M/S. LAKSHMI GANESHA TEXTILES PVT. LTD.,COIMBATORE vs. ACIT, CORP. CIRCLE-2,, COIMBATORE

The brief facts are that, the assessee is a company and filed its return of income for the assessment year 2016-17 on 08.05.2017 declaring total income of Rs. Nil with a current year loss carried forward at Rs.4,04,984/-. The said return was processed u/s.143(1) of the Act dated 16.08.2017 by arriving

Aggrieved by the order of the CPC, Bangalore, the assessee filed an appeal before the ld.CIT(A) on 31.05.2023 with a delay of 2,085 days and filed an application for condonation of delay. On perusal of condonation petition, the ld.CIT(A) dismissed the appeal as not maintainable as the appeal has been filed with a delay of 2,085 days without any sufficient cause. Aggrieved by the order of the ld.CIT(A), the assessee is in appeal before us.

The ld.AR for the assessee submitted that the ld.CIT(A) has erred in dismissing the appeal of the assessee on the ground on limitation without considering the reasons for condoning the delay in filing the appeal in proper perspective. The ld.AR also stated that the assessee was facing a lot of crisis due to illegal and indefinite strike announced by the workers union of the company since 2012. Further, the ld.AR also stated that the assessee’s loan liability with banks became NPA and the bank took possession of the assets of the company in the year 2013 itself. Further, on merits the ld.AR submitted that the bad debts of Rs.20,40,664/- was inadvertently shown as “provision for bad and doubtful debts” instead of “bad debts written off” under the head “debits to profit and loss account”. Therefore, the impugned addition has arisen due to clerical mistake in the ITR and hence prayed for condoning the delay in filing the appeal before the ld.CIT(A) and remit the matter back to the ld.CIT(A) to decide the issue on merits.

Per contra, the ld.DR submitted that there is an inordinate delay in filing the appeal before the ld.CIT(A) and hence, the ld.CIT(A) has rightly dismissed the appeal without condoning the delay. Therefore, the appeal of the assessee be dismissed.

We have heard the rival contentions perused material available on record and gone through the orders of lower authorities. Admittedly, the assessee is a company filed its return of income on 08.05.2017 by declaring a loss of Rs.4,04,984/-. The CPC, Bangalore has processed the return

We further note that despite the difficulties now pleaded by the assessee, such as labour unrest, financial crisis, and classification of bank loans as NPA, the assessee has admittedly continued to maintain its books of account and has also complied with statutory requirements, including audit of accounts under the Companies Act on a regular basis. This clearly demonstrates that the assessee was functional and in a position to take necessary legal steps within the prescribed time. The explanation offered by the assessee for the inordinate delay of 2,085 days, in our considered opinion, does not constitute “sufficient cause” within the meaning of the law. The reasons advanced are general in nature and are not supported by any cogent evidence to establish that the assessee was prevented by circumstances beyond its control from filing the appeal within the stipulated time. It is a settled position that while considering condonation petitions, a liberal approach may be adopted; however, such liberal approach cannot be extended to cases involving inaction or lack of bona fides. In the present case, the delay is not only substantial but also remains unexplained to a satisfactory extent. Accepting such explanations would render the provisions of limitation otiose.

The contention of the ld.AR that the addition arose due to a clerical error in the return of income and that the matter requires adjudication on merits cannot, by itself, be a ground for condoning such an extraordinary delay. The issue on merits becomes relevant only if the appeal is admitted; however, in the absence of sufficient cause for condonation of delay, the appeal cannot be entertained. Therefore, we are of the considered view that the ld. CIT(A) has

In the result, appeal filed by the assessee is dismissed. Order pronounced in the court on 16th April, 2026 at Chennai.