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Income Tax Appellate Tribunal, “H” BENCH, MUMBAI
Before: SHRI M. BALAGANESH, AM & SHRI AMARJIT SINGH, JM
O R D E R
PER AMARJIT SINGH, JM:
The assessee has filed the above mentioned appeals against the different order passed by the Commissioner of Income Tax (Appeals)- 36, Mumbai [hereinafter referred to as the “CIT(A)”] relevant to the A.Ys. 2008-09 to 2011-12 in which the penalty levied by the AO has been ordered to be confirmed.
The assessee has filed the present appeal against the order dated 20.06.2017 passed by the Commissioner of Income Tax (Appeals)-36, ITA. Nos. 6404 to 6411/Mum/2017 A.Ys. 2008-09 to 2011-12 Mumbai [hereinafter referred to as the “CIT(A)”] relevant to the A.Y. 2008-09 wherein the penalty levied by the AO has been ordered to be confirmed The assessee has raised the following grounds: -
3. “1 The Ld. Commissioner of Income Tax (Appeals) - 36, Mumbai hereinafter referred to as "Ld. CIT(A)"] erred in passing the order dated 20.06.2017 dismissing the appeal of the Appellant on the technical ground that same is filed in 'Manual Form' instead of 'e-form' prescribed by the CBDT vide notification No. S0637(E) [No.11/2016 (F. No. 149/150/2015-TPL)) dated 01.03.2016 without appreciating that due to some difficulty the Appellant could not be able to e-file the appeal memo. Thus, the order passed by Ld. CIT(A) is bad-in-law and the same may be quashed.
2. The 14. CIT(A) further erred in dismissing the appeal of the Appellant without providing an appropriate opportunity of being heard. Thus, the order passed by Ld. CIT(A) is against the principles of natural justice. Hence, the order passed by Ld. CIT(A) is void-ab-initio and the same may be quashed.
3. The Ld. CIT(A) further erred in confirming the action of the Ld. A.O. in levying concealment penalty on the addition of Rs.12,61,375/- being cash deposited in the account no. 020905000304 maintained by ICICI Bank treating the same as unexplained cash credit under section 68 of the Act without appreciating that the cash was deposited out of cash sales and also from the withdrawal made by the Appellant from the other bank account maintained by him. Hence, the levy of concealment penalty on the said addition is unjustified and the same may be deleted.
4. The Ld. CIT(A) failed to appreciate that the appellant has given a bonafide explanation with respect to the cash deposited in his bank account and the same has not been found to be false. Hence, levy of concealment penalty amounting to Rs.4,28742/- under section 271(1)(c) of the Act is unjustified and the same may be deleted. to 6411/Mum/2017 A.Ys. 2008-09 to 2011-12
5. The appellant craves leave to add, alter, rescind or amend any of the above grounds of appeal." At the very outset, the Ld. Representative of the assessee has 4. argued that the CIT(A) has dismissed the appeal of the assessee on the technical ground specifically on the basis of that the appeal has been filed in manually instead of E-form prescribed by CBDT Circular dated 01.03.2016 which is not mandatory and in this regard the Hon’ble ITAT has been decided the matter of controversy in the assessee’s own case in to 6403/M/2017 for the A.Ys. 2008-09 to 2011-12 dated 04.01.2018, therefore, in the said circumstances, the delay is also liable to be condoned and the appeal and the appeal is not liable to be dismissed on the basis of technical ground and is to be decided on merits and is liable to be restored before the CIT(A) for adjudicating the same on merits in accordance with law. However, on the other hand, the Ld. Representative of the Department has refuted the said contention. On appraisal of the order dated 20.06.2017, we noticed that the CIT(A) has decided the appeal on the basis of the technical ground that the appeal was not filed in E- form but filed manual and dismissed the appeal without deciding the appeal on merits. The appeal was against the quantum whereas the present appeal is the penalty appeal. The Hon’ble ITAT has condoned the delay and set aside the order of the CIT(A) by virtue of order dated 04.01.2018 in ITA. Nos. 6400 to 6403/M/2017 for the A.Ys. to 6411/Mum/2017 A.Ys. 2008-09 to 2011-12 2008-09 to 2011-12. The relevant finding is hereby reproduced as under:-
“2.1. I have considered the rival submissions and perused the material available on record. In view of the assertions made by the ld. respective counsel, so far as, condonation of delay is concerned no doubt filing of an appeal is a right granted under the statute to the assessee and is not an automatic privilege, therefore, the assessee is expected to be vigilant in adhering to the manner and mode in which the appeals are to be filed in terms of the relevant provisions of the Act. Nevertheless, a liberal approach has to be adopted by the appellate authorities, where delay has occurred for bona-fide reasons on the part of the assessee or the Revenue in filing the appeals. In matters concerning the filing of appeals, in exercise of the statutory right, a refusal to condoned the delay can result in a meritorious matter thrown out at the threshold, which may lead to miscarriage of justice. The judiciary is respected not on account of its power to legalize in justice on technical grounds but because it is capable of removing injustice and is expected to do so. 2.2. The Hon’ble Apex Court in a celebrated decision in Collector, Land Acquisition vs Mst. Katiji & Ors. 167 ITR 471 opined that when technical consideration and substantial justice are pitted against each other, the courts are expected to further the cause of substantial justice. This is for the reason that an opposing party, in a dispute, cannot have a vested right in injustice being done because of a non-deliberate delay. Therefore, it follows that while considering matters relating to the condonation of delay, judicious and liberal approach is to be adopted. If sufficient cause is found to exist, which is bona-fide one, and not due to negligence of the assessee, the delay needs to condoned in such cases. The expression ‘sufficient cause’ is adequately elastic to enable the courts to apply law in a meaningful manner, which subserves the end of justice- that being the life purpose of the existence of the institution of the courts. When substantial justice and technical consideration are pitted against each other, the cause of substantial justice deserves to be preferred. The Hon’ble Apex Court in Vedabhai vs Santaram 253 ITR 798 observed that inordinate delay calls of cautious approach. This means that there should be no malafide or dilatory tactics. Sufficient cause should receive liberal construction to advance substantial justice. The Hon’ble Apex Court in 167 ITR 471 observed as under:-
ITA. Nos. 6404 to 6411/Mum/2017 A.Ys. 2008-09 to 2011-12 “3. The legislature has conferred the power to condone delay by enacting section 51 of the Limitation Act of 1963 in order to enable the courts to do substantial justice to parties by disposing of matters on de 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. It is common knowledge that this court has been making a justifiably liberal approach in matters instituted in this court. But the message does not appear to have percolated down to all the others courts in the hierarchy.” 2.3. Furthermore, the Hon'ble Supreme Court in the case of Vedabai Alia Vaijayanatabai Baburao Patil vs. Shantaram Baburao Patil 253 ITR 798 held that the court has to exercise the discretion on the facts of each keeping in mind that in construing the expression ‘sufficient cause’, the principle of advancing substantial justice is of prime importance. The court held that the expression “sufficient cause” should receive liberal construction. 2.4. The decision of the Tribunal in People Infocom Private Ltd. v/s CIT (ITA No.210/Mum/2013) order dated 19/05/2016, M/s Neutron Services Centre Pvt. Ltd vs ITO (ITA No.1180/Mum/2012) order dated 18/02/2016, Shri Saidatta Coop-. Credit Society Ltd. v/s ITO (ITA No.2379/Mum/2015) order dated 15/01/2016 and Mr. Nikunj Barot (Prop. Enigma) vs ITO (ITA No.4887/Mum/2015) order dated 06/01/2016, wherein, substantial delay was condoned, supports the case of the present assessee. Having made the aforesaid observation and various decisions discussed hereinabove, including from Hon’ble Apex Court, the circumstances narrated by the assessee, wherein, he has stated the reasons which caused the delay, therefore, the delay is condoned.
So far as, the ground raised, on merit is concerned, it was explained that the impugned orders were passed by the First Appellate Authority and dismissed the appeal merely on technical grounds as were filed on manual form instead of ‘eform’ prescribed by CBDT without appreciating that the assessee due to some difficulties could not be able to e-file the appeal memos, without providing opportunity of being heard to the assessee. The Ld. DR contended that the assessee was expected to e-file on prescribed form. 3.1. I have considered the rival submissions and perused the material available on record. Without going into much deliberation, I am of the to 6411/Mum/2017 A.Ys. 2008-09 to 2011-12 view that merely on technical grounds, the appeals should not have been dismissed and the assessee should have been heard on merit. The assessee is a proprietor of Hemkiran Electronics. Additions u/s 68 of the Income Tax Act, 1961 (hereinafter the Act) were made while passing the order u/s 143(3) r.w.s. 147 of the Act. Admittedly, the assessee was expected to file the appeals electronically as per Circular No.20 automatically does not lead to the conclusion that if due to technical reasons, the same is filed manually, it will be treated not maintainable. If the Ld. Commissioner of Income Tax (Appeal) was not satisfied with manual filing, nothing prevented him to hear the practical difficulties of the assessee and then adjudicate the same. The appeals were filed on manual form on 13/02/2017. Even otherwise, as per Article-265 of the Constitution of India only due are to be levied/collected, therefore, without going into much deliberation, the Ld. Commissioner of Income Tax (Appeal) is directed to adjudicated the appeals of the assessee on merit afresh. The assessee be given opportunity of being heard with further liberty to furnish evidence, if any, to substantiate his claim. Thus, all the appeals are allowed for statistical purposes.
On appraisal of the above mentioned finding, we noticed that the delay has already been condoned and the appeal which has been decided on technical ground by CIT(A) has been restored to the CIT(A) to decide the matter afresh by giving an opportunity of being heard to the assessee. The finding above is quite applicable to the facts of the present case being the present case is the penalty appeal of the quantum decided by the Hon’ble ITAT (supra). Since the matter of controversy has duly been covered by the above mentioned order, therefore, we set aside the finding of the CIT(A) on this issue and condone the delay and restored the matter before the CIT(A) to decide afresh on merits by giving an opportunity of being heard to the assessee in accordance with law.
ITA. NOs. 6405 to 6411/M/2017 to 6411/Mum/2017 A.Ys. 2008-09 to 2011-12