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Facts
The assessee, M/s. MResult Services Pvt. Ltd., filed its return for AY 2022-23 declaring income of Rs.4,12,05,661/-. The CPC processed the return under section 143(1) and computed a higher tax liability. The assessee claimed benefit of lower tax rate under section 115BAA, which was not granted by the CPC, leading to a higher demand.
Held
The Tribunal condoned the delay of 10 days in filing the appeal, citing sufficient cause and no malafide intention. However, on merits, the Tribunal noted that a subsequent assessment order dated 28.02.2024 (after the impugned order) computed income as per the assessee's declaration and that the assessee had opted for taxation under section 115BAA for the preceding year. Since the grievance was resolved by the subsequent order, the appeal was dismissed as academic.
Key Issues
Whether the delay in filing the appeal should be condoned and if the appeal on merits is decided.
Sections Cited
143(1), 115BAA, 234B, 234C, 143(3), 144B
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, ‘A’ BENCH : BANGALORE
Before: SMT. BEENA PILLAI & SHRI LAXMI PRASAD SAHU
Date of Hearing : 08-05-2024 Date of Pronouncement : 31-05-2024 ORDER PER BEENA PILLAI, JUDICIAL MEMBER Present appeal arises out of order dated 17.01.2024 passed by the Ld.CIT(A)-13 for A.Y. 2022-23.
Brief facts of the case are as under: 2.1 The assessee is a company and is engaged in rendering IT enabled services. It filed its return of income for year under consideration on 07.11.2022 declaring total income of Rs.4,12,05,661/-. The intimation dated 28.07.2023 was processed by the CPC u/s. 143(1) of the act accepting the Page 2 of returned income. However, the tax liability was calculated at Rs.1,37,56,098/- as against Rs.1,03,70,641/- thereby raising a demand of Rs.7,00,680/-.
2.2 Aggrieved by the order of the CPC, assessee filed appeal before the Ld.CIT(A).
2.3 Before the Ld.CIT(A), it was submitted that the assessee had opted for the benefit of the lower tax rate as per section 115BAA of the act in A.Y. 2021-22. It was submitted that accordingly for the year under consideration, the tax liability should have been computed at the rate prescribed in section 115BAA i.e. at 22% + surcharge and cess. However, while processing the return, the CPC did not grant the benefit rate of 22% instead computed the tax liability at 30%. As a consequence, all the higher tax rate, interest u/s. 234B and C was also charged. The Ld.CIT(A) vide order dated 17.01.2024 did not appreciate the submissions of the assessee and upheld the computation of the CPC at higher tax rate.
2.4 Aggrieved by the order of the Ld.CIT(A), the assessee has filed the present appeal before this Tribunal.
At the outset, it is submitted that there is a delay of 10 days in filing the present appeal before this Tribunal.
3.1 The assessee has filed condonation petition vide affidavit dated 26.03.2024 seeking the delay to be condoned.
3.2 The assessee in the affidavit submitted as under:
Page 5 of 3.3 The Ld.AR submitted that in view of the above, the assessee could not file the appeal before this Tribunal well in time and by the time the appeal papers were prepared for filing, there arose delay of about 10 days in filing these present appeal before this Tribunal. The reason for the delay in filing the present appeal was due to reason beyond the control of the assessee. He thus prayed for the delay to be condoned.
3.4 The Ld.DR though objected however could not controvert the reasoning given by the Ld.AR for the delay that was caused in filing the present appeal.
We have perused the submissions advanced by both sides in the light of records placed before us.
3.5 It is noted that there is no malafide intention on behalf of assessee in not filing the present appeal within time. It is noted that there is no malafide intention on behalf of assessee in not filing the present appeal within time. In our opinion there is a sufficient cause for condoning the delay as observed by Hon’ble Supreme Court in case of Collector Land Acquisition Vs. Mst. Katiji & Ors., reported in (1987) 167 ITR 471 in support of his contentions, wherein, Hon’ble Court observed 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
Page 6 of has been making a 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. ......................................................1.Any appeal or any application, other than an application under any of the provisions of Order XXI of the Code of Civil Procedure, 1908, may be admitted after the prescribed period if the appellant or the applicant satisfies the court that he had sufficient cause for not preferring the appeal or making the application within such period.”
3.6 Considering the above observation by Hon’ble Supreme Court, we find it fit to condone the delay caused in filing the present appeal. Accordingly, the delay of 10 days in filing the present appeal before this Tribunal is condoned.
On merits of the case, the Ld.AR submitted that the assessing officer has subsequently rectified the issue under consideration and has passed the order u/s. 143(3) r.w.s. 144B of the act on 28.02.2024 wherein the income has been computed as per the income declared by the assessee under the ITR. It is also noted that the assessee has filed form 10IC on 31.10.2023 for A.Y. 2021-22 within the extended time limit prescribed in Circular 19/2023 dated 23.10.2023. The assessee has opted for taxation
Page 7 of u/s. 115BAA. The assessee had also relied on the decision of Hon’ble Delhi High Court in case of A.C. Surgipharma (P.) Ltd. vs. DCIT reported in (2023) 157 taxmann.com 360 wherein the Hon’ble Court directed the CBDT to process the taxpayer’s request contained in form 10IC by condoning the delay in filing the same. It was submitted that identical is the circumstances with that of the assessee and as assessee has already been assessed as per the rate u/s. 115BAA. For the immediately preceding assessment year, the same rate shall continue in the subsequent assessment years also. Be that as it may, as there is no grievance with the assessee, subsequent to the passing of the assessment order dated 28.02.2024 which is after passing of the impugned order, the present appeal becomes academic at this stage and deserves to be dismissed. In the result, the appeal filed by the assessee stands dismissed. Order pronounced in the open court on 31st May, 2024.