KIRAM PUKHRAJ JAIN ,MUMBAI vs. INCOME TAX OFFICER WARD 22(2)(1), MUMBAI

PDF · subscribers
ITA 2135/MUM/2026Status: DisposedITAT Mumbai14 May 2026AY 2018-197 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 significant delay in filing the appeal, holding that the assessee should not suffer for the negligence of their professional. The CIT(A)'s order dismissing the appeal in limine was set aside.

What were the facts?

The assessee filed an appeal before the CIT(A) with a delay of 1631 days. The delay was attributed to the negligence of the assessee's Chartered Accountant who failed to act on the intimation under section 143(1). The assessee only became aware of the demand upon appointing a new CA.

What were the issues?

Whether the delay in filing the appeal before the CIT(A) was sufficiently explained and should be condoned. Whether the CIT(A) erred in dismissing the appeal without adjudicating on merits.

Which sections of the Income-tax Act were involved?

Section 143(1),Section 54,Section 80TTA

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI BENCHES, MUMBAI

Before: HON’BLE BEENA PILLAI & HON’BLE ARUN KHODPIA

For Respondent: Shri Sandeep Jumale

आदेश / ORDER PER BEENA PILLAI, JUDICIAL MEMBER:

Present appeal is filed by the assessee against the order passed by Learned Commissioner of Income Tax, Appeal/Addl./JCIT(A)-1, Guwahati [hereinafter to as the “Ld.CIT(A)”] dated 07/01/2026, for A.Y. 2018-19, on the following grounds of appeal:-

“1. Condonation of delay 1.1. The Commissioner of Income-tax (Appeals) [hereinafter referred to as "the CIT(A)] erred in not condoning the delay in filing appeal against the intimation dated 30.12.2020 under section 143(1) of the Income-tax Act, 1961 (hereinafter referred to as "the Act") for reasons which are wrong, contrary to facts and position in law; 2. Disallowing deduction of Rs. 26,00,619/- under section 54 of Act 2.1. The Centralized Processing Center (hereinafter referred to as "the CPC")/ CIT(A) erred in not allowing deduction claimed under section 54 of Act of Rs. 26,00,619/-; 3. Disallowing deduction of Rs. 10,000/- under section 80TTA of the Act 3.1. The CPC/ CIT(A) erred in in not allowing deduction of Rs. 10,000/-under section 80TTA of Act against savings bank interest; 4. The above grounds/sub grounds of appeal are without prejudice to each other; 5. The appellant craves the leave to add, amend or alter all or any of the grounds of appeal.” 2. The primary grievance raised by the assessee before us is against the action of the Ld.CIT(A) in not condoning the delay of 1631 days in filing the appeal and consequently dismissing the appeal in limine without adjudicating the issues on merits, though grounds on merits have also been raised before us.

3.

The Ld. AR submitted that the delay occurred due to bona fide reasons beyond the control of the assessee. Referring to the averments made in Column No.15 of Form No.35 and the detailed application for condonation of delay, the Ld. AR submitted that the assessee had entrusted all taxation and compliance matters to one Mr. Suresh Phootermal Jain, Chartered Accountant, who had been handling the tax affairs of the assessee since 2007. It was submitted that the intimation issued u/s 143(1) dated 30/12/2020 was sent to the said Chartered Accountant; however, despite apparent mistakes in the processing of return, no remedial action was taken by him. The Ld. AR submitted that only after the assessee appointed a new Chartered Accountant in F.Y. 2024-25 and the income-tax portal was examined, the assessee came to know about the outstanding demand, whereafter immediate steps were taken to file the appeal before the Ld.CIT(A). The Ld. AR contended that the delay was neither deliberate nor intentional and that the assessee should not be penalised for the negligence of the professional engaged by him.

3.1. The Ld. AR further submitted that while considering applications for condonation of delay, the authorities are expected to adopt a liberal and pragmatic approach in order to advance substantial justice. Reliance was placed on the judgment of the Hon’ble Supreme Court in Collector, Land Acquisition, Anantnag & Anr. v. Mst. Katiji & Ors. reported in (1987) 167 ITR 471 (SC) wherein it was held that substantial justice should prevail over technical considerations and that ordinarily a litigant does not stand to benefit by lodging an appeal belatedly. Reliance was also placed on Vedabai alias Vaijayanatabai Baburao Patil v. Shantaram Baburao Patil & Ors. reported in (2001) 253 ITR 798 (SC) wherein the Hon’ble Apex Court held that the expression “sufficient cause” employed in Section 5 of the Limitation Act deserves liberal construction. Further reliance was placed on N. Balakrishnan v. M. Krishnamurthy reported in (1998) 7 SCC 123 for the proposition that the length of delay is not material and acceptability of the explanation alone is the relevant criterion. Reliance was also placed on Bharat Auto Center v. CIT reported in (2006) 282 ITR 366 (All.) wherein the Hon’ble Allahabad High Court observed that rules of limitation are not meant to destroy substantive rights. The Ld. AR, therefore, prayed that the delay be condoned and the matter be restored to the file of the Ld.CIT(A) for adjudication on merits.

3.2. Per contra, the Ld. DR supported the order passed by the Ld.CIT(A). The Ld. DR submitted that the delay involved in the present case is an inordinate delay of 1631 days and that the assessee failed to demonstrate sufficient cause for such substantial delay. It was contended that negligence on the part of the Chartered Accountant cannot automatically constitute sufficient cause and that the assessee remained inactive for several years. The Ld. DR thus submitted that the Ld.CIT(A) was justified in declining to condone the delay and dismissing the appeal in limine. However, the Ld. DR fairly conceded that the judicial precedents relied upon by the assessee lay down that matters should ordinarily be decided on merits where sufficient cause is demonstrated.

We have carefully considered the rival in light of the record placed before this Tribunal.

4.

We note that the assessee had furnished a detailed explanation for the delay in filing the appeal before the Ld.CIT(A). The explanation reveals that the assessee had entrusted the tax and compliance matters to the Chartered Accountant who had 4 been handling such affairs since long and that the intimation issued u/s 143(1) of the Act was admittedly sent to the said professional. It is the specific case of the assessee that the professional failed to take corrective measures and the assessee became aware of the outstanding demand only after a new Chartered Accountant examined the income-tax portal in F.Y. 2024-25. Thereafter, the appeal was filed without further delay.

4.1. In our considered opinion, the explanation furnished by the assessee cannot be said to be mala fide or lacking in bona fides. It is a settled principle of law that a litigant should not ordinarily be made to suffer for the fault or negligence of the counsel or consultant engaged by him. The Hon’ble Supreme Court in Collector, Land Acquisition, Anantnag & Anr. v. Mst. Katiji & Ors. (supra) held that while considering condonation applications, substantial justice deserves to be preferred over technical considerations. The Hon’ble Apex Court further observed that refusal to condone delay may result in meritorious matters being thrown out at the threshold.

4.2. Further, in Vedabai alias Vaijayanatabai Baburao Patil v. Shantaram Baburao Patil & Ors. reported in (2001) 253 ITR 798 (SC), the Hon’ble Supreme Court held that the expression “sufficient cause” under Section 5 of the Limitation Act should receive liberal construction so as to advance substantial justice. Similarly, in N. Balakrishnan v. M. Krishnamurthy reported in (1998) 7 SCC 123, the Hon’ble Apex Court held that the length of delay is immaterial and acceptability of the explanation is the sole criterion. The Hon’ble Court further held that rules of limitation are not meant to destroy the rights of parties.

4.3. We also find merit in the contention of the assessee that the Ld.CIT(A), being a quasi-judicial authority, ought to have adjudicated the issues on merits instead of dismissing the appeal in limine, particularly when the assessee had furnished reasons explaining the delay. The Hon’ble Allahabad High Court in Bharat Auto Center v. CIT reported in (2006) 282 ITR 366 (All.) held that rules of limitation are not meant to destroy substantive rights and that legal remedies should ordinarily be decided on merits.

4.4. Considering the totality of facts and circumstances and respectfully following the judicial precedents discussed hereinabove, we are of the considered view that the assessee has demonstrated sufficient and reasonable cause for the delay in filing the appeal before the Ld.CIT(A). Accordingly, the delay of 1631 days in filing the appeal before the Ld.CIT(A) stands condoned.

4.5. Consequently, the impugned order passed by the Ld.CIT(A) dismissing the appeal in limine is set aside and the matter is restored to the file of the Ld.CIT(A) with a direction to adjudicate the appeal afresh on merits in accordance with law after affording adequate opportunity of being heard to the assessee. The assessee is also directed to cooperate in the appellate proceedings and refrain from seeking unnecessary adjournments.

Accordingly, grounds raised by the assessee are allowed for statistical purposes.

In the result, appeal filed by assessee stands allowed for statistical purposes.

Order pronounced in the open court on 14/05/2026.

Sd/- Sd/-

ARUN KHODPIA BEENA PILLAI ACCOUNTANT MEMBER JUDICIAL MEMBER

Mumbai Dated: 14/05/2026 SC. Sr.P.S.

Copy to:

KIRAM PUKHRAJ JAIN , 14TH FLOOR, 1403, GARDEN COURT 1 BUILDING DADAR EAST, MUMBAI-400013, MAHARASHTRA

INCOME TAX OFFICER WARD 22(2)(1), 2 PIRAMAL CHAMBER LALBAUG PAREL, MUMBAI-400012, MAHARASHTRA 3 THE PCIT / CIT, 4 THE D.R., ITAT, MUMBAI BENCH 5 GUARD FILE

More judgments on Section 54

All 1,745 judgments and leading authorities on Section 54 →

Recent GST High Court judgments

Search GST case law →