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Income Tax Appellate Tribunal, ‘A’ BENCH, KOLKATA
Before: Shri Rajpal Yadav, Vice-(KZ) & Dr. Manish Borad
Per Rajpal Yadav, Vice-President (KZ):- The assessee is in appeal before the Tribunal against the order of ld. Commissioner of Income Tax (Appeals), National
ITA No. 219/KOL/2024 (A.Y. 2017-2018) Sri Kesharmul Agarwal Faceless Appeal Centre (NFAC), Delhi dated 04.10.2023 passed for A.Y. 2017-18.
This appeal was presented in the Tribunal on 05.02.2024. The Registry has pointed out that the appeal is time barred by 63 days. In order to explain the delay, the assessee has filed an application along with the appeal. It has been submitted in the application that though the impugned order was passed on 04.10.2023, but it was only uploaded on the e-Portal. The assessee accessed the order in the month of December. He has forwarded the order to his Tax Consultant and on account of time barring assessment, he could not file the appeal well in time. In this way, the appeal has become time barred.
With the assistance of the ld. Representatives, we have gone through the record carefully. Sub-section 5 of Section 253 contemplates that the Tribunal may admit an appeal or permit filing of memorandum of cross- objections after expiry of relevant period, if it is satisfied that there was a sufficient cause for not presenting it within that period. This expression sufficient cause employed in the section has also been used identically in sub-section 3 of section 249 of Income Tax Act, which provides powers to the ld. Commissioner to condone the delay in filing the appeal before the Commissioner. Similarly, it has been used in section 5 of Indian Limitation Act, 1963. Whenever interpretation and construction of this expression has fallen for consideration before Honble High Court as well
ITA No. 219/KOL/2024 (A.Y. 2017-2018) Sri Kesharmul Agarwal as before the Honble Supreme Court, then, Honble Court were unanimous in their conclusion that this expression is to be used liberally. We may make reference to the following observations of the Hon’ble Supreme court from the decision in the case of Collector Land Acquisition Vs. Mst. Katiji & Others, 1987 AIR 1353: 1. Ordinarily a litigant does not stand to benefit by lodging an appeal late.
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.
"Every day’s delay must be explained" does not mean that a pedantic approach should be made. Why not every hour's delay, every second's delay? The doctrine must be applied in a rational common sense pragmatic manner.
When substantial justice and technical considerations are pitted against each other, cause of substantial justice deserves to be preferred for the other side cannot claim to 3
ITA No. 219/KOL/2024 (A.Y. 2017-2018) Sri Kesharmul Agarwal have vested right in injustice being done because of a non-deliberate delay.
There is no presumption that delay is occasioned deliberately, or on account of culpable negligence, or on account of mala fides. A litigant does not stand to benefit by resorting to delay. In fact he runs a serious risk.
It must be grasped that judiciary is respected not on account of its power to legalize injustice on technical grounds but because it is capable of removing injustice and is expected to do so.
Similarly, we would like to make reference to authoritative pronouncement of Honble Supreme Court in the case of N. Balakrisknan Vs. M. Krishnamurtky (supra). It reads as under: “Rule of limitation are not meant to destroy the right 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 reason of legal injury. Law of limitation fixes a life-span for such legal remedy for the redress of the legal injury so suffered. Time is precious and the wasted time would never revisit. During efflux of time newer causes would sprout up necessitating newer persons to seek legal remedy by approaching the courts. So a life span must be fixed for each remedy. Unending period for launching the remedy may lead to unending uncertainty and consequential anarchy. 4
ITA No. 219/KOL/2024 (A.Y. 2017-2018) Sri Kesharmul Agarwal 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 putt to litigation). Rules of limitation are not meant to destroy the right 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. A court knows that refusal to condone delay would result foreclosing a suitor from putting forth his cause. There is no presumption that delay in approaching the court is always deliberate. This Court has held that the words "sufficient cause" under Section 5 of the Limitation Act should receive a liberal construction so as to advance substantial justice vide Shakuntala Devi lain Vs. Kuntal Kumari [AIR 1969 SC 575] and State of West Bengal Vs. The Administrator, Howrah Municipality [AIR 1972 SC 749]. It must be remembered that in every case of delay there can be some lapse on the part of the litigant concerned. That alone is not enough to turn down his plea and to shut the door against him. If the explanation does not smack of mala fides or it is not put forth as part of a dilatory strategy the court must show utmost consideration to the suitor. But when there is reasonable ground to think that the delay was occasioned by the party deliberately to gain time then the court should lean against acceptance of the explanation. While condoning delay the Could should not forget the opposite party altogether. It must be borne in mind that he is a looser and he too would have incurred quiet a large litigation expenses. It would be a salutary guideline that when courts condone the delay due to laches on the part of the applicant the court shall compensate the opposite party for his loss”.
We do not deem it necessary to re-cite or recapitulate the proposition laid down in other decisions. It is suffice to say that the Honble Courts are unanimous in their approach to propound that whenever the reasons assigned by an applicant for explaining the condonation
ITA No. 219/KOL/2024 (A.Y. 2017-2018) Sri Kesharmul Agarwal of delay, then such reasons are to be construed with a justice oriented approach.
In the light of the above, we are of the view that while making this appeal time barred, the assessee will not gain anything. The delay has not been adopted by the assessee as a strategy to litigate with the Revenue. Therefore, we condone the delay in filing the appeal and proceed to decide the appeal on merit.
The assessee has taken nine grounds of appeal, but perusal of the impugned order, we find that the appeal of the assessee has been dismissed by the ld. CIT(Appeals) on the ground that the assessee failed to make payment of advance tax, which was payable by him and, therefore, as per section 249(4), clause (b), his appeal is not maintainable. The finding recorded by the ld. CIT(Appeals) in this connection reads as under:-
“2.2. The appellant has complied and has furnished reply to the 2nd deficiency letter on 26.09.2023. But, it is seen that, in reply, the appellant has only uploaded Form no. 35 and a copy of challan for appeal fees paid. Therefore, it can be safely inferred that, the appellant does not have anything to say with respect to non-compliance of the provisions of section 249(4).
2.3. In this regard, provisions of Section 249(4) of the Act, is reproduced here under: [(4) No appeal under this chapter shall be admitted unless at the time of filing of the appeal, -
ITA No. 219/KOL/2024 (A.Y. 2017-2018) Sri Kesharmul Agarwal 1.Where a return has been filed by the assessee, the assessee has paid the tax due on the Income returned by him; or
2.Where no return has been filed by the assessee, the assessee has paid an amount equal to the amount of advance tax which was payable by him:
Provided that, [in a case falling under clause (b) and] on an application made by the appellant in this behalf, the [Joint Commissioner (Appeals) or the] [Commissioner (Appeals), may for any good and sufficient reason to be recorded in writing, exempt him from the operation of the provisions of [that clause]]”.
2.4. As per the assessment order under section 144 of the Act, it is stated that the appellant has not filed the return of income and the AO has computed the total income at Rs. 1,05,54,470/- and computed the tax payable at Rs. 4,01,30,409/- which includes the advance tax payable by the appellant as well as the interest on account of delayed payment of advance tax.
2.5. As per the deficiency letter, the details of deficiency is “Tax on returned income not paid/particulars of payment not mentioned”, which includes two parts, one part is tax on returned income not paid and secondly particulars of payment not mentioned. Particulars of payment not mentioned pertains to Section 249(4)(b) of the Act, which is particulars of payment of advance tax as per the said provision. The reply of the appellant to the deficiency letter is not relevant to the issue under consideration, therefore, it goes to suggest that the appellant has not paid an amount equal to the amount of advance tax which was payable on or before filing the appeal. 7
ITA No. 219/KOL/2024 (A.Y. 2017-2018) Sri Kesharmul Agarwal Moreover, the appellant has also not made an application as per the Proviso to Section 249(4).
2.6. In this regard, the Column nos.8 & 9 of Form No.35 is reproduced here under:
8 No Where a return has been filed by the appellant for the assessment year in connection with which the appeal is filed, whether tax due on income returned has been paid in full.
8.1. If reply to 8 is Yes, then enter details of return and taxes paid
a Acknowledgement number
b Date of filing
c Total tax paid 9 No Where no return has been filed by the appellant for the assessment year, whether an amount equal to the amount of advance tax as per section 249(4)(b) of the Income Tax Act, ,1961 has been paid
As can be seen from the above, the appellant has stated “No” in the above columns. This further establishes that, the appellant has not paid an amount equal to the amount of advance tax which was payable, on or before filing the appeal.
2.7. As per section 249(4)(b) of the Act, the appeal shall not be admitted, unless the appellant has paid an amount equal to the amount of advance tax which was payable. As the applicable advance tax has not been paid by the appellant before filing of the appeal, the appeal shall not be admitted. Therefore, the present appeal filed is not admitted as per the provisions of Section 249(4) of the Act.
ITA No. 219/KOL/2024 (A.Y. 2017-2018) Sri Kesharmul Agarwal 3. In the result, the appeal is treated as dismissed for statistical purposes.
The ld. Counsel for the assessee submitted that the assessee has no taxable income. He is a permanent resident of Sikkim prior to 1975 and exempt from tax. He has not filed his return, therefore, ld. CIT(Appeals) ought to have decided the appeal on merit.
On the other hand, ld. D.R. relied upon the finding of ld. CIT(Appeals), reproduced supra.
We have duly considered the rival contentions and gone through the record carefully. No doubt sub-clause (b) of section 249 contemplates that “where no return has been filed by the assessee, the assessee has paid an amount equal to the amount of advance tax which was payable by him”. The ld. CIT(Appeals) failed to point out which advance tax was payable by the assessee. It is not to be assumed that advance tax is payable on assessed income. There is no other independent material available to the revenue, which can exhibit a liability of advance tax payment at the end of the assessee. Therefore, we are of the view that ld. CIT(Appeals) has failed to examine the facts and circumstances in right perspective and has erred in dismissing the appeal in limine without adjudicating the issues on merit. The impugned order of the ld. CIT(Appeals) is set aside and all the issues are restored to the file of ld. CIT(Appeals) with a direction to decide the appeal on merit, preferably within six months because the ld. CIT(Appeals) kept the appeal pending with him for more than three years.
ITA No. 219/KOL/2024 (A.Y. 2017-2018) Sri Kesharmul Agarwal Considering the above aspect, this appeal is allowed for statistical purposes.
In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open Court on 19/06/2024. Sd/- Sd/- (Manish Borad) (Rajpal Yadav) Accountant Member Vice-President (KZ) Kolkata, the 19th day of June, 2024
Copies to :(1) Sri Kesharmul Agarwal, C/o. M/s. Salarpuria Jajodia & Co., 7, C.R. Avenue, 3rd Floor, Kolkata-700072 (2) Income Tax Officer, Ward-3(1), Gangtok, Aayakar Bhawan, Bhanupath, While Hall Campus, P.O. Rajbaheri, Gangtok-737101, Sikkim (3) Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi; (4) CIT- , Kolkata (5) The Departmental Representative; (6) Guard File TRUE COPY By order Assistant Registrar, Income Tax Appellate Tribunal, Kolkata Benches, Kolkata Laha/Sr. P.S.