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Income Tax Appellate Tribunal, MUMBAI BENCHES, ‘G’ MUMBAI
Before: Shri Joginder Singh, & Shri Manoj Kumar Aggarwal
आदेश / O R D E R
Per Joginder Singh(Judicial Member) The assessee is aggrieved by the impugned order dated 31/07/2009 of the Ld. Commissioner of Income Tax, Mumbai, invoking revisional jurisdiction u/s 263 of the Income Tax Act, 1961 (hereinafter the Act).
During hearing of this appeal, Ms. Vidisha Kalra, ld. CIT-DR, contended that there is huge delay of 809 days, which cannot be condoned as the assessee has not explained the delay. In reply, the Ld. counsel for the assessee, Shri Sameer Dalal, contended that the assessee has filed an application for codonation of delay, supported by an affidavit. It was contended that the order passed u/s 263 of the Act was received by the assessee on 18/08/2009 and was handed over to the tax consultant Mr. M.S. Alam Siddiquee, who was handling the taxation work of the assessee for past several years. The tax consultant after going through the order, advised the assessee not to file any appeal. Thereafter, the assessment was completed by the Assessing Officer on 27/12/2010 u/s 143(3) r.w.s 263 of the Act on 27/12/2010. Against this order, new consultant advised the assessee to file appeal against the 263 order dated 31/07/2009, which caused delay of 809 days. In view of this fact, the ld. counsel contended that delay may be condoned.
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2.1. We have considered the rival submissions and perused the material available on record. Now, question arises, whether there is bona-fide delay, which should be condoned. Before coming to any conclusion, however, we are not going into the merits of the appeal at this stage since we are only analyzing whether there were bona-fide reason, on the part of the assessee, in filing the appeal late by 809 days. As mentioned earlier, the assessee received the order u/s 263 of the Act on 18/08/2009 and the assessee was to file the appeal against the order within 60 days from the receipt of order. As per the assessee, a decision was taken not to file the appeal against the order of the Ld. Commissioner of Income Tax (Appeal) on the advice of their chartered accountant/tax consultant. We feel, even if the assessee acted upon the advice of the chartered accountant/tax consultant, it was a conscious decision of the assessee not to file an appeal. The assessee remained silent for about 809 days and thereafter, on second advice, as claimed by the assessee, filed appeal before this Tribunal. One fact is clearly oozing out that firstly consciously not filing an appeal and thereafter filing the appeal was a conscious decision of the assessee. In such as situation, the decision of the Mumbai Bench of the Tribunal in the case of B.S. International (ITA No.4683/Mum/2012), order dated 26/10/2015, supports the case of the Revenue.
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2.2. We have also considered the decision from Hon’ble Apex Court in Collector, land acquisition vs Kataji 167 ITR 471, (SC), L. Balkrishnan vs M. Krishnamurthy, (1998) 7 SCC 123 and Vasue & Company vs State of Kerala (2001) 124 STC 124 (Kerala.) We have perused the reasons mentioned by the assessee in its application for condonotion of delay along with the cited cases. Before us, the assessee has relied upon the observation of the Hon’ble Apex Court in the case 167 ITR 471(SC) Collector, land Acquisition vs Katiji. We find that the Hon’ble Apex Court held as under:-
“When substantial justice and technical considerations are pitted against each other, the cause of substantial justice deserves to be preferred, for the other side cannot claim to have a vested right in injustice being done because of a non-deliberate delay.”
We have also gone through the following observations of the Apex Court in the case of L. Balkrishanan. Vs. M. Krishnamurthy (1998) 7 SCC 123.
"The primary function of a court is to adjudicate the dispute between the parties and to advance substantial justice. The time-limit fixed for approaching the court in different situations is not because on the expiry of such time a bad cause would transform into a good cause. Rules of limitation are not meant to destroy the rights 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
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reason of legal injury. The law of limitation fixes a lifespan for such legal remedy for the redress of the legal injury so suffered. The law of limitation is thus founded on public policy. It is enshrined in the maxim interest reipublicae up sit finis litium (it is for the general welfare that a period be put to litigation). Rules of limitation are not meant to destroy the rights 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.”
We have also perused the decision and observation made therein by the Hon’ble Kerala High Court in the case of Vasu & Co. Vs. State of Kerala (2001) 124 STC 124 (Ker.). "We are of the view that it is not necessary in all cases to give evidence regarding the delay in filing appeals. The affidavits are documents of evidence. On the basis of the affidavits, if the Court is satisfied that sufficient explanation has been given for condoning delay, then the affidavit can be accepted as evidence. If proof of what is stated in the affidavit is insisted on, that will prolong the litigation. Here is a case where the Assessee. is aggrieved by the orders of the assessing authorities. According to him, he has been directed to pay tax which he was not bound to pay and on the ground of delay the Tribunal has shut the doors against him. Of course, if the Petitioner had been negligent or irresponsible, the Court cannot come to his succour. Here, we find some truth in what the Petitioner had stated in so far as he has approached this Court by filing original Petition. It would have been better, if some evidence was given regarding his case that the particular advocate did not file appeals. But the court can take judicial notice of the difficulty in getting such affidavits".
2.3. The Hon’ble Court in Vasu & Company vs State of Kerala has clearly mentioned that if the petitioner is
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negligent or irresponsible, the court cannot come to his rescue. This is exactly the case before us. The law of limitation fixes a life span for such legal remedies for the redressal of a legal injury, if any, suffered by the assessee. However, in the present appeal, there is a clear cut conscious delay of 809 days, which, in our view, if condoned, under the facts available on record, then there is no need to keep the provision under the limitation Act. Even the Hon’ble Apex Court in Collector, Land Acquisition vs Katiji (supra) has clearly mentioned about non-deliberate delay. Thus, in our humble opinion, the cases relied by the assessee cannot come to the rescue of the assessee, because the assessee has not adduced any evidence/reason, substantiating that the delay was caused due to the reasons which were beyond his/its control and at the same time, the reasons were ‘good and sufficient’, rather, it is a clear cut case of conscious decision in not filing the appeal and thereafter after such a huge delay, there is again a conscious decision to file the appeal. Even, the Hon’ble Apex Court in Vedabai alias Vaijayanatabai Baburao vs Shantaram Bavurao Patil reported in (2002) 253 ITR 798 (SC) made a distinction in delay and inordinate delay observed (page 799) as under:-
“In exercising discretion u/s 5 of the limitation Act, the Court should adopt a pragmatic approach. A distinction must be made between a case, where the delay is inordinate and a case where the delay is of a few days. Whereas, in the former case, the consideration of prejudice to the other side will be a relevant factor, so the case calls for more cautious approach…….”
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In Brij Inder Singh vs Kashiram (AIR) 1917 PC 156, it was observed that true guide for a Court to exercise the discretion u/s 5 of the limitation Act is whether the appellant acted with reasonable diligence in prosecuting the appeal. If the totality of facts, available on record, are judiciously examined then it can be said that the provisions relating to prescription of limitation in every statute must not be construed so liberally that it would have the effect of taking away the benefit accruing to the other party in a mechanical manner. Where the Legislature spells out a period of limitation and provides for power to condone the delay as well, there such delay can be condoned only for ‘sufficient and good reasons’ supported by cogent and proper evidence. Now, it is a settled principle of law that the provisions relating to specified period of limitation must be applied with their rigour and effective consequences. In this regard, reference can be made to the decision in the case of P. K. Ramachandran v. State of Kerala, AIR 1998 SC 2276. The relevant portion reads as under (page 2277):-
“Law of limitation may harshly affect a particular party but it has to be applied with all its rigour when the statute so prescribes and the courts have no power to extend the period of limitation on equitable grounds. The discretion exercised by the High Court, was, thus, neither proper nor judicious. The order condoning the delay cannot be sustained. This appeal, therefore, succeeds and the impugned order is set aside. Consequently, the application for condonation of delay filed in the High Court would stand rejected and the miscellaneous first appeal shall stand dismissed as barred by time. No costs.” XXXXXXXXXXXXX
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“Once the concerned authority applies its mind and declines to condone the delay in filing the appeal for good and appropriate reasons, in that event it cannot give rise to a question of law for determination.”
The Hon'ble Apex Court of India in the case of Oriental Investment Co. Ltd. v. CIT [1957] 32 ITR 664, 675; AIR 1957 SC 852, held as under (857 of AIR 1957 SC):
“A finding on a question of fact is open to attack under section 66(1) as erroneous in law if there is no evidence to support it or if it is perverse.”
A Full Bench of the Orissa High Court, in the case of Brajabandhu Nanda v. CIT [1962] 44 ITR 668, considering somewhat similar question, where the appeal was barred by time and reference of the question was declined, held as under (headnote) :
“That the questions referred were not questions of law but questions of fact since it was a matter of discretion for the Tribunal to condone delay for sufficient cause on the facts and circumstances of each case.”
The consistent view is that such question would be a question of fact simpliciter and would not be covered under the provisions of section 256 of the Act unless such exercise of discretion or conclusion arrived at was perverse or so illogical that no reasonable person could come to such a conclusion. The authorities have exercised their discretion and we find nothing perverse in the impugned orders. Specific reasons have been given in the order which are not only logical but even reflect the conduct of the appellant before the authorities in not producing the record in spite of seeking time.
The authorities which are exercising quasi-judicial powers in discharge of their statutory functions, inevitably have to be vested with some element of discretion in exercise of such powers. Merely because another view was possible or
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permissible on the same facts and circumstances, per se would not make such controversy a “question of law”. So far as such decision of the authority is in conformity to the principle of law and is apparently a prudent one, the court would normally be reluctant to interfere in such exercise of discretion. We are not able to appreciate the contention of learned counsel for the petitioner that the Tribunal has applied wrong principles of law or that it has relied upon incorrect principles of law regulating the controversy in issue (refer [1976] 105 ITR 133).
We are also not in a position to agree with the contention raised on behalf of the petitioner that the afore-given three reasons amount to palpably erroneous error of law in exercise of discretion by the authorities concerned. On the contrary, we have already held that the reasons stated for declining the reference are well in consonance with the settled cannons of law governing the subject.
Having cogitated over the matter and for the reasons aforestated, we do not find any error of jurisdiction or otherwise in the impugned order. We are constrained to hold that the view of the Tribunal in declining the reference to this court is fully justified and thus, we decline to issue any direction to the Income-tax Appellate Tribunal, Amritsar, to state and refer the aforesaid question, as question of law, to this court in exercise of its power under section 256 of the Act.
With the above observations, this petition is dismissed.
Our view is fortified by the decision from Hon’ble Punjab & Haryana High Court in the case of CIT vs Ram Mohan Kabra (2002) 257 ITR 773 (P& H). Our view also finds support from the decision of the Coordinate Bench in the case of Brihan Mumbai Kreeda & Lalitkala Pratisthan vs DIT (Exmp.) (ITA NO.6417/Mum/2013) order dated 20/11/2015. The totality of facts, clearly indicates that the assessee took a conscious decision firstly, not to file the appeal against the order of the ld. Commissioner and
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thereafter took a decision to file the appeal. It is not the case of delay which was beyond the control of the assessee. So far as, the affidavit is concerned, it is a self serving document and the assessee has not explained satisfactorily the reason of delay in filing the appeal. The assessee was wilfully negligent or irresponsible in taking a decision, thus, the huge delay cannot be condoned. We are conscious of the fact that technicalities should not come in the way of substantial cause of justice, but in cases, where the delay was beyond the control of the assessee or some genuine difficulties hindered his smooth way. As discussed earlier, it is clear cut case of conscious decision, thus, we find no merit in the self made story of the assessee, therefore, on this issue, we are not agreeing with the admission of this appeal, thus, the delay is not condoned, consequently, the appeal is dismissed as not admitted. Finally, the appeal of the assessee is dismissed as not admitted.
This Order was pronounced in the open court in the presence of ld. representatives from both sides at the conclusion of the hearing on 02/02/2017.
Sd/- Sd/- (Manoj Kumar Aggarwal) (Joginder Singh) लेखा सद�य / ACCOUNTANT MEMBER �या�यक सद�य /JUDICIAL MEMBER मुंबई Mumbai; �दनांक Dated : 02/02/2017 f{x~{tÜ? P.S/.�न.स.
11 ITA No.79/Mum/2012 Mohd. Gafuruddin F.Siddique
आदेश क� ��त�ल�प अ�े�षत/Copy of the Order forwarded to : 1. अपीलाथ� / The Appellant (Respective assessee) 2. ��यथ� / The Respondent. 3. आयकर आयु�त(अपील) / The CIT, Mumbai. 4. आयकर आयु�त / CIT(A)- , Mumbai, 5. �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, मुंबई / DR, ITAT, Mumbai 6. गाड� फाईल / Guard file.
आदेशानुसार/ BY ORDER, स�या�पत ��त //True Copy//
उप/सहायक पंजीकार (Dy./Asstt. Registrar) आयकर अपील�य अ�धकरण, मुंबई / ITAT, Mumbai