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Income Tax Appellate Tribunal, COCHIN BENCH, COCHIN
Before: Shri George George K.and Shri Laxmi Prasad Sahu
This is an appeal filed by the assessee against the order of the learned CIT(A), NFAC, Delhi dated 27.10.2021 for AY 2017-18 on the following grounds of appeal: - “1. The order dated 27-10-2021 passed by the Commissioner of Income Tax (Appeals), National Faceless Appeal Center, Delhi dismissing the appeal on the ground of delay is totally illegal and unjustified.
2. The CIT (Appeals) erred in rejecting the appeal on the ground of delay without considering the matter on merits. The CIT (Appeals) went wrong in not considering, in the right perspective, the reason explained by the appellant for the delay in filing the appeal.
3. The appellant had explained that the delay happened for the reason that the matter had to be discussed in the Board and instructions given to the Secretary and Secretary in turn had to contact the advocate who looks after the Income Tax matters of the 2 M/s. Muliar Service Co-Operative Bank Ltd.
appellant and that the advocate went abroad i.e., to USA for 25 days due to certain unavoidable personal commitments. Therefore, the preparation and filing of the appeal got delayed. The assessment order was received on 15-12-2019 and the appeal ought to have been filed on or before 14-1-2020. However, for the reasons stated above, the appeal could be flied only on 2/3/2020. Therefore there occurred a delay of 48 days in filing the appeal before the CIT(Appeals). The CIT (Appeals) ought to have held that the reasons stated by the appellant for the delay is valid and sufficient reason for condoning the delay happened in this case.
4. The CIT (Appeals) erred in holding that there is a delay of 2 month and 16 days in filing the appeal, in a case where the actual delay was only 48 days.
5. The CIT (Appeals) ought to have noted that the reason for delay in each case has to be considered independently. The CIT (Appeals) failed to note that the delay was only of few days and it was not a case of inordinate delay. The appellant had explained the reasons for the delay which is a valid, genuine and sufficient reason for condoning the delay. Therefore this was a case where the CIT (Appeals) should have taken a pragmatic and liberal approach. The CIT (Appeals) failed to understand the decisions referred to in the impugned order in the right perspective 6. The CIT (Appeals) ought to have noted that the appellant is a registered Co-op Society classified as Primary Agricultural Credit Co- op Society and is eligible for deduction under section 80 P of the Income Tax Act as held by the Apex Court in the case of Mavilayi Service Co-op Bank Ltd. Vs CIT reported in 431 ITR 1 (SC). As per the Judgment of the Apex court the deduction claimed by the appellant under the section 80 P of the act is to be allowed. The CIT (Appeal) ought to have considered the merits involved in this case and erroneously dismissed the appeal on the ground of delay. On account of the same, the eligible deduction of 80 P is denied to the appellant, which is highly illegal, arbitrary and unjustified.”
The brief facts of the case are that the assessee filed return of income on 07.03.2018 declaring total income at Rs. 13,99,970/- and claimed deduction under Section 80P of the Income Tax Act, 1961 (hereinafter "the Act") of Rs.12,41,456/- from the income from business. The return was processed under Section 143(1) of the Act and later on selected for scrutiny and statutory notices were issued to the assessee. The assessee had claimed deduction under Section 80P of the Act of 3 M/s. Muliar Service Co-Operative Bank Ltd.
Rs.12,41,456/- which was not allowed by the AO by holding that the principle business carried out by the assessee is in the transaction of banking business. Therefore, the assessee is treated as a Co-Operative Bank and Section 80P is not applicable to Co-Operative banks for claiming deduction under Section 80P of the Act as per amendments made in Section 2(24(viia) of the Act w.e.f. 01.04.2007. Aggrieved by the order of the AO assessee filed appeal before the CIT(A). The CIT(A) observed that the order passed under Section 143(3) of the Act on 15.12.2019 through ITBA portal and it was served on 15.12.2019. The appeal was instituted by the assessee on 02.03.2020 before the CIT(A). Therefore there was a delay of two months and 16 days and the delay was explained by the assessee as has been incorporated by the CIT(A) as per para 3 of his order. The CIT(A) did not accept the explanation given by the assessee and he dismissed the appal without going into the merits of the case.
The learned A.R. submitted that delay for condonation was explained before the CIT(A) that the responsible person, the Secretary, was out of India for 25 days and there are some formalities which are required to be completed for filing the appeal by the assessee society. Accordingly the filing of appeal before the CIT(A) got delayed. He further submitted that the delay in filing of the appeal was not deliberate but because of circumstances beyond the control of the society and requested that the delay may be condoned by the Tribunal and the matter may be send back to the CIT(A) for afresh adjudication on merits of the case.
The learned D.R. relied on the orders of the lower authorities. She submitted that the lower authorities have rightly decided the case and she also submitted that the delay was not properly explained, therefore, the order of the lower authorities should be restored.
From a perusal of the order of the CIT(A) it has been observed that there was a delay of 48 days in filing the appeal before the CIT(A) which has not been condoned even the assessee has explained the reasons for 4 M/s. Muliar Service Co-Operative Bank Ltd.
the delay in filing the appeal before the CIT(A). The assessee has duly explained the delay which was beyond the control of the assessee and the delay was not intentional. Therefore we condone the delay in filing the appeal following the decision in the case of Collector Land Acquisition, ... vs Mst. Katiji&Ors on 19 February, 1987, 1987 AIR 1353. Since the CIT(A) has not adjudicated the issue on merits, we think it fit to send back the matter to the file of the CIT(A) for afresh adjudication and the assessee is directed to appear before the CIT(A). The assessee is further directed not to seek unnecessary adjournments for early disposal of the appeal. Needless to say that the assessee should be provided reasonable opportunity to produce documents/evidence to substantiate his case.
In the result, the appeal filed by the assessee is allowed for statistical purposes.
Dictated and pronounced in the open Court on 30th June, 2022.