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Facts
The assessee, a non-resident individual, filed a belated return of income for AY 2020-21, where relief claimed u/s 90/90A was denied in the intimation order dated 26/11/2021. The assessee filed an appeal to the CIT(A) on 20/11/2024, with a significant delay of approximately 1053 days, which the CIT(A) dismissed *in limine* as time-barred. Prior to filing the appeal, the assessee had filed multiple rectification requests to resolve the issue, but these were unsuccessful.
Held
The ITAT found that the delay in filing the appeal before the CIT(A) was accidental, attributable to the COVID-19 pandemic period exclusion and the assessee's bona fide pursuit of the rectification remedy. Relying on Supreme Court precedents, the Tribunal condoned the delay, emphasized that the CIT(A) should have adopted a justice-oriented approach, and set aside the CIT(A)'s *ex-parte* dismissal. The case was remanded to the CIT(A) for a decision on merits after providing adequate hearing opportunities to the appellant.
Key Issues
Whether the delay in filing an appeal before the CIT(A) should be condoned, considering the COVID-19 exclusion period and the assessee's bona fide pursuit of rectification, and if the CIT(A) was justified in dismissing the appeal *in limine* as time-barred.
Sections Cited
Section 250, Section 143(1), Section 90, Section 90A, Section 139(1), Section 246A, Section 249(2), Section 249(3), Section 250(6), Section 154
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Income Tax Appellate Tribunal, PANAJI BENCH, GOA
Before: HON’BLE SHRI PAVANKUMAR GADALE & SHRI G. D. PADMAHSHALI
ORDER PER G. D. PADMAHSHALI; Assessee’s captioned appeal impugns DIN & Order 1072026383(1) dt. 09/01/2025 passed by Addl//Jt. Commissioner of Income Tax Appeals-2, Jaipur [‘Ld. CIT(A)’] u/s 250 of the Income-tax Act, 1961 [‘the Act’] which in turn arisen out of order of intimation dt. 26/11/2021 passed u/s 143(1) of the Act by Asstt. Direction of Income Tax, CPC, Bengaluru [‘Ld. AO’] anent to assessment year 2020-21 [‘AY’]. ITAT-Panaji Page 1 of 10
Ojas Shashikant Kulkarni Vs ADIT AY: 2020-21 2. Without touching merits we have heard rival party’s submission on limited issue of ex-parte dismissal of first appeal owning to unsupported delay in instituting appeal before and subject to rule 18 of ITAT-Rules 1963 perused material placed on record and considered the facts & circumstance of the case in the light of settled position of law.
We note that, the assessee is a non-resident individual who for the year under consideration filed his return of income belated on 31/03/2021 as against prescribed due date 31/07/2021 & extended due date 10/01/2021 of filing u/s 139(1) of the Act. The said return was processed on 26/11/2021 wherein claim for relief made u/s 90/90A of the Act was denied. The appeal thereagainst u/s 246A of the Act was filed before the Ld. CIT(A) on 20/11/2024. In the absence of sufficient cause shown by the ITAT-Panaji Page 2 of 10
Ojas Shashikant Kulkarni Vs ADIT AY: 2020-21 assessee, the Ld. CIT(A) after placing reliance on the decision of Hon’ble Madras High Court in the case of ‘Shiva Ind. & Holding Ltd. Vs ACIT’ [2023, 153 taxmann.com 354 (Mad)] considered the case unfit for condonation of delay and in consequence dismissed the appeal in limine as barred by limitation. Faced with the situation, the assessee came in present appeal alleging violation of natural justice.
The order of intimation passed on 26/11/2021 was received by the appellant on 30/11/2021 and thus was under obligation to file an appeal within 30 days therefrom in terms of s/s (2) to section 249 of the Act. Going by the limitation appellant was required to file first appeal u/s 246A of the Act by 30/12/2021, whereas the appeal before Ld. CIT(A) was filed on 20/11/2024. Apparently the said first appeal was filed with a delay of 1053 days (approx.) ITAT-Panaji Page 3 of 10
Ojas Shashikant Kulkarni Vs ADIT AY: 2020-21 5. Admittedly said appeal was filed without accompanying therewith a petition & an affidavit for condonation of delay stating therein reasons behind such belated filing of appeal. In the absence of such necessitating documents, ostensibly there is much less flaw in the action of Ld. CIT(A) in dismissing the appeal at the threshold. However for two convincing reasons we are afraid to sustain the impugned order as there exists sufficient reasons which in our considered view prevented the appellant from filing of first appeal u/s 246A of the Act within the statutory limit prescribed u/s 249 of the Act.
The first and foremost reason is that, period of almost two years commencing from 15/03/2020 to 28/02/2022 has been excluded from limitation by the Hon’ble Apex Court vide its order MA 21/2022 [2022, 134 taxmann.com 307]. Vide former directions their ITAT-Panaji Page 4 of 10
Ojas Shashikant Kulkarni Vs ADIT AY: 2020-21 Hon’ble Lordships have further clarified that, in computing period of limitation for any suit/appeal/application, period from 15/03/2020 to 28/02/2022 not only shall be excluded but cases where limitation would have expired during above period, time limit of 90 days or actual balance time (whichever is higher) from 01/03/2022 for filing appeals/applications etc. is also to be made available. Thus by application of former judicial direction, actual period of delay should commencing from expiry of 90 days from 01/03/2022 i.e. 01/06/2022. In view thereof rival party’s Ld. Representatives jointly ventured & consensually computed actual delay in filing first appeal before Ld. CIT(A) to 882 days (approx.). The rival parties are in agreement that, recomputed delay still remains to be substantial for the purpose of admission of appeal, thus requiring existence of sufficient reasons for its condonation. ITAT-Panaji Page 5 of 10
Ojas Shashikant Kulkarni Vs ADIT AY: 2020-21 7. Now climax of the case came out of records which revealed that, meanwhile the appellant filed as many as five rectification requests one after another vide dt. 29/11/2021, 10/01/2023, 02/09/2024, 23/09/2024 & 23/10/2024. These requests however did fail to bring any prolific results reversing erroneous denial of relief claimed u/s 90/90A of the Act. Till the rejection of latest rectification request by order dt. 12/11/2024 the appellant was under bonafied belief & wait that, error in processing return could effectively be resolved by rectification mechanism. Therefore the appellant was scrupulously pursuing them until filing of appeal to the Ld. CIT(A). The reworked delay thus clearly & convincingly explained to have been attributable solitarily to appellant’s bonafied pursuance of rectification mode over appellate forum. The said delay, therefore in our considered view appeared neither intentional nor deliberate, but accidental. ITAT-Panaji Page 6 of 10
Ojas Shashikant Kulkarni Vs ADIT AY: 2020-21 8. We note that, section 154 of the Act is a vital remedial provision that facilitates correction of evident and unintended errors in tax proceedings. It benefits both the revenue authorities and taxpayers by promoting efficiency, reducing litigation, and ensuring that minor mistakes do not result in disproportionate consequences. In view thereof, the appellant filed a rectification application against order of intimation passed denying the relief claimed u/s 90/90A for belated filing of return. The revenue could on the other hand lay any material on record or submission to dislodge the appellant’s claim that denial of relief by the Ld. AO on the basis of belated date of filing of return vis-à-vis belated filing of requisite in view of Hon’ble Apex Court decision in ‘T.S. Balaram Vs Volkart Brothers’ [1971, 82 ITR 50 (SC)] forms and is an apparent & rectifiable mistake u/s 154 of the Act. ITAT-Panaji Page 7 of 10
Ojas Shashikant Kulkarni Vs ADIT AY: 2020-21 9. In view of the aforestated discussion, we are of the view that, the delay occurred in filing first appeal u/s 246A of the Act was accidental as was jointly attributable to COVID-19 pandemic & bonafide engagement of appellant assessee with easiest remedial course of action that is rectification remedy available in the statute over appeal. The appellant in our considered view thus has made out his case fit for condonation of delay as it falls within the parameter set in landmark judicial precedents laid by Hon’ble Courts in ‘Vijay Vishin Meghani Vs. DCIT & Anr’ [2017, 398 ITR 250 (Bom)] and ‘Collector, Land Acquisition, Anantnag and Anr. Vs Ms Katiji and Others’ [1987, 167 ITR 5 (SC)]. By placing strong reliance thereon, we condone the delay occurred in filing first appeal before Ld. CIT(A) and thus treat the appeal filed before Ld. CIT(A) as within the statutory time limit prescribed u/s 249(2) of the Act. ITAT-Panaji Page 8 of 10
Ojas Shashikant Kulkarni Vs ADIT AY: 2020-21 10. The appellate remedy or forum is created by the statute is to rest dispute and not to just accelerate for higher forum perfunctorily. Having regard to present facts and circumstances, placing reliance on recent judgement of Hon’ble Supreme Court rendered in ‘Raheem Shah & ANR Vs Govind Singh & Ors’ [CIVIL APPEAL NO.4628 OF 2023], we are heedful to state that, while dealing with tax litigation, the Ld. CIT(A) being a quasi-judicial authority was expected to adopt justice-oriented approach rather resorting to iron- cast technical one. We say so because, in dismissing the appeal of the appellant in limine on a hyper- technical ground the Ld. CIT(A) perfunctorily dealt with provisions of s/s (3) of section 249 of the Act as the record could hardly show of any fair opportunity of hearing was granted to the appellant to show cause as to why appeal should not be dismissed in limine on the law of limitation. ITAT-Panaji Page 9 of 10
Ojas Shashikant Kulkarni Vs ADIT AY: 2020-21 11. In view of our decision laid in preceding paragraphs, the appellant deserves an opportunity to present his case on merits before the Ld. CIT(A), which can only be possible on remand. For the reasons we set-aside the impugned ex-parte order to the file of Ld. CIT(A) with a direction to deal therewith on merits in accordance with law after according three effective hearings to the appellant and pass a speaking order in terms of s/s (6) of section 250 of the Act. The respective ground thus stands allowed.
The appeal in result is allowed for statistical purposes in aforestated terms. In terms of rule 34 of ITAT Rules, 1963 the order pronounced in the open court on date mentioned hereinbefore.