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Income Tax Appellate Tribunal, PUNE BENCHES “A” :: PUNE
Before: DR.DIPAK P. RIPOTE & SHRI VINAY BHAMORE
Assessment Year : 2012-13 Chandan Hassanand Lokwani, V The Assistant 2 Jawahar Market, Nashik road, s Commissioner of Maharashtra – 422101. Income Tax, Circle-1, PAN : ABCPL7072N Nashik. Appellant / Assessee Respondent / Revenue Assessee by Shri Sanket M Joshi – AR Revenue by Shri Ramnath P Murkunde - DR Date of hearing 23/10/2024 Date of pronouncement 23/10/2024 आदेश/ ORDER
PER DR. DIPAK P. RIPOTE, AM:
This is an appeal filed by the Assessee directed against the order of ld.Commissioner of Income Tax(Appeal)[NFAC], under section 250 of the Income tax Act 1961, dated 18.05.2024. The assessee has raised the following grounds of appeal : “1) The learned CIT(A) erred in dismissing the appeal in limine by refusing to condone the delay of 108 days in filing the appeal without appreciating that the said delay was due to reasonable cause and the said delay ought to have been condoned in the interest of justice.
2) The learned CIT(A) failed to appreciate that in this case, the disallowance u/s 40(a)(ia) was made by the A.O. towards non deduction of TDS on interest paid to three NBFC in spite of the fact that the appellant had furnished CA Certificate in Form 26A to prove that the payees had offered the interest to tax and paid taxes thereon and hence, the said addition resulted into double taxation of the same income and therefore, the impugned delay of 108 days in filing appeal ought to have been condoned in view of the ratio laid down by Hon'ble Madras High Court in case of Venkatadri Traders Ltd. v. CIT [248 ITR 681].
3) The appellant craves leave to add/ alter/ amend any of the grounds of appeal.”
2. In this case, Assessee is an individual engaged in wholesale trade. Assessee filed Return of Income for A.Y.2012-13 on 01.06.2012 declaring total income of Rs.7,34,049/-. Assessee’s case was selected for scrutiny. The Assessee’s case was reopened by issuing notice u/sec.148 of the Act on 27.03.2017. Assessee submitted that Return of Income filed on 01.06.2012 may be treated as Return of Income filed under section 148 of the Act. Accordingly, the AO issued various notices to the assessee. The AO observed that Assessee has paid interest to Bajaj Finance Limited of Rs.1,13,355/-, to Future Capital of Rs.1,98,053/- and India Bulls Limited Rs.91,252/- during the year without deducting TDS u/sec.194A of the Act. Therefore, AO held that the impugned interest needs to be disallowed u/sec.40(a)(ia) of the Act. The Assessee has submitted before the AO that all these entities had filed Return of Income and shown the impugned interest in their Return of Income. Assessee filed a Certificate of Chartered Accountant in the prescribed format. Assessee also invited Assessing Officer’s attention to the Amendment introduced by Finance Act, 2012 to Section 40(a)(ia) of the Act. However, AO disallowed the interest made addition u/sec.40(a)(ia) of the Act of Rs.4,02,660/-.
3. Aggrieved by the assessment order, assessee filed appeal before the ld.CIT(A). Ld.CIT(A) observed in Para 17 that due date of filing appeal was on or before 27.08.2017, however, assessee filed appeal on 14.12.2017. Ld.CIT(A) held that there has not been sufficient cause for delay. Hence, ld.CIT(A) dismissed the appeal of the assessee without discussing the merits of the case. It is observed that in Form No.35 assessee has mentioned reason for delay as Illness and Family Problems. Assessee has filed an Affidavit to explain the reason for delay in filing appeal before the ld.CIT(A). The relevant part of the Affidavit is reproduced here as under :
4. On perusal of the Affidavit of the assessee, we are convinced that there was sufficient cause for delay in filing of appeal before the ld.CIT(A).
4.1 The Hon’ble Madras High Court in the case of Elnet Technologies Ltd., Vs. ACIT 259 Taxmann 593, held as under : “11. Furthermore, law of limitation is founded on the principle to give finality to orders and judgments. The intention is not to deny the rights of the parties on technical grounds. In cases where there are mala fides on the part of the litigants to approach Courts within time, then Courts have taken strict view, however less the number of days of delay may be. Ordinarily, no litigant will lodge the case belatedly.
In the instant case, the Revenue has not established any mala fide reasons on the part of the appellant to belatedly file the appeal before the CIT (A). Even in the decision in the case of Vedabai (supra), the Hon'ble Supreme Court held that there is no hard and fast rule, which can be laid down while considering an application for condonation of delay. It was further held that Courts should adopt a pragmatic approach. The Tribunal, while concurring with the view taken by the CIT(A), held that the assessee and its Directors were guilty of negligence. However, we do not find any such gross negligence on the part of the appellant especially in the light of the reasons assigned for filing the appeal belatedly, which have not been controverted by the Revenue. Therefore, we are of the considered view that the matter should not be shut down on technicalities and a liberal approach should be taken bearing in mind the reasons assigned by the appellant, as the assessee is a joint venture company controlled by the Government of Tamil Nadu and its DCEO, who is invariably in the cadre of IAS Officer, is being nominated by the Government and he has to take a decision to file an appeal.” 4.2 The Hon’ble Punjab & Haryana High Court in the case of Poonam Industries vs. CIT 178 Taxman 319, held as under : “8. We are of the view that though, a party is required to explain each day's delay and to show that it was prevented by sufficient cause in filing the appeal in time, power to condone delay has to be exercised in a pragmatic manner to advance substantial justice. The plea of illness is admittedly not fake. Even if the other partner had appeared in another income-tax case, the same could not be conclusive against genuineness of the reason given by the assessee. Every partner may not be aware of all the affairs of the firm. No harm would be done to either party if the matter is heard on merits.”
4.3 Thus, respectfully following the Principle laid down by the Hon’ble High Courts(supra), we direct the ld.CIT(A) to Condone the Delay and accordingly we set-aside the order of ld.CIT(A) to ld.CIT(A) for denovo adjudication.
In the result, appeal of the assessee is allowed for statistical purpose. Order pronounced in the open Court on 23rd October, 2024.