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Before: Shri V. Durga Rao & Shri G. Manjunatha
O R D E R
PER V. DURGA RAO, JUDICIAL MEMBER:
This appeal filed by the assessee is directed against the order of the ld. Principal Commissioner of Income Tax, Chennai-3, Chennai, dated 15.03.2021 relevant to the assessment year 2015-16 passed under section 263 of the Income Tax Act, 1961 [“Act” in short].
The appeal filed by the assessee is time barred by 472 days delay in filing the appeal before the Tribunal. In the form of an affidavit, the assessee has filed petition for condonation of delay, wherein, following submissions were made: “1. I am the assessee and am well acquainted with the facts of the case. 2. I state that the respected Pr. Commissioner of Income Tax had passed an order u/s 263 dated 15/03/2021 which was received by me on 18/03/2021. I state the appeal against the order ought to have been filed before the Hon'ble Income Tax Appellate Tribunal within 60 days, i.e. on or before 17/05/2021. Hence, there is a delay of 472 days.
I state that the employee in charge of Case File was given the documents to handle the Income Tax Hearings and Appeals but had fallen unwell (due to Covid) and was subsequently asked to isolate. It is submitted that during this period, the City was asked to completely lock down and in the intervening period, the employee left the job, with the documents in hand. Due to the same, the appeal against the 263 Order could not be filed as I did not have any documents in hand with me. 4. I state that upon receiving the giving effect order to the penalty order, and penalty notices, we were able to once again build up our files for the case and on reference to our counsel, M/s. Victor Grace & Co., Chartered Accountants, we were able to regularize the issue by proper appeal against the impugned order. The appeal was filed on 1 /9/22 resulting in a delay 472 days. 5. I state that the delay in filing the above appeal is neither willful nor wanton but only due to the aforesaid bonafide reasons. 6. It is therefore prayed that your good self may please condone the delay of 472 days in filing the appeal and the appeal may be taken up and disposed off on merits and thus render justice.” 3. The ld. Counsel for the assessee has submitted that one of the employees of assessee’s office has taken the case file and subsequently suffered due to Covid-19 and thereafter, left the office. Therefore, the assessee could not file the appeal in time and thereby, there is a delay and prayed for condonation of delay of 472 days in filing the appeal.
On the other hand, the ld. DR has submitted that the assessee has not been able to establish any reasonable cause to condone the delay and the delay may not be condoned. He also relied on the decision of the Coordinate Benches of the Tribunal in the case of Mrs. Preeti Madhok v. ITO in dated 17.06.2022.
We have heard both the sides, perused the condonation petition filed in the form of affidavit. Admittedly, the assessee has filed his appeal with a delay of 472 days out of which 305 days delay is under Covid-19 pandemic period and 167 days after Covid-19 period. The delay in Covid-19 period of 305 days [472 – 167] is acceptable as there is reasonable cause for the delay. But, the remaining period of 167 days day in filing the appeal, in the affidavit, the assessee has submitted that one of the employees of assessee’s office has taken the case file, who has suffered from Covid-19 and thereafter he left the office. There is nothing available on record with regard to name of the employee, why he has taken the case file and how the assessee was able to built-up the appeal i.e., how he has got the revision order passed under section 263 of the Act, etc. were not explained. Therefore, the explanation given by the assessee cannot be accepted as bonafide explanation.
So far as case law relied upon by the ld. DR in the case of Mrs. Preeti Madhok v. ITO (supra), in the absence of any reasonable cause, the Coordinate Benches of the Tribunal has observed and held as under: “5. We have heard both the parties and considered the petition filed by the assessee for condonation of delay of 581 days. We have also carefully considered the reasons given by the assessee for delay in filing of the appeal. We find that prima facie the reasons given by the assessee, in her Affidavit for condonation of delay of 581 days, seems to be not bona fide. Further, in the petition filed for condonation of delay, the assessee claimed that she was not aware of law that an appeal can be filed against the order of the PCIT u/s.263 of the Act, and further, an advice from the Counsel, Mr. T. Banusekar, CA, she came to know that there is a provision to file appeal against the revision order and thus, she took decision to file appeal, which caused delay of 581 days. We have gone through the Affidavit filed by the assessee and also examined sequence of events and after considering necessary facts, we are of the considered view that the reasons given by the assessee in her Affidavit is not bona fide, because, the assessee has very well represented her case through an Authorized Representative before the AO and also before the PCIT during revisional proceedings. She had been represented by Mr. Chandanmal Jain, CA, before the Income Tax Officer. During the course of revision proceedings, she had also engaged the same CA to appear before the PCIT under 263 proceedings. Therefore, we are of the considered view that when she was capable of engaging a professional for appearing before two different authorities at two different points of time, it is impossible to believe her version that she was not aware of filing of the appeal against 263 order within the due date prescribed under the provisions of Income Tax Act, 1961. We further noted that in her petition, she claimed, she met Mr. T. Banusekar, CA, to seek his services for representing the case before the CIT(A) in connection with the appeal filed by the assessee against the order u/s.143(3) r.w.s.263 of the Act. Therefore, from the above, what is clear is that she is an educated person, aware of Income Tax proceedings, including filing of the appeal against the order of the AO. Further, from the contents of the petition filed by the assessee for condonation of delay, what we could understand is that the assessee has chosen not to file the appeal against the order of the PCIT u/s.263 of the Act, because, she can pursue an alternative remedy available with her and represent her case before the AO on the belief that she can get a favourable order from the AO. Once, the assessment order passed by the AO, went against the assessee, then she consulted a different professional, who advised her to file the appeal against the order of the PCIT u/s.263 of the Act, which is clearly evident from the fact that in all proceedings, including assessment proceedings before the AO and revision proceedings before the PCIT and consequential assessment proceedings before the AO, she had appeared through her Authorized Representative and filed necessary details. Therefore, from the above sequence of events, it is very clear that subsequent filing of the appeal against the order of the PCIT passed u/s.263 of the Act, is only an afterthought, but not a case of ignorance of law or unaware of provisions in filing of the appeal before the Tribunal against the order of the PCIT u/s.263 of the Act. Therefore, we are of the considered view that there is no merit in the reasons given by the assessee in her petition for condonation of delay in filing of the appeal.
6. Be that as it may. Coming back to the legal position evolved by the decision of various High Courts, including the Hon’ble Supreme Court in number of cases, where it has been, time and again, held that when merits and technicalities pitted against each other, then merit alone deserves to be prevailed, because, if you throw out a meritorious case out of judicial scrutiny on the grounds of technicalities, then you may deprive the right of the petitioner in pursuing their case. At the same time, various Courts have held that rules of limitation are not meant to destroy the rights of parties, they are meant to see that parties do not resort to dilatory tactics, but seek their remedy promptly, within the time bound prescribed under the Act. Further, in a case, where, for the reasons beyond the control of the petitioner, the appeal could not be filed, then the Courts are well equipped with power to condone the delay, if the petitioner explains the delay in filing of the appeal with a reasonable cause. However, there is no law or mandate in the Act, to condone the delay in each and every case. But, it depends upon all facts of each case and the reasons given by the parties for condonation of delay. Therefore, one has to go by the facts of its own case and the reasons given by the petitioner for condonation of delay. In this case, on perusal of reasons given by the assessee for delay in filing of the appeal, we find that although it appears, the assessee is not deriving any benefit by not filing the appeal within the due date prescribed under the Act, but, from the contents of petition filed by the assessee, we could easily make out a case that the assessee has made an afterthought to file the appeal against the order of the PCIT u/s.263 of the Act, only when she did not get a favourable order from the AO, consequent to the order passed by the PCIT u/s.263 of the Act.
Therefore, in our considered view, for these vague reasons, such huge delay of 581 days in filing of the appeal, cannot be condoned.
7. As regards, the case law relied upon by the assessee in the case of Mr.Imam Syed Abdul Kamal Nazar v. ITO in dated 02.06.2022, as we have already stated in earlier part of this order, condonation of delay, has to be examined based on facts of each case. However, it does not depend upon observations of any Court or Tribunal in some other case. Although, in the case law referred by the Ld. Counsel for the assessee, the Tribunal has condoned the delay of 486 days in filing of the appeal, but the said findings of the Tribunal is based on facts of those case and as per the facts of the above case, the assessee himself had represented his case before the PCIT through his Accountant without any help from Professional or /Chartered Accountant or /Advocate. Under those facts, the Tribunal came to the conclusion that although the ignorance of law is not an excuse, but it cannot be expected from each person to know laws of this country. In so far as the arguments of the Ld. Counsel for the assessee, in light of decision of the Hon’ble Supreme Court in the case of Motilal Padampat Sugar Mills Co. Ltd. v. State of Uttar Pradesh &Ors.(supra) that ignorance of law is also an excuse, but if you examine the facts of the present case, we are of the considered view that the assessee is not ignorant of law, because, she was well aware of the Income Tax proceedings and further, hired professional Chartered Accountant, for representing her case. Therefore, we are of the considered view that the assessee cannot claim that she was ignorant of law and because of her ignorance, she could not file appeal against the order of the PCIT u/s.263 of the Act. Thus, we are of the considered view that the case laws relied upon by the assessee, are not applicable to the facts of the present case.
In this view of the matter and considering the facts and circumstances of the case, we are of the considered view that the assessee had failed to make out a prima facie case for condonation of delay of 581 days in filing of the appeal before the Tribunal. Further, the reasons given by the assessee in her Affidavit does not come under reasonable cause as prescribed under the Act, for condonation of delay. Hence, we reject the petition filed by the assessee for condonation of delay and dismiss the appeal filed by the assessee. By considering the submissions of the ld. Counsel as well as unbelievable reasons stated in the affidavit filed by the assessee for condonation of delay, we are of the considered opinion that the reasons given by the assessee in the affidavit does not come under reasonable cause for condonation of delay, as prescribed under the Act and thus, the petition filed by the assessee for condonation of delay is rejected. Since we have rejected the petition for condonation of delay in filing the appeal before the Tribunal, the appeal filed by the assessee is not maintainable and accordingly, the appeal filed by the assessee is dismissed.
In the result, the appeal filed by the assessee is dismissed. Order pronounced on 14th December, 2022 at Chennai.