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Facts
The assessee's appeal before the CIT(A) was filed with an inordinate delay of approximately 10 years. The assessee attributed this delay to changes in management and tax consultants, a reason which the CIT(A) found lacked sufficient evidence and bona fides.
Held
The Tribunal upheld the CIT(A)'s decision to dismiss the appeal as time-barred. It found that the assessee's explanations for the delay did not constitute 'sufficient cause' and were not supported by any cogent evidence, especially considering the assessee had filed appeals for other assessment years promptly.
Key Issues
Whether the extensive delay in filing an appeal can be condoned without sufficient cause and supporting evidence, and if the CIT(A) was justified in dismissing the appeal on limitation grounds.
Sections Cited
143(1), 80P(2)(d), 234A, 234B, 234C, 249(3)
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Before: SHRI SANDEEP GOSAIN & SHRI PRABHASH SHANKAR
PER PRABHASH SHANKAR [A.M.] :- The present appeal arising from the appellate order dated 25.08.2025 is filed by the assessee Trust against the order passed by the Learned Commissioner of Income-tax, Appeal, ADDL/JCIT(A), Agra [hereinafter referred to as “CIT(A)"] pertaining to assessment order passed u/s. 143(1) of the Income-tax Act, 1961 [hereinafter referred to as “Act"] dated 16.10.2014 for the Assessment Year [A.Y.] 2013-14. 2. The grounds of appeal are as under: Page 2 Α.Υ. 2013-14 KCA Cooperative Credit Society
The learned Assessing Officer erred in disallowing interest received from the Cooperative Banks eligible for deduction us 80P 2d of Rs 9,76,373. The learned Assessing Officer further erred in levying interest under section 234A,234B and 234C of Rs.6,032, Rs.54,288 and Rs.11,159 respectively.
Your Petitioner further states that the learned CIT(A) also erred in confirming the Order of the assessing officer without considering the submissions made by your Petitioner on 13/02/2025 regarding the merits of the case in response to Notice dt 4/02/2025 filed vide acknowledgement no 86864851130225. 3. Your Petitioner further states that the Appeal was dismissed only on the grounds that it was filed after the stipulated time for filing the appeal and the case was not discussed on merits.
Your Petitioner places reliance on the following judgement in the case of M/s Udaya Ravi Arecanut vs Income Tax Officer Ward no 21 March 2025, wherein it was held that not condoning a delay in filing a appeal would amount to legalizing an illegal Order - ITAT Bangalore.
Your Petitioner states that the assesse is a Co-Operative Society registered under The Maharashtra State Co-Operative Act 1960. 6. Your petitioner further states that Co-Operative Banks are registered under the Co-Operative Societies Act in the various states as applicable.
Your petitioner states that under the provisions of Section 80P2d, interest received by a registered Cooperative society from a registered Co- Operative Bank is exempt from Income Tax.
Reliance is placed on the various ITAT decisions as mentioned in the Statement of Facts attached.
Your Petitioner further prays that interest received of Rs. 9,76,373/- by the Cooperative Credit Society from Cooperative Bank be allowed as deduction us 80P2d of the Income Tax Act 1961 and Interest levied us 234A, 234B and 234C of Rs.6,032, Rs 54,288 and Rs. 11,159/- respectively be deleted.
Your Petitioner prays that the delay in filing the appeal be condoned. Page 3 Α.Υ. 2013-14 KCA Cooperative Credit Society
Brief facts of the case are that the return of income was filed electronically declaring income of Rs. 9,76,373/-. Intimation u/s 143(1) was issued raising a demand of Rs. 3,73,180/-. The Assessing Officer (CPC) disallowed the deduction claimed u/s 80P(2)(d) in respect of interest income earned from deposits with Co-operative Banks, holding that such income was not eligible for deduction under the said provision. The assessee preferred appeal against the intimation u/s 143(1), challenging the disallowance of deduction u/s 80P(2)(d) and consequential levy of interest u/s 234A, 234B, and 234C.
It was noted that the appeal before the ld.CIT(A) had been filed belatedly, and condonation of delay had been sought by the appellant stating that the delay in filing the appeal is attributable to change in management and tax consultants. The appeal against the intimation u/s 143(1) dated 16.10.2014 had been filed only on 20.09.2024, after an inordinate delay of nearly 3,620 days (approximately 10 years). The appellant contended that due to change in management and tax consultants, the appeal could not be filed within the statutory period and has now been filed with a request for condonation. The ld.CIT(A) observed that the plea of "change in management/consultant" was a generic explanation not supported by any evidence such as board resolutions, resignation letters, or correspondence with erstwhile Page 4 Α.Υ. 2013-14 KCA Cooperative Credit Society representatives. Such general submissions could not constitute "sufficient cause" within the meaning of section 249(3) of the Act. More significantly, records revealed that for Assessment Year 2014-15, the appellant had duly filed appeal in Form 35 on 28.02.2017 before CIT(A), Mumbai against the order passed u/s 143(3) dated 23.12.2016, received on 31.01.2017. This fact demolished the appellant's contention of ignorance or inability to file appeal due to change in management or consultant. If the appellant was able to file an appeal promptly for AY 2014-15, there was no plausible reason for not filing the appeal for AY 2013-14 within the limitation period.
1 The ld.CIT(A) further observed that by failing to disclose these facts candidly and instead projecting misleading grounds, the appellant had presented a false statement during the course of appellate proceedings. This conduct not only reflected lack of bona fides but also amounted to deliberate negligence in discharging statutory obligations. It is well-settled law that condonation of delay is not a matter of right. The expression “sufficient cause” must be interpreted strictly and could not be extended to cover negligence, inaction, or lack of bona fides. In the present case, the delay of 3,620 days was not only extraordinary but also unexplained by cogent evidence. The appellant's reasons were perfunctory and contradicted by its own conduct. The explanation, Page 5 Α.Υ. 2013-14 KCA Cooperative Credit Society therefore, was nothing but an afterthought and a generalized excuse bereft of evidentiary support. Such selective compliance, where appeals were filed promptly in subsequent years but not for the year under consideration, established that the appellant had full knowledge of the statutory remedy but chose not to act diligently. None of the appellant's submissions was supported by credible evidence. No documents relating to change of management or change of tax consultant had been produced. Thus, the explanations failed the threshold test of sufficiency and cannot be accepted as a valid ground for condonation. The Hon'ble Supreme Court in the case of Chennai Metropolitan Water Supply and Sewerage Board and others vs. T.T. Murali Babu [2014 (4) SCC 108] declined to condone a delay of four years, holding that delay without sufficient cause cannot be condoned. Further, the Hon'ble Supreme Court in Majji Sannemma @ Sanyasirao vs. Reddy Sridevi & Ors., Civil Appeal No. 7696/2021 (disposed of on 16.12.2021), relying on Basavaraj vs. Special Land Acquisition Officer [(2013) 14 SCC_81], observed: “The expression 'sufficient cause' cannot be liberally interpreted if negligence, inaction or lack of bona fides is attributed to the party.” It was further held that if courts start condoning delay where no sufficient cause is made out, it would amount to violation of statutory principles and disregard of legislative Page 6 Α.Υ. 2013-14 KCA Cooperative Credit Society intent. Likewise, in Lingeswaran Etc. vs. Thirunagalingam, SLP (C) Nos. 2054-2055/2022, decided on 25.02.2022, the Hon'ble Supreme Court reiterated that when delay is not properly explained, the application for condonation must be dismissed.
2 In view of the foregoing analysis, the ld.CIT(A) concluded that as there was no sufficient cause and the application for condonation of delay was rejected. Consequently, the appeal itself was dismissed as barred by limitation, without going into the merits of the grounds of appeal.
Before us, when the case was called out for hearing by the Bench, none attended nor any adjournment was sought. We find on record an affidavit by the Chairman of the assessee bank wherein he claimed that the delay in filing of the appeal before the ld.CIT(A) occurred due to justifiable reasons. It is stated that the Elections to the Managing Committee of the Society is conducted once in every 5 years. The last Elections were held in February 2023 and the tenure of the present committee shall be from 2023 to 2028. The tenure of the previous Committee was from 2018 to 2023 and from 2013 to 2018. The Return of Income of the Society for AY 2013-14 was filed on 30/09/2013, the, declaring a Total Taxable Income of Rs. NIL. The Page 7 Α.Υ. 2013-14 KCA Cooperative Credit Society Intimation Order u/s 143(1) for A.Y.2013-14 was issue by the Income Tax Department on 16/10/2014. The Intimation was issued during the term of the earlier Committee. A Rectification Request was filed on 12/12/2014 vide Rectification Acknowledgement No.4430618101212214. No Action was initiated by the Department.
1 The previous Managing Committee's Chairman Mr. Johnson Theratil's mobile no. and email id were registered with the Income Tax Department for communication purposes to KCA Cooperative Credit Society Ltd. Also due to Mr. Johnson's ill health his staff in his factory were operating the systems. The previous Managing Committee of which was also a part as Secretary then, was never informed of the Taxation matters and was attended to by the then Chairman individually along with the then Chartered Accountant CA R.M.Patil. After taking over as the Chairman, he initiated the process of regularising the procedural irregularities. In this process, he became aware of the problem of non- attendance in Society's taxation matters.
2 On appointing another Chartered Accountant, he was informed in September 2024 that Intimation u/s143(1) for A.Ys. 2012- 13, 2013-14, 2018-19 and 2020-21 were already issued with heavy Income Tax Demands and no action was taken against them. He then Page 8 Α.Υ. 2013-14 KCA Cooperative Credit Society initiated the filing of the Appeal before the CIT (A), Mumbai and got the same filed on 20/09/2024. 6. The ld.DR on the hand objected to the condonation application claiming that the such inordinate delay could not be condoned as was rightly rejected by the ld.CIT(A).
We have carefully gone through the contents of the affidavit and also the reasons adduced by the ld.CIT(A) for rejecting the application for condonation. We agree with the observations by the ld.CIT (A) that the reasons attributed for such enormous delay of 10 years could not be considered ‘sufficient cause' especially in view of the fact that the contentions are not supported by any supporting details whatsoever. Even before us, the assessee did not attend the appeal proceedings and thus, failed to bring any cogent evidence to our knowledge to support the contentions made in the affidavit filed. The assessee is blaming the old management but there is no material brought on record to support its contentions. The ld.CIT(A) has relied upon several judgments of hon'ble Apex Court for rejecting the condonation application.
1 Therefore, considering the above discussion, we do not find any infirmity in the action of the ld.CIT(A) in dismissing the appeal in Page 9 Α.Υ. 2013-14 KCA Cooperative Credit Society limine. We therefore, uphold his action and thus, dismiss the grounds of appeal and also the appeal filed.
In the result, appeal of the assessee is dismissed. Order pronounced in the open court on 18/02/2026. SANDEEP GOSAIN (न्यायिक सदस्य /JUDICIAL MEMBER) Place: मुंबई/Mumbai दिनांक / Date 18.02.2026 Lubhna Shaikh / Steno PRABHASH SHANKAR (लेखाकार सदस्य/ACCOUNTANT MEMBER) आदेश की प्रतिलिपि अग्रेषित/Copy of the Order forwarded to : 1. 2. 3. 4. 5. अपीलार्थी / The Appellant प्रत्यर्थी / The Respondent. आयकर आयुक्त / CIT विभागीय प्रतिनिधि, आयकर अपीलीय अधिकरण DR, ITAT, Mumbai गार्ड फाईल / Guard file. सत्यापित प्रति //// आदेशानुसार / BY ORDER, उप/सहायक पंजीकार (Dy./Asstt.