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Facts
The assessee, a cooperative society, filed its return of income declaring 'NIL' income after claiming a deduction of Rs.17,17,680/- under Section 80P. The Assessing Officer disallowed this deduction. The assessee appealed to the CIT(A) but filed the appeal with a delay, citing the COVID-19 pandemic and other reasons.
Held
The Tribunal held that the CIT(A) dismissed the appeal solely on the grounds of delay without deciding the merits of the case. Citing the Supreme Court's decision in Collector, Land Acquisition vs. MST Katiji, the Tribunal emphasized that substantial justice should be preferred over technicalities, especially when the delay is not willful.
Key Issues
Whether the CIT(A) erred in dismissing the appeal on grounds of delay without considering the merits, and whether condonation of delay is warranted in the interest of substantial justice.
Sections Cited
80P, 143(1), 250(6)
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Income Tax Appellate Tribunal, NAGPUR “SMC” BENCH : NAGPUR
Before: SHRI V. DURGA RAO
ORDER
PER V. DURGA RAO, J.M. : This appeal has been filed by the assessee against the order dated 25.01.2024, of the learned Addl./JCIT(A)-1, Jaipur, relating to assessment year 2020-2021. 2. Facts of the case, in brief, are that the assessee is a cooperative society registered under the law in the State of Maharashtra and engaged in providing credit facilities to it’s member s. The assessee-society has filed it’s return of income on 09.01.2021 declaring income at Rs.NIL by claiming deduction 2 ITA.No.162/NAG./2024 u/sec.80P of the Act at Rs.17,17,680/-. The Assessing Officer/CPC, Bengaluru, vide order dated 23.12.2021 passed u/sec.143(1) of the Act disallowed the deduction of Rs.17,17,680/- claimed u/sec.80P of the Act.
Aggrieved by the order of the Assessing Officer/CPC, Bengaluru, the assessee carried the matter in appeal before the learned CIT(A) with delay. Before the learned CIT(A), the assessee submitted that the part of the delay was due to Covoid-2019 outbreak pandemic and for the balance period the assessee society offered it’s explanation. However, the learned CIT(A) was not satisfied with the explanation submitted by the assessee society and confirmed the order of the Assessing Officer in disallowing claim of deduction u/sec.80P of the Act and dismissed the appeal of the assessee by not condoning the delay.
Aggrieved by the order of the learned CIT(A), the assessee is in appeal before the Tribunal.
Learned Counsel for the Assessee, during the course of hearing, submitted that the learned CIT(A) has dismissed the appeal of the assessee society without providing adequate opportunity of hearing for explaining the delay. He submitted that the assessee 3 ITA.No.162/NAG./2024 society is ready to file an affidavit before the learned CIT(A) along with petition for condonation of delay and the learned CIT(A) be directed to condone the delay and decide the appeal on merits. He further submitted that part of delay has been occurred due to Covid-2019 outbreak pandemic and for the part delay he has sufficient cause. He submitted that the claim of sec.80P deduction is a legitimate one and the assessee society has got fair chances to succeed. He submitted that the delay in filing the appeal before the learned CIT(A) is neither willful nor wanton. He accordingly submitted that one more opportunity may please be provided to the assessee society to substantiate it’s case and prayed that the matter may be sent back to the learned CIT(A) for afresh adjudication by condoning the delay in filing the appeal before him.
The Learned DR on the other hand, relied on the orders of the lower authorities and strongly opposed for condonation of delay.
I have heard the arguments of both the sides and perused the material on record. I find that the learned CIT(A) has dismissed the appeal of assessee on the ground of delay but not decided the appeal on merits as contemplated u/sec.250(6) of the Act, according to which, the learned CIT(A) has to give reasons for decision and 4 ITA.No.162/NAG./2024 adjudication thereof. In this connection, I note that the Hon’ble Supreme Court in the case of Collector, Land Acquisition vs., MST Katiji [1987] 167 ITR 471 (SC) has held that when substantial justice and technical considerations are pitted against each other, cause of substantial justice deserves to be preferred for the other side cannot claim to have vested right in injustice being done because of a non- deliberate delay. It has further been held that refusing to condone delay can result in a meritorious matter being thrown-out at the very threshold and cause of justice being defeated. As against this, when delay is condoned, the highest that can happen is that a cause would be decided on merits after hearing the parties. In view of the above decision of Hon’ble Supreme Court in the case of Collector, Land Acquisition vs., MST Katiji (supra) and considering the submission of the assessee that assessee society would be filing condonation application along with the affidavit before the learned CIT(A), considering the totality of the facts and circumstances of the case, I deem it fit and appropriate to direct the learned CIT(A) to condone the delay in filing of the appeal before him and decide the appeal as per fact and law. I hold and direct accordingly.
In the result, appeal of the assessee is allowed.
5 ITA.No.162/NAG./2024 Order pronounced in the open Court on 28.01.2025.