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Income Tax Appellate Tribunal, DIVISION BENCH, ‘A’ CHANDIGARH
Before: SHRI RAJPAL YADAV & SHRI KRINWANT SAHAY
against the order of the Commissioner of Income Tax (Appeals) [in short ‘the CIT (A)’] dated 24.06.2024 passed for assessment year 2017-18.
2. At the very outset, ld. Counsel for the assessee submitted that the appeal of the assessee before the ld. A.Y.2017-18 2 first appellate authority was time barred by 62 days. The CIT(A) did not condone the delay and dismissed the appeal on account of being time barred. He took us to page number 1 to 5 of the Paper Book where copy of the application for condonation of delay of delay filed under Section 249 sub-section (3) is available. He submitted that this delay of 62 days happened on account of non filing of the appeal by the authorized representative. The assessee has handed over all necessary papers to the authorized representative, who did not file the appeal and failed to give any explanation as to why it was not filed in time.
Thereafter, the assessee made reference to a large number of decisions in the application and prayed for condonation of delay. However, ld. First Appellate Authority did not accept this explanation of the assessee and dismissed it being time barred.
With the assistance of ld. representative, we have gone through the record carefully. Sub-section 5 of Section 253 contemplates that the Tribunal may admit an appeal or permit filing of memorandum of cross- objections after A.Y.2017-18 3 expiry of relevant period, if it is satisfied that there was a sufficient cause for not presenting it within that period.
This expression sufficient cause employed in the section has also been used identically in sub-section 3 of section 249 of Income Tax Act, which provides powers to the ld. Commissioner to condone the delay in filing the appeal before the Commissioner. Similarly, it has been used in section 5 of Indian Limitation Act, 1963. Whenever interpretation and construction of this expression has fallen for consideration before Hon’ble High Court as well as before the Hon’ble Supreme Court, then, Hon’ble Court were unanimous in their conclusion that this expression is to be used liberally. We may make reference to the following observations of the Hon’ble Supreme court from the decision in the case of Collector Land Acquisition Vs. Mst. Katiji& Others, 1987 AIR 1353:
Ordinarily a litigant does not stand to benefit by lodging an appeal late.
Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As against this when delay is condoned the highest A.Y.2017-18 4 that can happen is that a cause would be decided on merits after hearing the parties. 3. "Every day’s delay must be explained" does not mean that a pedantic approach should be made. Why not every hour's delay, every second's delay? The doctrine must be applied in a rational common sense pragmatic manner.
4. When substantial justice and technical considerations are pitted against each other, cause of substantial justice deserves to be preferred for the other side cannot claim to have vested right in injustice being done because of a non-deliberate delay.
5. There is no presumption that delay is occasioned deliberately, or on account of culpable negligence, or on account of mala fides. A litigant does not stand to benefit by resorting to delay. In fact, he runs a serious risk.
It must be grasped that judiciary is respected not on account of its power to legalize injustice on technical grounds but because it is capable of removing injustice and is expected to do so.
Similarly, we would like to make reference to authoritative pronouncement of Hon’ble Supreme Court in the case of N. Balakrishnan Vs. M. Krishnamurthy (supra).
It reads as under:
ITA No.746/CHD/2024 A.Y.2017-18 5
“Rule of limitation are not meant to destroy the right of parties. They are meant to see that parties do not resort to dilatory tactics, but seek their remedy promptly. The object of providing a legal remedy is to repair the damage caused by reason of legal injury. Law of limitation fixes a life-span for such legal remedy for the redress of the legal injury so suffered. Time is precious and the wasted time would never revisit. During efflux of time newer causes would sprout up necessitating newer persons to seek legal remedy by approaching the courts. So a life span must be fixed for each remedy. Unending period for launching the remedy may lead to unending uncertainty and consequential anarchy. Law of limitation is thus founded on public policy. It is enshrined in the maxim Interest reipublicae up sit finislitium (it is for the general welfare that a period be putt to litigation). Rules of limitation are not meant to destroy the right of the parties. They are meant to see that parties do not resort to dilatory tactics but seek their remedy promptly. The idea is that every legal remedy must be kept alive for a legislatively fixed period of time. A court knows that refusal to condone delay would result foreclosing a suitor from putting forth his cause. There is no presumption that delay in approaching the court is always deliberate. This Court has held that the words "sufficient cause" under Section 5 of the Limitation Act should receive a liberal construction so as to advance substantial justice vide Shakuntala Devi lain Vs. Kuntal Kumari [AIR 1969 SC 575] and State of West Bengal Vs. The Administrator, Howrah Municipality [AIR 1972 SC 749]. It must be remembered that in every case of delay there can be some lapse on the part of the litigant concerned. That alone is not enough to turn down his plea and to shut the door against him. If the explanation does not smack of mala fides or it is not put forth as part of a dilatory strategy the court must show utmost consideration to the suitor. But when there is reasonable ground to think that the delay was occasioned by the party deliberately to gain time then the court should lean against acceptance of the explanation. While condoning delay the Could should not forget the opposite party altogether. It must be borne in mind that he A.Y.2017-18 6 is a looser and he too would have incurred quiet a large litigation expenses. It would be a salutary guideline that when courts condone the delay due to laches on the part of the applicant the court shall compensate the opposite party for his loss”.
We do not deem it necessary to re-cite or recapitulate the proposition laid down in other decisions. It is suffice to say that the Hon'ble Courts are unanimous in their approach to propound that whenever the reasons assigned by an applicant for explaining the condonation of delay, then such reasons are to be construed with a justice oriented approach.
6. In the light of above, if we examine the application filed by the ld. Counsel for the assessee, then it would reveal that assessee has not made the appeal time barred deliberately. He has not adopted delay a strategy to litigate with the Department because by making the appeal barred, assessee will not gain anything. To our mind, it is a bonafide mistake at the end of the assessee while interacting with his counsel. Therefore, ld. CIT(A) for the assessee ought to have adopted a justice oriented approach by resolving the controversy on merit instead of dismissing the appeal in limine. It is further observed that an A.Y.2017-18 7 addition of Rs.1,44,34,370/- has been confirmed by the ld. First Appellate Authority in this manner. The penalty in the shape of tax liability on this addition is far disproportionate to the negligence even if committed by the assessee by making his appeal time barred by 62 days.
Therefore, we condone the delay in filing the appeal before the First Appellate Authority and set aside the impugned order. We restore this appeal to the file of ld. CIT(A) which is to be decided on merit. It is further observed that appeal was instituted before the First Appellate Authority on 06.03.2020. It remained pending for more than four years and then, ld. CIT(A) has dismissed it being time barred. Therefore, we direct the ld. CIT(A) to decide the appeal within four months from receipt of this order.
In result, appeal of the assessee is allowed for statistical purposes.
Order pronounced on 07.01.2025.