MURLI KUMAR AGRAWAL (HUF) vs. ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 1(1)

This appeal is against the order dated 18.10.2023 passed by the Learned Income Tax Appellate Tribunal (ITAT) in ITA No. ITA 22/RPR/2023. Whereby the appeal preferred by the appellant was dismissed on the short ground of delay.

Learned counsel for the appellant would submit that this appeal is filed on the ground that despite sufficient reason having been shown for condoning the delay, the Appellate Tribunal did not condone the delay in the peculiar facts of this case. He further submits that the ITAT did not go into it in detail, resulting into, the dismissal.

After going through the record the following substantial question of 2 law emerges:- “whether the appellant was precluded by sufficient cause to file the appeal before ITAT, within the time prescribed?”

The record would suggest that Murli Kumar Agrawal (since diseased), who was the Karta of HUF, filed the original return on 16.11.2014 wherein the assessment order has been passed under Section 143(3) of the Income Tax Act. On 23.12.2016. Being aggrieved by such order, an appeal was filed before the Commissioner of Income Tax (Appeals) under Section 246A(1)(a) on 26.01.2017. It is contended that the Medical documents file would show that on 29.04.2021, the Karta Murli Kumar Agrawal was infected with severe COVID-19 and was hospitalized at NH MMI Narayan Superspeciality Hospital, Raipur. Subsequently, he was shifted to Lilavati Hospital in Mumbai in between period of 30.05.2021 to15.06.2021. Again he was admitted in Lilavati Hospital in Mumbai on 18.06.201 to 29.07.2021 for various issues, thereafter, from August, 2021 till December, 2021, Murli Kumar Agrawal was said to be in complete bed rest. In the meanwhile, on 13.12.2021, the order was passed by the Commissioner of Income Tax (Appeals) which was appealable in nature. The appeal could not be filed before the ITAT within time because of COVID-19 pandemic break- through. On 10.01.2022, an order was passed by the Supreme Court in Suo Motu W.P.C. No. 3 of 2020, whereby the period of limitation was extended in consideration of COVID-19. 5. Subsequently, again in January, 2022 for the treatment of the Karta, he was again admitted in NH MMI Narayan Superspeciality

The time limit for filing the appeal before the ITAT expired on 29.05.2022, and according to the appellant, the last rituals have been performed by Hitesh Agrawal, who stepped into the shoes of the Karta on 15.06.2022. Thereafter it is stated that from 16.06.2022 to 23.11.2022, the son of the Karta, in between the period started resuming the business activities, then only, the order came to his knowledge when on 24.11.2022 notice was issued by Tax Recovery Officer which was received by new Karta i.e. Hitesh Kumar Agrawal by speed post on 02.12.2022. Therefore, the appeal was filed by new Karta before the ITAT on 18.01.2023, i.e. after delay of 341 days and after deduction of 108 days of the COVID period, the delay of 233 days exist.

The perusal of the medical record would show that the original Karta, Murli Kumar Agrawal underwent the continuous frequent treatment and was frequently admitted to the hospital. It is obvious that the nature of the hospitalization and the infrequence would show that the entire focus was to cure the ailment and eventually the state of affairs continued and Murli Kumar Agrawal has died on 15.05.2022. and 29.05.2022 the time limit for filing the appeal before the ITAT expired.

Learned ITAT has dismissed the appeal solely on the ground that it is barred by time. Section 253(5) of Income Tax Act 1961 gives the power to the Appellate Tribunal to admit an appeal, If it is satisfied that there was sufficient cause for not presenting it within that period. It is obvious that after death of Murli Kumar Agrawal on 15.05.2022, as has been stated by Hitesh Agrawal, who resumed the business activities, received the recovery notice then he field the appeal before the ITAT. The ailment which was being suffered by Murli Kumar Agrawal, who was the original Karta, has eventually died in May, 2022 and thereafter the son Hitesh Kumar Agrwal, who stepped into the shoes of Karta resumed the business activities appears to be reasonable and logical.

Accordingly, after considering the medical record and events of facts, we are of the view that sufficient cause was shown by Hitesh Agrawal before ITAT which warrants the condonation of delay. Accordingly, we answer the question of law in favour of the appellant to hold that the sufficient cause was shown by Hitesh Agrawal to condone the delay. Consequently, the order dated 18.10.2023 is set aside. The appeal is remanded back to the learned ITAT to decide afresh on merits.

Accordingly, the appeal is allowed to the extent indicated above.