Puram Narsimhulu&Sons, Hyderabad V. ITO, Mahabubnagar Dist

ITA 1110/HYD/2010

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 9873 (ITAT-HYDERABAD)
• Duration Of Justice: 5 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-01-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 15-12-2010
• Assessment Year: 2001-2002
• Appeal Filed On: 19-08-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K E SUNIL BABU
• Assessee Lawyers: CHAITANYA KUMAR
• Keywords: Condonation of delay
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B , HYDERABAD BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI CHANDRA POOJARI ACCOUNTANT MEMBER ITA NO.1110/HYD/2010 ASSESSMENT YEAR 2001-02 SHRI PURAM NARSIMHULU & SONS, MAHABUBNAGAR. (PAN AADFP 2160 P) VS THE ITO, WARD-2, MAHABUBNAGAR (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI CHAITANYA KUMAR RESPONDENT BY : SHRI K.E. SUNIL BABU O R D E R PER CHANDRA POOJARI, ACCOUNTANT MEMBER: THIS APPEAL PREFERRED BY THE ASSESSEE IS DIRECTE D AGAINST THE ORDER PASSED BY THE CIT(A)-V, HYDERABAD DATED 17.06 .2010 AND PERTAINS TO THE ASSESSMENT YEAR 2001-02. 2. THE MAIN GRIEVANCE OF THE ASSESSEE IN ITS AP PEAL IS WITH REGARD TO NON CONDONING OF DELAY OF 18 DAYS IN FILING THE APPEAL BEFORE THE CIT(A). THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSES SEE DREW OUR ATTENTION TO THE LETTER OF CONDONATION FILED BEFORE THE CIT(A ) AND HE SUBMITTED THAT IN THE RELEVANT PERIOD OF TIME, WHEN THE ASSESSEE IS R EQUIRED TO FILE THE APPEAL WITH THE STATUTORY LIMITED PERIOD OF 60 DAYS FROM T HE DATE OF COMMUNICATION OF THE ORDER, THERE WERE DIFFERENCES AMONG THE PARTNERS WHICH ULTIMATELY RESULTED IN CLOSURE OF BUSINESS AN D BECAUSE OF THIS, THE ASSESSEE HAS FORGOTTEN TO FILE THE APPEAL IN TIME. THE ASSESSEE ALSO STATED THAT THE ASSESSMENT ORDER WAS COMPLETELY GONE OUT O F MIND BECAUSE OF THESE DISTURBANCES AND HE WAS ABLE TO FILE THE APPE AL ONLY ON 23.12.2004. THUS, THERE WAS DELAY OF 18 DAYS IN FILING THE APPE AL BEFORE THE CIT(A) AND PRAYED FOR CONDONING THE DELAY. ITA NO.1110 /HYD/2010 2 2 3. ON THE OTHER HAND, THE LEARNED DEPARTMENTAL R EPRESENTATIVE STRONGLY OPPOSED THE SUBMISSIONS MADE BY THE LEARNE D AR AND SUBMITTED THAT THE ASSESSEE IS A FIRM REPRESENTED BY ITS PART NERS AND FURTHER STATED THAT THE SCRIBBLE ON THE TOP PORTION OF THE ASSESS MENT ORDER WHEREIN MENTIONED THAT THE SAME WAS RECEIVED ON 30.11.2004 AND THAT ITSELF CANNOT BE CONSIDERED AS EVIDENCE. SINCE , IT IS NO T ON THE RECORD OF THE ASSESSING OFFICER. IT IS SELF SERVING EVIDENCE AND CANNOT BE ACTED UPON. HE RELIED ON THE ORDER OF THE CIT(A). 4. WE HAVE HEARD BOTH THE PARTIES AND PERUSED TH E MATERIALS AVAILABLE ON RECORD AND WE HAVE ALSO CAREFULLY GONE THROUGH MATERIALS. IN OUR OPINION, THE REASONS ADVANCED BY THE ASSESSEE B EFORE THE CIT(A) WHICH READS AS FOLLOWS : THE ASSESSEE FIRM FOR THE ASSESSMENT YEAR 2001-02 FILED THE RETURN OF INCOME ON 30.7.2001. THE ASSESSMENT WAS COMPLETED U/S 143(3) R.W.S. 147 ON 25.10.2004. AGGRIEVED WITH T HE ORDER OF THE ASSESSMENT THE ASSESSEE FILED APPEAL BEFORE THE CIT (A) HYDERABAD ON 23.12.2004. THE CIT(A) DISPOSED OF THE APPEAL VIDE ORDER DATED 11.3.2005. THE CIT(A) DISMISSED THE APPEAL IN LIMI NE ON THE GROUND THAT THE APPEAL IS FILED BELATEDLY AND NO PETITION REQUESTING FOR CONDONATION OF DELAY HAS BEEN FILED BY THE ASSESSEE . ACCORDING TO THE ASSESSEE THE ASSESSMENT ORDER WAS SERVED ON 5.11.20 04. HOWEVER, THE APPEAL WAS FILED ON 23.12.2004. THE CIT(A) STA TED THAT AS PER THE TORN ACKNOWLEDGEMENT PROVIDED BY THE ASSESSING OFFI CER, THE DATE OF SERVICE WAS 5.11.2004. IN THIS REGARD, THE ASSESSE E SUBMITTED THAT DURING THE RELEVANT PERIOD, THERE WERE DIFFERENCES AMONG THE PARTNERS WHICH ULTIMATELY LEAD TO THE CLOSURE OF BUSINESS. DURING NOV.2004, THE FIRM WAS ALSO VIRTUALLY ON THE VERGE OF CLOSURE AS ALL THE PARTNERS OF THE FIRM LEFT THE BUSINESS ACTIVITY. THEREFOR E, THE MANAGING PARTNER SRI JAIRAMULU WAS ALONE ATTENDING TO THE AF FAIRS OF THE FIRM. THE SERVICE OF THE ASSESSMENT ORDER WAS NOT IN HIS KNOWLEDGE. THE ASSESSMENT ORDER COME TO HIS NOTICE ONLY ON 30.1.20 04 AND THE SAME DATE WAS RECORDED ON THE FIRST PAGE OF THE ASSESSME NT ORDER. AS THE MANAGING PARTNER WAS ALONE ATTENDING TO VARIOUS WOR KS OF THE FIRM, HE COULD NOT CONSULT THE ADVOCATE REGARDING FILING OF APPEAL AGAINST THE ORDER OF THE ASSESSMENT IMMEDIATELY ON KNOWING ABOU T THE ORDER OF THE ASSESSMENT ON 30.11.2004. HE COULD CONSULT AN ADVOCATE AT HYDERABAD AND GET THE APPEAL PREPARED ON 23.12.2004 AND FILED BEFORE ITA NO.1110 /HYD/2010 3 3 THE CIT(A) ON THE SAME DAY. AS THE ASSESSEE WAS UN DER THE BONAFIDE IMPRESSION THAT THE APPEAL WAS PREFERRED WITH A PER IOD OF 30 DAYS FROM 30.11.2004 IT DID NOT FILE ANY PETITION SEEKIN G CONDONATION OF DELAY. THE ASSESSEE SUBMITTED AS THE SERVICE OF TH E ORDER HAS COME TO THE NOTICE OF THE MANAGING PARTNER OF THE FIRM ONLY ON 30.11.2004, THE ASSESSEE HAS MENTIONED SUCH A DATE IN FORM 35 F ILED BEFORE THE CIT(A). HOWEVER, THE ASSESSEE IS FILING THE PRESEN T PETITION SEEKING CONDONATION OF DELAY. THE ASSESSEE PRAYS THE CIT(A ) TO KINDLY CONSIDER THE ABOVE SUBMISSIONS, CONDONE THE DELAY A ND PASS APPROPRIATE ORDERS ON THE MERITS OF THE CASE. 5. THUS, THE CRUX OF THE ARGUMENTS OF THE ASSESSE ES COUNSEL IS THAT THE ORDER WAS MISPLACED AND THE SAME WAS FOUND ONLY ON 30.11.2004 AND AFTER THAT THE ASSESSEE FILED THE APPEAL BEFORE THE CIT(A) WHICH ULTIMATELY RESULTED IN 18 DAYS DELAY. 6. WE HAVE CAREFULLY GONE THROUGH THE REASONS ADV ANCED BY THE ASSESSEE. IN OUR OPINION, WHEN SUBSTANTIAL JUSTICE IS INVOLVED, TECHNICAL CONSIDERATION TO BE IGNORED. THE OTHER SIDE CANNOT CLAIM TO HAVE VESTED RIGHT FOR INJUSTICE BEING DONE BECAUSE OF NON DELIB ERATE DELAY. IT WAS HELD BY THE HONBLE SUPREME COURT IN THE CASE OF COLLE CTOR, LAND ACQUISITION VS. MST. KATIJI & OTHERS ( 167 ITR 471) (SC) AS UNDER: 1) ORDINARILY, A LITIGANT DOES NOT STAND TO BENEFI T BY LODGING AN APPEAL LATE. 2) REFUSING TO CONDONE DELAY CAN RESULT IN A MERITO RIOUS MATTER BEING THROWN AT THE VERY THRESHOLD AND CAUSE OF JUSTICE B EING DEFEATED. AS AGAINST THIS, WHEN DELAY IS CONDONED, THE HIGHEST T HAT CAN HAPPEN IS THAT A CAUSE WOULD BE DECIDED ON MERITS AFTER HEARI NG THE PARTIES. 3) EVERY DAYS DELAY MUST BE EXPLAINED DOES NOT ME AN THAT A PEDANTIC APPROACH SHOULD BE MADE. WHY NOT EVERY HO URS DELAY, EVERY SECONDS DELAY? THE DOCTRINE MUST BE APPLIED IN A RATIONAL, COMMON SENSE AND PRAGMATIC MANNER. 4) WHEN SUBSTANTIAL JUSTICE AND TECHNICAL CONSIDERA TION ARE PITTED AGAINST EACH OTHER, THE CAUSE OF SUBSTANTIAL JUSTIC E DESERVES TO BE PREFERRED, FOR THE OTHER SAID CANNOT CLAIM TO HAVE VESTED RIGHT IN INJUSTICE BEING DONE BECAUSE OF A NON DELIBERATE DE LAY. ITA NO.1110 /HYD/2010 4 4 5) THERE IS NO PRESUMPTION THAT DELAY IS OCCASIONED DELIBERATELY, OR AN 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. 6) IT MUST BE GRASPED THAT THE JUDICIARY IS RESPECT ED NOT ON ACCOUNT OF ITS POWER TO LEGALIZE INJUSTICE ON TECHNICAL GROUND S BUT BECAUSE IT IS CAPABLE OF REMOVING INJUSTICE AND IS EXPECTED TO DO SO. 7. FURTHER, IT IS NOT THE CASE OF THE REVENUE THAT THE APPEAL WAS NOT FILED DELIBERATELY. THEREFORE, WE HAVE TO PREFER S UBSTANTIAL JUSTICE RATHER THAN TECHNICALITY IN DECIDING THE ISSUE. AS OBSERV ED BY THE APEX COURT, IF THE APPLICATION OF THE ASSESSEE FOR CONDONING THE D ELAY IS REJECTED, IT WOULD AMOUNT TO LEGALIZE INJUSTICE ON TECHNICAL GROUND WH EN THE TRIBUNAL IS CAPABLE OF REMOVING INJUSTICE AND TO DO JUSTICE. T HEREFORE, THIS TRIBUNAL IS BOUND TO REMOVE THE INJUSTICE BY CONDONING THE DELA Y ON TECHNICALITIES. IN VIEW OF THE ABOVE DISCUSSION, IN OUR OPINION, TH E DELAY OF 18 DAYS IS REQUIRED TO BE CONDONED AS SUCH, WE CONDONE THE DEL AY OF 18 DAYS AND DIRECT THE CIT(A) TO DECIDE THE ISSUE ON MERIT. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IN IT A NO.1110/HYD/2010 STANDS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT 31. 1.2011 SD/- SD/- N.R.S. GANESAN CHANDRA POOJARI JUDICIAL MEMBER ACCOUNTANT MEMBER DATED THE 31.1.2011 COPY FORWARDED TO: 1. SHRI S. RAMA RAO, ADVOCATE, FLAT NO.102, SHRIYA S ELEGANCE, DOOR NO.3-6-643, ST.NO.9, HIMAYAT NAGAR, HYDERABAD 2. THE ITO WARD 2, MEHABUBNAGAR. 3. CIT(A)-V, HYDERABAD. 4. CIT, HYDERABAD 5. THE D.R., ITAT, HYDERABAD. NP