Ravi Prabhakar, CHENNAI V. ITO Non Corporate Ward 15(3), CHENNAI

ITA 1153/CHNY/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 9436 (ITAT-CHENNAI)
• Duration Of Justice: 8 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-01-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2013-2014
• Appeal Filed On: 22-04-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: N DEVANATHAN
• Keywords: Period of limitation; Right to appeal; Set aside
• Section: 246A

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, CHENNAI . . . , . !, # !$ BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI S. JAYARAMAN, ACCOUNTANT MEMBER ./ ITA NO.1153/CHNY/2019 & '& / ASSESSMENT YEAR : 2013-14 SHRI RAVI PRABHAKAR, NO.40/72, ANAND FLATS, B-9, 3 RD FLOOR, GANDHI NAGAR, 2 ND MAIN ROAD, ADYAR, CHENNAI - 600 020. PAN : AAAPP 7643 L V. THE INCOME TAX OFFICER, NON CORPORATE WARD - 15(3), CHENNAI - 600 034. ()*/ APPELLANT) (+,)*/ RESPONDENT) )* - . / APPELLANT BY : SH. N. DEVANATHAN, ADVOCATE +,)* - . / RESPONDENT BY : SHRI AR.V. SREENIVASAN, JCIT / - 0# / DATE OF HEARING : 25.11.2019 12' - 0# / DATE OF PRONOUNCEMENT : 02.01.2020 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER : THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) -15, CHENNAI, DATED 27.12.2018 AND PERTAINS TO ASSESSMENT YEAR 2013-14. 2. THERE WAS A DELAY OF 52 DAYS IN FILING THIS APPE AL BY THE ASSESSEE BEFORE THIS TRIBUNAL. THE ASSESSEE HAS FILED A PET ITION FOR CONDONATION OF DELAY. WE HAVE HEARD THE LD. COUNSEL FOR THE ASSES SEE AND THE LD. D.R. 2 I.T.A. NO.1153/CHNY/19 WE FIND THAT THERE WAS SUFFICIENT CAUSE FOR NOT FIL ING THE APPEAL BEFORE THE STIPULATED TIME. THEREFORE, WE CONDONE THE DELAY A ND ADMIT THE APPEAL. 3. SH. N. DEVANATHAN, THE LD.COUNSEL FOR THE ASSESS EE, SUBMITTED THAT THE ASSESSEE FILED THE APPEAL AGAINST THE ORDE R OF THE ASSESSMENT BEFORE THE CIT(APPEALS) ON 29.04.2016 MANUALLY WITH IN THE PERIOD OF LIMITATION. THE CIT(APPEALS) ISSUED A SHOW CAUSE NO TICE ON 30.11.2018 POINTING OUT THAT THE ASSESSEE HAS NOT FILED THE AP PEAL ELECTRONICALLY. ACCORDING TO THE LD. COUNSEL, THE ASSESSEE FILED TH E APPEAL ELECTRONICALLY ON 25.07.2019. THE CIT(APPEALS), HOWEVER, FOUND TH AT THE FILING OF APPEAL ELECTRONICALLY IS MANDATORY, THEREFORE, HE D ISMISSED THE APPEAL. ACCORDING TO THE LD. COUNSEL, SINCE THE ASSESSEE HA S FILED THE APPEAL ELECTRONICALLY ON 25.07.2019, THE DELAY IN FILING T HE APPEAL BEFORE THE CIT(APPEALS) MAY BE CONDONED AND THE CIT(APPEALS) M AY DISPOSE OF THE APPEAL ON MERIT. 4. WE HEARD SHRI AR.V. SREENIVASAN, THE LD. DEPARTM ENTAL REPRESENTATIVE ALSO. ACCORDING TO THE LD. D.R., TH E ASSESSEE FILED THE APPEAL ELECTRONICALLY ONLY AFTER THE CIT(APPEALS) D ISPOSED OF THE APPEAL BY THE IMPUGNED ORDER ON 27.12.2018. THEREFORE, ON THE DATE OF PASSING OF IMPUGNED ORDER, THERE WAS NO VALID APPEAL PENDIN G BEFORE THE CIT(APPEALS). HENCE, ACCORDING TO THE LD. D.R., TH ERE IS NO QUESTION OF CONDONATION OF DELAY. REFERRING TO RULE 45 OF INCO ME-TAX RULES, 1962, 3 I.T.A. NO.1153/CHNY/19 THE LD. D.R. SUBMITTED THAT FILING OF APPEAL ELECTR ONICALLY IS MANDATORY. THEREFORE, THE ASSESSEE IS EXPECTED TO FILE THE APP EAL ELECTRONICALLY WITHIN THE STIPULATED TIME OF 30 DAYS FROM THE DATE OF RECEIPT OF COPY OF ASSESSMENT ORDER. HENCE, ACCORDING TO THE LD. D.R. , THE CIT(APPEALS) HAS RIGHTLY DISMISSED THE APPEAL OF THE ASSESSEE. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. SECTION 249 OF THE INCOME-TAX ACT, 1961 (IN SHORT 'THE ACT') PROVIDES FORM OF APPEAL AND LIMITATION BEFORE THE CIT(APPEALS) AGAINST THE ORDE R OF ASSESSMENT. THE APPEAL SHALL BE FILED IN THE PRESCRIBED FORM BEFORE THE CIT(APPEALS) AND SHALL BE VERIFIED IN THE PRESCRIBED MANNER. THE FO RM WAS IN FACT PRESCRIBED IN FORM 35 FOR FILING APPEAL BEFORE THE CIT(APPEALS). RULE 45 OF INCOME-TAX RULES, 1962 PROVIDES THE MANNER IN WH ICH THE APPEAL IN FORM 35 SHALL BE FILED. RULE 45 MANDATES THAT IN C ASE OF AN ASSESSEE, WHO IS REQUIRED TO FURNISH RETURN OF INCOME ELECTRO NICALLY UNDER RULE 12(3) OF INCOME-TAX RULES, 1962, SHALL FURNISH THE APPEAL ELECTRONICALLY UNDER DIGITAL SIGNATURE. IN CASE OF AN ASSESSEE, WHOSE RETURN IS FILED MANUALLY, HE HAS AN OPTION TO FILE THE APPEAL EITHER MANUALLY / IN PAPER FORM OR ELECTRONICALLY. THEREFORE, THE PROCEDURE PRESCRIBE D UNDER RULE 45 MANDATES THE ASSESSEE TO FILE APPEAL IN FORM 35 ELE CTRONICALLY. IN THIS CASE, THE ASSESSEE ADMITTEDLY FILED THE APPEAL MANU ALLY / IN PAPER FORM. 4 I.T.A. NO.1153/CHNY/19 THEREFORE, THE QUESTION ARISES FOR CONSIDERATION IS WHEN THE ASSESSEE HAS FILED APPEAL MANUALLY / IN PAPER FORM, CAN WE S AY THAT THERE WAS NO VALID APPEAL BEFORE THE CIT(APPEALS)? TECHNICALLY SPEAKING, THE ASSESSEE HAS TO FILE THE APPEAL AS PER THE PROCEDUR E PRESCRIBED IN RULE 45. SECTION 246A OF THE ACT PROVIDES AN APPEAL BEF ORE THE CIT(APPEALS) AGAINST ASSESSMENT ORDER. THIS RIGHT OF APPEAL PRO VIDED UNDER SECTION 246A OF THE ACT IS A SUBSTANTIVE RIGHT UNDER THE SC HEME OF THE INCOME-TAX ACT. 6. THE ASSESSEE ADMITTEDLY FILED THE APPEAL MANUALL Y / IN PAPER FORM WITHIN THE PERIOD OF LIMITATION BEFORE THE CIT(APPE ALS) UNDER SECTION 246A OF THE ACT. NOW THE REVENUE CLAIMS THAT RULE 45 OF INCOME-TAX RULES, 1962 PROVIDES FOR FILING APPEAL ELECTRONICAL LY IN FORM 35, THEREFORE, THE APPEAL FILED IN FORM 35 MANUALLY / IN PAPER FOR M IS NOT MAINTAINABLE. THIS CONTENTION OF THE REVENUE TAKES US TO A QUESTI ON WHEN THERE IS A CONFLICT BETWEEN SUBSTANTIVE JUSTICE AND TECHNICALI TY, WHETHER TECHNICALITY IS TO BE PREFERRED OR SUBSTANTIVE JUSTICE? THIS WA S EXAMINED BY THE APEX COURT IN COLLECTOR, LAND ACQUISITION V. MST. KATIJI AND OTHERS (1987) 167 ITR 471. THE APEX COURT FOUND THAT WHEN SUBSTANTIA L JUSTICE AND TECHNICAL CONSIDERATIONS ARE PITTED AGAINST EACH OT HER, THE CAUSE OF SUBSTANTIAL JUSTICE DESERVES TO BE PREFERRED RATHER THAN TECHNICALITY. IN FACT, THE APEX COURT HAS OBSERVED AS FOLLOWS:- 5 I.T.A. NO.1153/CHNY/19 AND SUCH A LIBERAL APPROACH IS ADOPTED ON PRINCIPL E AS IT IS REALIZED THAT : 1. ORDINARILY, A LITIGANT DOES NOT STAND TO BENEFIT BY LODGING AN APPEAL LATE. 2. REFUSING TO CONDONE DELAY CAN RESULT IN A MERITOR IOUS MATTER BEING THROWN OUT AT THE VERY THRESHOLD AND C AUSE OF JUSTICE BEING DEFEATED. AS AGAINST THIS, WHEN DELAY IS CONDONED, THE HIGHEST THAT CAN HAPPEN IS THAT A CAU SE WOULD BE DECIDED ON MERITS AFTER HEARING THE PARTIES. 3. ' EVERY DAY'S DELAY MUST BE EXPLAINED ' DOES NOT MEAN THAT A PEDANTIC APPROACH SHOULD BE MADE. WHY NOT EV ERY HOUR'S DELAY, EVERY SECOND'S DELAY? THE DOCTRINE MU ST BE APPLIED IN A RATIONAL, COMMON SENSE AND PRAGMATIC M ANNER. 4. WHEN SUBSTANTIAL JUSTICE AND TECHNICAL CONSIDERAT IONS ARE PITTED AGAINST EACH OTHER, THE CAUSE OF SUBSTANTIAL JUSTICE DESERVES TO BE PREFERRED, FOR THE OTHER SIDE CANNOT CLAIM TO HAVE VESTED RIGHT IN INJUSTICE BEING DONE BECAUSE O F A NON- DELIBERATE DELAY. 5. THERE IS NO PRESUMPTION THAT DELAY IS OCCASIONED DELIBERATELY, OR ON 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 R ISK. 6. IT MUST BE GRASPED THAT THE JUDICIARY IS RESPECTE D NOT ON ACCOUNT OF ITS POWER TO LEGALIZE INJUSTICE ON TECHN ICAL GROUNDS BUT BECAUSE IT IS CAPABLE OF REMOVING INJUS TICE AND IS EXPECTED TO DO SO. 7. MOREOVER, UNDER ARTICLE 265 OF CONSTITUTION OF I NDIA, NO TAX SHALL BE LEVIED EXCEPT BY AUTHORITY OF LAW. THEREFORE, W HEN THE ASSESSEE HAS A SUBSTANTIAL RIGHT OF APPEAL UNDER SECTION 246A OF THE ACT, SUCH A RIGHT CANNOT BE TAKEN AWAY SO LIGHTLY MERELY BECAUSE THER E WAS A VIOLATION OF 6 I.T.A. NO.1153/CHNY/19 PROCEDURAL ASPECT IN THE FORM OF FILING APPEAL. SO FAR, THE ASSESSEE WAS PERMITTED TO FILE APPEAL IN MANUAL / PAPER FORM. N OW THE DEPARTMENT SWITCHED OVER TO ELECTRONICAL FORMAT FOR FILING THE APPEAL. THIS IS THE TRANSITION STAGE. THEREFORE, THERE MAY BE A MISUND ERSTANDING IN FILING THE APPEAL WHETHER THE APPEAL HAS TO BE FILED ELECTRONI CALLY OR MANUALLY. THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT WHATEVER MAY BE THE REASON FOR FILING APPEAL MANUALLY, NOW THE ASSESSEE FILED THE APPEAL ELECTRONICALLY ON 25.07.2019. THEREFORE, EVEN THE PROCEDURE OF FI LING OF APPEAL ELECTRONICALLY HAS BEEN COMPLIED WITH BY THE ASSESS EE. THEREFORE, THROWING THE ASSESSEE OUT OF COURT BY SAYING THAT T HE APPEAL WAS NOT FILED ELECTRONICALLY MAY NOT BE JUSTIFIED AT ALL. 8. THE ASSESSMENT PROCEEDING BEFORE THE ASSESSING O FFICER AND THE CIT(APPEALS) IS A JUDICIAL PROCEEDING AS PROVIDED U NDER SECTION 136 OF THE ACT. MOREOVER, THE VERY OBJECT OF PROCEEDING B EFORE THE INCOME-TAX AUTHORITIES IS TO COMPUTE THE TAXABLE INCOME, LEVY TAX THEREON AS PER THE LAW AND COLLECT THE SAME AS PER THE PROCEDURE PRESC RIBED FOR COLLECTION OF TAX. THEREFORE, MERELY ON TECHNICALITIES, THE GOVE RNMENT CANNOT RETAIN A SINGLE PIE OF TAXPAYER WHICH IS NOT AUTHORIZED BY L AW. IN THIS CASE, AN EFFECTIVE APPEAL REMEDY IS PROVIDED UNDER SECTION 2 46A OF THE ACT, THEREFORE, MERELY BECAUSE THERE WAS A TECHNICAL FLA W OR VIOLATION OF NOT FILING THE APPEAL INITIALLY BY ELECTRONICALLY WHICH WAS ADMITTEDLY COMPLIED 7 I.T.A. NO.1153/CHNY/19 BY THE ASSESSEE SUBSEQUENTLY ON 25.07.2019, THIS TR IBUNAL IS OF THE CONSIDERED OPINION THAT THE APPEAL OF THE ASSESSEE CANNOT BE THROWN AWAY. AT THE BEST, WE MAY SAY THAT THERE IS A DELA Y IN FILING THE APPEAL ELECTRONICALLY AS PROVIDED UNDER RULE 45. 9. BY KEEPING THE LAW LAID DOWN BY APEX COURT IN CO LLECTOR, LAND ACQUISITION (SUPRA), PROVISIONS OF THE CONSTITUTION FOR LEVY AND COLLECTION OF TAXES AND THE TRANSITION PERIOD THE TAXPAYERS AN D THE DEPARTMENT ARE PASSING THROUGH, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE DELAY IN FILING THE APPEAL ELECTRONICALLY HAS TO BE CONDO NED. ACCORDINGLY, THE DELAY IN FILING THE APPEAL ELECTRONICALLY IS CONDON ED AND THE IMPUGNED ORDER OF THE CIT(APPEALS) IS SET ASIDE AND THE ENTI RE ISSUE RAISED BY THE ASSESSEE IS REMITTED BACK TO THE FILE OF THE CIT(AP PEALS) FOR CONSIDERATION ON MERIT. 10. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE COURT ON 2 ND JANUARY, 2020 AT CHENNAI. SD/- SD/- (. !) ( . . . ) (S. JAYARAMAN) (N.R.S. GANESAN) # / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 4 /DATED, THE 2 ND JANUARY, 2020. KRI. 8 I.T.A. NO.1153/CHNY/19 - +056 76'0 /COPY TO: 1. )*/ APPELLANT 2. +,)*/ RESPONDENT 3. / 80 () /CIT(A)-15, CHENNAI 4. PRINCIPAL CIT-6, CHENNAI 5. 69 +0 /DR 6. :& ; /GF.