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Facts
The assessee filed an appeal against an order dated 09.07.2024 with a delay of 80 days. The assessee, being a senior citizen, claimed the delay was due to health issues and not accessing emails regularly. The Revenue argued that there was also a significant delay in prior appellate proceedings and the assessee lacked a plausible reason.
Held
The Tribunal condoned the delay of 80 days, citing the assessee's age and health. On merits, the Tribunal held that the notice issued u/s 148 of the Act for AY 2015-16 was barred by limitation, as it was issued on 31.07.2022, whereas the last date for issuance was 31.03.2022. Consequently, the assessment order was also quashed.
Key Issues
Whether the delay in filing the appeal can be condoned and whether the notice u/s 148 of the Act was issued within the prescribed limitation period for the assessment year.
Sections Cited
250, 148, 147, 24A, 73(1), 144B
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, MUMBAI BENCH “C”, MUMBAI
Before: SHRI NARENDER KUMAR CHOUDHRY & SHRI PRABHASH SHANKAR
Per : Narender Kumar Choudhry, Judicial Member:
This appeal has been preferred by the Assessee against the order dated 09.07.2024, impugned herein, passed by the National Faceless Appeal Center (NFAC)/ Ld. Commissioner of Income Tax (Appeals) (in short Ld. Commissioner) u/s 250 of the Income Tax Act, 1961 (in short ‘the Act’) for the A.Y. 2015-16.
At the outset, it is observed that there is a delay of 80 days in filing of instant appeal, on which the Assessee has submitted that he, being karta of the Assessee HUF is a senior citizen of aged about 78 years and was not in habit of accessing his email on regular basis and therefore due to old age and persisting health issues, the impugned order dated 09.07.2024 served on his email was missed out. However, somewhere in the month of mid November 2024, when the Assessee’s tax consultant checked the status of appeal proceedings at e-filing portal, he came to know that the impugned order has already been passed and thereafter immediately, the instant appeal was filed on dated 19.12.2024 but with a delay of 80 days in filing of the instant appeal. The Assessee further claimed that the delay occurred in filing the instant appeal was neither intentional nor malafide but because of the aforesaid reason and therefore the same may be condoned.
On the contrary, the Ld. D.R. submitted that in the first appellate proceedings before the Ld. Commissioner as well, there was inordinate delay of more than 7 months and the Assessee has not demonstrated the plausible reason by filling duly sworn affidavit, though the Assessee mentioned in column no.15 of Form no.35 that affidavit to be filed at the time of hearing. Therefore, the conduct of the Assessee is apparent, as of non-compliant attitude and thus the Assessee is not entitled for any leniency qua condonation of delay.
We have given thoughtful considerations to the peculiar facts and circumstances of the case. The Hon’ble Apex Court in the case of M/s. Singal Udyog vs. National Company Insurance Ltd. & ors. (civil appeal no.9161 of 2019 decided on 02.12.2019) has also dealt with the situation wherein the matter was barred by limitation but still the Tribunal or forum considered the merits of the matter and therefore the Hon’ble Apex Court has held that once it is having found that the appeal was barred by time, then the Tribunal could not have dealt with the merits of the matter. The Hon’ble Apex Court somehow condoned the delay of 150 days in preferring first appeal, subject to the payment of Rs. 25,000/- by way of cost to the respondent. For ready reference and clarity, the conclusion drawn by the Hon’ble Apex Court is reproduced herein below:
“Leave granted.
This appeal challenges the order dated 11.06.2019 passed by the National Consumer Disputes Redressal Commission, New Delhi (for short, ‘the National Commission’) rejecting First Appeal No.610 of 2019.
There was delay of 150 days in preferring the First Appeal which was not condoned by the order under appeal and consequently the First observed that there was apparent lack of merits in the matter and finally passed order as under:-
“11. In view of the detailed discussion above, this appeal is at the stage of admission itself, dismissed on grounds of both an inordinate delay of 150 days as well as on an apparent lack of merit.”
We have heard learned counsel for the parties and have perused the record.
The issue whether a Tribunal or a Forum, after having come to the conclusion that the matter was barred by limitation, could consider merits of the matter, was gone into by this Court in State Bank of India vs. B.S. Agriculture Industries (I)1 as under:-
“12. As a matter of law, the consumer forum must deal with the complaint on merits only if the complaint has been filed within two years from the date of accrual of cause of action and if beyond the said period, the sufficient cause has been shown and delay condoned for the reasons recorded in writing. In other words, it is the duty of the consumer forum to take notice of Section 24A and give effect to it. If the complaint is barred by time and yet, the consumer forum decides the complaint on merits, the forum would be committing an illegality and, therefore, the aggrieved party would be entitled to have such order set aside.”
The aforesaid view was relied upon by the Division Bench of the Allahabad High Court in Commissioner, Customs, Central Excise and Service Tax vs. Monsanto Manufacture Pvt. Ltd. 2 to observe as under:-
“21. The Tribunal came to the conclusion that the demand by the Revenue was beyond the period of limitation of one year prescribed under Section 73(1) of the Finance Act, 1994 and that the period of five years could not have been invoked. That part of the judgment of the Tribunal has been confirmed in the companion appeal. Once that be the position and the Tribunal having came to the conclusion that the extended period of limitation could not have been validly applied, the Tribunal, in our view, acted outside its jurisdiction in entering upon the merits of the dispute on whether the demand for duty should be confirmed. Once it is held that the demand is time- barred, there would be no occasion for the Tribunal to enquire into the merits of the issues raised by the Revenue.”
In the circumstances, the National Commission, having found that the appeal was barred by time, could not have dealt with merits of the matter.
In any case, the delay of 150 days, in the present circumstances, was not so alarming that the matter should have been rejected on the ground of delay.
In the circumstances, subject to the appellants paying a sum of Rs.25,000/- by way of costs to the respondent, we condone the delay of 150 days in preferring the First Appeal. Let the amount be deposited in the Registry of the National Commission within four weeks from today.
Upon deposit of the amount, the parties shall appear before the National Commission on 20.01.2020.
We thus allow the appeal, set aside the view taken by the National Commission and restore the First Appeal No.610 of 2019 to the file of the National Commission to be disposed of in accordance with law.”
Thus on the aforesaid analyzations and considering the age and health of the Assessee and probable cause shown for not having knowledge about the impugned order, we are inclined to condone the delay of 80 days in filing the instant appeal. Thus, the delay is condoned.
Coming to the merits of the case, we observe that the Assessee has raised the issue that assessment year involved in the instant appeal is 2015-16, whereas the notice u/s 148 of the Act was issued on dated 31.07.2022 with the prior approval of Pr. CCIT, Mumbai dated 20.06.2022 and therefore the such notice issued u/s 148 of the Act on dated 31.07.2022, is liable to be declared as time barred and/or invalid being barred by limitation and in consequence thereof, the assessment order passed u/s 147 of the Act is also liable to be quashed being void-ab-initio.
The Ld. D.R. though supported the impugned order but not the aforesaid factual aspects.
Considering the peculiar facts and circumstances in totality and the observations made in the case of Union of India vs. Rajeev Bansal (2024) 167 taxmann.com 70 (SC) wherein in para no. 19(f), the Revenue Department has conceded that for the assessment year 2015-16, all notices issued on or after 01.04.2021, will have to be dropped as they will not fall for completion during the period prescribed under Tola.
Thus, considering the peculiar facts and circumstances in totality, as in the instant case the last date for issuing the notice u/s 148 of the Act was on 31.03.2022, whereas the notice u/s 148 of the Act was issued only on 31.03.2022 and therefore such notice issued u/s 148 of the Act, is clearly barred by limitation as per aforesaid judgment. Thus, the notice dated 31.07.2022 u/s 148 of the Act, is declared as invalid and the assessment order dated 17.05.2023 u/s 147 r.w.s. 144B of the Act passed in consequence to the aforesaid impugned notice u/s 148 of the Act, is quashed. As we have quashed the notice u/s 148 of the Act and in consequence thereof the Assessment order as well, hence the impugned order has lost its existence and thus the same is also set aside being infructuous.
In the result, the appeal filed by the Assessee stands allowed.
Order pronounced in the open court on 25.03.2025.