PINKAL SURESHKUMAR KOTHARI,AHMEDABAD vs. THE ITO, WARD-5(2)(1), AHMEDABAD

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.

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 night 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 e 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.”

Their Lordships of Hon'ble Supreme Court have in case of N. Balakrishnan Vs M Krishnamurthy ((1998) 7 SCC 123) promulgated that Sureshkumar Kothari vs. ITO] A.Y. 2017-18 - 4 – "Rule of limitation are not meant to destroy the right of parties They are meant to see that parties do not resort to dilatory tactics, but seek their remedy promptly. The object of providing a legal remedy is to repair the damage caused by reason of legal injury Law of limitation fixes a lifespan for such legal remedy for the redress of the legal injury so suffered Time is precious and the wasted time would never revisit. During efflux of time newer causes would sprout up necessitating newer persons to seek legal remedy by approaching the courts So a life span must be fixed for each remedy. Unending period for launching the remedy may lead to unending uncertainty and consequential anarchy. Law of limitation is thus founded on public policy. It is enshrined in the maxim Interest reipublica up sit finis litium (it is for the general welfare that a period be putt to litigation). Rules of limitation are not meant to destroy the right of the parties. They are meant to see that parties do not resort to dilatory tactics but seek their remedy promptly. The idea is that every legal remedy must be kept alive for a legislatively fixed period of time. A court knows that refusal to condone delay would result 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 vide Shakuntala Devi lain Vs. Kuntal Kumari [AIR 1969 SC 575) and State of West Bengal Vs. The Administrator, Howrah Municipality [AIR 1972 SC 749]. It must be remembered that in every case of delay there can be some lapse on the part of the litigant concerned. That alone is not enough to turn down his plea and to shut the door against him. If the explanation does not smack of mala fides or it is not put forth as part of a dilatory strategy the court must show utmost consideration to the suitor. But when there is reasonable ground to think that the delay was occasioned by the party deliberately to gain time then the court should lean against acceptance of the explanation. While condoning delay the Could should not forget the opposite party altogether. It must be borne in mind that he is a looser and he too would have incurred quiet a large litigation expenses. It would be a salutary guideline that when courts condone the delay due to laches on the part of the applicant the court shall compensate the opposite party for his loss. It is suffice to say that the Hon'ble Courts are unanimous in their approach to propound that whenever the reasons assigned by an applicant for explaining the delay, then such reasons are to be construed with a justice oriented approach.

Taking up the appeal of the assessee for adjudication, at the outset itself, Ld. Counsel for the assessee contended that the solitary issue in the present appeal relates to addition confirmed by the Ld. CIT(A) on account of investment made by the assessee in immovable property remaining unexplained to the extent of Rs.6,39,000/-. The orders of the authorities below reveal that the assessee was noted to have purchased immovable property, being Flat No.B-15 in Bhumika Apartment, as per conveyance deed on 09.09.2016 for a consideration of Rs.60 Lakhs which was paid from 07.05.2016 to 01.09.2016. The assessee also had paid stamp duty to Rs.2,94,000/-, resulting in total investment made by the assessee amounting to Rs.62,94,000/-.

The assessee explained the source of investment in the said property as under: i. Loan from Axis Bank Rs.35 Lakhs ii. Borrowing from wife Rs.10 Lakhs Sureshkumar Kothari vs. ITO] A.Y. 2017-18 - 6 – iii. Borrowing from Grandfather Rs.4 Lakhs iv. Borrowing from Mother Rs.2 Lakhs v. Balance Rs.11,69,000/- from his savings

The AO accepted assessee’s explanation of the source of the investment made to the tune of Rs.46,55,000/- and treated the balance as unexplained investment made by the assessee, making addition of the same to the income of the assessee. The Ld. CIT(A) accepted further explanation of source to the extent of Rs.10 Lakhs resulting in the investment of Rs.6,39,000/- remaining to be accepted by the authorities below as being from explained sources and which addition made to the income of the assessee, therefore, stood confirmed.

The Ld. Counsel for the assessee during the course of hearing before me, assisted by the assessee himself in the open Court, explained that out of the total investment made in the flat by the assessee of Rs.62.94 lacs, except for an amount of Rs.2.94 Lakhs for stamp duty purposes which was paid in cash, the entire remaining amount was paid through banking channels from his savings bank account. That even the cash paid was out of withdrawals from this bank account. That therefore the credits in the bank account itself explained the source of investment in the impugned property. The credits in the bank account, it was contended pertained to all borrowings from the assesee’s wife, Grandfather, mother and also salary earned by him during the year, which was returned to tax also by the assessee. The source of investment, it was contended, stood clearly explained and the authorities below having accepted source of investment from Sureshkumar Kothari vs. ITO] A.Y. 2017-18 - 7 – borrowings from the assesses family, the balance amount of Rs.6.39 Lakhs clearly was out of his own savings from the salary earned by him. There was no reason, therefore it was stated, for treating any amount of investment made as unexplained vis a vis source.

In the result, the appeal filed by the assessee is allowed.