ALL INDIA RUBBER INDUSTRIES ASSOCIATION,MUMBAI vs. CIT(EXEMPTIONS) CIRCLE 1, MUMBAI

This appeal by the assessee is preferred against the order of the ld. CIT (Exemptions), Mumbai [hereinafter “the ld. CIT(E)”] dated 11/03/2024 framed u/s 263 of the Act by which the ld. CIT(E) set aside the assessment order dated 26/04/2021 framed u/s 143(3) r.w.s. 144B of the Act is erroneous and prejudicial to the interest of the revenue.

The appeal has been filed 328 days beyond the prescribed period of limitation which means that there is a delay of 328 days in filing the appeal. Considering the issue of substantial delay in filing the appeal, the parties at the very outset were heard on the issue of condonation of delay.

Section 253 of the Act provides right to appeal both to the assessee as well as the AO against certain orders which are appealable before the Tribunal as per the said provision. This means that the right to appeal under the Act is a statutory right circumscribed by period of limitation as per Section 253 of the Act. The appeal has to be filed within a period of 60 days from the date of receipt of order appealed against. 4.1. While explaining the cause of delay, the assessee through its affidavit dated 01/04/2025, and subsequent submissions made before the Bench on 03/07/2025 submitted that the employee staff looks into day-to-day operations of the association which included liaisoning with legal advisors. It is strongly contended that the impugned order which would have received by e-mail was not noticed and was overlooked and it is only in the month of January, 2025, when the notice u/s 142(1) dated 21/01/2025 was received for making a de novo assessment pursuant to the order u/s 263 of the Act, the association approached the legal advisors. It has been further stated in the affidavit that the assessment proceedings are going on with the same assessing officer who had already denied exemption, the said order u/s 263 of the Act may not cause any prejudice till the time he passes the relevant assessment order and, therefore, the legal advisor was not 3 approached. The assessment order was subsequently framed on 16/03/2025 and the association approached the legal advisor who advised to file the appeal against the original order u/s 263 of the Act.

We have given a thoughtful consideration to the contents of the affidavit. However, as per the provision contained u/s 253(5) of the Act, the Tribunal has power to condone the delay only when it is satisfied that there was sufficient cause for not presenting the appeal within the prescribed period of limitation. Fact of the present case show that the assessee waited for the assessment order pursuant to the order u/s 263 of the Act and when it did not receive a clean assessment order, it filed the appeal against the order framed u/s 263 of the Act. In case of Office of The Chief Post Master & Ors vs Living Media India Ltd. & Anr (2012) 348 ITR 7 (SC), while refusing to condone the delay Hon’ble Supreme Court has observed that the law of limitation undoubtedly binds everybody including the Government. In case of Union of India v. Jahangir Byramji Jeejeebhoy (D) through his legal heirs, 2024 SCC Online SC 489, The Hon’ble Supreme Court has observed that delay should not be excluded as a matter of generosity. Rendering substantial justice is not to cause prejudice to the opposite party. Therefore, while seeking condonation of delay, the party has to prove that it was reasonably diligent in prosecuting the matter.

In the facts of the present appeal, we do not find such diligence. On the contrary, as mentioned elsewhere, waiting for the assessment order and on not finding it beneficial, the appeal has been filed against the order u/s 263 of the Act, in itself shows malafide of the assessee.