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Facts
The appellant, a partnership firm running a resort, filed its return for AY 2010-11, which was assessed under Section 143(3) with additions for interest/bank charges under Section 43B and excess partner remuneration under Section 40(b). The CIT(A) subsequently dismissed the appellant's appeal for want of prosecution.
Held
The Tribunal noted a delay of 588 days in filing the appeal. The appellant's petition for condonation, citing fault of office staff, was deemed insufficient and lacking genuine reasons or evidence. Citing principles of limitation law, the Tribunal dismissed the appeal on the grounds of laches and delay, refusing to condone the significant delay.
Key Issues
Whether there was sufficient cause to condone the 588-day delay in filing the appeal before the Income Tax Appellate Tribunal.
Sections Cited
143(3), 43B, 40(b), 154
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Income Tax Appellate Tribunal, COCHIN BENCH
Before: SHRI INTURI RAMA RAO, AM
O R D E R These appeals filed by the assessee are directed against separate orders of the National Faceless Appeal Centre (NFAC), Delhi [CIT(A)] dated 27.02.2023 for Assessment Years (AY) 2010-11 to 2012-13.
Since identical issues are involved in these appeals, they are heard together and disposed of by this common order. For the sake of convenience and clarity the facts relevant to the appeal bearing for AY 2010-11 are stated herein. to 988/Coch/2024 Sea Castle An Ayurvedic and Leisure Hotel 3. Brief facts of the case are that the appellant is a partnership firm running a resort. The appellant filed the return of income for AY 2010-11 on 13.03.2014. Against the said return of income, the assessment was completed by the Income Tax Officer, Ward-1(4), Thiruvananthapura (hereinafter called "the AO") vide order dated 27.03.2015 passed u/s. 143(3) of the Income Tax Act, 1961 (the Act) at a total income of Rs. 5,08,000/-. While doing so, the AO made addition of interest and bank charges paid to KFC invoking the provisions of section 43B of the Act. The AO also made addition of Rs. 2,50,000/- being the excess remuneration paid to partners u/s. 40(b) of the Act.
Being aggrieved, an appeal was filed before the CIT(A), who vide the impugned order dismissed the appeal for want of prosecution.
Being aggrieved, the appellant is in appeal before the Tribunal in the present appeal.
At the outset I find that there is a delay of 588 days in filing the appeal. The appellant filed a petition seeking condonation of delay by stating that the delay has occurred, as the office staff did not inform of the order till December, 2023. Subsequently the appellant made an attempt to file the appeal, the records could not be traced. The appeal was filed finally on 05.12.2024 with a delay of 588 days. If the delay is not condoned a great irreparable damages would be caused to the appellant. Therefore, it is prayed tht the delay may be condoned.
On the other hand, the learned Sr. DR vehemently opposed to condemnation of delay as no sufficient cause was shown for the delay. to 988/Coch/2024 Sea Castle An Ayurvedic and Leisure Hotel 8. I have carefully gone through the averments made in the petition seeking condemnation of delay. From the averments made in the petition it is clear that the appellant had not shown any sufficient cause for the delay except blaming the office staff, The affidavit does not contain the details and the name of the staff who had received the appellate order but not informed the appellant. Further it is not clear as to how the misplaced records came to recovered. Just because the rectification order dated 14.11.2024 is traced, it does not lead to the conclusion that other papers such as order passed by the CIT(A) and the assessment order are also traced along with the order u/s. 154 of the Act. Thus, the averments made in the petition seeking condonation are not genuine and does not really explain the reasons for the delay with evidence. Therefore, I am of the considered opinion that it is not a fit case to condone the delay of 588 days. In the case of Pundlilk Jalam Patil (dead) by LRs vs. Executive Engineer Jalgaon Medium Project [2008] 17 SCC 448, the Hon'ble Supreme Court of India held that basically the laws of limitation are founded on public policy an the courts have expressed at least three different reasons supporting the existence of statutes of limitation, namely (i) that long dormant claims have more of cruelty than justice in them, (ii) that a defendant might had lost the evidence to dispute the said claim, and (iii) that persons with good causes of action should pursue them with reasonable diligence. It was observed that the statutes of limitation are often called as statues of peace insofar as the unlimited and perpetual threat of limitation creates insecurity and uncertainty which are essential for public order. In the light of the above legal decision, the appeal is dismissed on the ground of latches and delay.
Order pronounced in the open court on 25th March, 2025. 10.