JAGDISH PRASHAD PANCHAL,JHALAWAR vs. INCOME TAX OFFICER, JHALAWAR

3 ITA No. 55/JPR/2024 Jagdish Prashad Panchal vs.ITO deposited a sum of Rs.45,20,000/- in the bank account. The ld. AO also noted that out of the amount so deposited a sum of Rs. 30,50,000/- was deposited into specified bank note and remaining amount of Rs. 14,70,000/- being the prevalent currency notes but since the assessee could not give details the same was added in the hands of the assessee u/s 68 of the Act. Even though the book result was accepted and thereby against the return of income of Rs. 3,53,010/-, addition of Rs. 45,20,000/- and Rs. 14,650/- was made in the hands of the assessee.

“Decision: I have gone through the above submissions of the Appellant and have considered the facts and evidence on record. Condonation of Delay It is evident from the Form No. 35, filed by the appellant on 17/02/20 that there is a delay of 28 days in the filing of the Appeal. Grounds/Reasons for Condonation of Delay

4 ITA No. 55/JPR/2024 Jagdish Prashad Panchal vs.ITO In this regard, the appeal memo is not accompanied with any petition seeking condonation of delay in preferring the impugned appeal and the appellant has not stated any reason for Condonation of Delay in filing of the appeal. Adjudication on Condonation of Delay: The appellant has stated in form 35 that for the assessment order u/s. 143(3) of the Income Tax Act, 1961 dated 21/12/2019, the date of service of demand notice was 21/12/2019. As per form 35 filed by the appellant, the instant appeal was filed on 17/02/2020. In column No. 14 of form 35 filed by the appellant on 27/09/2022, the appellant stated that there is no delay in filing of the instant appeal. It may be construed that the appellant has intentionally not mentioned the fact of delay in filing the appeal and hasn't filed any letter/affidavit to substantiate the reasons for not filing the appeal within the time limit allowed u/s 249(2) of the Income Tax Act, 1961.. It is clear that there is a delay in filing of the appeal. This appeal should have been filed by 20.01.2020. As per the provisions of Sec. 249(2), an appeal before the CIT(A) is to be filed within 30 days of the receipt of notice of demand. Further, the delay may be condoned only when the CIT(A) is satisfied that the appellant had sufficient cause for not presenting it within the due date. Unfortunately, the appellant has not furnished any petition seeking condonation of the delay in filing the appeal or even explaining the purported 'sufficient cause' for not preferring the appeal within the time limit as prescribed under Section 249(2) of the Income Tax Act, 1961. "The law on the issue can be summarised to the effect that where a case has been presented in the court beyond limitation, the applicant has to explain the court as to what was the sufficient cause which means an adequate and enough reason which prevented him to approach the court within limitation. In case a party is found to be negligent, or for want of bonafide on his part in the facts and circumstances of the case, or found to have not acted diligently or remained inactive, there cannot be a justified ground to condone the delay. No court could be justified in condoning such an inordinate delay by imposing any condition whatsoever. The application is to be decided only within the parameters laid down by this Court in regard to the condonation of delay. In case there was no sufficient cause to prevent a litigant to approach the Court on time condoning the delay without any justification, putting any condition whatsoever, amounts to passing

5 ITA No. 55/JPR/2024 Jagdish Prashad Panchal vs.ITO an order in violation of the statutory provisions and it tantamounts to showing utter disregard to the legislature." Without prejudice to the above observations and defect, powers have been conferred upon the undersigned under Section 249(3) of the Income Tax Act, 1961 to admit an appeal after the expiration of the said period (of preferring an appeal as prescribed u/s 249(2) of the Act) in case, the Commissioner of Income Tax (Appeals) is satisfied that the appellant had sufficient cause for not presenting it within that period. Unfortunately, the appellant has not explained the purported 'sufficient cause' for not preferring the appeal within the time limit as prescribed under Section 249(2) of the Income Tax Act, 1961. While dismissing the impugned appeal in-limine, I have duly considered the ratio of the judgment of the Hon'ble Supreme Court in the case of Collector Land Acquisition V/S Mst. Katiji & Ors. [1987 AIR 1353]. However, while in that case, the Hon'ble Apex Court had enunciated the principles to be kept in mind while condoning the delay in filing appeal and had held that upon existence of a 'sufficient cause the delay in filing appeal should be condoned and that the doctrine must be applied in a rational common-sense pragmatic manner. On the contrary in the impugned matter, the appellant has not furnished "sufficient cause for condonation of delay and accordingly, the ratio of the above judgment is not applicable. Further, the Hon. Supreme Court finally held that - "15. The law on the issue can be summarised to the effect that where a case has been presented in the court beyond limitation, the applicant has to explain the court as to what was the sufficient cause which means an adequate and enough reason which prevented him to approach the court within limitation. In case a party is found to be negligent, or for want of bonafide on his part in the facts and circumstances of the case, or found to have not acted diligently or remained inactive, there cannot be a justified ground to condone the delay. No court could be justified in condoning such an inordinate delay by imposing any condition whatsoever. The application is to be decided only within the parameters laid down by this Court in regard to the condonation of delay in case there was no sufficient cause to prevent a litigant to approach the Court on time condoning the delay without any justification, putting any condition whatsoever, amounts to passing an order in violation of the statutory provisions and it tantamounts to showing utter disregard to the legislature."

6 ITA No. 55/JPR/2024 Jagdish Prashad Panchal vs.ITO In this case, the appellant has not shown any sufficient cause. The appeal is therefore dismissed in limine under the provision of Sec.249(3) r.w.s. 250 of the Income-Tax Act, 1961. Since the Appellant has not adduced any additional ground(s) and since no ground of appeal has been altered/modified/changed, this ground of appeal is dismissed as "not pressed". 6. In the result, the appeal is dismissed. In the result, the appeal is decided as above.”

“The Humble Appellant submits as under: 1. That the Assessment Order dated 21.12.2019 was passed by the Assessing Authority under Section 143(3) of the Act for the Assessment Year 2017-18. Assessing Authority made an addition of Rs. 45,20,000/- to the returned income under Section 68 of the Act. 2. That being aggrieved by the sald Assessment Order dated 21.12.2019, Appellant preferred an appeal before Commissioner of Income Tax (Appeals). The said Appeal was filed on 17.2.2020 in Form No 35. It is submitted that by inadvertent mistake, the Authorised Representative in column No 14 of the said Form No 35 declared that there is no delay in filing appeal. 3. That the said Appeal was decided by National Faceless Appeal Centre, Delhi by its order dated 4.12.2023. NFAC dismissed the Appeal of the Appellant in Limine on the ground that appeal is barred by limitation by 28 days and Appellant has not filed any application/affidavit to substantiate the reasons for not filing the appeal within the time limit provided under Section 249(2) of the Act.

7 ITA No. 55/JPR/2024 Jagdish Prashad Panchal vs.ITO 4. That being aggrieved by the Order dated 4.12.2023, Appellant preferred this appeal before this Hon'ble Tribunal. The Appellant raised the following ground of appeal: GROUNDS NO 1. Whether in the facts and circumstances of the case, the Learned CIT (Appeals) is justified in dismissing the Appeal in Limine on the ground of Limitation without marking the appeal as a defective and without providing opportunity to the appellant of explaining the delay in filing the appeal in compliance of the principles of natural justice? SUBMISSIONS ON GROUND No. 1 5. That it is submitted that there was no malafide intention of the Appellant in mentioning that there is no delay in filing the Appeal in the Appeal Memo. NFAC had not pointed out the said defect to the Appellant by Issuing any notice rather issued notice for hearing under Section 250 of the Act to which Appellant filed written submission on merits. Copies of Notice for hearing is submitted at Page 5 to 20 in Paper Book. It is submitted that it is the duty of the office of NFAC in cases of defective presentation of appeals that they should be carefully scrutinized at the initial stage soon after they are filed and intimate the defect to the Appellant to remedy the defects in compliance of the principle of natural justice. It is therefore submitted there was gross violation of the principle of natural justice on the part of NFAC in not intimating the defect of the appeal being time barred and in providing an opportunity to remove the said defect by filing affidavit/documents to substantiate the delay and showing sufficient cause for not preferring appeal within time limit. It is submitted that non filing of an application for condonation of delay to show the sufficient cause for delay is a curable defect on being intimated by the NFAC which is absent in the present case and under these circumstances, the NFAC should have given an opportunity to the Appellant to file an application for condonation of delay. 6. That now the Appellant is filing Affidavit of Shri Arpit Kasera, Authorised Representative of the Appellant before NFAC to show the sufficient cause for not preferring the appeal within time limit since the Authorised Representative Shri Arpit Kasera was under a bonafide belief that time available for filing appeal before CIT (A) is 60 days and not 30 days. Said Affidavit may kindly be treated as part of this written submission. 7. That Hon'ble Supreme Court in the case of Navinchandra N Majithia Vs. State of Maharashtra decided on 4.9.2000 has held that: "It is true that the pristine maxim Vigilantibus Non Dormientibus Jura Subveniunt (Law assists those who are vigilant and not those who sleep over their rights). But even a vigilant litigant is prone to commit

8 ITA No. 55/JPR/2024 Jagdish Prashad Panchal vs.ITO mistakes. As the aphorism to err is human is more a practical notion of human behavior than an abstract philosophy, the unintentional lapse on the part of a litigant should not normally cause the doors of the judicature permanently closed before him. The effort of the court should not be one of finding means to pull down the shutters of adjudicatory jurisdiction before a party who seeks justice, on account of any mistake committed by him, but to see whether it is possible to entertain his grievance if it is genuine." 8. That under the given facts and circumstances, it is pertinent to note that mere delay cannot be a ground to oust the reach of justice to person. The present case is one where the delay in filing has been upon the professional bonafide belief of filing of Appeal within a period of Sixty Days instead of statutory time line of Thirty Days. The present case is a delay of Twenty Eight Days only and not the one which would create an Ocean between the Justice and the Appellant. One has to meet the ends of Justice and not deny the same merely upon procedural lacunae. Hon'ble Supreme Court in the case of Commissioner of Sales Tax Vs. Auriya Chambers of Commerce reported in (1986) 167 ITR 458 (SC) has quoted that "Procedures are handmaids of justice and not mistress of law. The Procedure of filing of Appeal within a period of Thirty days instead of which the same has been filed on Fifty Eighth Day upon the mistake of Professional, a fair opportunity to correct such mistake by providing the opportunity to cure by way of filing of an Application for condonation of delay should have been the correct path in justice delivery system, instead of the approach adopted herein. GROUND NO 2. Whether in the facts and circumstances of the case, the Ld. Assessing Officer was justified in making addition of Rs. 45,20,000/- under section 68 of the Act, on account of Old Currency having been deposited by the Appellant which includes Rs. 14,70,000/- in new currency as well and CIT (A) is justified in not deciding the Appeal on merits. SUBMISSIONS ON GROUND No. 2 It is pertinent to mention here that any delay to be condoned or not, has to be adjudged on the merits of the case. Here is a case on hand in which the Appellant had made submissions on merits before the Lower Fora being NFAC but there the appeal which was preferred on bonafide belief that there is no delay in filing the Appeal whereas there being a delay, the Ld. NFAC ousted the Appellant without grant of opportunity to cure the delay part of the appeal by addressing the said delay and proceeded to dismiss it on the ground of being barred by limitation instead of appreciating the merits. Since in the present facts and circumstances the Appellant is of firm view that the Hon'ble Forum shall be kind and inclined to consider the bonafide of the facts and

9 ITA No. 55/JPR/2024 Jagdish Prashad Panchal vs.ITO circumstance of the case of the Appellant upon which it is a fit case for remand of the matter back to the desk of Lower Fora, although the merits of the case are duly submitted before the Lower Fora but if still the merits are to be addressed, the Appellant craves the opportunity by this Hon'ble Forum to submit the written submission on merits, for such act the Appellant shall be duty bound to ever pray. It is therefore requested that the said appeal of the Appellant may kindly be allowed and order dated 4.12.2023 passed by CIT (Appeals) may kindly be quashed and set aside. It is also requested that delay may kindly be condoned in filing of the matter before the Lower Fora i.e. NFAC and matter may be restored to the Assessing Authority to impart substantial justice.”

The ld. AR of the assessee filed an affidavit of the counsel wherein it has been stated that the ld. AR who filed the appeal was of the

10 ITA No. 55/JPR/2024 Jagdish Prashad Panchal vs.ITO view that the time limit to file the appeal before the ld. CIT(A) was 60 days and in that fact of the matter even the delay caused before the ld. CIT(A) be condone and the assessee may be provided one more opportunity to advance his arguments/submissions before the ld. AO on merits as the orders of the both the authority are without considering the merits of the case and the additional evidence filed before the ld. CIT(A) will reduce the liability of tax substantially and therefore, in the interest of equity and natural justice the assessee praying for the one chance before the ld. AO advanced the arguments on merits of the case.

11 ITA No. 55/JPR/2024 Jagdish Prashad Panchal vs.ITO to the assessee that the appeal filed by the assessee was time barred. In support of these contention we have seen the notices issued and there is no mention of defect allowing the assessee to explain the delay on merits. The ld. AR of the assessee in support of the delay before the ld. CIT(A) filed an affidavit of the counsel wherein the delay of 28 days has been explained saying that it was the wrong understanding of the counsel about the limitation of filling an appeal before the ld. CIT(A). We have seen the reasons provided by the ld. AR of the assessee by filling an affidavit of the ld. AR representing before the ld. CIT(A). Thus, considering that aspect of the matter that when the assessee has no role to act and the delay was on account of the AR of the assessee the assessee should not punished. Considering that set of facts placed before us we are of the considered view that there is reasonable cause for the assessee to file the appeal before the ld. CIT(A) with 28 days delay and therefore, considering the content of the affidavit the assessee has reasonable cause and we condone the delay in filling the appeal before the ld. CIT(A). Since, the assessee has moved an application for additional evidence before the ld. CIT(A) on which the comment of the ld. AO is required and therefore, considering that aspect of the matter we remand back the matter to

12 ITA No. 55/JPR/2024 Jagdish Prashad Panchal vs.ITO the file of the ld. AO as consented by both the parties to give one more opportunity to submit the evidences concerning the issue in question, to decide it afresh by providing one more opportunity of hearing. Considering that aspect of the matter we hold to remand back the matter to the file of the ld. AO who will decide the issue based on evidence and submission of the assessee. However, the assessee will not seek any adjournment on frivolous ground and remain cooperative during proceedings before the ld. AO. 9. Before parting, we may make it clear that our decision to restore the matter back to the file of the ld. AO shall in no way be construed as having any reflection or expression on the merits of the dispute, which shall be adjudicated by the ld. AO independently in accordance with law.

In the result, the appeal filed by the assessee is allowed for statistical purposes.

Order pronounced in the open Court on 02/05/2024.

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13 ITA No. 55/JPR/2024 Jagdish Prashad Panchal vs.ITO fnukad@Dated:- 02/05/2024 *Santosh आदेश की प्रतिलिपि अग्रेf’ात@ब्वचल वf जीम वतकमत वितूंतकमक जवरू 1. vihykFkhZ@The Appellant- Jagdish Prashad Panchal, Jhalawar. 2. izR;FkhZ@ The Respondent- ITO, Jhalawar. 3. vk;dj vk;qDr@ CIT 4. vk;dj vk;qDr@ CIT(A) 5. विभागीय प्रतिनिधि] आयकर अपीलीय अधिकरण] जयपुर@क्त्ए प्ज्Aज्ए Jंपचनत. 6. xkMZ QkbZy@ Guard File { ITA No. 55/JPR/2024} vkns'kkuqlkj@ By order

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