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Facts
The assessee did not file an income tax return. The AO discovered cash deposits of Rs 11,70,000 in a bank, issued a notice u/s 142(1), and since no details were provided, made an addition u/s 69A and assessed income u/s 144. The assessee's subsequent appeal to the CIT(A) was dismissed in limine because the CIT(A) did not condone the delay in filing.
Held
The Tribunal found a reasonable cause for the delay in filing the appeal before the CIT(A), attributing it to the Covid-19 pandemic, and condoned the delay. Citing Supreme Court pronouncements on the liberal approach to condoning delay, the Tribunal set aside the CIT(A)'s order and remitted the matter back for fresh adjudication on merits, providing the assessee another opportunity of hearing.
Key Issues
Whether the CIT(A) was justified in dismissing the appeal in limine by not condoning the delay in filing the appeal.
Sections Cited
Section 144, Section 250, Section 142(1), Section 69A, Section 249(3), Section 5 of the Limitation Act of 1963
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Income Tax Appellate Tribunal, PANAJI BENCH
Before: SHRI PAVAN KUMAR GADALE & SHRI G D PADMAHSHALI
Assessee by None Revenue by Shri.Ravindra Hattalli.Sr.DR सुनवाई क� तार�ख/Date of Hearing 20.03.2025 घोषणा क� तार�ख/Date of Pronouncement 24.03.2025 ORDER
PER PAVAN KUMAR GADALE JM:
The appeal is filed by the assesse against the order of National Faceless Appeal Centre (NFAC) Delhi / CIT(A) passed u/sec 144 and u/sec 250 of the Act.
The brief facts of the case are that, the assesse has not filed the return of income. The Assessing Officer (AO) based on the information from ITBA data/NMS found that the assesse has made cash deposits of Rs 11,70,000/-in Shree Basaveshwar Vividha Uddeshgala Sahakari Sangha Niyamit,Yargatti. BDCC Bank Badakanur in the F.Y.2017-18 and the notice u/sec142(1) of the Act was issued to furnish the details. Since, no details were filed and sources were not explained, hence the AO considering the information available on record has invoked the provisions of Sec. 144 of the Act and made addition u/sec69A of the Act and assessed the total income of Rs,11,70,000/- and passed the order u/sec 144 of the Act dated 25.12.2019.
Aggrieved by the order, the assessee has filed an appeal before the CIT(A),whereas the CIT(A) has issued notice and there was compliance by the assessee and there was delay in filling the appeal and the assessee has filed the sufficient reasons for the delay dealt at para4 of the order. Whereas the CIT(A) has not condoned the delay and dismissed the assessee appeal in limine. Aggrieved by the CIT(A)order, the assessee has filed an appeal before the Hon’ble Tribunal.
We heard the Ld.DR submissions and perused the material on record and none appeared on behalf of the assessee. Prima-facie, the CIT(A) has passed the order considering the fact that there is no proper compliance by the assesse in spite of providing adequate opportunity of hearing and the delay in filling the appeal was not explained with the reasonable cause. Whereas the assessee has raised grounds of appeal
challenging the addition by the A.O and there could be various reasons for no proper Shree Basaveshwar Vividha Uddeshgala Sahakari Sangha Niyamit,Yargatti. compliance. Whereas the application U/sec 249(3) of the Act for condonation of delay in filling the appeal was filed before the CIT(A) dealt at Page
4. Para 4 of the order, explaining that due to Covid-19 pandemic the filling was delayed and we find the assessment order u/sec144 of the Act was passed on 25-12-2019 and the assesee has filed the appeal with the CIT(A) on 18.02.2022. We Considering the facts, provisions and the contents of the application dealt at Para 4 of the CIT(A) order, we found that there is a reasonable cause explained and there is no benefit is derived in causing delay in filing appeal before the CIT(A). Whereas the Hon’ble Supreme Court in case of B. Madhuri Goud v. B. Damodar Reddy (2012)
12. SCC 693, has held that the following principles must be kept in mind while considering the application for condonation of delay; (i) There should be a liberal, pragmatic, justice oriented, non-pedantic approach while dealing with an application for condonation of delay, for the courts are not supposed to legalise injustice but are obliged to remove injustice. (ii) The terms “sufficient cause” should be understood in their proper spirit, philosophy and purpose regard being had to the fact that these terms are basically elastic and are to be applied in proper perspective to the obtaining fact-situation. (iii) Substantial justice being paramount and pivotal the technical considerations should not be given undue and uncalled for emphasis. (iv) No presumption can be attached to deliberate cause of delay but, gross negligence on the part of the counsel or litigant is to be taken note of. (v) Lack of bona fides imputable to a party seeking condonation of delay is a significant and relevant fact.
Shree Basaveshwar Vividha Uddeshgala Sahakari Sangha Niyamit,Yargatti. (vi) It is to be kept in mind that adherence to strict proof should not affect public justice and cause public mischief because the courts are required to be vigilant so that in the ultimate eventuate there is no real failure of justice. (vii) The concept of liberal approach has to encapsulate the conception of reasonableness and it cannot be allowed a totally unfettered free play. (viii)There is a distinction between inordinate delay and a delay of short duration or few days, for to the former doctrine of prejudice is attracted whereas to the latter it may not be attracted. That apart, the first one warrants strict approach whereas the second calls for a liberal delineation. (ix) The conduct, behaviour and attitude of a party relating to its inaction or negligence are relevant factors to be taken into consideration. It is so as the fundamental principle is that the courts are required to weigh the scale of balance of justice in respect of both parties and the said principle cannot be given a total go by in the name of liberal approach. (x) If the explanation offered is concocted or the grounds urged in the application are fanciful, the courts should be vigilant not to expose the other side unnecessarily to face such litigation. (xi) It is to be borne in mind that no one gets away with fraud, is representation or interpolation by taking recourse to the technicalities of law of limitation. (xii) The entire gamut of facts are to be carefully scrutinized and the approach should be based on the paradigm of judicial discretion which is founded on objective reasoning and not on individual perception. (xiii) The State or a public body or an entity representing a collective cause should be given some acceptable latitude.” 5.The Hon'ble supreme court in the case of Collector, Land Acquisition Vs. MST Katiji & others (167 ITR 471) (SC) has observed as under :
“ The legislature has conferred the power to condone delay by enacting s. 5 of the Limitation Act of 1963 in order to enable the Courts to do substantial justice to parties by disposing of matters on "merits". The expression "sufficient cause" employed by the legislature is adequately elastic to enable the Courts to Shree Basaveshwar Vividha Uddeshgala Sahakari Sangha Niyamit,Yargatti. apply the law in a meaningful manner which subserves the ends of justice—that being the life-purpose of the existence of the institution of Courts. The doctrine of equality before law demands that all litigants, including the State as a litigant, are accorded the same treatment and the law is administered in an even-handed manner. There is no warrant for according a step- motherly treatment when the "State" is the applicant praying for condonation of delay. In fact, experience shows that on account of an impersonal machinery (no one in charge of the matter is directly hit or hurt by the judgment sought to be subjected to appeal) and the inherent bureaucratic methodology imbued with the note-making, file- pushing, and passing-on-the-buck ethos, delay on its part is less difficult to understand though more difficult to approve. In any event, the State which represents the collective cause of the community does not deserve a litigant non grata status. The Courts, therefore, have to be informed of the spirit and philosophy of the provision in the course of the interpretation of the expression "sufficient cause". So also the same approach has to be evidenced in its application to matters at hand with the end in view to do even-handed justice on merits in preference to the approach which scuttles a decision on merits.”
We respectfully follow the observations and ratio of the decisions of Hon’ble Supreme Court and find that the delay in filing the appeal before the CIT (Appeals) by the assessee is supported with sufficient cause and pragmatic approach should be considered for condonation of delay and accordingly the delay is condoned.We considering the principles of natural justice, shall provide with one more opportunity of hearing to the assessee to substantiate the case along with the evidences. Accordingly, set aside the order of the CIT(A) and remit the entire disputed issues to the file of the CIT(A) to adjudicate afresh on merits. The assessee should be provided adequate opportunity of hearing and shall Shree Basaveshwar Vividha Uddeshgala Sahakari Sangha Niyamit,Yargatti. cooperate in submitting the information for early disposal of appeal and allow the grounds of appeal of the assessee for statistical purposes.
In the result, the appeal filed by the assessee is allowed for statistical purposes.
Order pronounced in the open court on 24.03.2025.