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Facts
The assessee e-filed her return for A.Y. 2018-19, and her case was selected for scrutiny, leading to an addition of Rs. 1,18,70,489/- as alleged Long Term Capital Gain under sections 143(3) r.w.s. 144B of the Act. The assessee filed an appeal before the CIT(A) against this order with a delay of 544 days, providing reasons including being a senior citizen, her CA expiring during the COVID-19 pandemic, and subsequent health issues. The CIT(A) dismissed the appeal as not maintainable, refusing to condone the delay without considering the merits.
Held
The ITAT found that the CIT(A) adopted a 'hyper-technical approach' and that there was sufficient cause for condoning the delay, citing the Supreme Court's directives for extending limitation periods during the COVID-19 pandemic. The ITAT set aside the CIT(A)'s order and remanded the case back to the CIT(A) with directions to dispose of the appeal on merits, after allowing the assessee to present her case within 90 days.
Key Issues
Whether the CIT(A) erred in dismissing the appeal as time-barred without condoning the 544-day delay, and if there was sufficient cause for the delay in filing the appeal before the CIT(A).
Sections Cited
Section 250, Section 249, Section 143(2), Section 143(3), Section 144B, Section 248, Section 5 of Limitation Act, 1963
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, MUMBAI BENCH “E”, MUMBAI
Before: SHRI OM PRAKASH KANT & SHRI. RAJ KUMAR CHAUHAN
O R D E R PER RAJ KUMAR CHAUHAN (J.M.): 1. This appeal is filed by the appellant/assessee against the order dated 16.02.2024 of Learned Commissioner of Income Tax (Appeals) / National Faceless Appeal Centre, Delhi [hereinafter referred to as the “CIT(A)”],passed under section 250 of the Income Tax Act, 1961 Heena Dineshkumar Sukhanandi [hereinafter referred to as “the Act”] for the A.Y. 2018-19, wherein the appeal of the assessee by the Ld. CIT(A) was dismissed as not maintainable because it was found that the appeal has been filed beyond the time limit permitted u/s. 249 of the act without any sufficient cause for condonation of delay of 544 days.
The brief facts of the case are that the assessee has e-filed its return of income for A.Y. 2018-19 on 30.03.2019 declaring an income of Rs. 12,31,890/-. Subsequently the case was selected for scrutiny under CASS and accordingly notice u/s 143(2) of the Act was passed on 27.09.2019. A show cause notice was also sent on 05.04.202 and thereafter AO after considering the notices as well as show cause, made addition of Rs. 1,18,489/- as alleged LTCG u/s 143(3) r.w.s. 144B of the Act.
Aggrieved by the order of AO, assessee preferred the appeal before Ld. Ld. CIT(A) requesting condonation of delay of 544 days, but the Ld. CIT(A) did not find those grounds justified and sufficient cause for condonation of delay and has dismissed the appeal without considering the merit of the appeal.
On the facts and in the circumstances of the case, and also in law, the Ld. CIT(A) erred in dismissing the appellant’s appeal on ground of being filed beyond the period prescribed u/s.249(2) of the Act despite there being reasonable cause for such delay in filing of the appeal before the Ld. CIT(A). Your appellant, therefore, prays that the impugned order dated 16.02.2024 be set aside and the Ld. CIT(A) be directed to adjudicate the appellant’s appeal on its merits.
On the facts and in the circumstances of the case, and also in law, the Ld. CIT(A) erred in not deleting the addition of Rs.1,18,70,489/- made by the Ld. AO as alleged Long Term Capital Gain. Your appellant, therefore, prays that the aforesaid addition of Rs.1,18,70,489/- be deleted.
Your appellant craves leave to alter, modify, amend or delete any of the above grounds of appeal, or to add one or more new ground(s), as may be necessary.
5. It is brought to our notice that there was sufficient cause for condonation of delay as mentioned in form no. 35 and the impugned order is therefore liable to be set aside and an opportunity of hearing need to be granted. The Ld. DR has relied upon the judgment of the Ld. CIT(A) stating that there was no sufficient cause for condonation of delay and the judgment is legally perfect.
Heena Dineshkumar Sukhanandi 6. We have considered the submissions made by Ld. DR as well the material placed on record. The observation of the Ld. CIT(A) shows that the Ld. CIT(A) has adopted a hyper-technical approach while considering the grounds of condonation of delay in the case of the appellant. 7. We have gone through the contents of the affidavit for condonation of delay of 544 days for filing the appeal against the assessment order which are reproduced as under:-
Affidavit For Condonation of Delay in Filing the Appeal Against Assessment Order of Income Tax officer-
1. 1. Mrs. HEENA DINESHKUMAR SUKHANANDI, identified by PAN ASSPS0021R, residing at A-2404, 24th Floor, Omkar Veda CHSL, Parel, Mumbai 400012, Maharashtra, India do solemnly affirm and state on oath as under: 1. That assessment order dated 17.05.2021 under section 143(3) r.w.s. 144B of the Income Tax Act, 1961 was passed against deponent for Assessment year 2018- 19.
2. That the time for filing of the appeal before the National Faceless Appeal Centre (NFAC) was to expire on 16.06.2021.
3. That in this way there is a delay of 540 days filing of appeal under section 248 of the Income Tax Act, 1961 for which an application under Section 5 of the Limitation Act has been filed.
4. That the deponent is a senior citizen and does not have the knowledge of technicalities of Income Tax Act, 1960. During Covid-19 second wave, the CA who was representing her case expired. Further, due to Covid-19 restrictions and health issues of the deponent, she was unable to appoint another consultant who could guide her in Income Tax Matter.
5. That on account of above mentioned reason, deponent was unaware about the order that has been passed in her case. Now, after receiving recovery notice said fact came to notice of the deponent that order has been passed in her case.
Heena Dineshkumar Sukhanandi 6. That delay in filing the appeal is because of the above-mentioned reason. 7. That deponent had no intention to jeopardize the interest of the revenue by delaying the filing of the appeal.
It is evident that the assessment order passed on 17.05.2021 during the Covid-19 period and the period of limitation for filing the appeal has also been expired during the Covid period. The Hon’ble Supreme Court in Suo Moto Writ Petition (Civil) No. 3 of 2020 vide order dated 10.01.2022, was pleased to direct the condonation of delay on account of covid pandemic and extended limitation period for judicial and quasi judicial proceedings from March 15, 2020 to February 28, 2022.
The Hon’ble Supreme Court has further allowed the filing of the proceedings whatever it may be within the limitation period starting the limitation from 01.03.2022. The appeal was instituted before the Ld. CIT(A) on 12.12.2022. The other reasons mentioned in the affidavit in our opinion makes out sufficient cause for condonation of delay in filing the present appeal. 10. The right of appeal to the Ld. CIT(A) u/s. 248 is a statutory right granted to the appellant/assessee. The statutory right cannot be denied to an assessee unless there is inordinate delay or gross negligence on the part of the assessee. It is settled law that the rules and procedure is
Nothing contrary has been brought on record by the respondents which may contradict and falsify facts alleged by the appellant in support of seeking condonation of delay. The Hon'ble Supreme Court in the case of Collector, Land Acquisition Vs. MST. Katiji&Ors., [1987] 167 ITR 471 (SC),dated 19.02.1987, was pleased to hold regarding the condonation of delay as under:
“The Legislature has conferred the power to condone delay by enacting section 51 of the Limitation Act of 1963 in order to enable the courts to do substantial justice to parties by disposing of matters on de merits”. The expression “sufficient cause” employed by the Legislature is adequately elastic to enable the courts to 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. It is common knowledge that this court has been making of justifiably liberal approach in matters instituted in this court. But the message does not appear to have percolated down to all the other courts in the hierarchy. And such a liberal approach is adopted on principle as it is realized that:
1. 1. Ordinarily, a litigant does not stand to benefit by lodging an appeal late.
2. 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 that can happen is that a cause would be decided on merits after hearing the parties.”
Heena Dineshkumar Sukhanandi 12. In the facts and circumstances as discussed above and because of the law laid down by the Hon’ble Supreme Court in Collector, Land Acquisition Vs. MST. Katiji & Ors (supra),we are of the considered opinion that there was sufficient cause for condoning the delay for filing this appeal before the Ld. CIT(A) by the assessee.
For the above reasons, the impugned order of the Ld. CIT(A) is not sustainable in the eyes of law and accordingly set aside with the directions to restore the case of the appellant on the file of Ld. CIT(A) who shall dispose the same on merit after duly considering the material brought on record by the appellant before the Ld. CIT(A). The appellant/assessee shall present its case before the Ld. CIT(A) within 90 days of this order.
In the result, appeal filed by the assessee is allowed for statistical purposes.
Order pronounced in the open court on 23.12.2024 Sd/- Sd/- (OM PRAKASH KANT) (RAJ KUMAR CHAUHAN) (ACCOUNTANT MEMBER) (JUDICIAL MEMBER) Mumbai / Dated 23.12.2024 Dhananjay (Sr. PS)
Copy of the Order forwarded to: 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file. //True Copy// BY ORDER (Asstt. Registrar) ITAT, Mumbai