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Facts
The assessee, a co-operative society, faced disallowance of deduction under Section 80P(2)(a) and 80P(2)(d) by the Assessing Officer. The appeal before the CIT(A) was dismissed in limine due to delay, and a subsequent appeal to the Tribunal also suffered from a delay.
Held
The Tribunal condoned the delay in filing appeals before both the CIT(A) and the Tribunal, citing principles of substantial justice and natural justice. The matter was restored to the CIT(A) for adjudication on merits.
Key Issues
Whether the delay in filing the appeal should be condoned and whether the assessee is eligible for deduction under Section 80P(2)(a)(i).
Sections Cited
80P(2)(a)(i), 80P(2)(d), 254(1)
AI-generated summary — verify with the full judgment below
PER PAWAN SINGH, JUDICIAL MEMBER;
This appeal by assessee is directed against the order of National Faceless Appeal Centre New Delhi/ [ ld. CIT(A)] dated 27.08.2024 for A.Y. 2020- 21.The assessee has raised the following grounds of appeal:
1. The Honourable Commissioner of Income Tax (Appeals) has been harsh in not considering the valid reasons and justification given by the Appellant for condonation of delay, for e-fling the Appeal. And has dismissed the Appeal without going into the Merits of the Case.
2. The Honourable Commissioner of Income Tax (Appeals), & Learned ITO, Assessment Unit erred in not allowing deduction under section 80P(2)(a)(i) of the Income Tax Act, 1961, for the 'interest and dividend income' earned amounting to Rs.21,08,232/-. It is to be considered that the such corresponding income of the Appellant is eligible and falls for deduction u/s 80P(2)(a)(i) only and no income is to be considered u/s 80P(2)(d).
3. The Honourable Commissioner of Income Tax (Appeals), erred in considering that interest earned on Deposits kept with Co-operative
Banks and Dividend earned from Co-operative Banks also, qualifies for deduction under section 80P(2)(a)(i). 4. The appellant craves leave to add, alter, amend or withdraw, all or any of the grounds before or during the adjudication proceedings.”
Rival submissions of both the parties have been heard and record perused.
The learned authorised representative (ld. AR) of the assessee submits that there is delay in filing appeal before Tribunal. The impugned order was passed by ld. CIT(A) on 07.08.2024 but the present appeal is filed only on 11.02.2025. Thus, there is delay of 103 days in filing appeal before Tribunal.
The assessee has also filed affidavit of one of its principal officer. The ld. AR of the assessee submits that at the time of filing appeal before ld. CIT(A), they have provided e-mail address of their consultant as secondary e-mail, who has not informed the assessee in time. All the notices and e-mails if any was received in the e-mail address of their consultant. The managing committee of assessee were changed and when new managing committee were formed and enquired about the pending cases, they came to know that appeal has already been dismissed in ex-parte order. The ld. AR of the assessee submits that there is no intentional or deliberate delay in filing appeal before Tribunal. The assessee has good case on merit and would suffer prejudice if delay in filing appeal is not condoned.
On merit, the ld. AR of the assessee submits that even first appeal of assessee was dismissed by ld. CIT(A) in limine by not condoning the delay in filing appeal. The ld. AR of the assessee further submits that assessing officer disallowed the deduction under section 80P(2)(a) and 80P(2)(d). The assessee is a co-operative society and earned dividend interest on deposits with co-operative bank as well as deduction under section 80P(2)(a) on account of income earned on its activities. The ld. AR of the assessee submits that delay in filing appeal before ld CIT(A) may also be condoned and matter may be restored back to the ld. CIT(A) to decide the appeal on merit. The ld. AR of the assessee further submits that for filing appeal belatedly before ld. CIT(A), the assessee has shown reasonable and sufficient cause by filing detail application. The assessee in column 15 of Form 35, the assessee has given reasons for delay in filing appeal. However, the ld. CiT(A) not considered such reasons by taking view that no specific reason for delay in appeal is given.
On the other hand, ld. Sr. DR for the Revenue submits that assessee is habitual in not making timely compliance either in making compliance or in filing appeal in time before ld. CIT(A) or before Tribunal. There was delay of about five (5) months in filing appeal before Tribunal. Further there was delay of almost similar in filing appeal before ld CIT(A). The assessee is giving self-serving story for seeking condonation of delay. The ld. Sr. DR submits that delay may not be condoned either before ld. CIT(A) or before Tribunal.
We have considered the rival submissions of both the parties and have gone through the lower authorities carefully. We find that assessment was completed by assessing officer on 31.09.2022. The assessing officer while passing the assessment order made disallowance under section 80P(2)(a) and 80P(2)(d). The ld. CIT(A) dismissed the appeal in limine by not condoning the delay in filing appeal before him by taking view that assessee has not discharged its onus in showing sufficient cause for condoning the delay. We find that assessee is co-operative society and has to take collective decision for recourse of law on the basis of advice of consultant. Therefore, keeping in view the principle of law that when technical consideration and cause of substantial justice are kept against each other because of substantial justice may be preferred. Thus, delay in filing appeal before ld. CIT(A) is condoned.
We further find that there is similar delay of 103 days in filing appeal before Tribunal. The assessee has taken excuse that their consultant has not informed them timely and that senior management were not aware about various notices or final order and that on realising the dismissal of appeal, they took step and filed appeal immediately. We find the approach of assessee is casual though it may not be intentional or deliberate. Therefore, keeping in view the principle of natural justice, the delay in filing appeal before Tribunal is also condoned but subject to payment of cost of Rs. 5,000/- (Rupee Five thousand) to be deposited with Bombay High Court Legal Aid and Advice Committee/Board and original receipt be placed on the record of this appeal.
Considering the fact that we have condoned the delay and find that ld. CIT(A) has not adjudicated various grounds of appeal on merit. Therefore, matter is restored back to the file of ld. CIT(A) or adjudication of all the issues on merit. Needless to direct the before passing the order afresh, the ld CIT(A0 shall allow reasonable opportunity to the assessee. The assessee is also directed to be more vigilant in future in making timely compliance before lower authorities.
In the result, the appeal of assesseeis allowed is allowed statistical purpose.
Order pronounced in the open Court on 30/05/2025.