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Facts
The assessee's return for AY 2012-13 was scrutinized, leading to disallowances under Section 14A and on interest by the AO. The CIT(A) dismissed the assessee's appeal for 'statistical purposes', believing the additions had abated in subsequent Section 153A proceedings based on an incorrect search date of 15.03.2015.
Held
The ITAT condoned the 939-day delay in filing the appeal, citing a liberal approach to substantial justice. It found the CIT(A) erred by dismissing the appeal due to a factual error regarding the search date (correct date being 15.03.2016, not 15.03.2015) and consequent abatement. The tribunal set aside the CIT(A)'s order and remanded the case for fresh consideration on merits.
Key Issues
Condonation of a 939-day delay in filing the appeal; whether CIT(A) erred in dismissing the appeal as abated based on an incorrect search date for Section 153A proceedings.
Sections Cited
51, 143(2), 142(1), 14A, 153A, 132, 153C
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “C” BENCH: KOLKATA
Before: Shri Rajesh Kumar&Shri Pradip Kumar Choubey]
ORDER / आदेश Per Pradip Kumar Choubey, JM:
This is the appeal preferred by the assessee against the order of Commissioner of Income Tax (Appeals), -21, Kolkata (hereinafter referred to as the Ld. CIT(A)] dated 29.12.2021 for AY 2012-13.
Assessment Year: 2012-13 Salarpuria Properties Pvt. Ltd. 2. It appears from the report of the registry that the appeal has been filed after a delay of 939 days for this the assessee has filed condonation petition. The Ld. A.R relied on the decision of Hon’ble Supreme Court in the case of Mst. Katiji & Ors. reported in (1987) 2 SCC 107 (SC) wherein it was held thus:
"3. The legislature has conferred the power to condone delay by enacting Section 51 of the Indian Limitation Act of 1963 in order to enable the Courts to do substantial justice to parties by disposing of matters on 'merits'. The expression "sufficient cause" employed by the legislature is adequately elastic to enable the courts to apply the law in a meaning- ful manner which subserves the ends of justice--that being the life-purpose for the existence of the institution of Courts. It is common knowledge that this Court has been making a justifiably liberal approach in matters instituted in this Court. But the message does not appear to have percolated down to all the other Courts in the hierarchy. And such a liberal approach is adopted on principle as it is realized that:-
1. 1. Ordinarily a litigant does not stand to benefit by lodging an appeal late.
2. 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 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. Making a justice-oriented approach from this perspective, there was sufficient cause for condoning the delay in the institution of the appeal. The fact that it was the 'State' which was seeking condonation and not a private party was altogether irrelevant. The doctrine of equality before law demands that all litigants, including the State as a litigant, are accorded the same treatment and the law is administered in an even handed manner. There is no warrant for according a step motherly treatment when the 'State' is the applicant praying for condonation of delay. In fact experience shows that on account of an impersonal machinery (no one in charge of the matter is directly hit or hurt by the judgment sought to be subjected to appeal) and the inherited bureaucratic methodology imbued with the note-making, file pushing, and passing-on-the-buck ethos, delay on its part is less difficult to understand though more difficult to approve. In any event, the State which represents the collective cause of the community, does not deserve a litigant-non-grata .
Assessment Year: 2012-13 Salarpuria Properties Pvt. Ltd. status. The Courts therefore have to be informed with the spirit and philosophy of the provision in the course of the interpretation of the expression "sufficient cause". So also the same approach has to be evidenced in its application to matters at hand with the end in view to do even handed justice on merits in preference to the approach which scuttles a decision on merits. Turning to the facts of the matter giving rise to the present appeal, we are satisfied that sufficient cause exists for the delay. The order of the High Court dismissing the appeal before it as time barred, is therefore. set aside. Delay is condoned. And the matter is remitted to the High Court. The High Court will now dispose of the appeal on merits after affording reasonable opportunity of hearing to both the sides." Keeping in view, the condonation petition as well as judicial pronouncement that the case should be decided on merit not on technical issue, the delay is hereby condoned.
Brief facts of the case of the assessee is that the return of income for AY 2012- 13 was filed by the assessee and also revised return of income filed showing total income at Rs. 32,94,95,864/-. The case was selected for scrutiny and accordingly notice u/s 143(2) and notice u/s 142(1) were issued. In response to the notice, the AR furnished audited report, tax audit report and other relevant details. The ld. AO found that the assessee company average investment into shares and other companies and mutual funds amounting to Rs. 83,61,36,845/-. The assessee company has been asked to furnish details of exempted income and details of expenses allocated to such income with source of fund for investment activity. No satisfactory explanation in this respect has been offered by the Ld. A.R as a result of which the total disallowance u/s 14A has been computed at Rs. 93,32,649/-. The ld. A.O has also made disallowances of Rs. 32,99,022/- on proportionate interest on interest free shares application money, interest on TDS at Rs. 1,90,719/- and at last assessed total income of the assessee at Rs. 56,18,05,280/-.
Aggrieved by the said order, the assessee preferred an appeal before the Ld. CIT(A) wherein the appeal of the assessee has been dismissed by holding that the assessee himself does not wish to pursue the appeal and the effect of the impugned addition has already abated in subsequent proceedings u/s 153A of the Act, hence the present appeal is dismissed for statistical purposes.
Being aggrieved and dissatisfied the assessee preferred an appeal before us.
Assessment Year: 2012-13 Salarpuria Properties Pvt. Ltd.
The Ld. A.R has only prayed to remit the appeal of the assessee before the Ld. CIT(A) as the Ld. CIT(A) has wrongly held that the search and seizure operation was conducted on 15.03.2015 though entire search and seizure was conducted on 15.03.2016. The Ld. A.R submits that it was a mistake on the part of the Ld. AR. The Ld. A.R in support of his contention has filed an order of ITAT passed against the assessee for the same assessment year in which it has clearly been mentioned that search and seizure operation u/s 132 of the act was conducted on Salarpuria Group on 15.03.2016.
Contrary to that the Ld. D.R did not raise any objection in remitting the appeal of the assessee before the Ld. CIT(A).
Upon hearing the submission of the counsel of the respective parties, we have perused the order passed by the Ld. CIT(A) and find that the Ld. CIT(A) has dismissed the appeal of the assessee for statistical purposes by holding that as below-
“As per submissions of the assessee, a search and seizure operation was conducted on 15.03.2015 and notice was issued u/s 153C for AY 2012-13. In response to the notice u/s 153A the assessee had filed return and subsequently assessment was completed u/s 153A/143(3). The submission of the assessee further states that since the impugned order has abated consequent to the search operation, the impugned order and the appeal so filed in such respect cannot be enforced.” The Ld. CIT(A) has held that impugned addition has already been abated in subsequent proceedings on the basis of submission made by the assessee that the search and seizure operation was conducted on 15.03.2015 though in fact search and seizure was conducted on 15.03.2016.
Keeping in view, the submission made by the assessee, and considering the fact that search and seizure was conducted on 15-02-2016 not on 15-03-2015, we are inclined to restore the appeal of the assessee before the Ld. CIT(A) for fresh consideration. The Ld. CIT(A) is directed to pass an afresh order after hearing the assessee on merit.
Order is pronounced in the open court on 25th July, 2025
Sd/- Sd/- (Rajesh Kumar/राजेश कुमार) (Pradip Kumar Choubey /�द�प कुमार चौबे) Accountant Member/लेखा सद�य Judicial Member/�या�यक सद�य Dated: 25th July, 2025 SM, Sr. PS Copy of the order forwarded to: 1. Appellant- Salarpuria Properties Pvt. Ltd. ,C/o, Salarpuria Jajodia & Co., 7, C.R. Avenue, 3rd Floor, Kolkata-700072 2. Respondent – DCIT, Central Circle-1(2), Kolkata 3. Ld. CIT(A)- 21, Kolkata 4. Ld. PCIT- , Kolkata 5. DR, Kolkata Benches, Kolkata (sent through e-mail)