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Facts
The assessee's return for AY 2014-15 was processed under Section 143(1), but later an ex-parte assessment was made under Section 144 for non-compliance, assessing income at Rs. 2,95,36,820/-. The assessee's appeal to the Ld. CIT(A) was dismissed due to a 454-day delay in filing, without adjudicating on merits. The assessee filed a condonation petition before the ITAT, explaining the delay was due to an office shift, non-receipt of notices, and the appellate order being in a spam folder.
Held
The ITAT found the reasons for the delay genuine and bonafide, citing Supreme Court judgments on the liberal interpretation of 'sufficient cause' under Section 5 of the Limitation Act. The Tribunal condoned the delay, set aside the Ld. CIT(A)'s order, and restored the case to the Ld. CIT(A) for fresh adjudication on merits after hearing the assessee.
Key Issues
Whether the delay in filing the appeal before the CIT(A) should be condoned and whether the CIT(A) erred in dismissing the appeal in limine without adjudication on merits.
Sections Cited
143(1), 143(2), 142(1), 144
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “D” BENCH: KOLKATA
Before: Shri Rajesh Kumar&Shri Pradip Kumar Choubey]
ORDER / आदेश Per Pradip Kumar Choubey, JM:
These are the appeals preferred by the assessee against the separate orders of Commissioner of Income Tax (Appeals)- NFAC, Delhi (hereinafter referred to as the Ld. CIT(A)] dated 20.09.2023 for AY 2014-15 to 2015-16 respectively. In all the to 413/Kol/2025 Assessment Year: 2014-15 to 2015-16 Purotech Merchants Pvt. Ltd. appeals the issues are common and taken up together for disposal by taking a lead case in AY 2014-15.
It appears from the report of the registry that the appeal has been filed after a delay of 454 days, for this the assessee has filed condonation petition, which are as follows- On perusal of the condonation petition, the reason for delay in filing the appeal seems to 413/Kol/2025 Assessment Year: 2014-15 to 2015-16 Purotech Merchants Pvt. Ltd. to be genuine and bonafide. The Ld. D.R did not raise any objection in condoning the delay. 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 assessee for AY 2014-15 filed its return of income declaring total income Nil. The return has been processed u/s 143(1) wherein the refund of Rs. 68,130/- has been raised and issued. The case of the assessee was selected for scrutiny, statutory notices u/s 143(2) and 142(1) were served on the issued calling for details, particulars mentioned therein but there was non-compliance on behalf of the assessee as a result of which the assessment order was passed by assessing the total income of the assessee at Rs. 2,95,36,820/-.
Aggrieved by the said order, the assessee preferred an appeal before the Ld. CIT(A) wherein the appeal of the assessee has been dismissed on account of delay in filing of the appeal.
Being aggrieved and dissatisfied the assessee has preferred an appeal before us.
The Ld. A.R instead of arguing into the merit of the case has only prayed that the appeal of the assessee be restored into the file of the Ld. CIT(A) for fresh adjudication after condoning the delay as the Ld. CIT(A) did not adjudicate the matter on merit nor consider the submission of the assessee with regard to the delay that there was no notice served to the assessee. The Ld. A.R filed an Affidavit stating the reasons of delay before the Ld. CIT(A).
Contrary to that the ld. D.R though supports the impugned order but did not raise any objection in restoring the appeal of the assessee before the Ld. CIT(A).
Upon hearing the submission of the Counsel of the respective parties, and find that the assessment was done behind the back of the assessee and the Ld. CIT(A) has passed an order by dismissing the appeal of the assessee on account of delay in filing of appeal. There was no adjudication on the merit of the case. The Ld. CIT(A) in its order has held that the assessee mentioned the date of service of order / notice or demand on to 413/Kol/2025 Assessment Year: 2014-15 to 2015-16 Purotech Merchants Pvt. Ltd. 14.08.2018. However, it did not submit any documentary evidence in support of service of notice. Hence there is no plausible explanation accordingly, the appeal is dismissed in limine. The Ld. A.R by filing a petition as discussed above in condonation petition has stated following paragraphs with regard to delay in filing of the appeal which is as follows:
In this context, we have perused the several decisions of the Hon'ble Apex Court and find that in Shakuntala Devi Jain v. Kuntal Kumari [AIR 1969 SC 575], this Court reiterated the following classic statement from Krishna vs. Chathappan [1890 ILR 13 Mad 269]: "... Section 5 gives the courts a discretion which in respect of jurisdiction is to be exercised in the way in which judicial power and discretion ought to be exercised upon principles which are well understood; the words `sufficient cause' receiving a liberal construction so as to advance substantial justice when no negligence nor inaction nor want of bona fides is imputable to the appellant."
In N.Balakrishnan v. M.Krishnamurthy [1998 (7) SCC 123], this Court held: "It is axiomatic that condonation of delay is a matter of discretion of the court. Section 5 of the Limitation Act does not say that such discretion can be exercised only if the delay is within a certain limit. Length of delay is no matter, acceptability of the explanation is the only criterion. Sometimes delay of the shortest range may be uncondonable due to a want of acceptable explanation whereas in certain other cases, delay of a very long range can be condoned as the explanation thereof is satisfactory. Once the court accepts the explanation as sufficient, it is the result of to 413/Kol/2025 Assessment Year: 2014-15 to 2015-16 Purotech Merchants Pvt. Ltd. positive exercise of discretion and normally the superior court should not disturb such finding, much less in revisional jurisdiction, unless the exercise of discretion was on wholly untenable grounds or arbitrary or perverse. But it is a different matter when the first court refuses to condone the delay. In such cases, the superior court would be free to consider the cause shown for the delay afresh and it is open to such superior court to come to its own finding even untrammeled by the conclusion of the lower court. The primary function of a court is to adjudicate the dispute between the parties and to advance substantial justice...... 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. A court knows that refusal to condone delay would result in 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 justice.”
Keeping in view the facts and the reason as stated in the affidavit as well as the view of the Hon’ble Apex Court we are inclined to give an opportunity to the assessee to place its case before the CIT(A). Affidavit of the assessee has explained the delay and according to us it is just and reasonable, accordingly delay is hereby condoned. The order of Ld. CIT(A) is hereby set aside. The case of the assessee is hereby restored in the file of Ld. CIT(A) to dispose of the case after hearing the assessee. The assessee is hereby directed to place its case before the Ld. CIT(A).
In the result, all the appeals filed by the assessee are allowed for statistical purposes.
Order is pronounced in the open court on 22nd May, 2025