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Income Tax Appellate Tribunal, MUMBAI BENCH “F”, MUMBAI
Before: SHRI JASON P. BOAZ & SHRI SANDEEP GOSAIN
This appeal by the assessee is directed against the order of the CIT(Appeals) – 20, Mumbai dated 21/10/2014 for assessment year 2006-07 dismissing the assessee’s appeal for statistical purposes, for the reason that the assessee having filed the appeal belatedly by 144 days, had failed to satisfy him that there was bonafide explanation or reasonable cause for not preferring the appeal within the time specified under section 249(2) of the Act.
In this appeal, the assessee has raised the following grounds:-
“1. The learned Commissioner of Income Tax (Appeals) erred in not condoning the delay in filing of appeal and while doing so he amongst other failed to appreciate that there was an inadvertent and bona fide lapse on part of the appellant in not presenting the appeal memo before the CIT(A) within the due date.
2. The appellant prays that the delay in filing of the appeal be condoned and the appeal be directed to be heard on merits by the CIT(A).”
The facts of the case, briefly, are as under:-
3.1 The assessee, a company in the business of trading in pharmaceuticals, filed its return for assessment year 2006-07 on 28/11/2006 declaring income of Rs.49,30,580/-. The return was processed under section. 143(1) of the Income Tax Act, 1961 ( in short ‘the Act’ ) and the case was subsequently taken up for scrutiny. The assessment was completed under section 143(3) of the Act vide order dated 17/11/2008; wherein the income of the assessee was determined at Rs.50,43,980/-. Proceedings under section 147 of the Act were initiated by the Assessing Officer and after recording reasons for the same, notice under section 148 of the Act was issued to the assessee on 22/3/2013. In response to the notice under section 148 of the Act, the assessee filed a copy of the original return of income filed under section 139 of the Act. The assessment was completed under section 144 r.w.s. 147 of the Act vide order dated 28/3/2014, wherein the income of the assessee was determined at Rs.52,48,910/- in view of the following disallowance/additions:-
(i) Disallowance under section 14A - Rs. 2,04,985/- (ii)STCG considered as business income - Rs. 40,84,185/- 3.2 Aggrieved by the order of assessment dated 28/03/2014 for the assessment year 2006-07 dated 28/3/2014, the assessee preferred an appeal before the CIT(A) -20, Mumbai which came be dismissed for statistical purposes vide the impugned order dated 21/10/2014, as the CIT(A) was of the view that the assessee was not able to satisfy him that it had a bona-fide explanation or reasonable cause for filing the appeal belatedly by 144 days. Consequently, the said delay was not condoned and the appeal was not admitted.
3.3 Before us, the Ld. Representative for the assessee submitted that the assessee was prevented by sufficient cause and had bonafide explanation for having filed the appeal before the CIT(A) belatedly. The application for condonation of delay in filing the appeal dated 18/09/2014 and an affidavit dated 18/09/2014 were filed before the CIT(A). In the said application, it is submitted as under:-
“ 1. On receipt of the assessment order u/s. 144 r.w.s. 147 of the Act on 30.3.2014, we had forwarded the order to our Tax Advocate for drafting the appeal. 2. Our tax advocate drafted the grounds of appeal
, statement of facts and reply to the show cause notice issued u/s. 274 r.w.s. 271(1)(c) to our office on 16.4.2014.
3. By mistake the account, instead of filing the appeal before your office, filed the grounds of appeal and statement of facts before the DCIT 9(3)on 14.4.2014, alongwith the reply on the show cause notice u/s. 274 r.w.s.271(1)(c).
4. We received another not1ce u/s. 274 r.w.s. 271(1)(c) on 16.9.2014. On verification of our records, we realized that the appeal has remained to be filed before your Honour.
5. The appellant submits that there is a delay in filing of this appeal for the reasons stated above. The appellant submits that having regard to the facts and circumstances of the case, the delay in filing of this appeal be condoned and the appeal be admitted for hearing on merits.”
3.4 In support of the above averments, the Ld. Representative for the assessee pleaded that the non-condonation of the delay of 144 days in filing the appeal had put the assessee to great hardship and injury, while no injury would be caused to Revenue if the delay of 144 days was condoned and the assessee’s appeal be heard by the CIT(A) and disposed off on merits. In support of the asessee’s pleadings, the Ld. Representative for the assessee, inter-alia, placed reliance on the following judicial pronouncements:-
(i) Collector, Land Acquisition vs. MST. Katiji and Others (167 ITR 471) and (ii) Radhakrishna Rai v. Allahabad Bank & Others (2009) 9 SCC 733. 3.5 The Ld. Departmental Representative on his part admitted that the CIT(A) had not adjudicated on the merits of the grounds raised in the assessee’s appeal. It was submitted that if the Bench were inclined to condone the delay of 144 days in filing this appeal, it would only be in the fitness of things if the issues raised in the assessee’s appeal before the CIT(A), be restored to the file of the CIT(A) for consideration and adjudication of the same on merit.
3.6.1 We have heard both parties and perused the material on record. The Hon’ble Apex Court in the case of collector, Land Acquisition(supra), while laying down the principles to be followed while considering the application for condonation of delay, has stated that substantial justice should prevail over technical considerations. The Hon’ble Apex Court explained that, everyday’s delay must be explained, does not mean that a pedantic approach should be taken. The doctrine must be applied in a natural, common sense and pragmatic manner. Considering the aforesaid principles and the submissions of the assessee, it appears to us that the assessee’s failure to file this appeal in time was due to the mistake and failure on the part of his Accountant. Further, we are also of the opinion that if the delay of 144 days in filing this appeal is condoned and the matter be restored to the file of the CIT(A) for disposal of the issues raised before him in appeal, there shall be no loss to Revenue as legitimate taxes payable to Revenue in accordance with law alone will be collected. In this view of the matter, we are of the opinion that this is a fit case for condonation of the delay of 144 days in filing the appeal and accordingly condone the same. In view of the fact that the CIT(A) has not adjudicated the issues raised in the assessee’s appeal before him for assessment year 2006-07, we, restore the matter to the file of the CIT(A) for further consideration and adjudication of the grounds raised in the appeal before him, on merits after affording the assessee adequate opportunity of being heard and to file details/submissions required in this regard. We hold and direct accordingly.
In the result, the assessee’s appeal for assessment year 2006-07 is treated as allowed for statistical purposes.
Order pronounced in the open court on 21/09/2016