ACIT, New Delhi V. Sh. D.K. Jain, New Delhi

ITA 1485/DEL/2012

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 3625 (ITAT-DELHI)
• Duration Of Justice: 5 year(s) 7 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-11-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 19-06-2017
• Assessment Year: 2007-2008
• Appeal Filed On: 29-03-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANIL KR SHARMA
• Keywords: Period of limitation; Reasonable cause; Condonation of delay

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH B, NEW DELHI BEFORE SH. BHAVNESH SAINI, JUDICIAL MEMBER AND SH. L. P. SAHU, ACCOUNTANT MEMBER ITA NO. 1485/DEL/2012 (ASSESSMENT YEAR: 2007-08) DEPARTMENT BY : SH. ANIL KR. SHARMA, SR. DR ASSESSEE BY : SH. GAUTAM JAIN SH. PIYUSH KAMAL SH. LALIT MOHAN SINGH, ADVS. DATE OF HEARING : 15.11.2017 DATE OF PRONOUNCEMENT : 17.11.2017 O R D E R PER BHAVNESH SAINI, J.M : 1. THIS APPEAL BY REVENUE HAS BEEN DIRECTED AGAINST T HE ORDER OF LD. CIT(A)XXVI, NEW DELHI, DATED 18.06.2010 FOR AS SESSMENT YEAR 2007-08. 2. ACCORDING TO COLUMN NO. 9 OF FORM NO. 36, DATED 21 .07.2010 HAS BEEN MENTIONED AS DATE OF COMMUNICATION OF ORDE R APPEALED AGAINST; HOWEVER, THE DEPARTMENTAL APPEAL HAS BEEN FILED IN THE OFFICE OF THE TRIBUNAL ON 29.03.2012. THE OFFICE IS SUED DEFECT NOTICE TO THE REVENUE INTIMATING THAT DEPARTMENTAL APPEAL IS TIME BARRED BY 557 DAYS. 3. THE REVENUE DEPARTMENT FILED AFFIDAVIT OF NEHA YAD AV, ACIT, CIRCLE-15(1), NEW DELHI, DATED 09.11.2016 IN WHICH IT IS EXPLAINED A CIT CIRCLE 32(1) NEW DELHI VS. D. K. JAIN D-19, NAZAMUDDIN EAST, NEW DELHI GIR/PAN: AAKPJ4559P (APPELLANT) (RESPONDENT) 2 ITA NO. 1485/DEL/2012 THAT THE IMPUGNED ORDER WAS RECEIVED IN THE OFFICE OF LD. CIT-XI ON 21.07.2010. THE AUTHORIZATION TO FILE APPEAL BEFORE THE TRIBUNAL WAS ISSUED BY LD. CIT-XI, NEW DELHI, VIDE ORDER DAT ED 08.09.2010 AND THE LIMITATION FOR FILING APPEAL BEFORE THE TRI BUNAL WAS TO EXPIRE ON 20.09.2010. HOWEVER, THE APPEAL BEFORE TH E TRIBUNAL COULD BE FILED ONLY ON 29.03.2012. IT IS FURTHER SU BMITTED THAT THE THEN AO WAS ALSO AS NODAL OFFICER FOR JUDICIAL PURP OSES AND INADVERTENTLY BOTH THE COPIES OF THE AUTHORIZATION WERE PLACED IN THE FILE OF THE NODAL OFFICER. THUS, THE SAME HAD I NADVERTENTLY ESCAPE THE KNOWLEDGE OF JURISDICTIONAL OFFICER DUE TO PLACING OF THE AUTHORIZATION IN THE JUDICIAL FOLDER OF THE NODAL O FFICER WHICH WAS FURTHER AGGRAVATED BY LACK OF ADEQUATE SUPPORT OF T HE STAFF. THE MISTAKE GOT DETECTED ON 29.03.2012 AND THE APPEAL I S FILED BEFORE THE TRIBUNAL. IT IS STATED THAT DELAY IS HIGHLY REG RETTED AND MAY KINDLY BE CONDONED. 4. PRIOR TO FILING OF THIS AFFIDAVIT THE REVENUE ALSO FILED AFFIDAVIT OF SH. GULZAR WANI, ACIT, CIRCLE -15(1), NEW DELHI, DA TED 01.03.2016 MENTIONING THE SAME FACT THEREIN WHICH WAS NOT FOUN D PROPER, THEREFORE, AFFIDAVIT DATED 09.11.2016 WAS FILED. 5. LD. DR RELIED UPON THE AVERMENT CONTENT IN BOTH TH ESE AFFIDAVITS AND SUBMITTED THAT THE DELAY IN FILING T HE APPEAL MAY BE CONDONED. HE FURTHER SUBMITTED THAT IT IS WELL SETT LED LAW THAT WHILE CONSIDERING THE DELAY THE PRAGMATIC VIEW MAY BE ADOPTED FOR CAUSE OF SUBSTANTIAL JUSTICE. LD. DR RELIED UPON TH E DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF COLLECTOR, LAN D ACQUISITION VS. MST. KATIGI & ORS 167 ITR 417. 6. ON THE OTHER HAND, LD. COUNSEL FOR THE ASSESSEE SU BMITTED THAT THE AFFIDAVITS OF TWO OF THE ACIT ARE NOT AFFI DAVIT IN THE EYES OF LAW BECAUSE THEY ARE NOT VERIFIED BY THE OFFICERS A ND THAT NO OATH 3 ITA NO. 1485/DEL/2012 HAVE BEEN ADMINISTERED TO THEM BY NOTARY PUBLIC. HE HAS SUBMITTED THAT NO MATERIAL EVIDENCE HAVE BEEN PRODU CED IN SUPPORT OF EXPLANATION. THE DEPARTMENT DID NOT TAKE STEPS ON TIME AND IT IS A CASE OF GROSS NEGLIGENCE. THEREFORE, DE LAY MAY NOT BE CONDONED. 7. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. THE REVE NUE FILED TWO ALLEGED AFFIDAVITS OF ACIT, CIRCLE -15(1), NEW DELHI AS NOTED ABOVE. THESE ARE NOT ACTUALLY AFFIDAVITS OF BOTH TH E OFFICERS OF THE DEPARTMENT BECAUSE THERE IS NO VERIFICATION IN BOTH THESE ALLEGED AFFIDAVITS AND EVEN NO OATHS HAVE BEEN ADMINISTERED TO THE OFFICERS BEFORE ATTESTING THE SAME. AUTHORIZATION ORDER PASS ED ON 08.09.2010, DIRECTING ACIT-32(1), NEW DELHI TO FILE APPEAL BEFORE TRIBUNAL BUT ALLEGED AFFIDAVITS ARE FILED BY ACIT, CIRCLE15(1), NEW DELHI. MAY BY THESE ALLEGED AFFIDAVITS DO NOT SATIS FY THE REQUIREMENTS OF PROPER AFFIDAVITS AS PER LAW, HOWEV ER, FOR THE PURPOSE OF CONSIDERING THE EXPLANATION OF THE REVEN UE WHETHER THE SAME DISCLOSED ANY SUFFICIENT/REASONABLE CAUSE FOR DELAY IN FILING THE DEPARTMENTAL APPEAL, THE AVERMENT CONTEND THERE IN ARE TAKEN INTO CONSIDERATION. IT IS ADMITTED FACT THAT AFTER PASSING OF THE IMPUGNED ORDER BY LD. CIT(A), THE IMPUGNED ORDER WA S RECEIVED IN THE OFFICE OF LD. CIT-XI ON 21.07.2010. LD. CIT (A) -XI, NEW DELHI, PASSED THE AUTHORIZATION ORDER DATED 08.09.2010 AUT HORIZING THE AO TO FILE THE APPEAL AGAINST THE IMPUGNED ORDER BE FORE THE TRIBUNAL. COPY OF THE AUTHORIZATION ORDER IS AVAILA BLE ON RECORD WHEREBY IT IS DIRECTED THAT LIMITATION IN FILING TH E APPEAL BEFORE TRIBUNAL WOULD EXPIRE ON 20.09.2010. IT IS ALSO ADM ITTED FACT THAT DESPITE AUTHORIZATION ORDER ISSUED BY LD. CIT-XI, W ITHIN TIME, THE AO DID NOT TAKE ANY STEP IN FILING THE APPEAL BEFOR E THE TRIBUNAL. IT IS EXPLAINED THAT THE AO WAS ALSO WORKING AS NODAL OFFICER AND THE 4 ITA NO. 1485/DEL/2012 AUTHORIZATION IS PLACED IN THE FOLDER OF NODAL OFFI CER. IT IS A CLEAR CASE OF THE NEGLIGENCE OF THE AO. WHEN THE AO RECEI VED THE AUTHORIZATION ORDER, EVEN IF HE WAS WORKING AS NODA L OFFICER ALSO, IT WAS HIS DUTY TO FILE APPEAL BEFORE THE TRIBUNAL WIT HIN THE PERIOD OF LIMITATION. THE NODAL OFFICER HAS BEEN APPOINTED FO R JUDICIAL PURPOSE ONLY, THEREFORE, DUTY IS ALSO CAST UPON HIM TO TAKE STEP TO FILE APPEAL WITHIN THE PERIOD LIMITATION. MERELY PL ACING THE AUTHORIZATION IN ANOTHER FOLDER IS NO GROUND SEEKIN G CONDONATION OF DELAY IN THE MATTER. THE FACTS THEREFORE, DO NOT DISCLOSE ANY SUFFICIENT CAUSE FOR DELAY IN SUBMISSION OF THE APP EAL BEFORE TRIBUNAL. NO MATERIAL IS PRODUCED IN SUPPORT OF THE SE AVERMENTS. THE DELAY IS NOT FEW DAYS BUT OF 557 DAYS AND REVEN UE FAILED TO EXPLAIN ANY REASONABLE CAUSE FOR NOT FILING THE APP EAL WITHIN THE PERIOD OF LIMITATION. THE EXPLANATION OF THE REVENU E IS NOT BONA FIDE AND APPEARS TO BE AFTER THOUGHT. THE GOVERNMENT DEP ARTMENTS ARE UNDER SPECIAL OBLIGATION TO ENSURE THAT THEY PERFOR M THEIR DUTIES WITH DILIGENCE AND COMMITMENT. CODONATION OF DELAY IS AN EXCEPTION AND SHOULD NOT BE USED AS AN ANTICIPATED BENEFIT FOR GOVERNMENT DEPARTMENTS. THE REVENUE DEPARTMENT HAD FAILED TO GIVE ACCEPTABLE AND COGENT REASON SUFFICIENT TO COD ONATION SUCH A HUGE DELAY. 8. IT WOULD BE APPROPRIATE TO REFER TO SOME OF THE JU DICIAL PRONOUNCEMENT ON THE ISSUE OF DELAY IN FILING OF AP PEALS. A) HONBLE SUPREME COURT IN THE CASE OF OFFICE OF T HE CHIEF POST MASTER GENERAL & ORS VS. LIVING MEDIA INDIA LTD., & ANR, 348 ITR 7; CONSIDERING ITS EARLIER DECISIONS IN THE CASE OF COLLECTOR (LAND AND ACQUISITION) VS. MST. KATIGI (SUPRA) RELIED UPO N BY LD. DR HELD AS UNDER: 5 ITA NO. 1485/DEL/2012 THE RESPONDENT, A COMPANY PUBLISHING MAGAZINES REGISTERED AS NEWSPAPERS WITH THE DEPARTMENT OF POS TS AND ENTITLED TO TRANSMIT ITS PUBLICATIONS BY POST UNDER CONCESSIONAL RATE OF POSTAGE, WAS DENIED PERMISSION TO POST ISSUES OF TAX OF ITS MAGAZINES CONTAINING ADVERTISE MENTS AT CONCESSIONAL RATES. THE COMPANY FILED WRIT PETITION S WHICH A SINGLE JUDGE OF THE HIGH COURT ALLOWED AND, ON APPE AL BY THE POSTAL DEPARTMENT, THIS WAS AFFIRMED BY A DIVISION BENCH OF THE HIGH COURT BY ORDER DATED SEPTEMBER 11, 2009. T HE POSTAL DEPARTMENT PREFERRED APPEALS TO THE SUPREME COURT BY WAY OF SPECIAL LEAVE WITH A DELAY OF 427 DAYS WI TH APPLICATIONS FOR CONDONATION OF DELAY IN FILING THE PETITIONS FOR SPECIAL LEAVE : HELD, DISMISSING THE APPLICATIONS, THE DEPARTMENT HAD ITSELF MENTIONED IN ITS AFFIDAVIT AND WAS AWARE OF THE DATE OF THE JUDGMENT OF THE DIVISION BENCH OF THE HIGH COUR T AS SEPTEMBER 11, 2009. EVEN, ACCORDING TO THE DEPONENT , ITS COUNSEL HAD APPLIED FOR THE CERTIFIED COPY OF THE J UDGMENT ONLY ON JANUARY 8, 2010, AND THE COPY WAS RECEIVED BY THE DEPARTMENT ON THE VERY SAME DAY. THERE WAS NO EXPLA NATION FOR NOT APPLYING FOR CERTIFIED COPY OF THE JUDGMENT ON SEPTEMBER 11, 2009, OR AT LEAST WITHIN A REASONABLE TIME. THE FACT REMAINS THAT THE CERTIFIED COPY WAS APPLIE D FOR ONLY ON JANUARY 8, 2010, I.E., AFTER A PERIOD OF NEARLY FOUR MONTHS. NEITHER THE DEPARTMENT NOR THE PERSON IN-CH ARGE HAD FILED AN EXPLANATION FOR NOT APPLYING FOR THE CERTI FIED COPY WITHIN THE PRESCRIBED PERIOD. THE OTHER DATES MENTI ONED IN THE AFFIDAVIT CLEARLY SHOWED THAT THERE WAS DELAY A T EVERY STAGE AND THERE WAS NO EXPLANATION AS TO WHY SUCH D ELAY HAD OCCASIONED. THE DEPARTMENT OR THE PERSON CONCER NED HAD NOT EVINCED DILIGENCE IN PROSECUTING THE MATTER TO THE COURT BY TAKING APPROPRIATE STEPS. THE PERSONS CONC ERNED WERE WELL AWARE OR CONVERSANT WITH THE ISSUES INVOL VED INCLUDING THE PRESCRIBED PERIOD OF LIMITATION FOR T AKING UP THE MATTER BY WAY OF FILING A SPECIAL LEAVE PETITION IN THE SUPREME COURT. IN THE ABSENCE OF PLAUSIBLE AND ACCE PTABLE EXPLANATION, THE DELAY COULD NOT BE CONDONED MECHAN ICALLY MERELY BECAUSE THE GOVERNMENT OR A WING OF THE GOVE RNMENT WAS A PARTY BEFORE THE COURT. THOUGH IN A MATTER OF CONDO- NATION OF DELAY WHEN THERE WAS NO GROSS NEGLIGENCE OR DELIBERATE INACTION OR LACK OF BONA FIDE, A LIBERAL CONCESSION HAD TO BE ADOPTED TO ADVANCE SUBSTANTIAL JUSTICE, I N THE FACTS AND CIRCUMSTANCES, THE CLAIM ON ACCOUNT OF IMPERSON AL 6 ITA NO. 1485/DEL/2012 MACHINERY AND INHERITED BUREAUCRATIC METHODOLOGY OF MAKING SEVERAL NOTES COULD NOT BE ACCEPTED IN VIEW OF THE MODERN TECHNOLOGIES BEING USED AND AVAILABLE. CONSI DERING THE FACT THAT THERE WAS NO PROPER EXPLANATION OFFER ED BY THE DEPARTMENT FOR THE DELAY EXCEPT MENTIONING OF VARIO US DATES, THE DEPARTMENT HAD FAILED TO GIVE ACCEPTABLE AND CO GENT REASONS SUFFICIENT TO CONDONE SUCH A HUGE DELAY. BY THE COURT : UNLESS GOVERNMENT BODIES, THEIR AGEN CIES AND INSTRUMENTALITIES HAVE REASONABLE AND ACCEPTABL E EXPLANATION FOR THE DELAY AND THERE WAS BONA FIDE E FFORT, THERE IS NO NEED TO ACCEPT THE USUAL EXPLANATION TH AT THE FILE WAS KEPT PENDING FOR SEVERAL MONTHS OR YEARS DUE TO CONSIDERABLE DEGREE OF PROCEDURAL RED-TAPE IN THE P ROCESS. GOVERNMENT DEPARTMENTS ARE UNDER A SPECIAL OBLIGATI ON TO ENSURE THAT THEY PERFORM THEIR DUTIES WITH DILIGENC E AND COMMITMENT. CONDONATION OF DELAY IS AN EXCEPTION AN D SHOULD NOT BE USED AS AN ANTICIPATED BENEFIT FOR GO VERNMENT DEPARTMENTS. THE LAW SHELTERS EVERYONE UNDER THE SA ME LIGHT AND SHOULD NOT BE SWIRLED FOR THE BENEFIT OF A FEW. THE LAW OF LIMITATION BINDS EVERYBODY INCLUDING THE GOV ERNMENT. B) HONBLE CALCUTTA HIGH COURT IN THE CASE OF CIT VS.PEERLESS GENERAL FINANCE & INVESTMENT CO., 31 TAXMANN.COM 11 7 HELD AS UNDER: WHERE ENTIRE STATEMENTS AND AVERMENTS OF DEPARTMENT FOR CONDONATION OF DELAY OF 2197 DAYS CONSTITUTED CULPA BLE LACHES AND NEGLIGENCE ON PART OF DEPARTMENTAL OFFIC IAL, SUCH DELAY COULD NOT BE CONDONED. C) ITAT DELHI BENCH IN CASE OF ACIT VS VIMAL MEHRA 28 TAXMANN.COM 210 HELD AS UNDER: IT: DELAY OF 557 DAYS IN FILING APPEAL BY REVENUE TAKING GROUND OF OVERSIGHT AND PRESSURE OF WORKLOAD IS FOU ND TO BE NEITHER REASONABLE NOR SUFFICIENT GROUND AND, THERE FORE, CONDONATION OF SUCH DELAY IS RIGHTFULLY DENIED. D) IN THE CASE OF HIND DEVELOPMENT CORPN. V. ITO [ 1979] 118 ITR 873, THE CALCUTTA HIGH COURT HELD THAT A TRIBUN AL CAN CONDONE THE DELAY IF THERE WAS SUFFICIENT CAUSE FOR THE DEL AY IN THE 7 ITA NO. 1485/DEL/2012 SUBMISSION OF THE APPEAL. IN THE CASE OF VEDABAI AL IAS VIJAYANATABAI BABURAO PATIL V. SHANTARAM BABURAO PA TIL [2002] 253 ITR 798' (SC), WHERE IT WAS HELD THAT WHILE EXE RCISING DISCRETION UNDER SECTION 5 OF THE LIMITATION ACT, 1 963, TO CONDONE DELAY FOR SUFFICIENT CAUSE IN NOT FILING THE APPEAL WITHIN THE PERIOD PRESCRIBED, COURTS SHOULD ADOPT A PRAGMATIC APPROAC H. A DISTINCTION MUST BE MADE BETWEEN A CASE WHERE THE D ELAY IS INORDINATE AND A CASE WHERE THE DELAY IS OF A FEW D AYS. THE COURT OBSERVED THAT WHEREAS IN THE FORMER CONSIDERATION O F PREJUDICE TO THE OTHER SIDE WILL BE A RELEVANT FACTOR AND CALLS FOR A MORE CAUTIOUS APPROACH. IN THE LATTER CASE NO SUCH CONSIDERATION MAY ARISE AND SUCH A CASE DESERVES A LIBERAL APPROACH. NOW IN THE PRESENT CASE DELAY IS NOT OF A FEW DAYS BUT OF 557 DAYS. BESIDES , THERE IS ABSOLUTELY NO VALID EXPLANATION/REASON FOR THE DELA Y. IN THE CASE OF CIT V. RAM MOHAN KABRA [2002] 257 ITR 773, THE HON' BLE PUNJAB & HARYANA HIGH COURT HAS HELD OBSERVED THAT WHERE T HE LEGISLATURE SPELLS OUT A PERIOD OF LIMITATION AND P ROVIDES FOR POWER TO CONDONE THE DELAY AS WELL, SUCH DELAY CAN ONLY B E CONDONED ONLY FOR SUFFICIENT AND GOOD REASONS SUPPORTED BY COGENT AND PROPER EVIDENCE. IT IS A SETTLED PRINCIPLE OF LAW THAT PRO VISIONS RELATING TO THE SPECIFIED PERIOD OF LIMITATION MUST BE APPLIED WITH THEIR RIGOUR AND EFFECTIVE CONSEQUENCES. IN THIS CASE DELAY FOR FILING THE APPEAL LATE FOR ONLY A FEW DAYS WAS NOT CONDONED. IN THE C ASE OF ASSTT. CIT V. TAGGAS INDUSTRIES DEVELOPMENT LTD. [2002]80 ITD 21(CAL.), TRIBUNAL, CALCUTTA BENCH, CALCUTTA, DID NOT CONDONE THE DELAY FOR FILING THE APPEAL LATE BY 13 DAYS BECAUSE THE DELAY WAS NOT DUE TO SUFFICIENT CAUSE. THUS, RELYING ON THE ABOVE JUDGME NTS, WE HOLD THAT REVENUE FAILED TO EXPLAIN THAT DELAY IN FILING THE APPEAL WAS DUE TO SUFFICIENT CAUSE. 8 ITA NO. 1485/DEL/2012 9. CONSIDERING THE ABOVE DISCUSSION IN THE LIGHT OF T HE ABOVE DECISIONS, WE HELD THAT APPEAL OF THE DEPARTMENT IS TIME BARRED THE SAME IS ACCORDINGLY DISMISSED IN LIMINE. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 17.11.2017. SD/- SD/- (L. P. SAHU) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATE: 17.11.2017 @M!T