PRIMARY AGRICULTURAL CO OPERATIVE SOCIETY LIMITED CHENNARAOPET,WARANGAL vs. ITO, WARD-1, WARANGAL

Aggrieved, the assessee society carried the matter in appeal before the CIT(A), who observed that though the appeal filed by the assessee society involved a delay of 388 days, the assessee society had not submitted any application seeking condonation of the same while filing the appeal. The CIT(A) observed that the assessee society had not mentioned any reason for the delay in filing of the appeal in the Memorandum of Appeal, i.e. Form No. 35. Rather, it was observed by him that the assessee society had stated that the delay condonation petition that will be filed along with affidavit with the written submissions, which may be considered.

Hence, you are given last opportunity to rectify the above defect in your appeal with relevant supporting documents by due date of compliance i.e. on or before on 17.09.2024, failing which your appeal may be rejected as per provisions of Section 249 of the Act.”

The assessee society, being aggrieved with the order of the CIT(A), has carried the matter in appeal before us.

Smt. S. Sandhya, Advocate, the learned Authorized Representative (for short “Ld.AR”) for the assessee society, at the threshold of hearing of the appeal, submitted that the same involves a delay of 32 days. Elaborating on the reasons leading to the delay in filing of the appeal before the Tribunal, the Ld. AR submitted that the same had crept in for the reason that, as 5 Primary Agricultural Cooperative Society Limited during the relevant period, i.e., 14.08.2024 to 25.11.2024, the Government of Telangana had implemented a loan waiver scheme for the farmers, which was to be attended by the assessee society on the highest priority, as the concerned agencies at the District administration of the State Government of Telangana were fully involved in the said time-bound program, therefore, the appeal against the impugned order could not be filed during the said period. Also, the Ld. AR has submitted that thereafter, as the assessee society had remained engaged in paddy procurement operations in various villages of the districts, therefore, the said reason also led to the delay in filing of the present appeal, which could only be filed on 04.05.2025 i.e. involving a delay of 32 days. The Ld. AR, to buttress her aforesaid claim, has drawn support from the application seeking condonation of the delay, along with a supporting affidavit of Sri Ravi Chitte, Chief Executive Officer (CEO) of the assessee society.

Per contra, Shri Gurpreet Singh, the learned Senior Departmental Representative (for short “Ld. DR”) objected to the seeking of condonation of the delay involved in the filing of the present appeal by the assessee society.

We have given our thoughtful consideration and find substance in the Ld. AR’s claim that as the assessee society, during the relevant period, had remained engrossed in, viz. (i). the loan waiver scheme that was implemented by the State Government of Telangana, a time-bound program implemented over the period 14.08.2024 to 25.11.2024; and (ii). paddy procurement operations in various villages in the month of December 2024, thus, the said reasons had resulted to a delay of 32 days in filing of the present appeal. As the delay involved in filing of the present appeal, in our view, has occasioned because of bona fide reasons and not on account of lackadaisical conduct of the assessee society, therefore, we have no hesitation in condoning the same.

Apropos the merits of the case, we find that the CIT(A) had dismissed the appeal for the solitary reason that though the same involved a delay of 388 days, but the assessee society had not submitted any application seeking condonation of the same.

We are of the view that it was for the assessee society to have filed an application seeking condonation of the delay involved in the appeal filed before the CIT(A). Rather, we find that the CIT(A), taking cognizance of the fact that the assessee society had failed 8 Primary Agricultural Cooperative Society Limited to file an application for condonation and had stated in the Memorandum of Appeal, i.e., Form No. 35, that the same would be filed along with written submissions, called upon it to file/ upload the same on or before 17.09.2024, but as observe by us hereinabove the needful was not done by the assessee society.

The Ld. AR submitted that the failure on the part of the assessee society to furnish the application seeking condonation of the delay before the CIT(A) was due to multiple reasons, viz., lack of technical expertise, resource constraints, remote location, and heavy reliance on the appointed Chartered Accountant, who had acted in a negligent manner, as he at the relevant point of time was engrossed in carrying out certain time bound statutory compliances.

Elaborating further on her contention, the Ld. AR has submitted that the assessee society is a rural government body, which is managed by only two to three persons, who are primarily engaged in government agricultural functions. It was stated that the office staff of the assessee society had no formal knowledge or training on Income-tax laws or procedures and was not equipped to handle the latest model fiscal tax norms. The Ld. AR has 9 Primary Agricultural Cooperative Society Limited submitted that due to the new system of computer digitalization, all notices, including the assessment orders, were uploaded on the Income Tax E-filing Portal, which the assessee society, due to its locational disadvantages, could not access or understand. Apart from that, it was stated by her that the assessee society had appointed a counsel, viz., Sri Garimella Venkateswarlu, C.A, who in turn had entrusted his work to Mr. T. Mahendra Reddy, C.A. The Ld. AR, submitted that as the concerned Chartered Accountant at the relevant point of time had remained preoccupied in filing of the I.T. returns, he had failed to comply with the notice dated 09.09.2024 that was received from the office of the CIT(A), wherein the assessee society was directed to submit an application seeking condonation of the delay in filing of the appeal before him. The Ld. AR has submitted that both the delay in filing of the appeal before the CIT(A) and also the non- compliance with his notice under Section 250 of the Act, dated 09.09.2024 (supra) had occurred due to bona fide reasons, therefore, in the totality of the facts, the CIT(A) be directed to condone delay and dispose of the appeal on merits.

We have thoughtfully considered the contentions advanced by the learned Authorized Representatives of both the parties on the aforesaid two-fold issues, viz., (i) the failure on the part of the assessee society to comply with the notice issued by the CIT(A) under Section 250 of the Act, dated 09.09.2024, directing it to file/upload a condonation application; and (ii). the reasons leading to the delay of 388 days in filing the appeal before the CIT(A).

At the threshold, we may herein observe that though no obligation was cast upon the CIT(A) to call upon the assessee society to file or upload a condonation application, but he had, in 11 Primary Agricultural Cooperative Society Limited all fairness, and in the interest of justice, directed the assessee society to do the needful. However, we find that the assessee society had failed to comply with the aforesaid direction of the CIT(A). At first blush, we were of a firm conviction that the conduct of the assessee society, which despite having been afforded an opportunity to place on record the condonation application which it was required to have voluntarily filed, failed to do so, therefore, its appeal had rightly been dismissed by the CIT(A) on the ground of limitation itself, but in the totality of the facts that have been brought to our notice, we are constrained to take a different view. We, say so, for the reason that, as per the facts deposed by the assessee society in its “affidavit” dated 24.06.2025, the failure on its part to comply with the notice issued by the CIT(A) under Section 250 of the Act, dated 09.09.2024 by the CIT(A) office is attributable to the negligence on the part of its C.A, who, at the relevant point of time, had remained pre-occupied in meeting out time-bound obligations. Apart from that, we find that though the CIT(A), in all fairness, has allowed the assessee society to file before him a condonation application on or before 17.09.2024, but thereafter, in the absence of the needful being done by the assessee society, he had, 12 Primary Agricultural Cooperative Society Limited on the very next day, i.e., on 18.09.2024, dismissed the appeal, as barred by limitation.

Ostensibly, the reasons leading to the delay of 388 days involved in the filing of the appeal before the CIT(A) carry substance, as the same had apparently crept in because of the negligence on the part of its counsel.

Be that as it may, we are of the firm conviction that in the totality of the facts involved in the present case, the matter, in all fairness, requires to be restored to the file of the CIT(A), who is directed to afford the assessee society an opportunity to file/ upload a petition for condonation of the delay of 388 days in filing of the appeal before him. The CIT(A) is directed to judiciously consider the application seeking condonation of the delay that shall be filed by the assessee society before him, if any.

Before parting, we may herein observe that, though we have restored the matter to the file of the CIT(A), but we have refrained from expressing any view on the merits of the case, and also the explanation of the assessee society regarding the delay of 388 days involved in filing of the appeal before the CIT(A), which the latter 13 Primary Agricultural Cooperative Society Limited shall remain at liberty to deal with as per the discretion vested with him under Section 249(3) of the Act.

Resultantly, the appeal filed by the assessee society is allowed for statistical purposes in terms of our aforesaid observations.