MONTVERT SEVILLE COOP HOUSING SOCIETY LIMITED,PUNE vs. DEPUTY COMMISSIONER OF INCOME TAX, AKRUDI,PUNE

The learned CIT(A) has failed to exercise the discretion vested in him judiciously while deciding the application for condonation of delay, despite the appellant having demonstrated sufficient and reasonable cause for such delay. 4. The learned CIT(A) has erred in not appreciating that the provisions relating to condonation of delay are required to be construed liberally in the interest of substantial justice, and that rejection of the appeal on technical grounds has resulted in grave injustice to the appellant. 5. The learned CIT(A) has erred in law in not adjudicating the appeal on merits, thereby violating the principles of natural justice. 6. The learned CIT(A) has failed to consider that the delay was neither intentional nor deliberate, but occurred due to circumstances beyond the control of the appellant, and that the appellant acted bona fide at all times. 7. That the learned CIT(A) has erred in law in not considering that the underlying assessment order passed by the Centralized Processing Centre (Centralized Processing Centre) suffers from serious legal infirmities, which warranted adjudication on merits instead of dismissal on limitation. 8. Without prejudice to the above, the learned CIT(A) failed to appreciate that the CPC had erroneously treated the appellant as a charitable trust and applied the provisions of sections 11 and 12 solely on account of filing of return in ITR-7, despite the appellant not being registered under section 12A/12AB or section 10(23C), nor having any intention to claim exemption under such provisions.

The learned CPC erred in disallowing expenses merely on the ground that the return was filed in ITR-7 instead of ITR-5, without appreciating that all material particulars were duly disclosed and no exemption under sections 11 or 12 was claimed by the appellant. 10. The learned CIT(A) failed to consider that the entire expenditure of 1,28,29,306/- incurred towards the running and maintenance of the Co-operative Housing Society/AOP was genuine, lawful, and wholly and exclusively incurred for its activities, and therefore could not have been disallowed merely due to an incorrect selection of return form. 11. That filing of an incorrect return form constitutes a procedural defect and cannot override substantive rights of the assessee, particularly when no prejudice has been. caused to the Revenue, as held in judicial precedents including New Surya Public School Vs Deputy/Assistant Commissioner of Income Tax, Ward 31(4), Delhi. 12. The learned CIT(A) has failed to apply the settled principle that substance prevails over form, and that procedural technicalities should not defeat substantive justice. 13. The appellant submits that the rejection of appeal on limitation is contrary to the settled legal position laid down by the Hon'ble Supreme Court in Collector, Land Acquisition v. Mst. Katiji, wherein it was held that a liberal approach must be adopted while considering condonation of delay so as to advance substantial justice. Further, the action of the CPC in disallowing expenditure merely on account of filing of return in an incorrect ITR form is unsustainable in law, as filing of wrong return form is a procedural defect, as held by the Hon'ble ITAT in New Surya Public School v. DCIT. It is a settled principle that substance prevails over form and procedural technicalities cannot defeat substantive rights.