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Facts
The assessee filed an appeal against an order of the Ld. CIT(A) which upheld the order of the CPC, Bengaluru. The appeal was filed with a delay of 402 days, attributed to the assessee's medical emergency and the unavailability of a consultant. The Ld. CIT(A) rejected the condonation of delay petition.
Held
The Tribunal held that procedural delays, when reasonably explained, should not defeat substantive justice. Relying on the Gujarat High Court's decision in Rajendrakumar Maneklal Shah (HUF) vs CIT, the Tribunal directed the Ld. CIT(A) to condone the delay and adjudicate the matter afresh.
Key Issues
Whether the delay in filing the appeal before the Ld. CIT(A) was sufficiently explained and if the delay should be condoned to allow for substantive justice.
Sections Cited
143(1), 250, 249(2), 249(3)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, MUMBAI BENCH “D”, MUMBAI
The instant appeal of the assessee was filed against the order of the Learned Commissioner of Income-tax (Appeals) / Addl / JCIT(A)-2, Jaipur, [for brevity, ‘Ld.CIT(A)]passed under section 250 of the Income-tax Act, 1961 (in short, ‘the Act’), for Assessment Year 2023-24, date of order 09/01/2025. The impugned order emanated from the order of the CPC, Bengaluru [for brevity, the “Ld. AO”]passed under section 143(1) of the Act, date of order 12/10/2023.
2 ITA 1163/Mum/2025 Deepti Mahajan 2. The brief facts of the case are that the assessee has filed the return of income and the return was processed under section 143(1) of the act by disallowing the carry forward of long term capital loss amounting to Rs.14,08,366/- and denying the TDS credit amounting to Rs.97,500/-. The assessee was busy in some medical emergency and finally, the consulted with the consultant, viz. Shri S.S. Mulay, who was travelling abroad and was unable to take any action against the demand raised by the CPC. Finally, the said consultant returned to India and has taken another two months for filing the appeal before the Ld.CIT(A) with a delay of 402 days. The assessee filed an affidavit and explained the delay; but the appeal order was passed by rejecting the petition for condonation of delay in filing the appeal and the assessment order was upheld. The Ld.CIT(A) dismissed the appeal filed by the assessee for contravening provisions of section 249(2) of the Act for absence of sufficient cause U/s 249(3) of the Act for delay in filing the appeal. Being aggrieved, assessee filed an appeal before us.
The Ld. AR advanced arguments and filed a written submission comprising pages 1 to 23, which has been placed on record. The Ld. AR submitted that the delay in filing the appeal was duly explained through a sworn affidavit executed on 16.12.2024, which was submitted before the Ld. CIT(A). The contents of the said affidavit have been reproduced in the impugned appellate order passed by the Ld. CIT(A).In support of the explanation for the delay, the Ld. AR has placed on record copies of the passport and visa of the concerned consultant, whose absence from India was cited as one of the reasons for the delayed filing. These documents are annexed at pages 5 to 6 of the assessee's paper book, while the affidavit is enclosed at pages 7 to 9 of the paper book.
3 ITA 1163/Mum/2025 Deepti Mahajan 4. The Ld.AR also relied on the order of the Hon’ble Gujarat High Court in the case of Rajendrakumar Maneklal Shah (HUF) vs CIT 213 ITR 715, wherein the Hon’ble Court upholding the order of the Tribunal that by condoning the delay, the department was not likely to suffer any loss or prejudice. The relevant paragraph of the judgement is extracted below:- "In our view, considering the order passed by the Appellate Assistant Commissioner, it is apparent that the appellate authority has felt that the delay was required to be condoned considering the various judgments which were cited before him, particularly, in view of the fact that the assessee has submitted a revised appeal memo duly signed by him and has prayed that the delay, if any, be condoned This may impliedly mean that the first appeal memo was not duly signed by the applicant. In such circumstance, when the appellate authority considered the fact that the revised appeal memo was submitted by the assessee and after considering various decisions, it thought that it was a fit case for condoning the delay as the Department is not likely to suffer any loss or prejudice. The Appellate Assistant Commissioner has exercised his discretionary jurisdiction and has condoned the delay and admitted the appeal for adjudication on the merits under section 249(3) of the Act. For condonation of delay, he has considered the facts stated by the applicant and also the case law cited before him. Further, by admitting the appeal for adjudication on the merits, the Department is not likely to suffer any loss or prejudice. Hence, it cannot be said that the discretionary power exercised by the appellate authority in curing the so-called irregularity with regard to the signature on the appeal memo, calls for any interference by the Tribunal. particularly when the fresh appeal memo duly signed by the applicant was submitted before it.”
The Ld. DR supported the findings of the revenue authorities and argued in favour of the departmental stand. However, the Ld. DR did not raise any specific objection to the factual submissions made by the Ld. AR.
We have heard the rival submissions and perused the material available on record. It is observed that the assessee’s return was processed under Section 4 ITA 1163/Mum/2025 Deepti Mahajan 143(1) of the Act, wherein the CPC disallowed the carry forward of loss and denied the credit of TDS.During the course of arguments, the Ld. AR submitted that the TDS credit was clearly reflected in Form 26AS and that the loss being claimed was duly carried forward from earlier assessment years. However, without appreciating these factual aspects, the CPC, while processing the return under Section 143(1), summarily disallowed the assessee's claim. On perusal of the appellate order, it is noted that the delay in filing the appeal was 402 days. The assessee explained the reasons for the delay by filing a duly sworn affidavit. Despite there being no apparent infirmity or inconsistency in the affidavit, the Ld. CIT(A) rejected the appeal on the technical ground of absence of sufficient cause for condonation of delay. Respectful reliance was placed on the judgment of the Hon’ble Gujarat High Court in the case of Rajendrakumar Maneklal Shah (HUF) (supra), which supports the proposition that procedural delays, when reasonably explained, should not defeat substantive justice. Accordingly, we direct the Ld. CIT(A) to condone the delay of 402 days and to adjudicate the matter afresh by passing a reasoned and speaking order after affording an opportunity of hearing to the assessee. Needless to say, the assessee shall be granted a reasonable opportunity of being heard in the remanded proceedings. Simultaneously, the assessee is expected to act diligently and extend full cooperation to ensure expeditious disposal of the appeal.