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Income Tax Appellate Tribunal, JAIPUR BENCHES, “SMC” JAIPUR
Before: SHRI SANDEEP GOSAIN, JM & SHRI RATHOD KAMLESH JAYANTBHAI, AM vk;dj vihy la-@ITA No. 58/JP/2023
आयकर अपीलीय अधिकरण] जयपुर न्यायपीठ] जयपुर IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, “SMC” JAIPUR Jh lanhi xkslkbZ] U;kf;d lnL; ,oa Jh jkBkSM deys’k t;arHkkbZ] ys[kk lnL; ds le{k BEFORE: SHRI SANDEEP GOSAIN, JM & SHRI RATHOD KAMLESH JAYANTBHAI, AM vk;dj vihy la-@ITA No. 58/JP/2023 fu/kZkj.k o"kZ@Assessment Year :2012-13 cuke Vishal Bansal DCIT, Vs. G-1/126-127, Sitapura Industrial Circle-7, Area, Jaipur. Jaipur. LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: ACSPB 7129 D vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksj ls@ Assessee by : Sh. Rohan Sogani (CA) jktLo dh vksj ls@ Revenue by : Smt. Monisha Choudhary (Addl.CIT) lquokbZ dh rkjh[k@ Date of Hearing : 07/06/2023 mn?kks"k.kk dh rkjh[k@Date of Pronouncement: 26/06/2023 vkns'k@ ORDER PER: RATHOD KAMLESH JAYANTBHAI, A.M. This appeal is filed by the assessee aggrieved from the order of the National Faceless Appeal Centre, Delhi [ Here in after referred as “NFAC/CIT(A)” ] for the assessment year 2012-13 dated 18.01.2023, which in turn arises from the order passed by DCIT, Circle-7, Jaipur, under section 271(1)(c) r.w.s 274 of the Income tax Act, 1961 (in short 'the Act').
Vishal Bansal 2. The assessee has taken following grounds in this appeal; “ 1. In the facts and circumstances of the case and in law, National Faceless Appeal Centre ("NFAC")/ ld. CIT(A) erred in not condoning the delay in filing the appeal, in the first appellate proceedings, thereby, passing the order against the Principles of Natural Justice. The action of the ld. CIT(A) is illegal, unjustified, arbitrary and against the facts of the case. Relief please be granted by quashing the order passed by ld. CIT(A).
In the facts and circumstances of the case and in law, ld. CIT(A) erred in not condoning the delay of the assessee in filing the appeal, in the first appellate proceedings, without taking into account the reasons due to which the appeal could not be filed by the assessee within the stipulated time period. The action of the ld. CIT(A) is illegal, unjustified, arbitrary and against the facts of the case. Relief please be granted by quashing the order passed by ld. CIT(A).
3. In the facts and circumstances of the case and in law, ld. CIT(A) erred in confirming the action of the ld. AO, in levying penalty of Rs. 3,16,891, under Section 271(1)(c) of the Income Tax Act, 1961. The action of the ld. CIT(A) is illegal, unjustified, arbitrary and against the facts of the case. Relief please be granted by quashing the order passed by ld. CIT(A).
4. The assessee craves his rights to add, amend or alter any of the grounds on or before the hearing.”
3. The fact as culled out from the records is that the assessee is engaged in the business of manufacturing and trading of garments. The assessee filed its Return of Income on 28.09.201 2, declaring a total income of Rs.47,97,430/-. The case was selected for scrutiny. The assessment was completed u/s. 143(3) of the Income tax Act, 1961 with an addition of Rs. 33,13,568/- and the total income was assessed at Rs.81,11,000/-. The assessee has preferred an appeal to ld. CIT(A). Thereafter, the Id. CIT(A) vide
Vishal Bansal his appellate order partly allowed the appeal of the assessee and confirmed addition of Rs. 10,25 538/-. The Assessing Officer passed a penalty order dated 23.03.2018 u/s 274 r.w.s 271(1)(c) and imposed a penalty of Rs. 3,16,891. While imposing the penalty proceeding, Ld. Assessing officer did not considered that the assessee company has nowhere tried to conceal it income which is a sine qua non for levy of penalty under section 271(1)(c) of the Act. He ignored that Law for making addition in quantum proceedings is different from the law for imposing penalty and in recognition of this fundamental difference, both proceedings have been kept separate and independent.
4. Aggrieved from the order of the assessing officer u/s 143(3) of IT. Act, assessee preferred an appeal before the ld. CIT(A).
Apropos to the grounds of the appeal so raised the relevant finding of the ld. CIT(A) is reiterated here in below :
“4.1.1 Submission of the appellant in respect of the delay in filing of appeal has been perused. The reasons cited by the appellant can be summarized as under: (a) The appellant is not conversant with provisions of Income Tax. (b) He is dependent on his Chartered Accountant. (c) He had admittedly received the order and forwarded it to his Chartered Accountant. (d) His Chartered Accountant missed the deadline.
Vishal Bansal (e) The order was traced when the appellant enquired about some refund. From the above, it is seen that none of the reasons cited by the appellant was on account of situation/conditions which were beyond the contrl of the appellant. The two case laws cited by the appellant have been perused. But both the judgment of Hon'ble Supreme Court are distinguishable. (a) In the first case i.e. Collector, Land Acquisition vs. Mst. Katiji (1987) 167 ITR 4712, there was delay of only 4 days whereas in the instant case the delay is of 872 days. (b) In the second case Le. Ms GMG Engineering Industries vs. Ms Issa Green Power Solution (Civil Appeal No. 44732015) With A.C.Govindaraj and Ors. vs. M. Krishna moorthy and Ors. (Civil Appeal No. 4473/2015), the issue was imposition of deposit of huge amount of money as condition for condonation of delay of 355 days. In the instant case there is no such cost/condition and the delay is of 872 days. 4.1.2 In view of the above it is seen that the judicial precedents are not related to facts of the instant case. Further, there was no situation beyond the control of the appellant which led to delay. Therefore, it is held that there was no sufficient reason before the appellant for not presenting the appeal within prescribed time limit. 5.0 Thus appeal is dismissed on account of delay. 6.0 Since, the appeal has been dismissed on account of delay; the merit of the case has not been discussed.”
5. The ld. AR of the assessee also filed an affidavit of the Chartered Accountant (CA) and the contention of the affidavit of the CA is reproduced here in below:
“I, Alok Modani, aged 43 years, son of Late Shri P.D Modani, residing at A- 503, Manglam Anchal, Kalwar Road, Jaipur, do hereby declare on oath as under:-
1. 1. That I am a Chartered Accountant, registered as a member of The Institute of Chartered Accountants of India, having Membership No. 402447.
2. That my Aadhar No. is 505305062344 and my PAN is AIZPM0888K.
Vishal Bansal 3. That the assessee, Shri Vishal Bansal, is my client, for whom I have been handling Accounting and Taxation issues. 4.
That order in the case of the assessee, Shri Vishal Bansal, in the penalty proceeding, under Section 271(1)(c) of the Income Tax Act, 1961 was passed on 23.03.2018.
That, subsequent, to receipt of the order by the assessee, the same was forwarded to me for further action to be taken in accordance with the relevant provisions of law.
6. That, however, subsequent to the order forwarded to me the same skipped my attention.
That inadvertently, out of oversight, the appeal, against the order passed by the ld. AO could not be filled by me, as it skipped my attention.
8. That, subsequently, when the assessee enquired, from me, about the status of his pending case, it came to my notice that filling of appeal in the said case had skipped in the present case.
That, thereafter, I immediately took steps to file the appeal before the Id. CIT(A).
That non filling of appeal in the case of the assessee was not willful on my part and was on account of inadvertent and bona fide mistake committed by me of having skipped noting the order received in my records.
That the contents of the condonation application filled by the assessee before Id. CIT(A) are true and correct.”
In addition the ld. AR of the assessee has also relied upon the following judicial decision to support the contentions so raised:- • Motilal Padampat Sugar Mills Co. Ltd. vs. State of Uttal Pradesh (1979) 118 ITR 326 (SC) • Collector, Land Acquisition vs. Mst. Katiji & Ors (1987) 167 ITR 0471 (SC) • M/s Hossana Ministries vs. ITO(E) TC(Appeal) No. 3 of 2017 (Madras H.C.) • Jayvantsinh N. Vaghela vs. ITO (2013) 40 Taxmann.com 491 (Gujarat H.C.)
Vishal Bansal • CIT vs. Sanmac Motor Finance Ltd. (2010) 322 ITR 309 (Mad. H.C.) • Prashanth Projects Ltd. vs. DCIT of 2014 dated 19.07.2016 (Mombay H.C.) • M/s Midas Ploymer Compounds Pvt. Ltd. ACIT in ITA No. 288/Coch/2017 dated 25.06.2018 • M/s Lahoti Overseas Ltd. vs. DCIT in ITA No. 3786/Mum/2012 dated 18.03.2016
7. On the other hand, the ld. DR representing the revenue heavily relied upon the finding of the ld. CIT(A) and submitted that the appeal of the assessee has rightly been dismissed and thereby relying on the decision of the ld. CIT(A) supported the orders ld. CIT(A) and that of the ld. AO.
We have heard both the parties, perused the material available on record and gone through the judicial decision relied upon by both the parties. The bench noted that the before the ld. CIT(A) the appeal of the assessee was delayed by 872 days and the ld. CIT(A) has not condoned the delay because the reasons cited by the assessee does not prove that the appeal of the assessee filed belated beyond the control of the assessee.
Therefore, he has considered that there was no sufficient reason before the assessee for not presenting the appeal within the Vishal Bansal prescribed time limit. Before us, the ld. AR of the assessee to support the contentions/reasons placed before the ld. CIT(A) also filed an affidavit dated 06.06.2023 duly signed by a Chartered Accountant strengthening the arguments raised before the ld. CIT(A). On the similar set of facts the Honourable Gujarat high court has recorded the following finding in the case of Jayvantsinh N. Vaghela vs. ITO (2013) 40 Taxmann.com 491 (Gujarat H.C.) where in the court has observed as under:
We have heard Shri Soparkar, learned advocate for the appellant and Shri Varun Patel, learned advocate for the respondent and perused the impugned common order passed by the learned Tribunal. Considering the affidavits filed by the assessee before the Tribunal which are even reproduced by the learned Tribunal, we are of the view that the learned Tribunal has committed error in not condoning the delay and not considering the appeals on merits. It is required to be noted that there is no observation by the learned Tribunal that there was any deliberate delay on the part of the assessee and / or there was any mala fide intention on the part of the assessee in not preferring the appeals within a period of limitation. The reasoning given by the learned Tribunal that the assessee has not filed the affidavit of Income Tax Practitioner in support of the affidavits filed by the assessee is concerned, it is required to be noted that once the Income Tax Practitioner is changed it may not be possible for the assessee to get affidavit of Income Tax Practitioner. On the aforesaid ground, the condonation of delay was not required to be refused. It is a cardinal principle of law that normally by and large, the appeals are required to be decided on merits rather than dismissing the same on technical ground like delay etc. unless it is found that there was gross negligence on the part of the assessee and / or there was any mala fide intention on the part of the assessee in not preferring the appeal within the period of limitation and / or in filing the appeals belatedly. As observed by the Hon'ble Supreme Court in the case of Collector, Land Acquisition, Anantnag v. Mst. Katiji [1987] 2 SCC 107 ordinarily a litigant does not stand to benefit by lodging an appeal late. It is further observed by the Hon'ble Supreme Court that 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.
Vishal Bansal Thus, considering the content of the affidavit of CA filed by the ld.
AR of the assessee we are of the view that the assessee has discharged the onus of proving that he has reasonable cause in not bringing the appeal before the ld. CIT(A) and thus, we condone the delay in filling appeal before the ld. CIT(A) by 872 days. Now as the order of the ld. CIT(A) is merely decided on the delay we direct the ld. CIT(A) to admit the appeal of the assessee and decide the appeal on its merits. Therefore, we set a side the matter to the file of ld. CIT(A) to decide the appeal of the assesses on merits. The assessee is also directed to co-operate with the ld. CIT(A) in deciding the appeal on merits and without sufficient reason, not to take further adjournments. Before parting, we may make It clear that our decision to restore the matter back to the file of the ld. CIT(A) shall in no way be construed as having an reflection or expression on merits of the dispute, which shall be adjudicated by the learned Commissioner of Income Tax, (Appeals) independently in accordance with the law.
Vishal Bansal In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open court on 26/06/2023