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Income Tax Appellate Tribunal, AMRITSAR BENCH, AMRITSAR
Before: SH. N.K.CHOUDHRY & DR. A.L.SAINI
IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH, AMRITSAR BEFORE SH. N.K.CHOUDHRY, JUDICIAL MEMBER AND DR. A.L.SAINI, ACCOUNTANT MEMBER
ITA No.169(Asr)/2015 Assessment Year:2006-07
M/s. Bhagwati Colonizers Vs. Income Tax Officer, Pvt. Ltd., Ward-1(4), Mansa Sunni Gali, Gaushala Road, Mansa [PAN:AACCB 4831F] (Appellant) (Respondent)
Appellant by: Sh. P. N. Arora (Ld. Adv.) Respondent by: Sh. Amar Pal Meena (Ld. DR) Date of hearing: 25.11.2019 Date of pronouncement: 25.11.2019 CONSEQUENTIAL ORDER PER N.K.CHOUDHRY, JM: In the instant case, while deciding the appeal of the assessee, the Members constituting the Bench have taken divergent views, which resulted into reference u/s 254(4) of the Income Tax Act, 1961 (hereinafter called as the ‘Act’).
The ld. Accountant Member vide order dated 20.12.2018 , though while touching the merit of the case allowed the appeal of the assessee, however, on the point of limitation/delay dismissed the same in limine as not maintainable. The ld. Judicial Member vide order dated 29.01.2019, while agreeing with the decision on merit by the ld. Accountant Member, took the dissenting view with regard to the dismissal of appeal on the
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point of limitation and condoned the delay of 570 days with a condition that the assessee shall deposit a sum of Rs.10,000/- in favour of Revenue Department within one month from the date of order.
The ld. Third Member vide order dated 22.10.2019 concurred the views of the ld. Judicial Member by holding as under:
“14. Now I shall turn to the facts of the present case. In the affidavit, the main reason cited by the assesee for the delay is that the copy of appellate order was received by the counsel who appeared before the Ld CIT(A), but the counsel never informed the assessee about the disposal of the appeal by Ld CIT(A). It is a fact that the office of Ld CIT(A) served the appellate order to the counsel of the assessee, as the address of the counsel was given in Form No.35 as the address to which notice/order to be served. Once the order was served, it is the duty of the Counsel to inform the assessee about the order received by him. According to the assessee, the Counsel did not inform or forward the copy of appellate order to it. 15. Since the assessee has put blame on the Counsel, it was specifically asked by the bench as to whether the assessee could get a letter from the Counsel in support of the averments made in the affidavit. The Ld A.R submitted that it may not be possible to get a letter from the counsel due to strained relationship between the assessee and counsel, since there was lapse on the part of the counsel. 16. An assessee usually engages a counsel to advise him and also to deal with legal matters and hence, in the normal circumstances, an assessee fully places his reliance on the counsel, due to domain expertise possessed by the Counsel. In that situation, generally the assessee should not be put in trouble for the mistake, if any, committed by a counsel. The following observations made Hon'ble Supreme Court in the case reported in AIR 1971 Ker. 211 @ 215 supports the above said view:-
ITA No.169/Asr/2015 (A.Y.2006-07) 3 Bhagwati Colonizers Pvt. Ltd. vs. ITO
“The law is settled that mistake of counsel may in certain circumstances be taken into account in condoning delay although there is no general proposition that mistake of counsel by itself is always a sufficient ground. It is always a question whether the mistake was bonafide or was merely a device to cover an ulterior purpose such as laches on the part of the litigant or an attempt to save limitation in an underhand way………. ” Though the above said observations were made in the context of the wrong advice given by the Counsel, I am of the view that the above said proposition can also be conveniently extended to the lapse of the counsel in not communicating the appellate to the assessee on right time. When an assessee authorizes a counsel to appear on his behalf, such authorization is given by placing faith on the legal expertise of the Counsel and also with the hope that the counsel shall take care of the interest of the assessee. Hence, when there is a lapse on the part of the legal counsel, in my view, the assessee should not be found fault with, unless it is shown that the blame put on the counsel with malafide intentions in order to cover up the mistake/lapse on the part of the assessee. In the instant case, it is the contention of the Ld D.R that the explanation of the assessee is not supported by any evidence. In my view, the submission of the Ld. A.R. that the assessee could not collect a letter from the Counsel in view of the strained relationship, is a reasonable explanation when we take into account human conduct and probabilities, since a professional counsel cannot be expected to admit his lapses, lest it should affect his reputation. In any case, no material was brought on record by the revenue to show that the assessee was continuing to avail the services of very same counsel even after noticing his lapse. Hence, I am of the view that the reason given by the affidavit cannot be considered to be a malafide one. It is well settled proposition that the mistake on the part of the counsel constitutes sufficient cause in the matter relating to condonation of delay.
The assessee has also submitted that it had applied for a copy of order by filing application with the
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office of Ld CIT(A) on 05-03-2004 and the same was supplied to the assessee on 04-03-2015. The delay that has occurred in supplying copy of order cannot be attributed to the assessee, since it is beyond the control of the assessee. I notice that the assessee has filed appeal before the Tribunal on 31.3.2005, i.e., immediately after the receipt of copy of order.
The issue before me can be looked from another angle. I notice that the Hon’ble Accountant member, even though declined to condone the delay, yet he has adjudicated the grounds urged on merits. The Hon’ble Judicial Member has also agreed with the view taken by Hon’ble Accountant Member on the grounds urged on merits. Thus, in effect, the appeal has been disposed of on merits. The Hon’ble Madras High Court considered an issue relating to condonation of delay in the case of Vijayeswari Textiles Ltd vs. CIT (2003) (131 Taxman 833) on identical circumstances, i.e., in the case before Hon’ble Madras High Court also, the Tribunal had refused to condone the delay, but disposed the appeal on merits also. The Hon’ble Madras High Court observed as under:-
“7. Matters relating to condonation of delay are indeed discretionary and are normally left to the Tribunal and this court will not ordinarily interfere with the discretion. In this case, as we have already pointed out, the Tribunal did not stop with the order declining to condone the delay, but considered the matter on merits and has practically treated the appeal as being properly before it and has answered the question brought before it with reference to the material placed on record. It is in the circumstances, we hold that the Tribunal was in error in not condoning the delay. The question regarding the correctness of the Tribunal’s holding that the delay is not to be condoned is therefore answered in favour of the assessee and against the Revenue....”
According to the ratio of the above said decision, if the appeal is adjudicated on merits, then refusing to condone the delay is an error.
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In view of the foregoing, I am of the view that the assessee has shown sufficient cause for the delay in filing appeal before the Tribunal and accordingly I concur with the view taken by Hon’ble judicial Member.
The Registry of ITAT is directed to list these matters before the Division Bench for passing of orders in accordance with the majority view.
On the aforesaid circumstances and as per majority view, the appeal of the assessee is liable to be allowed. Consequentially, the same stands allowed.
In the result, the appeal filed by the assessee is allowed.
Order pronounced in the open Court on 25/11/2019. Sd/- Sd/- (DR. A.L.SAINI) (N.K.CHOUDHRY) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated:25/11/2019. /PK/ Ps. Copy forwarded to: 1. The Appellant 2. The Respondent 3. The CIT 4. Then CIT(Appeals) 5. SR DR, I.T.A.T. Amritsar 6. Guard File True Copy By Order