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Facts
The assessee's appeals before the CIT(A) were dismissed due to significant delays, ranging from 712 to 1882 days. The assessee claimed the assessment orders were uploaded to the portal and not properly served, and due to business closure and financial hardship, they could not access the orders to file appeals promptly.
Held
The Tribunal held that the expression 'sufficient cause' for condoning delay should be interpreted liberally, referencing Supreme Court judgments. Considering the assessee's explanation of financial hardship and business closure, and the disproportionate penalty, the Tribunal condoned the delay.
Key Issues
Whether the delay in filing appeals before the CIT(A) can be condoned under 'sufficient cause' given the assessee's circumstances.
Sections Cited
143(3), 270A, 253(5), 249(3), 5
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Income Tax Appellate Tribunal, DIVISION BENCH, ‘A’ CHANDIGARH
Before: SHRI RAJPAL YADAV & SHRI MANOJ KUMAR AGGARWAL
PHYSICAL HEARING O R D E R PER RAJPAL YADAV, VP
The present three appeals are directed at the instance of the assessee against the separate orders of the ld. Commissioner of Income Tax (Appeals) [in short ‘the CIT (A)’] dated 29.07.2025 passed in assessment years 2016-17 and 2017-18.
2. The first two appeals, namely and 1242/CHD/2025 are quantum appeals which arose , 1242 & 1243/CHD/2025 A.Y.2016-17, 2017-18 & 2017-18 2 from assessment orders passed u/s 143(3) whereas is an appeal arisen from penalty proceedings u/s 270A of the Income Tax Act, 1961.
With the assistance of ld. Representative, we have gone through the record carefully. It emerges out that all these three appeals were time barred before the ld. First Appellate Authority, namely appeal in assessment year 2016-17 was time barred by 1882 days, in assessment year 2017-18 by 1553 days and in penalty proceedings is time barred by 712 days. The ld.CIT (Appeals) did not condone the delay and dismissed the appeal being barred by limitation. The ld. counsel for the assessee submitted that assessment orders were not served upon the assessee, rather were uploaded on the Portal. The assessee was suffering huge loss and its business concerns were closed down. Due to that reason, it could not lay its hands on the impugned assessment orders for filing appeals before the ld.CIT (Appeals). Therefore, he prayed that delay in filing the appeals be condoned and the issues be relegated to the file of CIT (Appeals) for deciding them on merit.
, 1242 & 1243/CHD/2025 A.Y.2016-17, 2017-18 & 2017-18 3
The ld. Sr.DR, on the other hand opposed the prayer of the assessee and submitted that there is huge delay of more than 1800 days. The assessee was negligent in prosecuting its litigation with the Income Tax Department, therefore, the delay in filing the appeals before ld.CIT (Appeals) should not be condoned.
Sub-section 5 of Section 253 contemplates that the Tribunal may admit an appeal or permit filing of memorandum of cross- objections after expiry of relevant period, if it is satisfied that there was a sufficient cause for not presenting it within that period. This expression sufficient cause employed in the section has also been used identically in sub- section 3 of section 249 of Income Tax Act, which provides powers to the ld. Commissioner to condone the delay in filing the appeal before the Commissioner. Similarly, it has been used in section 5 of Indian Limitation Act, 1963. Whenever interpretation and construction of this expression has fallen for consideration before Hon’ble High Court as well as before the Hon’ble Supreme Court, then, Hon’ble Court were unanimous in their conclusion that this expression is to be used liberally. We may make reference to the following 1242 & 1243/CHD/2025 A.Y.2016-17, 2017-18 & 2017-18 4 observations of the Hon’ble Supreme court from the decision in the case of Collector Land Acquisition Vs. Mst. Katiji & Others, 1987 AIR 1353:
Ordinarily a litigant does not stand to benefit by lodging an appeal late.
Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As against this when delay is condoned the highest that can happen is that a cause would be decided on merits after hearing the parties. 3. "Every day’s delay must be explained" does not mean that a pedantic approach should be made. Why not every hour's delay, every second's delay? The doctrine must be applied in a rational common sense pragmatic manner. 4. When substantial justice and technical considerations are pitted against each other, cause of substantial justice deserves to be preferred for the other side cannot claim to have vested right in injustice being done because of a non-deliberate delay. 5. There is no presumption that delay is occasioned deliberately, or on account of culpable negligence, or on account of mala fides. A litigant does not stand to benefit by resorting to delay. In fact, he runs a serious , 1242 & 1243/CHD/2025 A.Y.2016-17, 2017-18 & 2017-18 5 risk. 6. It must be grasped that judiciary is respected not on account of its power to legalize injustice on technical grounds but because it is capable of removing injustice and is expected to do so. 6. Similarly, we would like to make reference to authoritative pronouncement of Hon’ble Supreme Court in the case of N. Balakrishnan Vs. M. Krishnamurthy (1998) 7 SCC 123 dated 03.09.1998. It reads as under:
“Rule of limitation are not meant to destroy the right of parties. They are meant to see that parties do not resort to dilatory tactics, but seek their remedy promptly. The object of providing a legal remedy is to repair the damage caused by reason of legal injury. Law of limitation fixes a life-span for such legal remedy for the redress of the legal injury so suffered. Time is precious and the wasted time would never revisit. During efflux of time newer causes would sprout up necessitating newer persons to seek legal remedy by approaching the courts. So a life span must be fixed for each remedy. Unending period for launching the remedy may lead to unending uncertainty and consequential anarchy. Law of limitation is thus founded on public policy. It is enshrined in the maxim Interest reipublicae up sit finislitium (it is for the general welfare that a period be putt to litigation). Rules of limitation are not meant to destroy the right of the parties. They are meant to see that parties do not resort to dilatory tactics but seek their remedy promptly. The idea is that every legal remedy must be kept alive for a legislatively fixed period of time. A court knows that refusal to condone delay would result foreclosing a suitor from putting forth his cause. There is no presumption that delay in approaching the court is always deliberate. This Court has held that the words "sufficient cause" under Section 5 of the Limitation Act should receive a liberal construction so as to advance substantial , 1242 & 1243/CHD/2025 A.Y.2016-17, 2017-18 & 2017-18 6 justice vide Shakuntala Devi lain Vs. Kuntal Kumari [AIR 1969 SC 575] and State of West Bengal Vs. The Administrator, Howrah Municipality [AIR 1972 SC 749]. It must be remembered that in every case of delay there can be some lapse on the part of the litigant concerned. That alone is not enough to turn down his plea and to shut the door against him. If the explanation does not smack of mala fides or it is not put forth as part of a dilatory strategy the court must show utmost consideration to the suitor. But when there is reasonable ground to think that the delay was occasioned by the party deliberately to gain time then the court should lean against acceptance of the explanation. While condoning delay the Could should not forget the opposite party altogether. It must be borne in mind that he is a looser and he too would have incurred quiet a large litigation expenses. It would be a salutary guideline that when courts condone the delay due to laches on the part of the applicant the court shall compensate the opposite party for his loss”.
In the light of above, if we peruse the explanation of the assessee reproduced by the ld.CIT (Appeals) in the impugned order, then it would reveal that according to the assessee, the assessment orders were uploaded on the Portal and it could not lay its hands on them because its business was almost closed on account of financial hardships. Rather, its Management was also taken over for a temporary period. If we appreciate these facts and circumstances in the light of the fact that punishment in the shape of tax liability and penalty of Rs.8,50,000/- imposed u/s 270A @ 200% is disproportionate to the negligence of the assessee, if any 1242 & 1243/CHD/2025 A.Y.2016-17, 2017-18 & 2017-18 7 attributed to it. Therefore, we condone the delay in filing the appeal before ld. First Appellate Authority and set aside the impugned orders. However, we deem it appropriate to impose some cost upon the assessee on account of negligence attributable to it. Therefore, we impose a cost of Rs.10,000/- upon each appeal and assessee is directed to pay the cost imposed by us to ‘Poor Patient Welfare Fund’ maintained by PGIMER and submit the evidence of such payments to the Assistant Registrar who will put those receipts on the record. The ld.CIT (Appeals) would adjudicate the appeals on merit. Accordingly, all the three appeals are allowed.
In the result, all three appeals of the assessee are allowed.
Order pronounced on 06.04.2026.