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Facts
The assessee trust filed its return of income for AY 2020-21 declaring Nil income and was selected for scrutiny. The Assessing Officer made additions and initiated penalty proceedings. The appeal before the CIT(A) was dismissed due to a delay of 700 days in filing.
Held
The Tribunal condoned the 700-day delay in filing the appeal before the CIT(A) after considering the assessee's affidavit citing reasons beyond their control. The case was restored to the CIT(A) for fresh adjudication.
Key Issues
Whether the delay in filing the appeal before the CIT(A) was condonable due to sufficient cause, and if the matter should be remanded for fresh adjudication.
Sections Cited
250 of the Income-tax Act, 1961, 144 r.w.s. 144B of the Act, 274 r.w.s 270A of the IT Act, 10(23C)(vi) of the Act, Section 5 of the Limitation Act
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Income Tax Appellate Tribunal, “D” BENCH KOLKATA
Before: Shri Rajesh Kumar & Shri Pradip Kumar Choubey
Appearances by: Shri Rakesh Dubey, Adv., appeared on behalf of the appellant. Shri S B Chakraborthy, Addl. CIT, Sr. DR, appeared on behalf of the Respondent. Date of concluding the hearing : January 06, 2026 Date of pronouncing the order : January 15, 2026
ORDER
Per Pradip Kumar Choubey, Judicial Member:
This appeal filed by the assessee is directed against the order dated 03.09.2025 of the NFAC, Delhi (hereinafter referred to as the “CIT(A)”) passed u/s 250 of the Income-tax Act, 1961 (hereinafter referred to as “the Act”) for the assessment year 2020–21.
Brief facts of the case of the assessee are that the assessee trust had e-filed its return of income for the assessment year 2020-21 on 10.01.2021 declaring total income of Rs. Nil/- Thereafter, the case of the S D Rai Prayas Educational Trust assessee was selected for scrutiny under CASS for the reason that the assessee trust has paid salary and rent to specified person and the assessee trust has not filed any reply about the specified person to whom the assessee paid salary. The Assessing Officer passed assessment order u/s 144 r.w.s. 144B of the Act making addition of Rs.77,56,664/-under the head as income from other sources and penalty proceedings u/s 274 r.w.s 270A of the IT Act were also initiated on this issue.
Aggrieved by the said intimation order, the assessee preferred appeal before the ld. CIT(A) but failed to succeed as the appeal of the assessee was dismissed by the ld. CIT(A) as barred by limitation of 700 days in filing the appeal.
Being aggrieved and dissatisfied, the assessee is in appeal before us. The ld. AR challenges the impugned order of the ld. CIT(A) thereby submitting that there was only a delay of 42 days in filing the appeal before the ld. CIT(A) was occurred due to reasons which were beyond the control of the assessee. The ld. AR in this respect has submitted an affidavit for condonation of such delay, the contents of the same are as under:
The ld. DR supports the impugned order but did not raise any objection for remitting the appeal of the assessee before the ld. CIT(A).
Upon hearing the submissions of the counsels of the respective parties, we have gone through impugned order passed by the ld. CIT(A) and find that the appellant is a registered charitable trust and formed with the main object of establishing and operating educational institutions. We also find that the assessee-trust was granted provisional registration under section 10(23C)(vi) of the Act, vide Form 10AC dated 23/03/2022 which was valid for A.Ys. 2022-23 to 2024-25. We note that the assessee applied for regular registration but the application for regular registration was rejected on 30/06/2025 due to delay without any further opportunity to be heard. We further note that the assessee has filed an affidavit citing the reasons for such delay in filing the appeal before the ld. CIT(A) and considering the said affidavit, we find that the assessee was prevented by sufficient cause and the reasons for the delay was beyond the control of the assessee.
In this context, we have perused several decisions of the Hon'ble Apex Court and find that in Shakuntala Devi Jain v. Kuntal Kumari [AIR 1969 SC 575], this Court reiterated the following classic statement from Krishna vs. Chathappan [1890 ILR 13 Mad 269]:
"... Section 5 gives the courts a discretion which in respect of jurisdiction is to be exercised in the way in which judicial power and discretion ought to be exercised upon principles which are well understood; the words `sufficient cause' receiving a liberal construction so S D Rai Prayas Educational Trust as to advance substantial justice when no negligence nor inaction nor want of bona fides is imputable to the appellant."
In N.Balakrishnan v. M.Krishnamurthy [1998 (7) SCC 123], this Court held:
"It is axiomatic that condonation of delay is a matter of discretion of the court. Section 5 of the Limitation Act does not say that such discretion can be exercised only if the delay is within a certain limit. Length of delay is no matter, acceptability of the explanation is the only criterion. Sometimes delay of the shortest range may be uncondonable due to a want of acceptable explanation whereas in certain other cases, delay of a very long range can be condoned as the explanation thereof is satisfactory. Once the court accepts the explanation as sufficient, it is the result of positive exercise of discretion and normally the superior court should not disturb such finding, much less in revisional jurisdiction, unless the exercise of discretion was on wholly untenable grounds or arbitrary or perverse. But it is a different matter when the first court refuses to condone the delay. In such cases, the superior court would be free to consider the cause shown for the delay afresh and it is open to such superior court to come to its own finding even untrammeled by the conclusion of the lower court.
The primary function of a court is to adjudicate the dispute between the parties and to advance substantial justice...... Rules of limitation are not meant to destroy the rights of parties. They are meant to see that parties do not resort to dilatory tactics, but seek their remedy promptly.
A court knows that refusal to condone delay would result in foreclosing a suitor from putting forth his cause. There is no presumption that delay in approaching the court is always deliberate. This Court has S D Rai Prayas Educational Trust held that the words "sufficient cause" under Section 5 of the Limitation Act should receive a liberal construction so as to advance substantial justice.”
Keeping in view the above discussion and considering the judicial precedents, we condone the delay of 700 days in filing the appeal before the ld. CIT(A) and restore the appeal of the assessee to the file of the ld. CIT(A) for fresh consideration after affording reasonable opportunity to the assessee of hearing and the ld. CIT(A) will pass a reasoned order in accordance with law. The assessee is directed to fully cooperate in the remand proceedings.
In the result, the appeal of the assessee is allowed for statistical purposes.
Kolkata, the 15th January, 2026.