MAHARASHTRA अपीलाथ� Appellant ��थ� Respondent

Permanent Account Number of ABZPM1493K Assessee:

अपीलाथ� �ारा/Appellant represented by: Shri Nishit Gandhi, Advocate ��थ� �ारा/Respondent represented Shri Surendra Mohan ( SR. DR. by: )

सुनवाई की तारीख / Date of conclusion of hearing: 29-Jun-2026 घोषणा की तारीख / Date of pronouncement: 30/06/2026 आदेश / ORDER PER SMT. BEENA PILLAI, JUDICIAL MEMBER: Present appeal filed by assesse arises out of the order passed by NFAC, Delhi [hereinafter referred to as “Ld.CIT(A)”] dated 02/01/2023 for A.Y. 2016-17.

2.1. The Ld. DR did not seriously object to the condonation of delay and left the issue to the discretion of the Bench.

6.1 On merit the issue is in favour of the assessee. But there is a technical defect in the appeal since the appeal was not filed within the period of limitation. The assessee filed an affidavit saying that the appeal was not filed because of the Counsel’s inability to file the appeal. The Revenue has not filed any counter affidavit to deny the allegation made by the assessee. While considering a similar issue the Apex Court in the case of Collector, Land Acquisition v. Mst. Katiji and Ors. (167 ITR 471) laid down six principles. For the purpose of convenience, the principles laid down by the Apex Court are reproduced hereunder: (1) Ordinarily, a litigant does not stand to benefit by lodging an appeal late (2) Refusing to condone delay can result in a meritorious matter being thrown at the very threshold and cause of justice being defeated. As against this, when delay is condoned, the highest that can happen is that a cause would be decided on merits after hearing the parties. (3) 'Every day's delay must be explained' does not mean that a pedantic approach should be made. Why not every hour's delay, every second's delay? The doctrine must be applied in a rational, commonsense and pragmatic manner. (4) When substantial justice and technical consideration are pitted against each other, the cause of substantial justice deserves to be preferred, for the other side cannot claim to have vested right in injustice being done because of a nondeliberate delay. (5) There is no presumption that delay is occasioned deliberately, or on account of culpable negligence, or on account of mala fides. A litigant does not stand to benefit by resorting to delay. In fact, he runs a serious risk. (6) It must be grasped that the judiciary is respected not on account of its power to legalise injustice on technical grounds but because it is capable of removing injustice and is expected to do so. 6.2 When substantial justice and technical consideration are pitted against each other, the cause of substantial justice deserves to be preferred, for the other side cannot claim to have vested right for injustice being done because of nondeliberate delay. In the case on our hand, the issue on merit regarding allowability of deduction u/s. 80IB of the Act was covered in favour of the assessee by the binding Judgment of the jurisdictional High Court. Moreover, no counter-affidavit was filed by the Revenue denying the allegation made by the assessee. It is not the case of the Revenue that the appeal was not filed deliberately. Therefore, we have to prefer substantial justice rather than technicality in deciding the issue. As observed by Apex Court, if the application of the assessee for condoning the delay is rejected, it would amount to legalise injustice on technical ground when the Tribunal is capable of removing injustice and to do justice. Therefore, this Tribunal is bound to remove the injustice by condoning the delay on technicalities. If the delay is not condoned, it would amount to legalising an illegal order which would result in unjust enrichment on the part of the State by retaining the tax relatable thereto. Under the scheme of Constitution, the Government cannot retain even a single pie of the individual citizen as tax, when it is not authorised by an authority of law. Therefore, if we refuse to condone the delay, that would amount to legalise an illegal and unconstitutional order passed by the lower authority. Therefore, in our opinion, by preferring the substantial justice, the delay of 2819 days has to be condoned.”

3.1. In the present facts, on examining whether the reason stated by the assessee to seek condonation of delay before this Tribunal is sufficient to condone the delay and whether, there exists sufficient cause for not presenting the appeal before this Tribunal within the period of limitation under the statute, the assessee must show that, it was diligent in taking appropriate steps and the delay was caused notwithstanding with its due diligence. It is for the party concerned to explain the reasons for delay and it is not the 4 function of concerned authorities often to find cause for delay. The Court/authority has to examine whether the sufficient cause has been shown by the party for condoning the delay, and whether such cause is reasonable or not. 3.2. In case of People Education & Economic Development Society Vs. ITO reported in 100 ITD 87 (TM) (Chen), it was held that; “when substantial justice and technical consultation are pitted against each other, the cause of substantial justice deserves to be preferred for the other side cannot claim to have vested right in injustice being done because of non-deliberate delay”. 3.3. The next question that arises is whether delay was excessive or inordinate. There is no question of any excessive or inordinate when the reason stated by the assessee was a reasonable cause for not able to file the appeals within the period of limitation. The cause for the delay therefore deserves to be considered, when there exists a reasonable cause, and therefore the period of delay may not be relevant factor. In support, we rely on the decision of Hon’ble Madras High Court in the case of CIT vs. K.S.P. Shanmugavel Nadai and Ors. (153 ITR 596) considered the condonation of delay and held that there was sufficient and reasonable cause on the part of the assessee for not filing the appeal within the period of limitation. Hon’ble Madras High Court thus condoned nearly 21 years of delay in filing the appeal. As compared to 21 years, delay of about 1000 to 2000 days cannot be considered to be inordinate or excessive. 3.4. Hon’ble Madras High Court in the case of Sreenivas Charitable Trust reported in 280 ITR 357 held that, no hard and fast rule can be laid down in the matter of condonation of delay and the Court should adopt a pragmatic approach and the Court 5 should exercise their discretion on the facts of each case keeping in mind that in construing the expression "sufficient cause" the principle of advancing substantial justice is of prime importance and the expression "sufficient cause" should receive a liberal construction. Therefore, this Judgment of the Hon’ble Madras High Court (supra) clearly says that in order to advance substantial justice which is of prime importance, the expression "sufficient cause" should receive a liberal construction. Therefore, for the purpose of advancing substantial justice which is of prime importance in the administration of justice, the expression "sufficient cause" should receive a liberal construction. In opinion of this Tribunal, this decision of Hon’ble Madras High Court is applicable to the present facts of the case. A similar view was taken by Hon’ble Madras High Court in the case of Venkatadri Traders Ltd. v. CIT (2001) 168 CTR (Mad) 81 : (2001) 118 Taxman 622 (Mad). 3.5. Reliance is also placed on the decision of Hon’ble Mumbai Bench of this Tribunal in the case of Bajaj Hindusthan Ltd. v. Jt. CIT (AT) reported in 277 ITR 1 condoned the delay of 180 days when, the appeal was filed after the pronouncement of the Judgment of the Hon’ble Supreme Court. It is also to be noted that the Revenue has not filed any counter-affidavit opposing the application of the assessee for condonation of delay. Hon’ble Supreme Court in the case of Mrs. Sandhya Rani Sarkar vs. Smt. Sudha Rani Debi reported in AIR 1978 SC 537 held that, non- filing of affidavit in opposition to an application for condonation of delay may be a sufficient cause for condonation of delay. In this case, the Revenue has not filed any counter-affidavit opposing the application of the assessee, therefore, as held by 6 Hon’ble Supreme Court, there is sufficient cause for condonation of delay. Hon’ble Supreme Court also observed that; “It does not mean that when the delay was for longer period, the delay should not be condoned even though there was sufficient cause. Condonation of delay is the discretion of the Court/Tribunal. Therefore, it would depend upon the facts of each case. In our opinion, when there is sufficient cause for not filing the appeal within the period of limitation, the delay deserves to be condoned, irrespective of the duration/period.”

3.6. After considering the contents of the petition for condonation of delay, we are satisfied that the delay was caused due to circumstances beyond the control of the Assessee and that there was a reasonable and bona fide cause for not filing the appeal within the stipulated period. There is nothing on record to suggest that the delay was deliberate or attributable to any mala fide intention. We, therefore, feel that the reasons assigned by the assessee for the inability to present the appeal within time before this Tribunal deserves consideration based on the principles laid down by Hon'ble Supreme Court in case of Collector Land Acquisition Vs. Mst. Katiji & Ors., reported in (1987) 167 ITR 471. The relevant observation of Hon’ble Supreme Court in case of Collector Land Acquisition Vs. Mst. Katiji & Ors.,(supra) is as under:- “The Legislature has conferred the power to condone delay by enacting section 51 of the Limitation Act of 1963 in order to enable the courts to do substantial justice to parties by disposing of matters on de merits". The expression “sufficient cause” employed by the Legislature is adequately elastic to enable the courts to apply the law in a meaningful manner which subserves the ends of justice that being the life-purpose of the existence of the institution of courts. It is common knowledge that this court has been making a justifiably liberal approach in matters instituted in this court. But the message 7 does not appear to have percolated down to all the other courts in the hierarchy.

And such a liberal approach is adopted on principle as it is realized that :

3.7. Accordingly, in the interest of substantial justice, we condone the delay of 1,127 days in filing the present appeal, subject to the assessee depositing costs of Rs.5,000/- with the Maharashtra Legal aid cell and the assessee is directed to furnish affidavit of having made such payment. Subject to compliance with the aforesaid condition, the appeal is admitted for adjudication on merits. 4. Coming to the merits of the case, at the outset, the Ld. AR submitted that the impugned order passed by the Ld. CIT(A) is an ex parte order and has been passed in gross violation of the principles of natural justice without affording the assessee an effective opportunity of being heard. It was further submitted that the Ld. CIT(A), instead of adjudicating the issues on merits after considering the submissions and evidences of the assessee, 8 proceeded to dismiss the appeal ex parte, thereby causing serious prejudice to the assessee. 4.1. Having perused the impugned appellate order and considering the totality of the facts and circumstances of the case, we find that the matter deserves to be restored to the file of the Ld. CIT(A) in the interest of substantial justice. Accordingly, we set aside the impugned order and remit the matter to the file of the Ld. CIT(A) for de novo adjudication. The Ld. CIT(A) shall afford a reasonable and effective opportunity of being heard to the assessee, consider all the submissions and evidences that may be placed on record, and thereafter pass a reasoned and speaking order in accordance with law. The assessee is also directed to extend full cooperation in the appellate proceedings and refrain from seeking unnecessary adjournments. Thus, the grounds raised by the assessee are allowed for statistical purposes. In the result, appeal filed by assessee is allowed for statistical purposes. Order pronounced in the open court on 30/06/2026. Sd/- Sd/-

JAGADISH BEENA PILLAI ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai Dated: 30/06/2026 SC, Sr. P.S.

Copy to: SONA MANTRI , B-1705, WHISPERING HEIGHTS MINDSPACE CHINCHOLI BUNDER 1 ROAD, MALAD (WEST), MUMBAI-400064, MAHARASHTRA

DCIT, CIRCLE 17(1), KAUTILYA BHAVAN, BKC BANDRA 2 EAST, MUMBAI-400051, MAHARASHTRA

3 THE PCIT / CIT, 4 THE D.R., ITAT, MUMBAI BENCH 5 GUARD FILE