Smt. Nirmala Devi, CHENNAI V. ITO, CHENNAI

ITA 2476/CHNY/2016

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 7812 (ITAT-CHENNAI)
• Duration Of Justice: 6 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-02-2017
• Appeal Filed By: Assessee
• Bench Allotted: A
• Next Hearing Date: 22-02-2017
• Assessment Year: 2007-2008
• Appeal Filed On: 26-08-2016
• Court: TRIBUNAL
• Department Lawyers: SHIVA SRINIVASJ
• Assessee Lawyers: R K SUNDAR
• Keywords: Condonation of delay
• Section: 133A

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH : CHENNAI , ! ' . #$ % &' BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SHRI DUVVURU RL REDDY , JUDICIAL MEMBER ./ I.T.A.NOS.2476, 2477 & 2478/MDS./2016 / ASSESSMENT YEARS : 2007-08, 2009-10 & 2011-12 SMT. NIRMALA DEVI , NEW NO.13, OLD NO.14, ALAPAKKAM MAIN ROAD, ALAPAKKAM PORUR, C HENNAI - 116. VS. THE ITO, COMPANY WARD II(1), CHENNAI-34. [PAN ADFPN 7643 A ] ( () / APPELLANT) ( *+() /RESPONDENT) ./ I.T.A.NOS.2479, 2480 & 2481/MDS./2016 / ASSESSMENT YEARS : 2006-07,2007-08, & 2008-09 MR.E.JEEVANANDAM , NEW NO.13, OLD NO.14, ALAPAKKAM MAIN ROAD, ALAPAKKAM PORUR, CHENNAI-116. VS. THE ITO, COMPANY WARD II(1), CHENNAI-34 [PAN AAIPJ 2087 N ] ( () / APPELLANT) ( *+() /RESPONDENT) ASSESSEE BY : MR.R.K.SUNDAR,ADVOCATE REVENUE BY : MR.SHIVA SRINIVAS, JCIT,DR / DATE OF HEARING : 22 - 0 2 - 201 7 / DATE OF PRONOUNCEMENT : 27 - 02 - 2017 ITA NOS.2777 TO 2481/16 :- 2 -: , / O R D E R PER CHANDRA POOJARI, ACCOUNTANT MEMBER THESE SIX APPEALS FILED BY TWO DIFFERENT ASSESSES MENTIONED IN THE TITLE ARE DIRECTED AGAINST DIFFERE NT ORDERS OF THE COMMISSIONER OF INCOME-TAX(APPEALS)-6, CHENNAI IN R ESPECT OF THE ABOVE ASSESSMENT YEARS. SINCE, THE ISSUES INVO LVED IN THESE APPEALS ARE COMMON, THEY ARE CLUBBED TOGETHER, HEAR D TOGETHER AND DISPOSED OFF BY THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. 2. BOTH THE ASSESSEES ARE AGGRIEVED BY THE ORDER OF THE LD. CIT (A) FOR NOT CONDONING THE DELAY OF 22 MONTHS IN FILING THE APPEAL AND ADJUDICATE THE CASE ON MERITS. 3. THE FACTS OF THE ISSUE ARE THAT IN ALL THESE AP PEALS, THE ASSESSEE CARRIED THE APPEALS BEFORE THE LD.CIT(A) CHALLENGING THE ADDITIONS MADE BY THE LD. ASSESSING OFFICER. DURING THE COURSE OF FIRST APPELLATE PROCEEDINGS, T HE LD.A.R SUBMITTED THE FOLLOWING REASONS FOR CONDONATION OF DELAY IN FILING THE APPEAL BEFORE THE LD.CIT(A) FOR BOTH THE ASSESSEE. 2. THE PETITIONER / APPELLANT SUBMITS THAT THE D ELAY IN FILING THE APPEAL OCCURRED IN THE CIRCUMSTANCES SET OUT BELOW: ITA NOS.2777 TO 2481/16 :- 3 -: 2.1. THE PETITIONER / APPELLANT WAS CARRYING ON SMA LL JEWELLERY BUSINESS BY NAME JEEVA JEWELLERS BOTH THE PETITIONE R AND HER HUSBAND SRI E.JEEVANANDAM ARE DIRECTORS IN JEEVA CH ENNAI CHIT FUND (PVT) LTD, A COMPANY CARRYING ON CHIT BUSINESS . THE HUF OF WHICH THE PETITIONER IS A MEMBER AND HER HUSBAND IS A KARTA DERIVES RENTAL INCOME FROM HOUSE PROPERTY. ALL THE AFORESAID PERSONS I ENTITIES ARE REGULAR INCOME TAX ASSESSEES . 2.2. PURSUANT TO THE SURVEY U/S 133A OF THE INCOME TAX ACT CONDUCTED ON 18.06.2010 THE ASSESSMENT FOR THIS YEA R AND OTHER YEARS WAS REOPENED AND THE IMPUGNED ASSESSMENT ORDE R WAS PASSED ALONG WITH THE ASSESSMENT ORDERS FOR OTHER Y EARS. THE PETITIONER / APPELLANT HAS PAID THE SUBSTANTIAL AMO UNT OF TAX AND INTEREST AS PER THE ASSESSMENT ORDERS WITHOUT DEMUR AND SUFFERING CONSIDERABLE HARDSHIP. THE JEWELLERY BUSI NESS OF WHICH THE APPELLANT IS PROPRIETNX IS CARRIED ON A REDUCED SCALE. 2.3. IN THE COURSE OF THE SURVEY THE OFFICIALS OF T HE DEPARTMENT ORALLY ASSURED THE PETITIONER THAT IN THE EVENT OF MAKING A FULL DISCLOSURE OF THE INCOME ON WHICH SHE IS LIABLE TO PAY TAX AND COOPERATE WITH THE DEPARTMENT IN THE MATTER OF ASSE SSMENT AND PAYMENT OF TAX THE DEPARTMENT WILL RECIPROCALLY AFF ORD A LENIENT TREATMENT IN THE MATTER OF LEVY OF PENALTY. HOWEVER , THIS ASSURANCE WAS NOT ACTED UPON AND LARGE AMOUNTS OF P ENALTY U/S 271(1)(C) HAVE BEEN LEVIED. AGGRIEVED THE PETITIONE R HAS APPEALED AGAINST THE PENALTY ORDERS AND HER APPEALS NUMBERED AS ITA NOS.191 TO 195/14-15 ARE PENDING BEFORE THE COMMISSIONER (APPEALS). 2.4. THE PETITIONER I APPELLANT SUBMITS THAT IN THE PENDING APPEALS SHE HAS SPELT OUT HIS OBJECTIONS ON TRUE FACTS EVEN THOUGH HANDICAPPED BY WANT OF SUFFICIENT MATERIAL IN SUPPO RT. THOUGH ITA NOS.2777 TO 2481/16 :- 4 -: AGGRIEVED BY CERTAIN UNJUSTIFIED ADDITIONS IN THE A SSESSMENTS BELIEVING THE UNFULFILLED ASSURANCES BY THE DEPARTM ENTAL OFFICIALS THE PETITIONER HAD NOT ACTED EXPEDITIOUSLY TO APPRI SE THE MATERIAL ON RECORD OR GATHER EVIDENCE TO SUBSTANTIATE HER OB JECTIONS ON MERITS IN REGARD TO THE ADDITIONS IN THE ASSESSMENT S. FURTHER THE ENMITY BETWEEN THE PETITIONER AND THE PERSONS WITH WHOM SHE HAD TRANSACTIONS, MANY OF WHOM ARE HER CLOSE RELATI VES OR FRIENDS, AND WHO WERE CONCERNED WITH THE TAX IMPACT OF THE TRANSACTIONS IN THEIR OWN CASE ADDED TO THE PETITIO NERS PROBLEMS. TO MAKE MATTERS WORSE THE PETITIONER HAD SUFFERED HEALTH PROBLEMS WHICH NEEDED ATTENTION. THESE FACTO RS CUMULATIVELY DELAYED THE FILING OF THE QUANTUM APPE ALS BY THE PETITIONER. 3. THE PETITIONER RESPECTFULLY SUBMITS THAT THE DEL AY IN FILING THE APPEALS WAS CAUSED DUE TO THE GENUINE REASONS MENTI ONED ABOVE AND WAS BONAFIDE; THIS APPEAL AND THE QUANTUM APPEALS FILED FOR THE OTHER ASSESSMENT YEARS ALONG WITH THI S APPEAL INVOLVE SUBSTANTIAL FACTUAL ISSUES AND AMOUNTS AND IT IS NECESSARY AND PROPER THAT THEY ARE DECIDED ON MERIT S IN THE INTERESTS OF JUSTICE. 4. THE PETITIONER, THEREFORE, PRAYS THAT THE COMMIS SIONER OF INCOME TAX (APPEALS) BE PLEASED TO CONDONE THE DELAY IN FI LING THE APPEAL, ENTERTAIN AND DECIDE THE APPEAL ON MERITS I N ACCORDANCE WITH LAW FOR WHICH THE PETITIONER / APPELLANT SHALL EVER BE GRATEFUL. 3.1 AFTER EXAMINING THE SUBMISSIONS OF THE LD.A.R , THE APPEALS OF THE ASSESSEE WAS REJECTED BY THE LD.CIT(A) ON T HE REASON THAT THERE WAS A DELAY OF 22 MONTHS IN FILING THE APPEAL S AND THE ITA NOS.2777 TO 2481/16 :- 5 -: ASSESSEES HAVE NOT FURNISHED ANY COGENT REASONS FOR THE DELAY IN FILING THE APPEALS. AGAINST THIS, THE ASSESSEE IS IN APPEAL BEFORE US. 4. WE HAVE HEARD BOTH THE PARTIES AND CAREFULLY GO NE THROUGH THE REASONS ADVANCED BY THE LD.A.R AND THE MATERIAL S ON RECORD. ADMITTEDLY IN THIS CASE THERE WAS A DELAY OF 22 MON THS IN FILING THE APPEAL BEFORE THE LD.CIT(A). THE MAIN CONTENTION O F THE LD.A.R IS THAT THE AO HAD GIVEN ASSURANCE THAT HE WOULD NOT L EVY PENALTY U/S.271(1)(C) OF THE ACT. THEREFORE, THE ASSESSEE HAS NOT FILED ANY APPEAL AGAINST THE ORDERS OF LD.CIT(A) UPTO PAS SING OF PENALTY ORDERS IN THESE CASES. LATER, WHEN THE ASS ESSEE WANTED TO FILE APPEALS, AT THAT TIME THERE WAS INSUFFICIEN CY OF EVIDENCE IN SUPPORT OF CLAIM OF ASSESSEES CASES AND IT WAS DEL AYED ON THE REASON THAT ALL EVIDENCES IN SUPPORT OF THE ASSESSE ES CLAIM AGAINST THE IMPUGNED ADDITION MADE BY THE AO NOT AT ALL AVAILABLE DURING THE PERIOD OF 22 MONTHS. THE ASSESSEE WAS G ATHERING THE EVIDENCES DURING THIS PERIOD IN SUPPORT OF THE CLAI M OF ASSESSEE BEFORE FILING THE APPEAL BEFORE THE LD.CIT(A). HEN CE, IT TOOK A LONGER PERIOD OF 22 MONTHS IN GATHERING THESE EVIDE NCES AS THERE WAS A DISPUTE AMONG THE RELATIVES, WHO HAS TO GIVE THE EVIDENCES ITA NOS.2777 TO 2481/16 :- 6 -: IN SUPPORT OF ASSESSEES CLAIM. IN OUR OPINION, TH E REASONS ADVANCED BY THE ASSESSEES COUNSEL ARE REASONABLE O NE AND WE FIND THAT THERE WOULD BE GOOD AND SUFFICIENT REASON FOR FILING THE APPEAL BELATEDLY. 4.1 FURTHER, THE HONBLE SUPREME COURT IN THE CASE OF COLLECTOR, LAND ACQUISITION V. MST. KATIJI AND OTHE RS IN [1987] 167 ITR 471 (SC) HAS LAID DOWN FOLLOWING PRINCIPLES; 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 JUSTI CE BEING DEFEATED. AS AGAINST THIS, WHEN DELAY IS CONDONED, THE HIGHEST THAT CAN HAPPEN IS THAT A CAUSE WOULD BE DECIDED ON MERI TS AFTER HEARING THE PARTIES. 3. ' EVERY DAY'S DELAY MUST BE EXPLAINED ' DOES NOT MEAN THAT A PEDANTIC APPROACH SHOULD BE MADE. WHY NOT EVERY HOU R'S DELAY, EVERY SECOND'S DELAY? THE DOCTRINE MUST BE APPLIED IN A RATIONAL, COMMON SENSE AND PRAGMATIC MANNER. 4. WHEN SUBSTANTIAL JUSTICE AND TECHNICAL CONSIDERA TIONS ARE PITTED AGAINST EACH OTHER, THE CAUSE OF SUBSTANTIAL JUSTIC E DESERVES TO BE ITA NOS.2777 TO 2481/16 :- 7 -: PREFERRED, FOR THE OTHER SIDE CANNOT CLAIM TO HAVE VESTED RIGHT IN INJUSTICE BEING DONE BECAUSE OF A NON-DELIBERATE DE LAY. 5. THERE IS NO PRESUMPTION THAT DELAY IS OCCASIONED DELIBERATELY, OR ON ACCOUNT OF CULPABLE NEGLIGENCE, OR ON ACCOUNT OF MA LA 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. FURTHER, WHEN THIS SUBSTANTIAL JUSTICE AND TECHNICA L CONSIDERATION ARE PITTED AGAINST EACH OTHER, THE CAUSE OF SUBSTAN TIAL JUSTICE DESERVES TO BE PREFERRED; FOR THE OTHER SIDE CANNOT CLAIM TO HAVE VESTED RIGHT FOR INJUSTICE BEING DONE BECAUSE OF NO N-DELIBERATE DELAY. IN THE CASE IN HAND, WE FIND THAT THE DELAY OF 22 MONTHS IN FILING THE APPEAL DUE TO THE LACK OF DILIGENCE SHOW N BY THE ASSESSEE IN FILING THE APPEAL WITHIN THE PRESCRIBED PERIOD, AND UNDOUBTEDLY, THE LONG DELAY CANNOT BE SAID THAT IT IS AN INTENTIONAL ONE. ACCORDINGLY, WE ARE OF THE CONSIDERED VIEW THA T IN THE INTEREST OF JUSTICE, AN OPPORTUNITY SHOULD BE PROVI DED TO THE ASSESSEE TO PURSUE THEIR APPEALS. THEREFORE, WE HER EBY CONDONE THE DELAY OF 22 MONTHS IN FILING THE APPEAL AND REM IT THE MATTER ITA NOS.2777 TO 2481/16 :- 8 -: BACK TO THE FILE OF LD. CIT (A) WITH DIRECTION TO H EAR THE APPEALS ON MERITS AND PASS APPROPRIATE ORDER AS PER LAW AFTER AFFORDING SUFFICIENT OPPORTUNITY TO THE ASSESSEE OF BEING HEA RD. 5. IN THE RESULT, ALL THE APPEALS FILED BY THE ASS ESSEE IN RESPECT OF SMT. NIRMALA DEVI AND MR.E.JEEVANANDAM ARE ALLOWED . ORDER PRONOUNCED ON 27 TH FEBRUARY, 2017, AT CHENNAI. SD/ - SD/ - ( . ! ) ( DUVVURU RL REDDY ) ) % / JUDICIAL MEMBER ( ) (CHANDRA POOJARI) / ACCOUNTANT MEMBER #$ / CHENNAI %& / DATED: 27 TH FEBRUARY, 2017. K S SUNDARAM &' ) *+ ,+ / COPY TO: 1 . -. / APPELLANT 3. / () / CIT(A) 5. +01 ) 2 / DR 2. )3-. / RESPONDENT 4. / / CIT 6. 1! 4 / GF