VARITRA FOUNDATION,PANCHKULA vs. INCOME TAX OFFICER, EXEMPTIONS WARD, AMBALA, AMBALA

VI. Collector, Land Acquisition v. Mst. Katiji [(1987) 167 ITR 471 (SC)]: Although relied upon by the CIT(A), this decision supports a liberal approach to condonation where substantial justice is at stake.

VII. State of U.P. v. Satish Chand Shivhare [SLP (C) No. 5301 of 2022 (SC)]: Reaffirmed that unless delay is satisfactorily explained, appeals cannot be adjudicated on merits.

2.4 Relying on the above, the CIT(A) dismissed the appeal as time-barred without adjudicating the matter on merits.

4 The ld. AR for the assessee also specifically objected to the CIT(A)’s reliance on service through SMS and uploading on the CPC portal, contending that such modes are not valid modes of service as per the provisions of section 282 of the Act read with Rule 127 of the Income Tax Rules. It was submitted that valid service must be effected either by physical delivery or via the registered email address as per law. In the absence of valid service, it was urged that the limitation period had not commenced, and hence, the appeal filed was within time. In the light of above it was prayed that delay in filing the appeal before the CIT(A) may be condoned. It was further prayed that the matter may kindly be remanded back to the file of the CIT(A) for fresh adjudication on merit.

6.1 We have considered the rival contentions and perused the material on record. The primary issue for adjudication is whether the assessee had shown sufficient cause to warrant condonation of delay in filing the appeal before the CIT(A). It is observed that the delay in filing the appeal was attributed to the assessee's unawareness of the intimation dated 27.11.2023, allegedly due to inaccessibility of the registered email and absence of any valid service of the order.

The assessee claimed that service through SMS and uploading on the CPC portal cannot be considered a valid service under law. We find merit in this contention.

6.2 As per Section 282 of the Act, read with Rule 127 of the Income Tax Rules, service is valid only if effected either physically or through the registered email address. Service through SMS or mere uploading on the CPC portal is not recognised under the statute. In the absence of a valid service, the commencement of limitation is itself in question. For that, we may rely upon the decision of the jurisdictional high court in this regard.

6.3 While it is true that the delay of 353 days is substantial, the explanation furnished by the assessee cannot be said to be entirely lacking in bona fides. Upon becoming aware of the demand, prompt steps were taken to file the appeal. The explanation is not inherently implausible or indicative of negligence, however, we cannot be oblivious to the rules reproduced herein above.

6.4 The reliance placed by the CIT(A) on decisions such as Ram Lal and Basawaraj is distinguishable on facts. In those cases, the delay was found to be due to inaction and lack of bona fides. In contrast, in the present case, the delay has been sufficiently explained through a plausible and consistent explanation.

6.5 The decision in Collector v. Katiji in fact supports the assessee’s stand that courts should adopt a liberal approach where refusal to condone delay may result in miscarriage of justice. The law is fairly settled that the liberal approach should be followed in tax adjudication proceedings, more particularly when assessee is NGO doing good cause for soecity and nation.

6.6 In view of the above, and considering the principle of substantial justice, we are inclined to condone the delay. However, in order to strike a balance and discourage procedural laxity, we impose a cost of ₹2,000/- on the assessee, to be paid to the Prime Minister’s National Relief Fund within 30 days from the receipt of this order and under intimation to the CIT(A).

Order pronounced in the open Court on 05 / 08/2025.