Himanshu Bhogilal Patel, Ahmedabad V. ITO, Ward-5(2)(1), Ahmedabad

ITA 2027/AHD/2018

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 5028 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-10-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 26-09-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Period of limitation; Time period of passing order; Condonation of delay; Set aside
• Section: 143(3); 13

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, AHMEDABAD [CONDUCTED THROUGH VIRTUAL COURT AT AHMEDABAD] BEFORE SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER & MS. MADHUMITA ROY, JUDICIAL MEMBER I.T.A. NO. 2027/AHD/2018 (ASSESSMENT YEAR: 2010-11) HIMANSHU BHOGILAL PATEL 6B, DHANUSHDHARI SOCIETY, B/H. DHARNIDHAR TEMPLE, VASANA, AHMEDABAD VS. ITO-5(2)(1), AHMEDABAD 1 ST FLOOR, ROOM NO. 138, NARAYAN CHAMBERS, NEHRU BRIDGE CORNER, ASHRAM ROAD, AHMEDABAD [PAN NO. APK PP3 018 E] ( APPELLANT ) .. ( RESPONDENT ) APPELLANT BY : NONE RESPONDENT BY : SHRI VIDHYUT TRIVEDI, SR. D.R. DATE OF HEARING 08.09.2020 DATE OF PRONOUNCEMENT 13.10.2020 O R D E R PER MS. MADHUMITA ROY - JM: THE INSTANT APPEAL IS DIRECTED AGAINST THE ORDER DA TED 25.07.2018 PASSED BY THE COMMISSIONER OF INCOME TAX(APPEALS) 5, AHMEDABAD ARISING OUT OF THE ORDER DATED 08.12.2017 PASSED BY THE ITO, WARD-5(2)(1), AHMEDABAD UNDER SECTION 143(3) R.W.S. 147 OF THE IN COME TAX ACT, 1961 (HEREINAFTER REFERRED AS TO THE ACT) FOR ASSESSME NT YEAR 2010-11. 2. THE FACT RELATING TO THE CASE IS THIS THAT THERE IS A DELAY OF 37 DAYS IN FILING THE FIRST APPEAL BEFORE THE LD. CIT(A). THE APPELLANT, THEREFORE, MADE AN APPLICATION FOR CONDONATION OF DELAY ON 24.02.20 18. THE APPELLANT IS A NON-RESIDENT INDIAN, LIVING IN USA WHO GOT THE COPY OF THE ORDER PASSED BY THE LD. ITO FROM HIS NEIGHBOR AND THEN APPOINTED THE CHARTERED ITA NO.2027/AHD/2018 HIMANSHU BHOGILAL PATEL VS. ITO ASST. YEAR 2010-11 - 2 - ACCOUNTANT FOR TAKING STEPS IN THE MATTER. THE COP Y OF THE INVOICES OF SHARE TRANSACTION BEING THE DOCUMENTARY PROOF OF TRANSACT ION IN QUESTION FOR F.Y. 2006-07 AS REQUIRED BY THE SAID CHARTERED ACCOUNTAN T WAS RECEIVED LATE FROM THE SHARE BROKER OF THE APPELLANT. HE, THEREF ORE, WAS NOT ABLE TO FILE THE APPEAL BEFORE THE LD. CIT(A) WITHIN THE PRESCRI BED TIME AS OF THE EXPLANATION MADE BY THE ASSESSEE. HOWEVER, SUCH CO NTENTION OF THE ASSESSEE WAS NOT FOUND FEASIBLE AND THE APPLICATION FOR CONDONATION OF DELAY WAS REJECTED. CONSEQUENTLY, THE ADDITION WAS CONFI RMED. THE ASSESSEE HAS COME UP IN APPEAL BEFORE US CHALLENGING THE SAID OR DER. 3. AT THE TIME OF HEARING OF THE INSTANT APPEAL THE LD. COUNSEL APPEARING FOR THE ASSESSEE SUBMITTED BEFORE US THAT THE APPEA L WAS DISMISSED IN LIMINE REJECTING THE APPLICATION FOR CONDONATION OF DELAY IN FILING THE SAID APPEAL INSTEAD OF DISPOSING OF THE APPEAL ON MERIT. THE SUFFICIENT CAUSE WITHIN THE CONTEMPLATION OF THE LIMITATION PROVISION AS SH OWN BY THE ASSESSEE BEYOND THE CONTROL OF THE ASSESSEE; THERE IS NO INT ENTIONAL LATCHES ON THE PART OF THE ASSESSEE IN PREFERRING THE APPEAL BEYOND THE LIMITATION PERIOD. ON THE OTHER HAND, THE LD. DR RELIED UPON THE ORDE R PASSED BY THE AUTHORITIES BELOW. 4. WE HAVE HEARD THE RESPECTIVE PARTIES, WE HAVE ALSO PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. IT IS A WEL L SETTLED PRINCIPLE OF LAW THAT THE APPEAL MAY BE ADMITTED AFTER THE PRESCRIBE D PERIOD IF THE APPELLANT SATISFIES THE COURT THAT HE HAD SUFFICIE NT CAUSE FOR NOT PREFERRING THE APPEAL OR MAKING THE APPLICATION WIT HIN SUCH PERIOD. IN THE INSTANT CASE THE ASSESSEE TRIED TO JUSTIFY THE DELAY WITH THE PLEA ITA NO.2027/AHD/2018 HIMANSHU BHOGILAL PATEL VS. ITO ASST. YEAR 2010-11 - 3 - DISCUSSED IN THE PRECEDING PARAGRAPH THOUGH NOT EXP LAINED THE DELAY ON DAY TO DAY BASIS. THE SAID EXPLANATION COULD HAVE BEEN ACCEPTED BY THE LD. CIT(A) AT LEAST TAKING INTO CONSIDERATION THE S HORT PERIOD OF 37 DAYS ONLY. THE DOCTRINE OF EQUALITY BEFORE LAW DEMANDS THAT ALL LITIGANTS, INCLUDING THE STATE AS A LITIGANT, ARE ACCORDED THE SAME TREATMENT AND THE LAW IS ADMINISTERED IN AN EQUITABLE MANNER. FURTHE RMORE, THE LEGISLATURE HAS CONFERRED THE POWER TO CONDONE DELAY BY ENACTIN G SECTION 51 OF THE INDIAN LIMITATION ACT OF 1963 IN ORDER TO ENABLE TH E COURTS TO DO SUBSTANTIAL JUSTICE TO THE PARTIES BY DISPOSING OF MATTERS ON MERITS. THE EXPRESSION SUFFICIENT CAUSE EMPLOYED BY THE LEGIS LATURE IS ADEQUATELY ELASTIC TO ENABLE THE COURTS TO APPLY THE LAW IN A MEANINGFUL MANNER WHICH SUBSERVES THE ENDS OF JUSTICE THAT BEING THE LIFE-PURPOSE FOR THE EXISTENCE OF THE INSTITUTION OF COURTS. THEREFORE, IT IS EXPECTED THAT THE AUTHORITY ALSO SHOULD HAVE A JUSTIFIABLY LIBERAL AP PROACH IN MATTERS FILED BEFORE IT. IN THIS RESPECT WE WOULD LIKE TO REFER THE JUDGMENT PASSED BY THE HONBLE APEX COURT IN THE MATTER OF COLLECTOR L AND ACQUISITION VS. MST. KATIJI & ORS 1987 AIR 1353, 1987 SCR (2) 387. WHERE WHILE CONDONING THE DELAY THE HONBLE APEX COURT OBSERVED AS FOLLOWS:- 'ANY APPEAL OR ANY APPLICATION, OTHER THAN AN APPL ICATION UNDER ANY OF THE PROVISIONS OF ORDER XXI OF THE CODE OF CIVIL PROCED URE, 1908. MAY BE ADMITTED AFTER THE PRESCRIBED PERIOD IF THE APPELLANT OR THE APPLI CANT SATISFIES THE COURT THAT HE HAD SUFFICIENT CAUSE FOR NOT PREFERRING THE APPEAL OR M AKING THE APPLICATION WITHIN SUCH PERIOD.' 1. ORDINARILY A LITIGANT DOES NOT STAND TO BENEFIT BY LODGING AN APPEAL LATE. 2. REFUSING TO CONDONE DELAY CAN RESULT IN A MERITO RIOUS MATTER BEING THROWN OUT AT THE VERY THRESHOLD AND CAUSE OF JUSTICE BEING DEFEA TED. AS AGAINST THIS WHEN DELAY IS CON- DONED THE HIGHEST THAT CAN HAPPEN IS THAT A CA USE WOULD BE DECIDED ON MERITS AFTER HEARING THE PARTIES. ITA NO.2027/AHD/2018 HIMANSHU BHOGILAL PATEL VS. ITO ASST. YEAR 2010-11 - 4 - 3. 'EVERY DAY'S DELAY MUST BE EXPLAINED' DOES NOT M EAN THAT A PEDANTIC APPROACH SHOULD BE MADE. WHY NOT EVERY HOUR'S DELAY, EVERY S ECOND'S DELAY? THE DOCTRINE MUST BE APPLIED IN A RATIONAL COMMON SENSE PRAGMATI C MANNER. 4. WHEN SUBSTANTIAL JUSTICE AND TECHNICAL CONSIDERA TIONS ARE PITTED AGAINST EACH OTHER, CAUSE OF SUBSTANTIAL JUSTICE DESERVES TO BE PREFERRED FOR THE OTHER SIDE CANNOT CLAIM TO HAVE VESTED RIGHT IN INJUSTICE BEING DONE BECAUSE OF 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 RI SK. 6. IT MUST BE GRASPED THAT JUDICIARY IS RESPECTED N OT ON ACCOUNT OF ITS POWER TO LEGALIZE INJUSTICE ON TECHNICAL GROUNDS BUT BECAUSE IT IS CAPABLE OF REMOVING INJUSTICE AND IS EXPECTED TO DO SO. MAKING A JUSTICE-ORIENTED APPROACH FROM THIS PERSPE CTIVE, THERE WAS SUFFICIENT CAUSE FOR CONDONING THE DELAY IN THE INSTITUTION OF THE A PPEAL. THE FACT THAT IT WAS THE 'STATE' WHICH WAS SEEKING CONDONATION AND NOT A PRIVATE PAR TY WAS ALTOGETHER IRRELEVANT. THE DOCTRINE OF EQUALITY BEFORE LAW DEMANDS THAT AL L LITIGANTS, INCLUDING THE STATE AS A LITI-GANT, ARE ACCORDED THE SAME TREATMENT AND TH E LAW IS ADMIN- ISTERED IN AN EVEN HANDED MANNER. THERE IS NO WARRANT FOR ACCORDING A STEPMOTHERLY TREATMENT WHEN THE 'STATE' IS THE APPLICANT PRAYING FOR CONDONATIO N OF DELAY. IN FACT EXPERI- ENCE SHOWS THAT ON ACCOUNT OF AN IMPERSONAL MACHINARY (N O ONE IN CHARGE OF THE MATTER IS DIRECTLY HIT OR HURT BY THE JUDGMENT SOUGHT TO BE S UBJECTED TO APPEAL) AND THE IN- HERITED BUREAUCRATIC METHODOLOGY IMBUED WITH THE NO TE-MAK-ING, FILE PUSHING, AND PASSING-ON-THE-BUCK ETHOS, DELAY ON ITS PART IS LES S DIFFICULT TO UNDERSTAND THOUGH MORE DIFFI-CULT TO APPROVE. IN ANY EVENT, THE STATE WHICH REPRESENTS THE COLLECTIVE CAUSE OF THE COMMUNITY, DOES NOT DESERVE A LITIGANT -NON-GRATA STATUS. THE COURTS THEREFORE HAVE TO BE INFORMED WITH THE SPIRIT AND P HILOSOPHY OF THE PROVISION IN THE COURSE OF THE INTERPRETATION OF THE EXPRESSION 'SUF FI-CIENT CAUSE'. SO ALSO THE SAME APPROACH HAS TO BE EVIDENCED IN ITS APPLICATION TO MATTERS AT HAND WITH THE END IN VIEW TO DO EVEN HANDED JUSTICE ON MERTIS IN PREFERE NCE TO THE APPROACH WHICH SCUTTLES A DECISION ON MERITS. TURNING TO THE FACTS OF THE M ATTER GIVING RISE TO THE PRESENT APPEAL, WE ARE SATISFIED THAT SUFFICIENT CAUSE EXIS TS FOR THE DELAY. THE ORDER OF THE HIGH COURT DISMISSING THE APPEAL BEFORE IT AS TIME BARRED, IS THEREFORE. SET ASIDE. DELAY IS CONDONED. AND THE MATTER IS REMITTED TO TH E HIGH COURT. THE HIGH COURT WILL NOW DISPOSE OF THE APPEAL ON MERITS AFTER AFFORDING REASONABLE OPPORTUNITY OF HEARING TO BOTH THE SIDES. APPEAL IS ALLOWED ACCORD INGLY. NO COSTS. SINCE WE HAVE ALREADY OBSERVED THAT THE EXPLANATIO N RENDERED BY THE ASSESSEE FOR FILING THE APPEAL BEYOND LIMITATIO N PERIOD SEEMS TO BE GENUINE MEANING THEREBY SUFFICIENT CAUSE BEING RE FLECTED FROM SUCH EXPLANATION WHICH DEMANDS SUCH DELAY TO BE CONDONED . KEEPING IN VIEW ITA NO.2027/AHD/2018 HIMANSHU BHOGILAL PATEL VS. ITO ASST. YEAR 2010-11 - 5 - THE LITIGANT PAIN OUR SUCH FINDING IS FURTHER BEEN STRENGTHEN BY THE ESSENCE ENUMERATED FROM THE RATIO LAID DOWN AND THE OBSERVATION MADE IN THE JUDGMENT AS CITED ABOVE AND HENCE RESPECTFULLY RELYING UPON THE SAME WE CONDONE THE DELAY IN PREFERRING THE APPEAL BY TH E ASSESSEE BEFORE THE LD. CIT(A). SINCE THE APPEAL IS NOT DECIDED ON MERIT WE SET-AS IDE THE ISSUE TO THE FILE OF THE LD. CIT(A) TO ADJUDICATE THE SAME AFRESH UPON GIVING A REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESS EE AND ALSO UPON TAKING INTO CONSIDERATION THE EVIDENCE WHICH THE ASSESSEE MAY C HOOSE TO FILE BEFORE THE LD. CIT(A). 5. IN THE RESULT, ASSESSEES APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. THIS ORDER PRONOUNCED IN OPEN COURT ON 13 / 1 0 /20 20 SD/- SD/- (PRADIP KUAMR KEDIA) (MS. MADHUMITA ROY) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED 13/10/2020 TANMAY, SR. PS TRUE COPY / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / CONCERNED CIT 4. ( ) / THE CIT(A)- 5. , ! ' , #$%% / DR, ITAT, AHMEDABAD 6. &' () / GUARD FILE. / BY ORDER, / (DY./ASSTT. REGISTRAR) !, #$ / ITAT, AHMEDABAD