GANESH INTERNATIONAL,MUMBAI vs. A.C.I.T. 17(1), MUMBAI

Date of Hearing 30/01/2020 Date of Pronouncement 12/02/2020 आदेश आदेश / O R D E R आदेश आदेश PER G.MANJUNATHA (A.M):

This appeal filed by the assessee is directed against order of the Ld. Commissioner of Income Tax (Appeals)–56, Mumbai, dated 06/11/2018 and it pertains to Assessment Year 2008-09.

1. On the facts and circumstances of the case and in law, the learned CIT (A) erred in dismissing, in limine, the manual appeal (though filed within time prescribed under section 249(2) of IT. Act, 1961) in ex-parte manner merely on a technical/venial flaw of non filling of e-appeal, thereby resulting in meritorious matter being thrown out at the very threshold and cause of justice being defeated, for no deliberate fault/default on the part of the appellant.

2. On the facts and circumstances of the case and in law, the learned CIT (A) erred in not appreciating the fact that (a) appeal could not be filed electronically on account of lack of legal knowledge on the part of the Appellant and lack of proper filing by the erstwhile authorized representative as also (b) the failure on the part of erstwhile authorized representative during appellate proceedings, cannot be construed as deliberate default on the part of appellant.

3. On the facts and circumstances of the case and in law, the learned CIT (A) erred in dismissing the appeal In limine keeping in view the settled law that when substantial justice and technical considerations are pitted against each other, the cause of substantial justice deserve to be preferred and hence the impugned appellate order may kindly be quashed and appeal to be heard on merits after condoning delay, if any 4. On the facts and circumstances of the case and in law, the Learned CIT (A) in not appreciating that manually filed appeal within the stipulated time was accepted by his office without any objection and therefore, the Learned (A) should have admitted appeal and decided the issues on merits.

5. On the facts and circumstances of the case and in Jaw, the Learned CIT (A) erred in not appreciating that even though the appeal of the Appellant was not filed electronically, sufficient time could have been given to Appellant by Learned CIT (A) to remove the defect by allowing filing of appeal electronically and then the appeal could have been disposed of by Learned CIT (A) on merits after such compliance.

3. None appeared for the assessee. We have heard the Ld. DR and perused the material available on record. We find that the Ld.CIT(A) has dismissed appeal filed by the assesse in limine for not filing an appeal in electronic form, as required under Rule 45 r.w.Rule 12 of I.T.Rules 1962. We find that the issue involved in the present appeal is covered by the decision of ITAT, Mumbai in the case of Deepak Raheja in where under identical set of facts, the Tribunal has restored the appeal back to the file of the Ld.CIT(A) to decide the appeal on merits in accordance with law, after allowing the assessee to file appeal in electronic form, if not file already. The relevant findings of the Tribunal are as under:-

5. None appeared for the assessee. We have heard the Ld. DR and perused the materials available on record along with orders of the Ld.CIT(A). We find that the Ld.CIT(A) has dismissed appeal filed by the assessee in-lumine on technical ground for not filing appeal in electronic form as per amended Rule 45 of the I.T.Rules,1962, as well as CBDT circular No. 11/2016, dated 01/03/2016 and 20/2016 dated 26/05/2016, although, the assessee has filed appeal within the prescribed time allowed under the Act in manual form. The assessee has explained the reasons for not filing appeal in electronic form before the Ld.CIT(A), as per which the assessee was not aware of the amended Rule 45 of the I.T.Rules, 1962, which mandates filing of appeals in electronic form. Further, when the said lapses has been brought to the notice of the assessee, it has filed appeal in electronic form on 29/08/2018. But the Ld.CIT(A) has dismissed appeal filed by the assessee, on the ground that said appeal is not maintainable, as per the provision of section 249(1) of the Act. No doubt, the law has been amended, so as to file appeal in electronic form after certain dates and as per which, all appeals are required to be filed in electronic form only. But, when the assessee has explained the reasons for not filing appeal in electronic form and said reasons are bonafide, then the Ld.CIT(A) ought to have considered the explanation of the assessee, condone the delay in filing of appeal and dispose-off the appeal on merits in accordance with law, because, the assessee has filed appeal in manual form within the due date prescribed under the Act. Therefore, we are of the considered view that when, the assessee has filed an appeal in manual form within the prescribed time allowed under the Act and also, rectified the lapses, as and when said lapses has been brought to his notice, the appeal of the assessee cannot be dismissed on technical grounds that too during transition period.

6. We further noticed that the co-ordinate bench of ITAT, Mumbai ‘G’ bench, in the case of M/s. Asterix Reinforced Ltd.,vs ITO in had considered an identical issue and after considering relevant facts has restored the appeal to the file of the Ld. CIT(A) and direct him to condoned delay in filing appeal in electronic form and to decide the issue on merits in accordance with law. The relevant findings of the Tribunal are as under:-

“6. We have heard both the parties and perused the materials available on record. It is an undisputed fact that the CBDT has mandated filing of appeal in electronic form after a certain date by issuing notification vide Notification No.SO 637(E) [No.11/2016 (F. No.149/150/2015-TPL)] dated 01.03.16 as per which the assessee is required to file form No.35 electronically. It is also an admitted fact that the CBDT has extended such due date of filing of appeal in electronic mode up to 15.06.16 considering the hardships/technical glitches in filing the appeal electronically. Admittedly, the assessee has filed its appeal in paper form on 29.04.16. The assessee claims that it is unaware of the notification issued by the CBDT for filing appeals in electronic format, therefore, it has filed its appeal in manual form on 29.04.16. The assessee further claims that during transition period the provisions of notification should not be applied strictly.

7. Having heard both the sides, we find merits in the arguments of the assessee for the reason that during transition period the provisions of any notification or circulars mandating the assessees to follow certain instructions should not be strictly applied. We further noticed that the assessee has filed its appeal in manual form and such appeal has been filed within the prescribed time under the Act. Therefore, we are of the considered view that merely because the assessee has not filed the appeal in electronic form, the assessee's appeal cannot be dismissed on technical grounds that too during transition period. We, further, noticed that the Hon'ble Supreme Court and various High Courts have already categorically stated that when technicalities and substantial justice is pitted against each other, the substantial justice deserves to be prevailed over technicalities. Therefore, we are of the considered view that the Ld. CIT(A) was erred in dismissing the appeal filed by the assessee as not maintainable, hence, we set aside the issue to the file of the Ld. CIT(A) and direct him to admit the appeal filed by the assessee by directing the assessee to file its appeal in electronic format and also to condone delay in filing such appeal in electronic format. We also direct the Ld. CIT(A) to decide the issues on merits.”

Order pronounced in the open court on this 12 /02/2020