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Facts
The assessee's appeal against a rectification order u/s 154 and subsequent tax demand, and denial of exemption u/s 12AA, was dismissed by the CIT(A) due to a delay of 1161 days in filing. The assessee contended that the delay was not intentional and should be condoned, citing the Supreme Court judgment and CBDT circulars regarding the COVID-19 period.
Held
The ITAT acknowledged the substantial delay but considered the Supreme Court's directives and CBDT Circulars concerning the exclusion of the COVID-19 period for limitation purposes. Consequently, the ITAT condoned the delay and remanded the case back to the CIT(A) for fresh adjudication on merits, ensuring the assessee receives an adequate opportunity to be heard.
Key Issues
Whether the significant delay (1161 days) in filing the appeal before the CIT(A) should be condoned, especially in light of the COVID-19 pandemic and relevant judicial pronouncements and circulars.
Sections Cited
250, 154, 12AA
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, CHANDIGARH BENCHE A’, CHANDIGARH.
Before: SH. RAJPAL YADAV, HON’BLE VICE- & SH. KRINWANT SAHAY, HON’BLE
ORDER Per: KRINWANT SAHAY, AM: The instant appeal of the assessee is directed against the order of the ld. Commissioner of Income Tax (Appeals), NFAC, Delhi, [in brevity the ‘CIT (A)’], order passed u/s 250 of the Income Tax Act 1961, dated 25.06.2024 [in brevity ‘the Act’] for A.Y. 2018-19. The impugned order is emanated from the order of the ld. CPC, Bangaluru, [in brevity ‘the AO’] order passed u/s 154 of the Act.
The grounds taken by the assessee are as under:
“1. That the ld. Assessing Officer erred to issue the Rectification order u/s 154 of Tax Act 1961 as per DIN- CPC/1819/U7/1973741623 dated 12.02.2020.
2. That the ld. Assessing officer erred to compute and demand the tax amounted to Rs. 20,74,215/- on the total receipt of the society.
That the ld. Assessing Officer erred to deny the exemption u/s 12AA of the Income Tax Act 1961.
That the ld. CIT Appeal has not considered our grounds of appeal and not given the benefit of condonation of delay.
5. That any other grounds of appeal may be taken or amend at the time of hearing.”
3. At the very outset the counsel of the assessee submitted that during proceedings before us that the ld. CIT(A) has dismissed the appeal on the ground that there was a delay of 1161 days in filing of appeal before the ld. CIT(A). Facts gathered from the ld. CIT(A) order as well as. The relevant para of the ld. CIT(A) are as under:
“2. Condonation of Delay: There has been a delay of 1161 days in filing of this appeal by the assessee in as much as the rectification order u/s. 154 of the Act, Dated: 12.02.2020 was served on the appellant on 12.02.202C and the present appeal was e-filed by the assessee on 18.05.2023 which is 1161 days after the expiry of 30 days period allowed for filing the appeal before the CIT(A) by the Act. Before proceeding to decide merits of this appeal, the issue of condonation of delay in filing of appeal is being adjudicated. The appellant in Form No.35 has mentioned the grounds for Condonation of delay as under: 2.2 Having gone through the assessee's aforesaid application for condonation of delay, I find that there is a delay of 1161 days in filing of appeal and no case has been made out by the assessee explaining such a long delay. The assessee admittedly received the relevant order of the AO on 12.02.2020 and the last day of filing of appeal 2 33 2020. The appeal was actually filed on 18.05.2023. 2.3 It is thus seen that no circumstances have been explained nor any evidence for existence of any circumstances which prevented the assessee from filing the appeal has been filed. The reasons given by the assessee are too general and they do not warrant a delay of 1161 days. 2.4 The aforesaid application, therefore does not explain reasons brought by demonstrating sufficient cause. It is a settled position of law that the assessee is duty bound to explain each day's delay after the last date of limitation. It is case of sheer negligence for non-pursuing available remedy in time. It is for the appellant concerned to explain the delay and it is not the function of the appellate xxxxxxxxxx 2.8 In view of the foregoing discussion, factual matrix and the judicial precedents, I find that no case has been made out by the assessee for existence of sufficient cause in the application for condonation of substantial period of delay of 1161 days in filing of appeal I also find that it is also a settled position of law that the delay is unexcusable unless sufficient cause is shown. I further find that proper explanation and reasons for delay have not been given. Therefore, I am of the view that in the absence of existence of reasonable cause and also in the absence of proper explanation and reasons, without being supported by proper evidence, the appeal filed by the assessee late by 1161 days the delay is not condonable. Hence, the appeal of the assessee is not admitted and the same is dismissed in limine.”
4. The counsel of the assessee accordingly requested the fact to condone the delay that the condonation of delay should be taken up sympathetically keeping in view, the Covid period and accordingly, the ld. CIT(A) should be instructed to pass an order on merits.
The ld. DR relied on the order of the ld. CIT(A) and argued that delay of 1161 days in filing of the appeal before the ld. CIT(A) could not be justified because even during the covid period the system was operating and the assessee could file an appeal before the ld. CIT(A).
We have considered the arguments and request of the ld. AR of the assessee as well as the findings given by the ld. CIT(A).
6.1 We have also gone through the written submission of this issue filed by the ld. AR which is reproduced as under:
To The Hon'ble Income Tax Appellate Tribunal, Chandigarh Bench. Subject: Application For Condonation Of Delay MOST RESPECTFULLY SHOWETH:
1. 1. That the appellant has preferred the present appeal for Assessment Year 2018-19, which was listed for hearing before this Hon'ble Tribunal on 04.02.2025.
2. That during the hearing, the Hon'ble Bench raised the issue of condonation of delay in filing the appeal.
3. That the delay in filing the appeal is covered under the Hon'ble Supreme Court judgment and CBDT Circular, wherein the period from 15.03.2020 to 14.03.2021 stands excluded from the computation of the limitation period due to the COVID-19 pandemic. The circular is enclosed as Annexure-A.
4. That another issue raised during the hearing pertains to the delayed filing of the return for A.Y. 2018-19. In this regard, it is most respectfully submitted that: As per CBDT Circular (Annexure B), the due date for filing returns for the relevant assessment year was extended.
The appellant duly filed the return within the extended timeline and, therefore, prays that no adverse inference may be drawn on this ground. That the delay in filing the appeal is neither intentional nor deliberate but occurred due to circumstances beyond the appellant's control. The appellant has a bona fide case on merits and shall suffer irreparable loss if the delay is not condoned.
6.2 We have gone through the submission filed by the counsel of the assessee for condonation of delay we have also gone through the order of the Hon’ble Supreme Court in the case on this issue of exempting period of Covid for the purpose of accounting of delay in filing any appeal before any authority and we have also considered the CBDT Circular on this issue. Having gone through all these documents, circular and orders, we are inclined to condone the delay in filing appeal before the ld. CIT(A) and as requested by the ld. AR of the assessee the case is being remanded back to the file of the ld. CIT(A) for passing an order on merits of the case. The assessee is also instructed to cooperate with the revenue and file all required papers and documents for the purpose of deciding the appeal before the ld. CIT(A) in time, all the legal and factual issues are open to the assessee. Accordingly, the appeal is remanded back to the file of the ld. CIT(A) for fresh adjudication.
6.3 Needless to say, that the ld. CIT(A) shall provide proper and adequate opportunity of being heard to the assessee in set aside proceedings. The evidence/explanation submitted by assessee in its defence shall be admitted by the ld. CIT(A) and adjudicated on merits in accordance with law and considering the CBDT Circular & Instruction. We order accordingly.