Loading judgment…
Facts
The assessee's appeal before the CIT(A) was dismissed due to a delay of 274 days. The assessee contended that its India operations were closed, there was no dedicated tax compliance personnel, the former responsible employee had left, and the assessment order was never received. The assessee learned about the order only upon receiving a penalty notice and filed an application for condonation of delay.
Held
The Tribunal condoned the delay in filing the appeal before the CIT(A), finding the reasons furnished by the assessee to be bonafide and not a result of negligence. Citing Supreme Court precedents on adopting a liberal approach to condonation of delay, the Tribunal restored the appeal to the CIT(A) for re-adjudication on merits, ensuring a reasonable opportunity of hearing for the assessee.
Key Issues
Whether the CIT(A) was justified in dismissing the assessee's appeal on the ground of limitation; Whether there were bonafide reasons for the delay in filing the appeal before the CIT(A).
Sections Cited
Section 5 of the Limitation Act
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCH “D”, DELHI
Before: SHRI VIKAS AWASTHY & SHRI AVDHESH KUMAR MISHRAHong Kong, SAR- 999999
अपीलाथ� �ारा/ Appellant by : Shri Tapas Misra, Advocate �ितवादी�ारा/Respondent by : Shri Ekta Jain, CIT(DR) सुनवाई क� ितिथ/ Date of hearing : 22/10/2024 घोषणा क� ितिथ/ Date of pronouncement : : 22/10/2024 आदेश/ORDER
PER VIKAS AWASTHY, JM:
This appeal by the assessee is directed against the order of Commissioner of Income Tax (Appeals),Delhi-42 (hereinafter referred to as 'the CIT(A)') dated 11.05.2023, for assessment year 2015-16.
The ld. Counsel for the assessee submitted that the CIT(A) has dismissed the appeal in limine on the ground of limitation. He stated that appeal before the (AY 2015-16) CIT(A) was belated by 274 days. The assessee had filed an Application for condonation before the CIT(A) giving reasons for delay in filing of the First Appeal. The CIT(A) taking a hyper technical view on the reasons furnished by the assessee explaining delay, dismiss appeal on the ground of limitation. Hence, the present appeal.
The ld. Counsel submits that the assessee has closed down its operations in India; hence, there was no dedicated person to oversee and follow up tax compliances in India. The person who was earlier looking after tax affairs in India had also left the company. His official email-id was furnished to the department for communication of all notices, since, he had left the company. The assessment order dated 21.05.2023 was never received by the assessee. The assessee came to know about the impugned order only when penalty notice was received by the assessee on email address which was subsequently registered with the department for service of notices. The assessee has prima facie good case on merits, if, an opportunity of appeal is allowed to the assessee, the assessee would be able to show that the addition made in the assessment order is not sustainable.
Per contra, Shri Ekta Jain representing the department vehemently defended the impugned order. The ld. DR submits that the assessee was not able to show bonafide reasons for delay in filing of appeal before the CIT(A).
We have heard the submissions made by rival sides and have examined the orders of authorities below. The assessee had filed appeal before the CIT(A) with the delay of 274 days. The assessee had filed application for condonation of delay (AY 2015-16) before the CIT(A), giving reasons causing delay in filing of appeal. The assessee has also furnished an affidavit before us, explaining reasons for delay in filing of appeal before the CIT(A). The reasons given by the assesee before the CIT(A) and the Tribunal are alike. After considering reasons given by the assessee, we are of view that the delay in filing of appeal before the First Appellate Authority was for bonafide reasons and not due to any negligence or inaction on the part of the assessee.
The Hon’ble Apex Court in the case of Collector Land Acquisition vs. Mst. Katiji & Ors. 1987 taxmann.com 1072 has held that liberal approach should be adopted while dealing with an application praying for condonation of delay. Refusing to condone delay can result in meritorious matter being thrown out at the very threshold and cause of justice being defeated. Pedantic and hyper technical approach should not be adopted while dealing with an application for condonation of delay.
The Hon’ble Apex Court in the case of Ram Nath Sao @ Ram Nath Sahu And Others vs Gobardhan Sao and Others has held that the expression “sufficient cause” within the meaning of Section 5 of the Limitation Act or Order 22 Rule 9 of CPC or any other similar provision should receive a liberal construction so as to advance substantial justice. The courts should not proceed with the tendency of finding fault with cause shown and reject the petition by a slipshod order in over jubilation of disposal derive. Acceptance of explanation furnished should be the rule and refusal, an exception, more so when no negligence or inaction or want of bonafides can be imputed to the defaulting party.
(AY 2015-16) 8. Thus, in facts of the case and in light of the law expounded by Hon’ble Apex Court in accepting the explanation furnished by the party, the delay in filing of appeal is condoned before the CIT(A). The appeal is restored to the file of CIT(A), for deciding appeal of the assessee on merits after affording reasonable opportunity of hearing/make submissions to the assessee, in accordance with law.
In the result, appeal of the assessee is allowed for statistical purpose. Order pronounced in the open court on Tuesday the 22nd day of October, 2024. Sd/- Sd/- (AVDHESH KUMAR MISHRA) (VIKAS AWASTHY) लेखाकार सद�य/ACCOUNTANT MEMBER �याियक सद�य/JUDICIAL MEMBER िद�ी/Delhi, �दनांक/Dated 22/10/2024 NV/- �ितिलिप अ�ेिषतCopy of the Order forwarded to : अपीलाथ�/The Appellant , 1. �ितवादी/ The Respondent. 2.
The PCIT 4. िवभागीय �ितिनिध, आय.अपी.अिध., िद�ी /DR, ITAT, िद�ी गाड� फाइल/Guard file.
BY ORDER, //True Copy// (Dy./Asstt. Registrar) ITAT, DELHI