M/S INTERNET COMPONET MANAGEMENT GROUP PRIVATE LIMITED ,BANGALORE vs. THE DEPUTY COMMISSIONER OF INCOME TAX CIRCLE-3(1)(1), BANGALORE

IN THE INCOME TAX APPELLATE TRIBUNAL BANGALORE BENCHES “ C ” BENCH: BANGALORE BEFORE SHRI A.K. GARODIA, ACCOUNTANT MEMBER AND SHRI PAVAN KUMAR GADALE, JUDICIAL MEMBER ITA No.3273/Bang/2018 (Assessment Year: 2010-11) M/s. Internet Component Management Group Pvt. Ltd., No.66/1, Magadi Main Road, Rananathapura, Kamakshipalya, Opp. to Safal Daily Fresh, Bangalore-560079 ….Appellant PAN AAACI 7483C Vs. Dy. Commissioner of Income Tax, Circle 3(1)(1), Bangalore. ……Respondent.

Assessee By: Shri V. Srinivasan, Advocate. Revenue By: Smt. R. Premi, JCIT (D.R)

Date of Hearing : 26.02.2020 Date of Pronouncement : 27.02.2020

O R D E R PER SHRI PAVAN KUMAR GADALE, JM : The assessee has filed an appeal against the order of Commissioner of Income Tax (Appeals)-3, Bangalore passed u/s 143(3) and u/s 250 of the Income Tax Act, 1961 (the Act).

2 ITA No.3273/Bang/2018 2. At the time of hearing, the learned Authorized Representative submitted that the assessee has raised the grounds of appeal that the CIT (Appeals) has not condoned the delay in filing the appeal. 3. The Brief facts of the case are that the assessee is engaged in software consultancy and corporate training and filed the Return of Income on 14.10.2010 with loss of Rs.5,40,052 and the case was selected for scrutiny under CASS and Notice under Section 143(2) and 142(1) of the Act were issued. In compliance, the learned Authorized Representative has appeared from time to time and submitted the details. The Assessing Officer found that the assessee company has made investments in mutual funds and there is a difference in value of investments and disclosures in the Balance Sheet, hence made addition as unexplained investments. Similarly Ao found, there are outstanding liabilities of Rs.1, 10,30,585/- and the details were called for along with confirmations. Since the assessee could not submit the details, the Assessing Officer made disallowance and assessed the total income of Rs.1,10,90,533/- and passed order under Section 143(3) of the Act dt.18.03.2013. Aggrieved by the order, the assessee filed an appeal with the CIT (Appeals). The assessee has filed condonation petition before the CIT (Appeals) as there is delay in filing the appeal and reasons were explained in the Affidavit. But the CIT (Appeals) found that there is no prima facie cause for condoning the delay

3 ITA No.3273/Bang/2018 of 331 days in filing the appeal and dismissed the appeal without condoning the delay. Aggrieved by the order, the assessee has filed an appeal before the Tribunal. 4. At the time of hearing, the learned Authorized Representative submitted that the delay in filing the appeal before the CIT (Appeals) was not intentional as the Accountant of the assessee took the assessment order and kept with him and these facts were brought on record at page 3 of the CIT(Appeals) order and prayed for an opportunity to substantiate the case with evidences on merits and condonation of delay in filing the appeal. Contra, the ld. DR supported the orders of CIT (Appeals). 5. We heard the rival contentions and perused the material on record. The sole matrix of the disputed issue as envisaged by the learned Authorized Representative is in respect of condo nation of delay in filing the appeal before the CIT(Appeals). The contention of the learned Authorized Representative that there is no wanton act on the part of the assessee for the delay but due to the circumstances beyond the control of the assessee. Further upon, garnish order issued by the Assessing Officer to the Bank Account, the assessee come to know about the assessment order and lapse of duties of the accountant, and the assessee has no intention to delay in filling the appeal but to contest on the disallowances by the Assessing Officer. The learned Authorized Representative supported his arguments with judicial decisions. We found that the CIT(Appeals) has not condoned the delay as

4 ITA No.3273/Bang/2018 there is no sufficient cause was explained and the delay of 331 days in filing the appeal before the CIT(Appeals) is not disputed. We are of the opinion that the delay in filing the appeal before the CIT(Appeals) supported with the reasons explained in the Affidavit can be accepted. Further the litigant will not gain by delaying the filing of appeal. We support our view, relying on the decision of the Hon'ble Apex Court in the case of Collector, Land Acquisition Vs. MST Katiji & others (167 ITR 471) (SC) and observations as under :

“ The legislature has conferred the power to condone delay by enacting s. 5 of the Limitation Act of 1963 in order to enable the Courts to do substantial justice to parties by disposing of matters on "merits". The expression "sufficient cause" employed by the legislature is adequately elastic to enable the Courts to apply the law in a meaningful manner which subserves the ends of justice—that being the life-purpose of the existence of the institution of Courts. The doctrine of equality before law demands that all litigants, including the State as a litigant, are accorded the same treatment and the law is administered in an even-handed manner. There is no warrant for according a step-motherly treatment when the "State" is the applicant praying for condonation of delay. In fact, experience shows that on account of an impersonal machinery (no one in charge of the matter is directly hit or hurt by the judgment sought to be subjected to appeal) and the inherent bureaucratic methodology imbued with the note-making, file- pushing, and passing-on-the-buck ethos, delay on its part is less difficult to understand though more difficult to approve. In any event, the State which represents the collective cause of the community does not deserve a litigant non grata status. The Courts, therefore, have to be informed of the spirit and philosophy of the provision in the course of the interpretation of the expression "sufficient cause". So also the same approach has to be evidenced in its application to matters at hand with the end in view to do even-handed justice on merits in preference to the approach which scuttles a decision on merits.”

5 ITA No.3273/Bang/2018 We considering the observations of judicial decision and submissions of the assessee before the CIT(Appeals) are of the opinion that the delay in filing the appeal before the CIT (Appeals) is supported with sufficient cause and pragmatic approach should be considered for condonation of delay. Accordingly, we condone the delay of 331 days in filing the appeal before the CIT (Appeals) and restore the entire disputed issues to the file of CIT (Appeals) to admit the appeal and adjudicate on merits and provide adequate opportunity of hearing to the assessee and, the assessee shall co-operate in submitting the information for early disposal of the appeal and allow the grounds of appeal of the assessee for statistical purposes. 6. Since we have condoned the delay in filing the appeal before the CIT(Appeals) and remitted the matter to the file of CIT(Appeals) for fresh adjudication, other grounds of appeal are not adjudicated. 7. In the result, appeal of the assessee is allowed for statistical purposes. Pronounced in the open court on the date mentioned on the caption page. Sd/- Sd/- (A.K. GARODIA) (PAVAN KUMAR GADALE) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 27.02.2020. *Reddy GP

6 ITA No.3273/Bang/2018 Copy to

Assistant Registrar Income-tax Appellate Tribunal Bangalore