HARI MOHAN SHARMA ,ALIGARH vs. THE ITO-4(1)(3), ALIGARH, ALIGARH

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ITA 721/AGR/2026Status: DisposedITAT Agra28 October 2026AY 2022-236 pages
AI SummaryRemanded

What did the Tribunal hold?

The ITAT held that the learned CIT(A) erred in dismissing the assessee's appeal as time-barred and subsequently deciding it on merits. The Tribunal condoned the delay of 1428 days in filing the first appeal before the CIT(A), considering the assessee's status as a retired senior citizen with limited knowledge and the bonafide cause for the delay. The ITAT emphasized that substantial justice should not be denied on technicalities and that the object of procedural rules is to advance justice. The Tribunal also noted that deciding an appeal on merits after rejecting the prayer for condonation of delay is contrary to established legal principles. The ITAT cited the Supreme Court's observation in Union of India & Anr. v. Jahangir Byramji Jeejeebhoy (D) and the Allahabad High Court's order in Dinanath Singh & Anr. V. State of U.P. & Ors., stating that an appellate authority lacks jurisdiction to entertain a time-barred appeal without condoning the delay. Consequently, the ITAT set aside the impugned order of the CIT(A) and restored the matter to the CIT(A)'s file for a fresh decision on merits after considering the authoritative precedents. The ITAT directed the assessee to be diligent and cooperative and the CIT(A) to ensure observance of principles of natural justice.

What were the facts?

The assessee, Hari Mohan Sharma, filed an appeal before the Income Tax Appellate Tribunal (ITAT) challenging an order dated 04.08.2026 passed by the Commissioner of Income Tax (Appeals) [CIT(A)]. The CIT(A) had dismissed the assessee's appeal for Assessment Year 2022-23 as time-barred and also on merits. The original intimation order dated 14.07.2022 had disallowed the assessee's claim of exemption of Rs. 6,29,246/- under Section 10(10AA) of the Income Tax Act, 1961, related to leave encashment on retirement. The assessee's first appeal before the CIT(A) was filed with a delay of approximately 1428 days. The assessee, a retired senior citizen with limited knowledge of income tax, attributed the delay to learning about CBDT Notification No. 31/2023 which enhanced leave encashment amounts retrospectively. The assessee contended the delay was not intentional or malafide but due to a bonafide and sufficient cause.

What were the issues?

1. Whether the learned CIT(A) erred in dismissing the assessee's appeal as time-barred by rejecting the prayer for condonation of delay, contrary to law and CBDT directions? (Question of law and fact, turning on principles of condonation of delay and procedural fairness). Assessee's Contention: The delay in filing the first appeal was due to a bonafide and sufficient cause, as the assessee is a retired senior citizen with limited knowledge of income tax and learned about retrospective enhancement of leave encashment benefits later. The rejection of the condonation prayer and subsequent decision on merits was contrary to law and CBDT directions. The assessee relied on the principle that substantial justice should not be denied on technicalities and that the object of procedural rules is to advance justice. Revenue's Contention: The judgment records no specific contentions from the revenue regarding the condonation of delay or the merits of the appeal.

Which sections of the Income-tax Act were involved?

Section 10(10AA),Section 250,Section 143(1)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, AGRA (SMC

Before: SUNIL KUMAR SINGHBRAJESH KUMAR SINGH

For Appellant: Shri Naveen Gargh, Adv
For Respondent: Shri Rajesh Kumar Gupta, Sr (DR)
Hearing: 27.10.2026Pronounced: 27.10.2026

IN THE INCOME TAX APPELLATE TRIBUNAL, AGRA (SMC) BENCH, AGRA BEFORE: SUNIL KUMAR SINGH, JUDICIAL MEMBER BRAJESH KUMAR SINGH, ACCOUNTANT MEMBER ITA No. 721/Agr/2026 Assessment Year: 2022-23 Hari Mohan Sharma, Vs. THE ITO-4(1)(3) Sarai Vrindavan, Sasni Gate, Ramghat Road, Qadiri Aligarh-202001 Building, Marris Road, Aligarh-202001 PAN: ABOPS5802P (Appellant) (Respondent) Assessee by Shri Naveen Gargh, Adv. Department by Shri Rajesh Kumar Gupta, Sr (DR) Date of hearing 27.10.2026 Date of pronouncement 27.10.2026 ORDER PER:SUNIL KUMAR SINGH, J.M.

This appeal is directed against the impugned order dated 04.08.2026 passed in appeal No ADDL/JCIT (A)-3 BENGALURU/10053/2021-22 by the ld. Commissioner of Income Tax/ ADDL/JCIT (A)-3 BENGALURU (hereinafter referred to as the “CIT(A) u/s. 250 of the Income Tax Act, 1961 (hereinafter referred to as the “Act”) for the A.Y. 2022-23, wherein ld CIT(A) has dismissed assessee’s appeal as time barred and on merits as well against the

ITA No.721/Agr/2026

intimation order dated 14.07.2022 whereby assessee’s claim of exemption of Rs. 6,29,246/- u/s 10(10AA) of the Act as leave encashment on retirement, was disallowed. 2. Aggrieved, assessee preferred an appeal before ld CIT(A), who dismissed assessee’s appeal as time barred and on merit as well. 3. This second appeal has been preferred by the assessee on the ground in addition to many others that ld CIT(A) has erred in dismissing assessee’s appeal upon rejection of assessee’s prayer for condonation of delay, contrary to law and CBDT direction. 4. We have heard both the parties and perused the material available on record. 5. We note that the first appeal was filed on 11.07.2026 against the intimation u/s 143(1) dated 14.07.2022 by a delay of about 1428 days. The cause for the delay shown before ld CIT(A) was that the assessee was a retired senior citizen who had little knowledge of income tax. Assessee learnt about CBDT Notification No. 31/2023 dated 24.05.2023, in which the amount of leave encashment was enhanced and was granted retrospectively by various tribunals. The delay is neither intentional nor deliberate nor malafide but based on reasonable bonfide sufficient cause.

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6.

It is well established principle of law that the substantial justice cannot be denied on technical aberrations. The object of prescribing procedure is to advance the cause of justice. In an adversial justice system like ours, no party should ordinarily be denied the opportunity of participating in the process of justice dispensation. Justice is the goal of jurisprudence. Any interpretation which eludes or frustrates the recipient of justice, is not to be followed. The object of prescribing certain time period for filing of the appeal is to expedite the proceedings before the concerned authorities and to advance the cause of justice. In the facts and circumstances of the case, we treat the cause of delay sufficient and condone the said delay caused in filing first appeal before the ld. CIT(Appeals). 7. We are further surprised to note that after refuting assessee’s prayer for condonation of delay, learned CIT(Appeals) proceeded to decide the appeal on merit, which is contrary to the law. The law on the subject is well settled that unless the delay is condoned, the appeal does not come into existence legally, and in such absence, the court is wholly without jurisdiction to hear or decide the same on merit. 8. Hon’ble Supreme Court in Union of India & Anr. v. Jahangir Byramji Jeejeebhoy (D), 2024 SCC online SC 489, has observed that the question of limitation is not merely a technical consideration. The

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rules of limitation are based on the principles of sound public policy and principles of equity, that the length of delay is a relevant matter, which the court must take into consideration while considering whether the delay should be condoned or not. The Hon’ble Apex Court has been pleased to hold that while considering the plea for condonation of delay, the court must not start with merits of the main matter. However, the courts are required to condone delay on the bedrock of the principle that adjudication of a lis on merits is seminal to justice dispensation system. 9. Thus, the issue of condonation of delay in the proceedings has to be decided at the first instance before delving into the merits of the case. However, if the delay is condoned, there is no bar on the courts to proceed with the case and decide the same on merits on the very day. In the same manner, if the prayer for condonation of delay is rejected, the proceedings will automatically fail. It is, thus, settled that without condoning the delay in filing the appeal, the appellate authority lacks jurisdiction to entertain such time barred appeals. 10. Hon’ble Allahabad High Court, vide order dated 25.07.2025 passed in Writ-C No.22221 of 2025, Dinanath Singh & Anr. V. State of U.P. & Ors., held that unless delay is condoned, the appeal does not come into existence legally, and in such absence, the court is wholly

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without jurisdiction to hear or decide the same on merits. Ld. CIT(Appeals), thus, has committed patent illegality in deciding the matter on merits after rejection of assessee’s prayer for the condonation of delay caused in filing the first appeal. 11. Since we have condoned the delay caused in filing first appeal before ld CIT(A), the matter is restored to the file of ld. CIT(Appeals) who shall pass order on merit a fresh in accordance with law after considering the authoritative precedents brought on record by ld AR. We further direct the assessee to be diligent and co-operative in attending the proceedings and making submissions before ld. CIT(Appeals) for expeditious and effective disposal of appeal. Needless to say that learned CIT(A) shall ensure the observance of the principles of natural justice. 12. In the result, assessee’s appeal is allowed for statistical purposes. The impugned order dated 04.08.2026 is set aside.

Order pronounced in the Open Court on- 27.10.2026

Sd/- Sd/- (BRAJESH KUMAR SINGH) (SUNIL KUMAR SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER

Dated: 28.10.2026

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*Aamir, PS Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, Agra

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