Loading judgment…
No AI summary yet for this case.
Income Tax Appellate Tribunal, MUMBAI BENCH “C” MUMBAI
Before: SHRI RAVISH SOOD & SHRI N.K. PRADHAN
ORDER PER N.K. PRADHAN, A.M. This is an appeal filed by the assessee. The relevant assessment year is 2010-11. The appeal is directed against the order of the Commissioner of Income Tax-37, Mumbai [in short ‘CIT(A)’] and arises out of the assessment completed u/s 143(3) r.w.s. 147 of the Income Tax Act 1961, (the ‘Act’). 2. The first ground raised in this appeal by the assessee is against the order of the Ld. CIT (A) dismissing the appeal filed by the appellant on Assessment Year 2010-11 the ground that the same was filed on 18.04.2016 manually and not electronically. Against the assessment order, passed by the Assessing Officer (AO) u/s 143 (3) read with section 147 dated 26th February, 2016, determining the taxable income at Rs. 51,40,050/- , the assessee filed an appeal before the Ld. CIT (A). In the appellate proceedings, the Ld. CIT (A) examined the issue of admissibility of the appeal before going into the merits of the case. Referring to the Notification No. SO 637(E) [No. 11/2016 (F. No. 149/150/2015-TPL)] dated 1st March, 2016, issued by the Central Board of Direct Taxes (CBDT) prescribing mandatory e-filing of appeals for specified category of the appellants/assessees and the amendment in the Income Tax Rules, 1962 for substitution of Rule 45 and Form No. 35 and also Rule 12(3) and subsequent CBDT Circular No. 20 of 2016 dated 26th May, 2016, the Ld. CIT (A) held that in the instant case the appellant was required to file this appeal only in electronic form latest by 15th June, 2016. Thus, holding that the appellant was mandatorily required to file the appeal electronically in the first instance as per Circular No. 20, which is not complied with and as the manual appeal filed is not admissible as per the provisions of the Act, the Ld. CIT (A) dismissed the appeal.
3. In a nutshell, the dispute here is the order of the Ld. CIT (A) dismissing the appeal filed by the appellant on the ground that the appeal was filed on 18.04.2016 manually and not electronically. It is the contention of the Ld. counsel of the assessee that the system filing of appeal electronically was introduced w.e.f. 1st March, 2016 and there Assessment Year 2010-11 were technical difficulties initially as the system introduced was not fully functional. It is further stated by him that the appellant had manually filed the appeal within the stipulated time which was accepted by the office of the CIT (A) without objection. The Ld. counsel thus submits that the non-filing of appeal electronically was only a technical breach and that the appeal manually filed did not suffer from any other defects. The Ld. counsel relies in the order of the Tribunal in the case of Ashraf Aziz Kasmani vs. ITO (2018) 92 taxmann.com 283 (Mum Trib.).
On the other hand, the Ld. DR supports the order passed by the Ld. CIT (A).
We have heard the rival submissions and perused the relevant material on record. We find that a similar issue arose in the case of Ashraf Aziz Kasmani (supra). In that case, the assessee filed appeal before the CIT (A) on 30th June, 2016 against the order passed by the AO which was dated 14th February, 2016. The said appeal was filed in manual form. The Ld. CIT (A) opined that the assessee was required to file said appeal only in electronic form latest by 15th June, 2016. However, since the appeal was filed manually, the Ld. CIT (A) held that the said appeal was not maintainable. On second appeal, the ‘SMC’ Bench of the Tribunal held that: “8. I have heard the ld. Departmental Representative. None appeared on behalf of the assessee. The notice for hearing has also returned unserved. Hence, I proceeded to adjudicate the case by hearing the ld. Departmental Representative and perusing the records. From the grounds of appeal in this case, it transpires that the assessee has raised a ground that the CBDT Circular which mandated appeals before the ld. Commissioner of Income Assessment Year 2010-11 Tax (Appeals) to be filed electronically was dated 01.3.2016 and hence, it is the plea of the assessee that the appeals against the assessment order passed on or before 01.03.2016 can be filed manually and all the appeals in respect of assessment order passed on or after 01.3.2016 to be filed electronically.
First of all I note that the ld. Commissioner of Income Tax (Appeals) has himself noted in the first paragraph of his order that the appeal is “well within time”. Therefore the ld. Commissioner of Income Tax (Appeals) has opined that the assessee should have filed the appeal electronically by referring the CBDT Circular.
I find that there is no clarification in the said CBDT Circular, regarding the applicability of the same with regard to the date of assessment order passed. In the present case, admittedly the assessment order has been passed before 01.03.2016, so the claim of the assessee that the said Circular is applicable to assessment orders passed after 01.03.2016, cannot be brushed aside summarily. When this question was put to the ld. Departmental Representative, she replied that since the assessment order has been served to the assesse after 01.03.2016, the assessee’s ground taken cannot be sustained.
Upon careful consideration, I find that the above CBDT Circular, admittedly there is no discussion about the date of assessment order, with respect to which the said Circular is applicable. A construction that the said Circular is not applicable to assessment orders passed prior to 01.3.2016, cannot be said to be totally unsustainable. The Hon’ble Apex Court in the case of CIT v. Vegetable Products Ltd. [1973] 88 ITR 192 has expounded if two constructions are possible, one in favour of the assessee should be applied. On the facts of the present case, and on the touch stone of the above said Hon’ble Apex Court decision, I am of the considered opinion that the assessee’s plea that the appeal filed manually for assessment order passed prior to 01.03.2016, should be admitted by the ld. Commissioner of Income Tax (Appeals), is cogent. More so, when the ld. Commissioner of Income Tax (Appeals) in his earlier paragraph has accepted that the appeal is well within time. Accordingly I direct the ld. Commissioner of Income Tax (Appeals) to admit the aforesaid appeal of the assessee and pass an order on the merits of the case. Needless to add, the assessee should be granted adequate opportunity of being heard.