CENTRE FOR HERITAGE STUDIES,THRIPUNITHURA vs. DEPUTY COMMISSIONER OF INCOME TAX, CPC, BANGALORE

At the outset, it was noticed that there was a delay in filing the appeal before the ld. CIT(A) of 1439 days which was not condoned by the learned CIT(A) and therefore the appeal filed by the assessee was dismissed in limini.

However, the learned A.R. before us contended that in the present case the gross amount has been added to the total income of the assessee in arbitrary manner without given benefit of corresponding expenditure/ application of income. According to the learned A.R., the income of the SA 44/Coch/2024 Centre for Heritage Studies assessee has to be charged to tax within the four corners of law despite the assessee failed to cooperate during the proceedings. According to the learned A.R. the assessee has a strong case on merits and therefore a meritorious case should not be dismissed on technical lapses.

The learned A.R. also contended that the substantial delay in filing the appeal before the learned CIT(A) is also attributable to the Covid-19 period which was duly condoned by the Hon'ble Supreme Court. Accordingly, the learned A.R. prayed before us to restore the issue to the file of the ld. CIT-A with the direction to the learned CIT(A) to condone the delay and decide the issue on merits.

On the other hand, the learned CIT-DR considering the substantial delay opposed to condone the same.

We have heard the rival contentions of both the parties and perused the material available on record. Indeed, the delay is substantial, but the meritorious case cannot be ignored merely on the delay in filing the appeal. In this regard, we note that the Hon’ble Gujarat High Court in the case of Vareli textile industry versus CIT reported in 154 Taxman 33 has held as under:

From the above, it is transpired that a meritorious case of the assessee should not be thrown away due to negligence or on account of technical lapses. In the light of the above stated discussion, we proceed to evaluate whether the delay in the present case needs to be condoned in the given facts and circumstances. Admittedly, the gross amount cannot be made subject to the charge of tax SA 44/Coch/2024 Centre for Heritage Studies without allowing the corresponding expenditure/ application of income. Accordingly, we are of the opinion that it is the fit case where the delay has to be condoned irrespective of the duration/period of the delay. We also note that there is no allegation from the Revenue that the appeal was not filed by the assessee within the time deliberately. Therefore, we are inclined to prefer substantial justice rather than technicality in deciding the issue. We also find that if we reject the application of the assessee for condoning the delay before the ld. CIT-A, then it would amount to legalise injustice on technical ground whereas the Tribunal is capable of removing injustice and to do justice. Thus, we condone the delay of in filing the appeal before the ld. CIT-A and restore the issue to the file of the ld. CIT-A. Accordingly, we direct the ld. CIT-A to adjudicate the appeal on merit. Hence, the ground of appeal of the assessee is allowed for statistical purposes.

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