VASAVI HOSTEL TRUST,BANGALORE vs. THE DEPUTY COMMISSIONER OF INCOME TAX, CPC, BANGALORE

The facts relating to the above said issue are stated in brief. The assessee is a charitable trust and it filed its return of income for the year under consideration on 10.10.2013. The CPC issued an intimation dated 30- 03-2015 under section 143(1) of the Act wherein the claim of the assessee under section 11(2) of the Act for accumulation of income was rejected on the ground that the conditions specified in section 11(2) of the Act were not fulfilled. Accordingly, the total income of the assessee was determined at Rs.15,41,910/-. The assessee field the appeal belatedly before Ld CIT(A). In the petition for condoning of the delay, the assessee stated that the intimation was served on the tax consultant’s email ID and it was not informed to the assessee. It was submitted that the tax consultant was having several email IDs and he did not keep tract of them. It was submitted that the assessee received a letter dated 29.03.2009 on 30.03.2019 from the DCIT, CPC, showing outstanding demand for the year under consideration. Consequent thereto, the assessee made enquiries with tax consultants and could locate the intimation. In view of the reluctance of the tax consultant to file appeal, the assessee had to consult a senior person and it took some time. Thereafter, it filed the appeal before Ld CIT(A) on 12.08.2019. Ld AR submitted that the delay in filing appeal before Ld CIT(A) was on account of reasonable cause. Accordingly, she prayed that the delay may be condoned. In this regard, the Ld AR placed reliance on the decision rendered by Hon’ble Supreme Court in the case of Collector, Land Acquisition Vs. MST Katiji 1987 AIR 1353. The Ld AR further submitted that the disallowance under section 11(2) of the Act is not an item of adjustment that could be made in the intimation issued under section 143(1) of the Act. She further submitted that the assessee has filed Form No.10 for accumulation of income online on 25.06.2019 which was not recognized by the CPC and the same resulted in the disallowance of claim made under section 11(2) of the Act. Accordingly, Ld AR submitted that the assessee has got good case on merits also. Accordingly, she prayed that justice may be rendered by condoning the delay in filing appeal before Ld CIT(A).

The Ld DR, on the contrary, strongly opposed the prayer made by Ld AR. He submitted that the reasons furnished by the assessee for the delay in filing the appeal before Ld CIT(A) are very vague. In any case, the assessee has not explained the delay between the date of notice issued by CPC and filing of appeal which is nearly about 5 months. The Ld DR submitted that the Co-ordinate Division Bench in the case of M/s. The Puttur Co-operative Town Bank Limited Vs. DCIT (ITA Nos.14 to 22/Bang/2022) has refused condone the delay of 651 days and 742 days in filing appeal before Ld CIT(A) on the reasoning that the assessee has not given sufficient reason for the delay.

I heard the rival contentions and perused the records. There should not be any dispute that, for the purpose of deciding the issue relating to condonation of delay, the reasons submitted by the assessee for the delay is required to be examined. Admittedly, the reasons for the delay may differ from case to case. If there exists reasonable cause for the delay, in the interest of justice, the delay should be condoned. The Hon’ble Supreme Court in the case of Mst. Katiji (supra) has stated that the natural justice should outweigh the technical considerations. In the instant case, the Ld. AR submitted that the email ID given to the Income Tax Department belongs to the earlier tax consultant by name Pandurang and hence the intimation under section 143(1) of the Act was served on the email ID of the tax consultant. She also submitted that the said tax consultant is no more alive. It is the submission of the assessee that the said tax consultant has not intimated the assessee since he was having several email IDs for his clients and he was not keeping track of them. Thus, according to the assessee, the delay has mainly occurred on account of delinquency on the part of the tax consultant. It was stated that the assessee came to know about the intimation issued under section 143(1) of the Act only when it received the notice from CPC on 30.03.2019. Subsequently, the assessee could locate the intimation from the earlier tax consultant and since he was not ready to file the appeal, the assessee had to approach some other senior consultant and file the appeal. The sequence of events narrated by the assessee, in my view, cannot be considered as unreasonable. The assessee cannot be found fault with for the mistake committed by the tax consultant. However, there is a delay of about 5 months between the date of receipt of letter from CPC and date of filing of appeal before the Ld CIT(A). It is the say of the Ld AR that during this intervening period, the assessee was trying to locate the copy of intimation, a senior tax consultant and was trying to file the appeal. In this explanation, the assessee has explained the delay of 5 months is a general manner. However, in the interest of natural justice and also considering the overall facts surrounding the case, I am of the view that the delay may be condoned subject to payment of cost. Accordingly, I impose a cost of Rs.5,000/- on the assessee, which shall be paid to the credit of the Income Tax Department as “other fees” within one month from the date of receipt of this order. Subject to the payment of above cost, I condone the delay in filing the appeal before Ld CIT(A). Since the issues urged on merits have not been adjudicated by Ld CIT(A), I restore all the issues to the file of Ld CIT(A) for adjudicating them on merits.

In the result, the appeal filed by the assessee is allowed.