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Facts
The assessee, a trust, filed appeals for AYs 2015-16 and 2017-18 with delays of 2114 and 1384 days respectively. The appeals challenged intimations under section 143(1) denying exemption under section 11, which were uploaded in 2017 and 2019. The assessee claimed unawareness until late 2022 and attributed the delay partly to the death of its President in 2021.
Held
The Tribunal upheld the CIT(A)'s decision to dismiss the appeals, finding that the assessee's explanation for the inordinate delay was insufficient. It noted the trust's continuous responsibility and its access to the e-filing portal for other filings, concluding that the delay was due to negligence and not adequately explained day-by-day. The death of the President did not cover the entire period of delay.
Key Issues
Whether the delay in filing appeals against intimations denying tax exemption under section 11, citing lack of knowledge and the death of a key trustee, should be condoned.
Sections Cited
143(1), 12A, 11, 143(1)(a)(ii), 143(1)(a)
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Income Tax Appellate Tribunal, DELHI BENCH “G”: NEW DELHI
Before: SHRI M. BALAGANESH & SHRI ANUBHAV SHARMA
O R D E R PER M. BALAGANESH, A. M.: 1. The appeal in and 1152/Del/2024 for AYs 2015-16 and 2017- 18, arise out of the order of the Add/JCIT(A)-1, Visakhapatnam [hereinafter referred to as ‘ld. JCIT’, in short] dated 19.01.2024 against the order of assessment passed u/s 143(1) of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’) dated 27.03.2019 by the Assessing Officer, CPC, Bengaluru (hereinafter referred to as ‘ld. AO’).
Identical issue is involved in both these appeals and hence they are taken up together and disposed of by this common order for the sake of convenience.
Though the assessee has raised several grounds of appeal before us for both the years, we find that the only effective issue to be decided by us is as to whether the ld. CIT(A) was justified in dismissing the appeal of the assessee for both the years by not condoning the inordinate delay in the facts and circumstances of the instant case.
We have heard the rival submissions and perused the materials available on record. The assessee is a trust, registered u/s 12A of the Act vide registration granted by the competent authority on 3.5.1999. The return of income for the Asst Year 2015-16 was filed by the assessee on 9.10.2015 declaring Nil income after claiming exemption u/s 11 of the Act. On 31.10.2015, Form 10 for accumulation of income and Form 10B audit report was uploaded by the assessee on e-filing portal. The return was processed u/s 143(1) of the Act and the said intimation was uploaded on e-filing portal on 27.3.2017 denying exemption u/s 11 of the Act to the assessee. The time limit for preferring the appeal before the ld. CIT(A) expired on 26.4.2017. The assessee did not keep track of uploading of intimation u/s 143(1) of the Act and ultimately noticed about the same only in December 2022 when new management took over the helm of affairs pursuant to the death of erstwhile President of the trust on 22.2.2021. Soon after noticing the fact of intimation u/s 143(1) of the Act uploaded as above, the assessee preferred an appeal before the ld. CIT(A) with a delay of 2114 days. The assessee filed a delay condonation petition on 8.12.2023 before the ld. CIT(A) which is reproduced hereunder:-
"Respectfully submits that the present appeal is against Intimation Order u/s 143(1) passed by the learned AO/CPC vide order dated 27.3.2017. Order u/s 143(1) was uploaded on portal. Technically it was served to the appellant on 27.3.2017, but the fact remains that it was not in the knowledge of appellant that any intimation order u/s 143(1) has been passed against the appellant. It was only in the month of December 2022, it came to the knowledge of appellant that any Intimation Order u/s 143(1) has been passed against him and has been uploaded on portal. As soon as the appellant came to know about the Initiation order u/s 143(1), appellant immediately filed an appeal against the said order before your goodself on 09.01.2023. Moreover, Sh. Pritam Ahuja, President of the appellant Trust, who mainly manages the affairs of Trust expired on 22.02.2021. Due to his demise, other office bearers didn't came about the addition made. Appellant's case is covered by the judgment of Hon'ble Supreme Court in Mst. Katiji and Others in 167 ITR 471: In the view of the above submission, it is prayed that a liberal view may kindly be taken and technical delay in filing of appeal may kindly be condone and oblige."
It was pleaded before the ld. CIT(A) that until December 2022, the assessee did not have any knowledge of the passing of intimation u/s 143(1) of Page | 2 the Act. The ld. CIT(A) however rejected the plea of the assessee by stating that the erstwhile President expired on 22.2.2021, whereas the intimation u/s 143(1) of the Act has been passed on 27.3.2017 itself. In any case, the trust is an organization and is not dependent upon any individual trustee. The Trust should run in collaboration with all the trustees and every trustee is responsible members of the Trust apart from the President of the Trust. Accordingly, the reasons stated by the assessee for the delay in filing appeal were considered not tenable by the ld. CIT(A) and hence the appeal filed by the assessee was dismissed by not condoning the delay.
For the Asst Year 2017-18, the return of income was filed by the assessee on 28.10.2017 declaring Nil income after claiming exemption u/s 11 of the Act. On 27.10.2017, Form 10 for accumulation of income was uploaded by the assessee on e-filing portal. The return was processed u/s 143(1) of the Act and a communication was received from Central Processing Centre (CPC) for incorrect claim u/s 143(1)(a)(ii) of the Act on 21.8.2018. On 8.10.2018, a communication was received from CPC for proposed adjustment u/s 143(1)(a) of the Act. Later the intimation u/s 143(1) of the Act was uploaded on e-filing portal on 27.3.2019 denying exemption u/s 11 of the Act to the assessee. The time limit for preferring the appeal before the ld. CIT(A) expired on 26.4.2019. The appeal was ultimately preferred by the assessee before the ld. CIT(A) on 9.1.2023 with a delay of 1384 days. On 8.12.2023, the assessee filed a delay condonation petition. For the very same reasons as was adduced for Asst Year 2015-16, the ld. CIT(A) dismissed this appeal for the Asst Year 2017-18 by not condoning the delay.
At the outset, we find that the intimation u/s 143(1) of the Act stood passed in the case of the assessee on 27.3.2017 and 27.3.2019 for Asst Years 2015-16 and 2017-18 respectively and uploaded on the e-filing portal. We find that the assessee has been accessing the very same e-filing portal for filing its regular income tax returns for Asst Year 2016-17 and 2017-18 and also for uploading of Form 10 and Form 10B on various dates. Hence it cannot be said that assessee either did not have access to its e-filing portal or its portal was not functioning due to some technical glitches. The facts of the case clearly prove negligence on the part of the assessee. Though the assessee does not stand to gain by filing an appeal before the ld. CIT(A) belatedly, which might be a ground for condonation of delay, but at the same time, the assessee is duty bound to explain the delay day by day that it was prevented by sufficient cause in not filing in appeal in time. But in the reasons stated in the condonation petition by the assessee, no such sufficient cause was brought on record by the assessee. The ld. AR relied on the decision of co-ordinate bench of this Tribunal in the case of Max Maintenance Limited vs ITO in & 2209/Del/2022 dated 5.10.2023 . We have gone through the said order and we find that in that case, the email ID of the professional was mentioned in the ITR and not that of the assessee. Moreover, it was alleged that the erstwhile professional had not taken due action on the intimation received in his email, which stood further confirmed by way of an affidavit from the Directors of Max Maintenance Limited. None of these facts are prevalent in the instant case before us. The present assessee in its delay condonation petition before the ld. CIT(A) had categorically admitted to have received the intimation u/s 143(1) of the Act on 27.3.2017 and 27.3.2019 for Asst Years 2015-16 and 2017-18 respectively technically as it was uploaded in e-filing portal. It was trying to take shelter of the death of the erstwhile President of the Trust on 22.2.2021. Even if this has to be construed as a reasonable cause, the delay from 26.4.2017 to 22.2.2021 for Asst Year 2015-16 and delay from 26.4.2019 to 22.2.2021 for Asst Year 2017-18 does not stand explained by the assessee with sufficient cause. This is a clear case of negligence on the part of the assessee in not responding to the statutory proceedings in time. Hence the delay in preferring appeal before the ld. CIT(A) is not properly explained by the assessee with sufficient cause. Further we find that the assessee had filed the delay condonation petition only on 8.12.2023 though the appeal was filed on 9.1.2023 before the ld. CIT(A). Hence it cannot be said that no notice of hearing was issued by the ld. CIT(A) to the assessee as argued by the ld. AR before us. In these facts and circumstances, in our considered opinion, the ld. CIT(A) was duly justified in dismissing the appeals by not condoning the delay for both the years under consideration. Accordingly, the grounds raised by the assessee are dismissed for both the years.
In the result, both the appeals of the assessee are dismissed. Order pronounced in the open court on 24/07/2024.