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Income Tax Appellate Tribunal, “B” BENCH : BANGALORE
Before: SHRI N. V. VASUDEVAN & SHRI JASON P BOAZ
O R D E R Per Shri Jason P Boaz, A.M. :
These appeals by the assessee, an employee of the Central Excise and Customs Department, are directed against the separate orders of the PCIT, Kalburgi passed u/s 263 of the Income Tax Act, 1961 (in short ‘the Act’) on 24.03.2014, for Assessment Years 2009-10 and 2010-11.
Briefly stated, the facts of the case are as under: and 2034/Bang/2016 Page 2 of 7 2.1 For Assessment Year 2009-10, the assessment was completed u/s 143(3) of the Act vide order dated 27.12.2011, wherein the assessee’s income was determined at Rs.5,22,560/-.
For Assessment Year 2010-11, the assessment was completed u/s 143(3) of the Act vide order dated 29.03.2012, wherein the assessee’s income was determined at Rs.4,13,694/- and agricultural income at Rs.2,40,000/-.
2.2 The PCIT, Kalburgi, on a perusal of the records of assessment, initiated revisionary proceedings u/s 263 of the Act as he was of the view that the orders of assessment for Assessment Years 2009-10 and 2010-11 dated 27.12.2011 and 29.03.2012 respectively, were erroneous in so far as they were prejudicial to the interests of Revenue. After putting the assessee on notice on certain issues in this regard, and after considering the assessee’s submissions in the matter, the PCIT passed the impugned orders u/s 263 of the Act dated 24.03.2014 for both Assessment Years 2009-10 and 2010-11. In these orders, the PCIT held that the orders of assessment for these two years being erroneous and prejudicial to the interests of Revenue are set aside and directed the Assessing Officer (AO) to frame fresh orders of assessment for Assessment Years 2009-10 and 2010-11 in accordance with law, after verification of details and affording the assessee opportunity of being heard in the matter.
Order on petitions for condonation of delay in filing the appeals for Assessment Years 2009-10 and 2010-11 before the ITAT, Bangalore 3.0 The present appeals by the assessee directed against the separate orders of PCIT, Gulbarga, both dated 24.03.2014 for Assessment Years 2009-10 and 2010-11; it is observed; were filed before the Tribunal only on 24.11.2016. Along with the appeals for these two Assessment Years, the assessee has also filed separate petitions for condonation of delay of 898 days in filing the appeal for Assessment Year and 2034/Bang/2016 Page 3 of 7 2009-10 and delay of 883 days in filing the appeal for Assessment Year 2010-11. On a perusal of the said petitions, we find that the reasons cited by the assessee for the said delay in filing the appeals are similar for both Assessment Years and we, therefore, extract hereunder the assessee’s averments in Assessment Year 2010-11:
2. The prayer for condonation of delay: “The prayer for condonation of delay is on the following grounds:
(i). The appellant assessee was acting on the advice of the tax consultant under the bona-fide impression that appeal is provided only when the assessment order is completed by the Commissioner of Income-tax u/s.
The appellant assessee is filing the appeal as soon as he is informed of the fact that the law provides for direct appeal against the order u/s. 263, as more clearly submitted in the "Statement of facts" enclosed herewith, and; (ii). The fresh notice u/s.263 dated 09.08.2016 again proposing to revise the order completed afresh u/s. 143(3) r.w.s.263 compelled the Appellant to seek expert opinion and proper advice in this matter. The filing of appeal at this stage is also justified on one more ground that the Appellant would be subjected to undergo repetitive appeals against the assessment orders and fresh order u/s.263, if the impugned order is not contested. It is the unjust act of the department in issuing fresh notice/s.263 as above submitted that has compelled the Appellant and seek justice before the Hon'ble ITAT by contesting the order u/s. 263 at this stage. The following documents are enclosed herewith in evidence of the above averment: Fresh show cause notice u/s.263, dated, 09-08-2016 in F.No.263/PrCIT/KLB/2016-17, dated, 09-08-2016 issued by the Pr.CIT, which shows that the Department is again subjecting the Appellant to the repeated proceedings before the Principal CIT and consequently, before the Assessing Officer and the Appellate Authorities. In Collector. Land Acquisition vs. Mst. Katiji & Ors. 167 ITR 0471, the Hon'ble Supreme Court laid down the principle that the expression "reasonable cause" should be liberally construed so as to advance the cause of substantial justice. The non-condonation of delay has the undesirable effect of throwing out a meritorious case at the threshold, which should be avoided.
4. It is far this reason that the Hon'ble Gujarat High Court has laid down the proposition that when a prayer is made for condonation of delay, the concerned authority has to first examine whether prima-facie there is a case. If there is a prima- facie arguable case, condonation should not be refused. It is for this reason, the Hon'ble Karnataka High Court has held that ultimately the question is whether the assessee is liable according to provisions of the law or not. and a liability cant be fastened by refusing condonation of delay. and 2034/Bang/2016 Page 4 of 7
5. If the delay is condoned, there ought not to be any prejudice to the Department /Revenue, because the matter would be decided on merits and on the other hand, there would be a great injustice to the Appellant, if the delay is not condoned. It is most respectfully submitted that the respondent Department cannot object to the condonation when reasonable cause is shown. since such an objection would impliedly mean that the Department has no case on merits. Hence, it is prayed that condonation of delay may not be refused.” It was prayed that the delay in filing the appeals for Assessment Years 2009-10 and 2010-11 before the Tribunal be condoned.
Per contra, the learned Departmental Representative opposed the assessee's prayer for condonation of delay of 898 and 883 days in filing the appeals for Assessment Years 2009-10 to 2010-11 respectively. The learned Departmental Representative submitted that the aforesaid delay should not be condoned in a routine manner and that a distinction ought to be drawn between a case where the delay is inordinate, as it is in the case on hand and in cases where the delay is of a few days. The learned Departmental Representative further contended that the explanation put forward by the assessee for the aforesaid delay does not amount to “reasonable” and sufficient cause which were beyond the assessee's control and the assessee has certainly not proved beyond doubt that he was diligent and not guilty of negligence whatsoever in the matter. The learned Departmental Representative prayed that since the inordinate delay in filing of these appeals being clearly due to the negligence on the part of the assessee, the petitions for condonation of delay in filing the appeals for Assessment Years 2009-10 and 2010-11 be rejected and the appeals be dismissed on this score, without admitting them for adjudication.
5.1 We have heard both parties and perused and carefully considered the material on record, including the judicial decisions cited. The Hon'ble Apex Court in the case of Vedabai alias Vaijayanatabai Baburao Patil V Shantaram Baburao Patil & Ors (2002) 253 ITR 798 has held that while exercising discretion, distinction should be made between a case where the delay is inordinate and a case where the delay is of a few and 2034/Bang/2016 Page 5 of 7 days, which may deserve a liberal approach. The exercise of discretion, their Lordships observed, would depend on the facts of each case and no hard or fast rule can be laid down in this regard. In the above cited case, the application for condonation of delay in filing the appeal was 7 days. In the case of Ganga Sahai Ram Swarup V ITAT (2004) 271 ITR 512 (All) the delay was of 12 days in filing the appeal and it was held therein that a liberal view ought to be taken, as there was a delay of only a very short period. Even in the land mark decision on the issue of condonation, Collector, Land Acquisition V MST Katiji (supra), cited by the assessee, wherein the Hon'ble Apex Court laid down that courts should have a liberal and practical approach in exercising its discretionary powers of condonation of delay, the delay was of 4 days.
5.2 From a perusal of the averments made by the assessee in the petition for condonation of delay we are of the opinion that not only the submissions are merely self-serving statements, the veracity of which are not established but also there is an admitted inordinate delay of 898 days and 883 days in filing the appeal. The assessee in its averments has not made out of a case that there was “reasonable cause” which being beyond the control of the assessee that prevented him from filing the appeals in time before the Tribunal. The delay cannot be condoned merely because the assessee's case calls for sympathy or merely out of benevolence. For the exercise of discretion in condoning the delay, it must be established beyond the shadow of doubt that the assessee was diligent and was not guilty of negligence on his part. “Reasonable cause” as contemplated in the limitation provisions must be a cause which is beyond the control of the party. In the case on hand, the factual matrix, in our view, clearly establishes that the delay was due to the negligence and inaction on the part of the assessee, which could have been avoided by the assessee if he had exercised due care and attention. Therefore in our opinion, in the factual matrix of this case there exists no sufficient and reasonable cause for the inordinate delay in filing the appeals for Assessment Years 2009-10 to 2010-11 by the assessee. In and 2034/Bang/2016 Page 6 of 7 coming to this finding, we draw support from the decisions of the Hon'ble Apex Court in the case of MST Katiji (supra), Vedabai alias Vaijayanatabai Baburao Patil (supra), of the Hon'ble Allahabad High Court in the case of Ganga Sahai Ram Swaroop (supra) and of the ITAT, Chennai Bench (Third Member) in the case of JCIT V Tractors & Farm Equipments Ltd. (2007) 104 ITD 149 (Chennai) (TM). The cases cited by the assessee of various courts and of the co-ordinate benches of this Tribunal (supra), have been duly considered and with due respects we find the factual matrix different therein. We have considered the factual matrix of this case to reach the finding that there existed no sufficient and reasonable cause for the inordinate delay of 898 days and 883 days in filing the appeals for Assessment Years 2009-10 and 2010-11 as the assessee has also not been able to establish that he was prevented by sufficient causes beyond his control from filing these appeals on time. In this view of the matter, we are of the opinion that, in the case on hand, the cause of substantial justice would not be served by condoning the inordinate delay in filing these appeals for which reasonable or sufficient cause has not been established. We accordingly reject these petitions for condonation of delay for Assessment Years 2009-10 and 2010-11. Consequently, the assessee's appeals for Assessment Years 2009-10 and 2010-11 are not admitted for adjudication on merits and are dismissed in limine.
In the result, the assessee's appeals for Assessment Years 2009-10 and 2010-11 are dismissed.
Order pronounced in the open court on this 11th day of January, 2019.