G2K Trust vs. The Income Tax Officer

TCA/103/2026HC Madras30 September 2026Bench: Honourable The CHIEF JUSTICE8 pages

AI SummaryDismissed

What did the High Court hold?

The High Court held that the appeals filed by the assessee were without merit and accordingly dismissed them. The Court found that the Income Tax Appellate Tribunal and the Commissioner of Income Tax (Appeals) had rightly rejected the appeals on the grounds of limitation. The reasoning was that the assessee failed to provide valid and cogent reasons to justify the abnormal delay of 2235 days. The death of the auditor, while a significant event, was not considered a sufficient cause, particularly as the assessee did not explain the subsequent seven-year period before appointing a new auditor. The Court emphasized, citing Supreme Court judgments, that delay should not be condoned merely as an act of generosity and that the pursuit of substantial justice must not prejudice the opposing party. The bonafides of the explanation offered by the party seeking condonation must be ascertained first. The Court found no such bonafides or sufficient cause demonstrated by the assessee. No issue was expressly left undecided.

What were the facts?

The assessee, G2K Trust, filed two tax appeals (TCA Nos. 103 and 138 of 2026) before the High Court of Judicature at Madras. These appeals challenged the order of the Income Tax Appellate Tribunal (ITAT), Chennai, dated 24.02.2026. The ITAT had confirmed the order of the Commissioner of Income Tax (Appeals) (CIT(A)), Chennai, which rejected the assessee's appeals on the grounds of limitation. The CIT(A) had found a delay of 2235 days (approximately 7 years) in filing the appeals before it. The assessee's stated reason for this significant delay was the death of their auditor. The revenue is the Income Tax Officer, Ward 2(1), Trichirapalli. The assessment years are not explicitly stated in the provided text.

What were the issues?

1. Whether the delay of 2235 days in filing the appeals before the Commissioner of Income Tax (Appeals) was sufficiently explained by the death of the auditor, thereby constituting a 'sufficient cause' for condonation? (Question of law and fact, turning on the interpretation of 'sufficient cause' under the Income Tax Act, 1961). Assessee's Contentions: The assessee contended that the death of their auditor was the reason for the delay. The judgment does not record specific arguments made by the assessee before the High Court, but it implies their attempt to justify the delay based on the auditor's death. Revenue's Contentions: The revenue, through the orders of the lower authorities, argued that the reasons provided for the delay were general, vague, and unsupported by cogent documentary evidence. They further argued that the assessee failed to explain why it took approximately seven years to appoint a new auditor, especially since the trust continued to file returns for subsequent years. The revenue contended that the death of the auditor did not constitute a 'sufficient cause' to condone such a substantial delay.

AI-generated summary — verify with the full judgment below

TCA Nos.103, 138 of 2026 IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 30.09.2026 CORAM THE HON'BLE MR.SUSHRUT ARVIND DHARMADHIKARI, CHIEF JUSTICE AND THE HON'BLE MR.JUSTICE G. ARUL MURUGAN TCA No. 103 of 2026 CNR:{HCMA011425482026} TCA No. 138 of 2026 CNR:{HCMA011435542026} G2K Trust, No.5, Abila Avenue, Santhosh Garden, Kulumani Main Road, Woriayur, Trichy 620 102 : Appellant in both appeals. versus The Income Tax Officer Ward 2(1) Trichirapalli : Respondent in both appeals Prayer: Appeals filed against the order of the Income Tax Appellate Tribunal, ‘A’ Bench, Chennai dated 24.02.2026 in ITA No.3113/CHNY/2025 and No.3114/CHNY/2025. For Appellant : Ms.K.Abhirame Page 1 of 8 https://www.mhc.tn.gov.in/judis ( Uploaded on: 01/10/2026 12:04:55 pm ) TCA Nos.103, 138 of 2026 COMMON JUDGMENT (Judgment of the Court was delivered by the Hon'ble Chief Justice) Since common issue of delay is involved in these two appeals, both the appeals are heard and decided analogously. 2. The tax appeals arise out of the order passed by the Income Tax Appellate Tribunal, ‘A’ Bench, Chennai dated 24.02.2026 in ITA No.3113/CHNY/2025 and No.3114/CHNY/2025; whereby the order of the Commissioner of Income Tax (Appeals), Chennai, rejecting the appeals on the ground of limitation has been confirmed. The Commissioner of Income Tax (Appeals) while dismissing the appeal, came to the conclusion that the delay is abnormally large i.e. 2235 days (around 7 years). Reasons stated in the application are general, vague and not supported by any cogent documentary evidence showing ‘sufficient cause’ to condone the delay. The only reason assigned for such a huge delay is the death of the auditor. The appellant could not assign any reason as to why they took around seven years to appoint a new auditor. Moreover, the appellant, being a trust, has been filing returns regularly for the subsequent years as Page 2 of 8 https://www.mhc.tn.gov.in/judis ( Uploaded on: 01/10/2026 12:04:55 pm ) TCA Nos.103, 138 of 2026 well. Therefore, the reason that auditor died cannot be countenanced. The reason assigned does not constitute ‘sufficient cause’ to condone the delay of 2235 days. 3. The issue relating to condonation of delay is no longer res integra, and the Supreme Court has settled the legal position through a catena of decisions, of which relevant paragraphs of a few decisions are reproduced hereunder: (i) In Karnataka Power Corporation Ltd. V. K. Thangappan and another1, the Supreme Court has held as follows: “6. Delay or laches is one of the factors which is to be borne in mind by the High Court when they exercise their discretionary powers under Article 226 of the Constitution. In an appropriate case the High Court may refuse to invoke its extraordinary powers if there is such negligence or omission on the part of the applicant to assert his right as taken in conjunction with the lapse of time and other circumstances, causes prejudice to the opposite party. Even where fundamental right is involved the matter is still within the discretion of the Court as pointed out in Durga Prashad v. Chief Controller of Imports and Exports, (1969) 1 SCC 185. Of course, the discretion has to be 1(2006) 4 SCC 322 Page 3 of 8 https://www.mhc.tn.gov.in/judis ( Uploaded on: 01/10/2026 12:04:55 pm ) TCA Nos.103, 138 of 2026 exercised judicially and reasonably.” (ii) Long delay cannot be allowed to be condoned as a matter of course in view of the recent judgment of the Apex Court in the case of Shivamma v. Karnataka Housing Board2, wherein it is held as under: “258. The length of the delay is a relevant matter which the court must take into consideration while considering whether the delay should be condoned or not. From the tenor of the approach of the respondents, it appears that they want to fix their own period of limitation for instituting the proceedings for which law has prescribed a period of limitation. Once it is held that a party has lost his right to have the matter considered on merits because of his own inaction for a long, it cannot be presumed to be non-deliberate delay and in such circumstances of the case, it cannot be heard to plead that the substantial justice deserves to be preferred as against the technical considerations. While considering the plea for condonation of delay, the court must not start with the merits of the main matter. The court owes a duty to first ascertain the bona fides of the explanation offered by the party seeking condonation. It is only if the sufficient cause assigned by the litigant and the opposition of the other side is equally balanced that the court may bring into 22025 INSC 1104 Page 4 of 8 https://www.mhc.tn.gov.in/judis ( Uploaded on: 01/10/2026 12:04:55 pm ) TCA Nos.103, 138 of 2026 aid the merits of the matter for the purpose of condoning the delay.” (iii) In a recent decision in Thirunagalingam v. Lingeswaran and another3, the Supreme Court held thus: “31. It is a well-settled law that while considering the plea for condonation of delay, the first and foremost duty of the court is to first ascertain the bona fides of the explanation offered by the party seeking condonation rather than starting with the merits of the main matter. Only when sufficient cause or reasons given for the delay by the litigant and the opposition of the other side is equally balanced or stand on equal footing, the court may consider the merits of the main matter for the purpose of condoning the delay. 32. Further, this Court has repeatedly emphasised in several cases that delay should not be condoned merely as an act of generosity. The pursuit of substantial justice must not come at the cost of causing prejudice to the opposing party. In the present case, the respondents/defendants have failed to demonstrate reasonable grounds of delay in pursuing the matter, and this crucial requirement for condoning the delay remains unmet.” 32025 INSC 672 Page 5 of 8 https://www.mhc.tn.gov.in/judis ( Uploaded on: 01/10/2026 12:04:55 pm ) TCA Nos.103, 138 of 2026 4. The Income Tax Appellate Authority has rightly rejected the appeals. No reasons, much less valid and cogent reasons, are assigned to condone the delay. We do not find any merit in the present tax appeals. Accordingly, the same are dismissed. There will be no order as to costs. (SUSHRUT ARVIND DHARMADHIKARI, CJ.) (G. ARUL MURUGAN, J.) 30.09.2026 Index : Yes/No Neutral Citation : Yes/No tar Page 6 of 8 https://www.mhc.tn.gov.in/judis ( Uploaded on: 01/10/2026 12:04:55 pm ) TCA Nos.103, 138 of 2026 To 1.The Income Tax Officer Ward 2(1) Trichirapalli 2.The Income Tax Appellate Tribunal, ‘A’ Bench, Chennai Page 7 of 8 https://www.mhc.tn.gov.in/judis ( Uploaded on: 01/10/2026 12:04:55 pm ) TCA Nos.103, 138 of 2026 THE HON'BLE CHIEF JUSTICE AND G. ARUL MURUGAN

, J.

(tar) TCA Nos.103, 138 of 2026 30.09.2026 Page 8 of 8 https://www.mhc.tn.gov.in/judis ( Uploaded on: 01/10/2026 12:04:55 pm )

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