Tamilnadu Cements Corporation Ltd., CHENNAI V. Addl. CIT, CHENNAI

ITA 1432/CHNY/2015

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 95914 (ITAT-CHENNAI)
• Duration Of Justice: 2 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-08-2015
• Appeal Filed By: Assessee
• Bench Allotted: A
• Assessment Year: 2007-2008
• Appeal Filed On: 12-06-2015
• Court: TRIBUNAL
• Department Lawyers: JAYANTHI KRISHNAN
• Assessee Lawyers: SANDEEP BAGMAR R
• Keywords: Principle of natural justice; Period of limitation; Reasonable cause; Condonation of delay

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH : CHENNAI . . . , ! , ' #$ % [ BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER ] ./ I.T.A.NO.1432/MDS/2015 / ASSESSMENT YEAR : 2007-08 M/S TAMILNADU CEMENTS CORPORATION LTD LLA BUILDING 735, ANNA SALAI CHENNAI 600 002 VS. THE ADDL. COMMISSIONER OF INCOME-TAX COMPANY RANGE-III CHENNAI [PAN AABCT 1819 J] ( &' / APPELLANT) ( ()&' /RESPONDENT) / APPELLANT BY : SHRI SANDEEP BAGMAR R., ADVOCATE /RESPONDENT BY : S MT. JAYANTHI KRISHNAN, CIT / DATE OF HEARING : 05 - 08 - 2015 / DATE OF PRONOUNCEMENT : 21 - 0 8 - 2015 / 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)-11, CHENN AI, DATED 6.3.2015 AND PERTAINS TO ASSESSMENT YEAR 2007-08. 2. SHRI SANDEEP BAGMAR, LD. COUNSEL FOR THE ASSESSEE S UBMITTED THAT THERE WAS A DELAY OF 45 DAYS IN FILING THE APP EAL BEFORE THE CIT(A). THE ASSESSEE FILED AN APPLICATION BEFORE THE CIT(A) TO ITA NO.1432/15 :- 2 -: CONDONE THE DELAY OF 45 DAYS. REFERRING TO THE APP LICATION FILED BY THE ASSESSEE BEFORE THE CIT(A), THE LD. COUNSEL SUBMITT ED THAT THE IMPUGNED ORDER OF THE ASSESSING OFFICER WAS RECEIVE D BY THE ASSESSEE ON 23.12.2009. THE ASSESSEE OBTAINED PROFESSIONAL ADVICE. THE ASSESSEE WAS ADVISED TO FILE APPEAL BEFORE THE CIT( A) SINCE THE ASSESSING OFFICERS ORDER IS NOT ONLY ERRONEOUS BUT ALSO VIOLATIVE OF PRINCIPLES OF NATURAL JUSTICE. ACCORDINGLY, THE A SSESSEE INITIATED THE PROCESS TO FILE APPEAL BY OBTAINING VARIOUS INTERNA L APPROVAL PRIOR TO HANDING OVER THE PAPER TO THE COUNSEL FOR PREPARATI ON OF THE APPEAL. UNFORTUNATELY, ACCORDING TO THE LD. COUNSEL, THE PA PERS GOT MIXED UP WITH SOME OTHER FILE AND COULD NOT BE TRACED OUT IN SPITE OF BEST EFFORTS BY THE OFFICIALS OF ASSESSEE. AFTER PROLONGED EF FORTS, THE PAPERS COULD BE TRACED ON 25.2.2010 AND IT WAS FILED IMMEDIATELY WITHOUT ANY FURTHER DELAY. ACCORDING TO THE LD. COUNSEL, THE ASSESSEE, BEING A STATE GOVERNMENT CORPORATION, THE DELAY OF 45 DAYS IN FILING THE APPEAL BEFORE THE CIT(A) MAY BE CONDONED. 3. ON THE CONTRARY, SMT. JAYANTHI KRISHNAN, LD. DEPART MENTAL REPRESENTATIVE SUBMITTED THAT THERE WAS AN INORDINA TE DELAY OF 45 DAYS IN FILING THE APPEAL BEFORE THE CIT(A). ACCOR DING TO THE LD. DR, EACH AND EVERY DAY OF DELAY HAS TO BE EXPLAINED WIT H SUFFICIENT REASONS. THE CIT(A), BY FOLLOWING THE JUDGMENT OF THE APEX COURT IN J.B ADVANI AND COMPANY VS CIT, 72 ITR 395, AND THAT OF BOMBAY HIGH ITA NO.1432/15 :- 3 -: COURT IN THE CASE OF RAJU RAMACHANDRA BHANGDE VS CI T, 148 ITR 391, HAS RIGHTLY REJECTED THE CLAIM OF THE ASSESSEE FOR CONDONATION OF DELAY OF 45 DAYS. SINCE THERE WAS NO REASONABLE CAUSE FO R THE DELAY IN FILING THE APPEAL, ACCORDING TO THE LD. DR, NO INTERFERENC E IS CALLED FOR IN THE ORDER OF THE CIT(A). 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITHER SIDE AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. ADMI TTEDLY, THE ASSESSEE, A STATE GOVERNMENT CORPORATION, RECEIVED THE IMPUGNED ORDER OF THE ASSESSING OFFICER ON 23.12.2009. IT I S ALSO AN ADMITTED FACT THAT THE ASSESSEE, BEING A STATE GOVERNMENT C ORPORATION, HAS TO OBTAIN VARIOUS INTERNAL APPROVALS FOR FILING THE AP PEAL BEFORE THE CIT(A) BEFORE HANDING OVER THE PAPERS TO THE COUNSEL FOR P REPARATION OF APPEAL PAPERS. THE ASSESSEE CLAIMED BEFORE THE CI T(A) THAT THE PAPERS GOT MIXED UP IN THE PROCESS OF OBTAINING INT ERNAL APPROVALS. THIS CLAIM OF THE ASSESSEE IS NOT DISPUTED BY THE REVENUE. THE CIT(A), BY FOLLOWING THE JUDGMENT OF APEX COURT IN J.B. ADVANI AND COMPANY(SUPRA) AND THE JUDGMENT OF BOMBAY HIGH COUR T IN RAJU RAMACHANDRA BHANGDE(SUPRA), FOUND THAT EACH AND EVE RY DAY OF DELAY HAS TO BE EXPLAINED AND DELAY ON ACCOUNT OF AN ERRO R BY AN ADVOCATE CANNOT BE TREATED AS SUFFICIENT CAUSE TO CONDONE TH E DELAY. THIS TRIBUNAL FOUND THAT THE APEX COURT IN COLLECTOR, L AND ACQUISITION VS MST. KATIJI, 167 ITR 471, HAS CONSIDERED AN IDENTIC AL ISSUE AND FOUND ITA NO.1432/15 :- 4 -: THAT EACH AND EVERY DAY NEED NOT BE EXPLAINED. IF EACH AND EVERY DAY NEEDS TO BE EXPLAINED, WHY NOT EVERY HOUR AND EVERY SECOND. THEREFORE, WHAT HAS TO BE SEEN IS A REASONABLE CAUS E FOR NOT FILING THE APPEAL. WE FIND THAT THE MADRAS HIGH COURT IN N. S ENGODA GOUNDER VS R. MANICKAM IN CRP NPD NO.3746 OF 2009 EXAMINED THI S ISSUE AND AFTER REFERRING TO THE JUDGMENT OF THE APEX COURT I N N. BALAKRISHNAN VS M. KRISHNAMURTHY 1998(7) SCC 123, FOUND THAT CONDON ATION OF DELAY IS A MATTER OF DISCRETION OF THE COURT. LENGTH OF DEL AY IS NO MATTER, ACCEPTABILITY OF EXPLANATION IS THE ONLY CRITERIA. THE APEX COURT FURTHER FOUND THAT THE PRIMARY FUNCTION OF THE COURT IS TO ADJUDICATE THE DISPUTE BETWEEN THE PARTIES AND TO ADVANCE SUBSTANT IAL JUSTICE. THE TIME LIMIT FIXED FOR APPROACHING THE COURT IN DIFFE RENT SITUATIONS IS NOT BECAUSE OF THE EXPIRY OF SUCH TIME, A BAD CAUSE WOU LD TRANSFORM INTO A GOOD CAUSE. IN FACT, THE APEX COURT HAS OBSERVED A S FOLLOWS: 9. IT IS AXIOMATIC THAT CONDONATION OF DELAY IS A M ATTER OF DISCRETION OF THE COURT. SECTION 5 OF THE LIMITATION ACT DOES NOT SAY THAT SUCH DISCRETION CAN BE EXERCISED ONLY IF TH E DELAY IS WITHIN A CERTAIN LIMIT. LENGTH OF DELAY IS NO MATTER, ACCE PTABILITY OF THE EXPLANATION IS THE ONLY CRITERION. SOMETIMES DELAY O F THE SHORTEST RANGE MAY BE UNCONDONABLE DUE TO A WANT OF ACCEPTAB LE EXPLANATION WHEREAS IN CERTAIN OTHER CASES, DELAY OF A VERY LON G RANGE CAN BE CONDONED AS THE EXPLANATION THEREOF IS SATISFACTORY. ONCE THE COURT ACCEPTS THE EXPLANATION AS SUFFICIENT, IT IS T HE RESULT OF POSITIVE EXERCISE OF DISCRETION AND NORMALLY THE SUP ERIOR COURT SHOULD NOT DISTURB SUCH FINDING, MUCH LESS IN REVIS IONAL JURISDICTION, UNLESS THE EXERCISE OF DISCRETION WAS ON WHOLLY UNTE NABLE GROUNDS OR ARBITRARY OR PERVERSE. BUT IT IS A DIFFERENT MATT ER WHEN THE FIRST COURT TO CONSIDER THE CAUSE SHOWN FOR THE DEL AY AFRESH AND IT ITA NO.1432/15 :- 5 -: IS OPEN TO SUCH SUPERIOR COURT TO CONDONE TO COME T O ITS OWN FINDING EVEN UNTRAMMELLED BY THE CONCLUSION OF THE LOWER COURT. 1O. THE REASON FOR SUCH A DIFFERENT STANCE IS THUS : THE PRIMARY FUNCTION OF A COURT IS TO ADJUDICATE TH E DISPUTE BETWEEN THE PARTIES AND TO ADVANCE SUBSTANTIAL JUST ICE. THE TIME- LIMIT FIXED FOR APPROACHING THE COURT IN DIFFERENT S ITUATIONS IS NOT BECAUSE ON THE EXPIRY OF SUCH TIME A BAD CAUSE WOULD TRANSFORM INTO A GOOD CAUSE. 11. RULES OF LIMITATION ARE NOT MEANT TO DESTROY TH E RIGHTS OF PARTIES. THEY ARE MEANT TO SEE THAT PARTIES DO NOT RESORT TO DILATORY TACTICS, BUT SEEK THEIR REMEDY PROMPTLY. T HE OBJECT OF PROVIDING A LEGAL REMEDY IS TO REPAIR THE DAMAGE C AUSED BY REASON OF LEGAL INJURY. THE LAW OF LIMITATION FIXES A LIFE SPAN FOR SUCH LEGAL REMEDY FOR THE REDRESS OF THE LEGAL INJURY SO SUFFE RED. TIME IS PRECIOUS AND WASTED TIME WOULD NEVER REVISIT. DURIN G THE EFFLUX OF TIME, NEWER CAUSES WOULD SPROUT UP NECESSITATING NE WER PERSONS TO SEEK LEGAL REMEDY BY APPROACHING THE COURTS. SO A L IFE SPAN MUST BE FIXED FOR EACH REMEDY. UNENDING PERIOD FOR LAUNCH ING THE REMEDY MAY LEAD TO UNENDING UNCERTAINTY AND CONSEQU ENTIAL ANARCHY. THE LAW OF LIMITATION IS THUS FOUNDED ON P UBLIC POLICY. IT IS ENSHRINED IN THE MAXIM INTEREST REIPUBLICAE UP SI T FINIS LITIUM (IT IS FOR THE GENERAL WELFARE THAT A PERIOD BY PUT TO LITIGATION). RULES OF LIMITATION ARE NOT MEANT TO DESTROY THE RIGHTS O F THE PARTIES. THEY ARE MEANT TO SEE THAT PARTIES DO NOT RESORT TO DILATORY TACTICS BUT SEEK THEIR REMEDY PROMPTLY. THE IDEA IS THAT EVERY LEGAL REMEDY MUST BE KEPT ALIVE FOR A LEGISLATIVELY FIXED PERIOD OF TIME. 12. A COURT KNOWS THAT REFUSAL TO CONDONE DELAY WOUL D RESULT IN FORECLOSING A SUITOR FROM PUTTING FORTH HIS CAUSE. THERE IS NO PRESUMPTION THAT DELAY IN APPROACHING THE COURT IS ALWAYS DELIBERATE. THIS COURT HAS HELD THAT THE WORDS 'SUF FICIENT CAUSE' UNDER SECTION 5 OF THE LIMITATION ACT SHOULD RECEIVE A LIBERAL CONSTRUCTION SO AS TO ADVANCE SUBSTANTIAL JUSTICE V IDE SHAKUNTHALA DEVI JAIN V.KUNTAL KUMARI AND STATE OF WEST BENGAL . ADMINISTRATOR, HOWRAH MUNICIPALITY. ITA NO.1432/15 :- 6 -: 5. THE MADRAS HIGH COURT HAD AN OCCASION TO CONSIDER A N IDENTICAL ISSUE IN RIYA TRAVELS & TOURS INDIA PVT. LTD VS CUSTOMS, EXCISE AND SERVICE TAX APPELALTE TRIBUNAL IN CMA NO .2679 OF 2014. IN THE CASE BEFORE THE MADRAS HIGH COURT, THERE WAS A DELAY OF 69 DAYS IN FILING THE APPEAL. AFTER DISTINGUISHING THE JUD GMENT OF THE ANDHRA PRADESH HIGH COURT IN SRI BHAVANI CASTINGS LTD VS COMMISSIONER OF CENTRAL EXCISE, VISAKHAPATNAM, 2012 9275) ELT 321, THE MADRAS HIGH COURT FOUND THAT THE ASSESSEE HAS MISPLACED THE RE LEVANT PAPERS WHILE SHIFTING THE BRANCH OFFICE. THE HIGH COURT F URTHER FOUND THAT THE CONDUCT OF THE ASSESSEE DOES NOT INDICATE INACTION OR NEGLIGENCE IN PURSUING THE MATTER. THE DELAY IS ONLY 69 DAYS WHI CH IS MARGINAL AS OBSERVED BY THE MADRAS HIGH COURT, THEREFORE, THERE WAS A SUFFICIENT CAUSE FOR CONDONATION OF DELAY. ACCORDINGLY, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE CIT(A) OUGHT TO HAVE CO NDONED THE DELAY OF 45 DAYS IN FILING THE APPEAL. IN VIEW OF THE AB OVE DISCUSSION, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THAT THE RE WAS A REASONABLE CAUSE IN NOT FILING THE APPEAL WITHIN THE PERIOD OF LIMITATION. ACCORDINGLY, THE DELAY OF 45 DAYS IN FILING THE APP EAL BEFORE THE CIT(A) IS HEREBY CONDONED. NOW THE APPEAL OF THE ASSESSE E STANDS RESTORED TO THE FILE OF THE CIT(A). THE CIT(A) SHALL DECIDE THE APPEAL ON MERIT AFTER GIVING A REASONABLE OPPORTUNITY TO THE ASSES SEE IN ACCORDANCE WITH LAW. ITA NO.1432/15 :- 7 -: 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOW ED. ORDER PRONOUNCED IN THE OPEN COURT ON 21 ST OF AUGUST, 2015, AT CHENNAI. SD/- SD/- ( ! ) (CHANDRA POOJARI) ' / ACCOUNTANT MEMBER ( . . . ! ) (N.R.S. GANESAN) / JUDICIAL MEMBER '# / CHENNAI $% / DATED: 21 ST AUGUST, 2015 RD %&'' ()'*) / COPY TO: ' 1 . / APPELLANT 4. ' + / CIT 2. / RESPONDENT 5. ),-' . / DR 3. ' +'/! / CIT(A) 6. -0'1 / GF