RAHUL ASHOK KAMAT,MUMBAI vs. I.T.O., WARD-34(2)(1), MUMBAI

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ITA 104/MUM/2024Status: HeardITAT Mumbai29 July 2024AY 2016-174 pages
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What did the Tribunal hold?

The Tribunal held that the delay of 199 days in filing the first appeal before the CIT(A) should be condoned. The Tribunal noted that the assessee had filed an affidavit explaining that he had entrusted his tax matters to his friend's wife, Ms. Devarakonda Gowthami, who also filed an affidavit stating she could not communicate the receipt of notices. The revenue did not file any counter-affidavit. The Tribunal emphasized the well-established principle that substantial justice cannot be denied on technicalities and that the object of procedural provisions is to advance justice. It stated that provisions relating to condonation of delay need to be interpreted liberally. Consequently, the Tribunal condoned the delay based on the uncontroverted affidavits and refrained from making any observations on the merits of the case. The impugned order of the CIT(A) was set aside, and the matter was restored to the file of the CIT(A) for passing an order afresh on merits, ensuring compliance with the principles of natural justice.

What were the facts?

The assessee, Rahul Ashok Kamat, filed an appeal before the Commissioner of Income-tax (Appeals) - National Faceless Appeal Centre (NFAC) for Assessment Year 2016-17. This appeal was against a penalty order dated 22.09.2022 passed under Section 271(1)(c) of the Income-tax Act, 1961. The assessee's appeal before the CIT(A) was filed with a delay of 199 days. The CIT(A) dismissed the assessee's appeal solely on the ground that the application for condonation of this delay was rejected. The assessee's appeal before the Income Tax Appellate Tribunal (ITAT) is against this order of the CIT(A) dated 27.12.2023.

What were the issues?

1. Whether the Tribunal has the power to condone the delay of 199 days in filing the first appeal before the CIT(A) under Section 249(3) of the Income-tax Act, 1961, when the CIT(A) was not satisfied with the cause shown. Assessee's contention: The assessee argued that the delay of 199 days should be condoned because there was a bonafide cause for non-receipt of any notice. This was supported by the affidavit of the assessee and his friend's wife, Ms. Devarakonda Gowthami, who managed his tax matters and stated she could not communicate the receipt of notices. The assessee relied on the principle that substantial justice should not be denied on technical aberrations and that provisions for condonation of delay should be interpreted liberally. Revenue's contention: The learned DR supported the impugned order of the CIT(A). No specific arguments or reliance on authorities were recorded for the revenue.

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 250,Section 249(2),Section 249(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘D’ BENCH

Before: SHRI OM PRAKASH KANT, ACCOUNTANT & SHRI SUNIL KUMAR SINGH

Pronounced: 29/07/2024

आदेश / O R D E R PER SUNIL KUMAR SINGH (J.M): 1. This appeal has been preferred against the impugned order dated 27.12.2023 passed in Appeal no. NFAC/2015- 16/10250314 by the Ld. Commissioner of Income– tax(Appeals)/National Faceless Appeal Centre (NFAC) [hereinafter referred to as the “CIT(A)”] u/s. 250 of the Rahul Ashok Kamat Income-tax Act, 1961 [hereinafter referred to as "Act"] for the Assessment year [A.Y.] 2016-17, wherein learned CIT(A) has dismissed assessee's appeal upon rejection of assessee’s application for condonation of delay in filing the same.

2.

At the very outset, learned representative for the appellant assessee has, apart from the submissions related to the merits, submitted that learned CIT(A) has erred in not condoning the delay of 199 days, despite bonafide cause of non receipt of any notice, which is clear from the affidavit of assessee and his friend’s wife Ms. Devarakonda Gowthami.

3.

Learned DR has supported the impugned order.

4.

We have heard the parties and perused the material available on record.

5.

It transpires from the perusal of records that the assessee filed an appeal before learned CIT(A) against the penalty order dated 22.09.2022 (served on the same day) passed u/s. 271(1)(C) of the Act by a delay of 199 days. First appeal was dismissed by the First Appellate Authority solely upon rejection of assessee’s prayer for condonation of delay in filing the same.

6.

The limitation period for filing an appeal before learned CIT(A) u/s. 249(2) of the Act is 30 days. However, section 249(3) of the Act empowers the first appellate authority to condone the delay if satisfied that appellant had sufficient cause for not presenting it within that period. Learned CIT(A) was, however not satisfied to condone the said delay of 199 days.

1.

Rahul Ashok Kamat 7. We find that the assessee, has filed an affidavit to support his contention that he had entrusted his tax matters to his friend’s wife Ms. Devarakonda Gowthami, who has also filed an affidavit, stating that she could not communicate the receipt of assesse’s notices. Revenue department has not filed any counter affidavit against the contents of these affidavits.

8.

It is well established principle of law that the substantial justice cannot be denied on technical aberrations. The object of prescribing procedure is to advance the cause of justice. In an adversial justice system like ours, no party should ordinarily be denied the opportunity of participating in the process of justice dispensation. Justice is the goal of jurisprudence. Any interpretation which eludes or frustrates the recipient of justice, is not to be followed. The provisions relating to the condonation of delay, need to be interpreted liberally.

9.

The object of prescribing the time period for filing of the appeal, is to expedite the proceedings before the concerned authorities and to advance the cause of justice. In view of uncontroverted affidavits filed by the assessee and his friend’s wife Ms. Devarakonda Gowthami, we, condone the said delay in filing the first appeal before the first appellate authority and restrain ourselves from making any observation in respect of the merits of the case.

10.

In the result, the appeal is allowed. The impugned order dated 27.12.2023 is set aside. The delay in filing the first appeal before first appellant authority i.e learned CIT(A) stands condoned. We restore the matter back to the file of Rahul Ashok Kamat learned CIT(A) for passing order afresh on merit in accordance with law. Needless to say that the first appellant authority shall ensure the substantial compliance of the principles of natural justice. Order pronounced in open court today on 29.07.2024 Sd/– Sd/– (OM PRAKASH KANT) (SUNIL KUMAR SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai; Dated 29/07/2024 Anandi Nambi, Steno Copy of the Order forwarded to:

1. 1. The Appellant 2. The Respondent.

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