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Income Tax Appellate Tribunal, “SMC-C” BENCH : BANGALORE
Before: SHRI N.V. VASUDEVAN
Per N. V. Vasudevan, Vice President
The impugned orders of the CIT(A) in both these appeals are of CIT(A)-3, Bengaluru, dated 22.09.2020 and 24.08.2020 respectively. These appeals have been filed by the assessee on 05.04.2021. The Registry has sought to raise objection with regard to the delay in filing the appeals by the assessee. In view of the decision of the Hon’ble Supreme Court In Re Cognizance for extention of limitation, Miscellaneous Application No.665/2021 order dated dated 23.09.2021, the period from 25.03.2020 to 04.10.2021 will have to be excluded for the purpose of computing period of limitation. Therefore these appeals are to be treated as appeals filed within time.
ITA Nos.133, 134/Bang/2021 Page 2 of 5 2. The assessee is a primary agricultural Co-operative Society registered under the Karnataka Co-operative Societies Act, 1959. For Assessment Year 2018-19, the assessee filed return of income claiming exemption under section 80P of the Act of a sum of Rs.12,61,500/-. In computing its income from business, the assessee had also claimed deduction of Rs.49,126/- being contribution to education fund administered by Karnataka State Co-operative Federation Ltd., Bengaluru, as per the provisions of section 57(2A) of the Karnataka Co-operative Societies Act, 1959. The return of income so filed by the assessee was processed electronically by the Centralized Processing Centre (CPC) under section 143(1) of the Income Tax Act, 1961 (hereinafter called ‘the Act’). The CPC by an intimation dated 25.06.2019, disallowed the claim of the assessee for deduction under section 80P of the Act and also disallowed the deduction claimed on account of contribution to education fund.
Against the aforesaid intimation making the adjustment as above, the assessee filed an application under section 154 of the Act on 29.07.2019. It appears that the aforesaid application under section 154 of the Act was dismissed by the CPC by an order dated 08.09.2019. According to the assessee, he was not aware of the order dated 08.09.2019. The assessee had filed a letter dated 11.11.2019 in which the assessee enquired about his application under section 154 of the Act. The CPC, vide its letter dated 14.02.2020, informed the assessee as follows: “Vide letter dtd. 11.11.2019, with reference to your return filed and processed by the CPC for the AY 2018-19, it was informed that you have applied an application to CPC Bengaluru seeking rectification of mistake vide rectification reference number 645853810290719 dtd. 29.07.19 and asking the undersigned to allow deduction u/s.80P as per your return of income. However, it is seen from the website of the CPC that your rectification application dtd. 29.07.2019 was processed by the CPC
ITA Nos.133, 134/Bang/2021 Page 3 of 5 and that the rectification order has been passed on 08.09.2019 and send by email on 12.09.2019 to email tejaswinijayaram088gmail.com Since your rectification application filed before the CPC was already taken by the CPC and the order has been passed. it is requested to do the needful as per the rectification order passed by the CPC with regard to your return filed for the AY 2018-19.”
Against the intimation dated 25.06.2019 under section 143(1) of the Act and the order under section 154 of the Act (claimed by the Department to be dated 08.09.2019 and alleged by the assessee to have knowledge about the same only on 14.02.2020), appeals were filed before the CIT(A) on 18.03.2020. As far as the appeal against the order dated 25.06.2019 under section 143(1) of the Act is concerned, the CIT(A) found that there was a delay of 163 days. The assessee had prayed for condonation of delay before CIT(A) by stating that the Assessee could learn about the availability of the appellate remedy only on advise from the new Chartered Accountant Singhvi Dev and Unni LLP, and hence the delay in filing the appeal.
As far as the appeal against the order under section 154 of the Act is concerned, the CIT(A) took the view that the delay in filing these aforesaid appeals has to be construed from 12.09.2019 which is the date of the communication of the order under section 154 of the Act, according to the Department. Accordingly, the CIT(A) computed the delay in filing the appeal against the order under section 154 of the Act as 159 days.
As far as the delay in filing the appeal against the intimation under section 143(1) of the Act is concerned, the plea of the assessee was that it was waiting for the outcome of the application under section 154 of the Act and therefore did not file the appeal in time. As far as the delay in filing appeal against the order under section 154 of the Act is concerned, the assessee submitted the same reasons as
ITA Nos.133, 134/Bang/2021 Page 4 of 5 was given for the delay in filing appeal against the intimation under section 143(1) of the Act. The CIT(A) held that the fact that the assessee was pursuing alternative remedy is not a good ground for condoning delay and he dismissed the appeal of the assessee as unadmitted.
As far the appeal against the order under section 154 of the Act is concerned, the CIT(A) held that the plea of the assessee that the professional did not advise properly and that the assessee came to know about the Appellate remedy only on approaching the new CA cannot be a sufficient cause for condoning the delay in filing the appeals. Thus both the appeals filed by the assessee was dismissed by the CIT(A) as unadmitted.
Against the aforesaid orders of the CIT(A), the assessee is in appeal before the Tribunal.
I have heard the rival submissions. In my view, the CIT(A) has taken a very technical view of the matter. The approach to be adopted in such matters in such cases has been explained in the case of Collector of Land Acquisition Vs. MST Katiji and Others, 167 ITR 471 (SC). The Supreme Court took the view that unless there is negligence or want of due diligence, the delay in filing the appeal should be condoned. I also derive support from the decision of the Hon’ble Jammu and Kashmir High Court in the case of Faisal Hameed Vs. ITAT and another, ITA No.2/2012 order dated 13.09.2012 wherein it was held where an assessee pursues an alternative remedy, that would be sufficient cause for condoning the delay in filing appeal. I am also of the view that in the date of service of order under section 154 of the Act if it is construed as 14.02.2020 as claimed by the assessee, then the delay in filing that appeal would be very marginal and would deserve a liberal approach to be adopted. Taking into consideration all the facts and circumstances of the case and keeping in mind that
ITA Nos.133, 134/Bang/2021 Page 5 of 5 the assessee’s grievance has not been addressed on merits at any point of time by any of the authorities, I am of the view that the orders of the CIT(A) has to be set aside and the issue raised with regard to deduction under section 80P of the Act and allowing deduction on account of contribution to education fund should be examined afresh by the AO after affording opportunity of being heard to the assessee. I accordingly allow both the appeals of the assessee for statistical purposes.
In the result, the appeals of the assessee are treated as allowed for statistical purposes.
Pronounced in the open court on the date mentioned on the caption page. Sd/- Sd/- (B. R. BASKARAN) (N. V. VASUDEVAN) Accountant Member Vice President Bangalore. Dated: 12.10.2021. /NS/*
Copy to: 1. Appellants 2. Respondent 3. CIT 4. CIT(A) 5. DR 6. Guard file By order Assistant Registrar, ITAT, Bangalore.