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Facts
The D P School Society filed an appeal before the First Appellate Authority (FAA) with a significant delay of 969 days, attributing it to “unavoidable circumstances.” The FAA dismissed the appeal in limine as time-barred, finding the explanation inadequate despite opportunities. The assessee then appealed to the Tribunal, arguing for a liberal approach for charitable organizations and citing a communication gap.
Held
The Tribunal acknowledged the assessee's initial explanation for delay was insufficient under Section 249(3). However, it decided to grant the assessee a second chance, setting aside the FAA's order. The matter was remanded back to the FAA with directions for the assessee to file a fresh condonation petition with an affidavit, which the FAA would consider, and if condoned, proceed to adjudicate the appeal on its merits.
Key Issues
Whether the First Appellate Authority correctly dismissed the appeal as time-barred and if the assessee should be granted another opportunity to justify the delay for condonation under Section 249(3) of the Income Tax Act.
Sections Cited
Section 250, Section 249(3), Section 12A, Section 11
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Income Tax Appellate Tribunal, GUWAHATI BENCH, GUWAHATI
D P School Society, 2.1/2 Mile Darogapathar, Dimapur - 797112 [PAN: AAAAD2809D] .................…...……………....Appellant vs. Income Tax Officer, Ward 2(3), Aayakar Bhawan, Christian Basti, G.S Road, Guwahati- 781005 ...…..…............................ Respondent Appearances by: Assessee represented by : Manish Jain, FCA Department represented by : Kausik Ray, JCIT Date of concluding the hearing : 13.08.2025 Date of pronouncing the order : 21.08.2025
ORDER
PER SANJAY AWASTHI, ACCOUNTANT MEMBER:
The present appeal arises from order u/s 250 of the Income Tax Act, 1961 (hereafter “the Act”) dated 27.03.2025, passed by Ld. Additional/ Joint Commissioner of Income Tax (Appeals),1, Delhi (hereafter “the Addl./JCIT(A].
1.1 In this case, there was apparently a delay of 969 days in the filing of the appeal before the First Appellate Authority. Before the Ld. Addl./JCIT(A), the assessee gave the reasons for said delay as under:
1.1 At first appeal stage, the following finding has been given:
“In the instant case, despite multiple opportunities and the benefit of a significantly extended deadline, the appellant failed to take timely action. Further, the condonation application does not demonstrate any exceptional or reasonable cause to justify such a prolonged delay. Mere assertion of “unavoidable circumstances” without adequate supporting documentation cannot be considered sufficient ground for condonation of delay of this magnitude….. In view of the above, and considering that the delay is inordinate and inadequately explained, the appeal is held to be inadmissible and is dismissed as time-barred under the provisions of the Income-tax Act, 1961.” 1.2 Since the appeal has been dismissed in limine hence it is pertinent to confine ourselves to that issue at this stage. However, the assessee has filed the present appeal with the following grounds:
1. That the learned Commissioner of Income Tax (Appeals) adopted a rigid and inflexible view of law rather than adopting a liberal interpretation while assessing the case of the Appellant society, which is established for charitable purposes, by not condoning the delay of filing appeal and failed to adopt the settled principle of liberal interpretation applicable to institutions serving a non- profit motive. It is a well-established principle of law that the expression sufficient cause" must be interpreted liberally, particularly in matters involving charitable organizations whose objective is to serve the public good and not to earn profits. Technical or procedural lapses should not be allowed to override the cause of substantial justice, as has been repeatedly emphasized by various judicial pronouncements.
2. That the demand of 2,79,09,413/- raised against the Appellant, a trust duly registered under Section 12A of the Income Tax Act, 1961, is wholly unjustified. The Appellant has been consistently claiming exemption under Section 11 for the past assessment years and continues to claim exemption under Section 11 even in the current assessment year, and the same is being accepted by the Department, reflecting the consistency of its charitable status and compliance. The Society has been applying its income exclusively towards charitable purposes, strictly in accordance with the provisions of Sections 11 of the Act. There is neither any finding nor any allegation by the Department regarding usage of funds.
3. That the appellant craves leave to add, amend, or withdraw any of the above grounds at the time of hearing.”
Before us, the Ld. AR vehemently argued that the assessee is a D P School Society respectable trust of long standing and the delay in filing of the appeal was unintentional and was not with any malafide intention. On a query from the Bench regarding the finding given on page 4 (1st paragraph) of the impugned order that an opportunity given at first appeal stage was not availed of to explain the delay substantially and appropriately keeping in view the provision of section 249(3) of the Act, the Ld. AR mentioned that due to a communication gap between the AR of the assessee and the assessee himself, appropriate compliance could not be made. The Ld. AR pleaded from an opportunity to present the facts before the First Appellate Authority.
2.1 The Ld. DR relied on the orders of authorities below and stated that the delay could only be condoned after a good and sufficient reason was provided by the assessee. In this case that had not been done.
We have carefully considered the documents before us and have heard the Ld. AR/DR. We find that a cryptic two-line explanation (supra) by the assessee would certainly not make a good case for condonation of delay u/s 249(3) of the Act. However, we are considerably persuaded by the prayer of the Ld. AR that the assessee deserves a second chance to prove his bonafides. Accordingly, we set aside the impugned order and remand this issue back to the file of Ld. Addl/JCIT(A) with specific directions as under:
(a) The assessee would file a petition seeking condonation of delay before the First Appellate Authority, through an affidavit. The first Appellate authority would consider the same and take an appropriate decision on that basis.
(b) In case, the delay is condoned then there would be adjudication on the merits also.
In result, appeal of the assessee is allowed for statistical purposes.