M/s. Rao Computers Consultants Pvt. Ltd, Bengaluru V. Income Tax Officer, Ward-5(1)(2), Bengaluru

ITA 2624/BANG/2017

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 4824 (ITAT-BANGALORE)
• Duration Of Justice: 4 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-04-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2013-2014
• Appeal Filed On: 06-12-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B R RAMESH
• Assessee Lawyers: VANI H
• Keywords: Reasonable cause; Condonation of delay; Ignorance of law
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, BANGALORE BENCH A BEFORE SHRI N.V VASUDEVAN, JUDICIAL MEMBER AND SHRI JASON P BOAZ, ACCOUNTANT MEMBER ITA NO. 2624/BANG/2 017 (ASST. YEAR 2013-14) M/S. RAO COMPUTERS CONSULTANTS PVT. LTD., PLOT NO. 118, NEIL RAO TOWERS, ROAD NO. 03, EPIP 1 ST PHASE, WHITEFIELD, BENGALURU 560066. PAN: AAACR8427R . APPELLANT VS. INCOME TAX OFFICER, WARD 5(1)(2), BENGALURU .RESPONDENT APPELLANT BY : MS. VANI. H, ADVOCATE RESPONDENT BY : SHRI B.R. RAMESH, JCIT DATE OF HEARING : 09-04-2018 DATE OF PRONOUNCEMENT : 11-04-2018 O R D E R PER SHRI N.V VASUDEVAN, JUDICIAL MEMBER : THIS IS AN APPEAL FILED BY THE ASSESSEE AGSINT THE ORDER DATED 11/8/2017 OF COMMISSIONER OF INCOME-TAX (APPEALS) - V BENGALURU RELATING TO ASSESSMENT YEAR 2013-14. 2. THE ASSESSEE IS A COMPANY ENGAGED IN THE BUSINES S OF PROVIDING INFRASTRUCTURE FOR IT COMPANIES. AN ORDER OF ASSES SMENT DATED 24/3/2016 WAS ITA NO. 2624/B/17 2 PASSED BY THE AO U/S 143(3) OF THE ACT (ACT) FOR AS SESSMENT YEAR 2013-14 DETERMINING THE TOTAL INCOME OF THE ASSESSE AT RS.6 8,96,068/- AS AGAINST THE INCOME DECLARED BY ASSESSEE AT RS.64,72,980/-. 3. AGGRIEVED BY THE ADDITION MADE IN THE ORDER OF A SSESSMENT, ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT(A). 4. THERE WAS A DELAY OF ABOUT 209 DAYS IN FILING T HE APPEAL BEFORE THE CIT(A). IN SUPPORT OF ITS APPLICATION FOR CONDONA TION OF DELAY IN FILING THE APPEAL, THE ASSESSEE SUBMITTED THAT IT WAS IGNORANT OF THE PROVISIONS OF LAW AND WAS NOT ADVISED BY THE TAX CONSULTANT PROPERLY TO F ILE APPEAL AGAINST THE ORDER OF THE AO. THE CIT(A) WAS OF THE VIEW THAT THERE WAS NO REASONABLE CAUSE FOR THE DELAY IN FILING THE APPEAL BELATEDLY. HE HELD THAT THE ASSESSEE, A CORPORATE ASSESSEE ASSISTED BY THE QUALIFIED PROFESSIONALS A ND CANNOT PLEAD IGNORANCE OF LAW OR WRONG ADVISE OF PROFESSIONALS. THE CIT(A) T HEREFORE REFUSED CONDONATION OF DELAY IN FILING THE APPEAL. 5. AGGRIEVED BY THE ORDER OF THE CIT(A), THE ASSESS EE HAS PREFERRED THE PRESENT APPEAL BEFORE THE TRIBUNAL. 6. BEFORE US, THE LD COUNSEL FOR THE ASSSESEE RELIE D ON CERTAIN JUDICIAL PRONOUNCEMENTS IN SUPPORT OF THE ASSESSEES CLAIM T HAT THE DELAY IN FILING THE APPEAL OUGHT TO HAVE BEEN CONDONED BY THE CIT(A). THESE DECISIONS ARE 1) N BALAKRISHNAN VS. M KRISHNAMURTHY AIR 1998 SC 3222 2) AUTO CENTRE VS. STATE OF UTTAR PRADESH 278 ITR 291 (ALL) 3) PHOENIX MILLS LTD. VS. ACIT IN THE DECISION OF MUMB AI A BENCH IN ITA NO.6240/MUM 2007 ORDER DATED 23/3/2010. 7. THE LD DR RELIED ON THE ORDER OF THE CIT(A). ITA NO. 2624/B/17 3 8. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. THE ASSESSEE DERIVES INCOME FROM LETTING OF CONSTRUCTING AND LETTING OUT BUILDI NG ON RENT TO IT AND ITES COMPANIES WITH ALL INFRASTRUCTURAL FACILITIES. THE INCOME FROM SUCH LETTING OUT OF PROPERTY, ACCORDING TO THE ASSESSEE, SHOULD BE ASSE SSED UNDER THE HEAD INCOME FROM BUSINESS AND NOT UNDER THE HEAD INCOME FROM HOUSE PROPERTY, EVEN THOUGH SUCH INCOME WAS OFFERED BY THE ASSESSEE UNDE R THE HEAD INCOME FROM HOUSE PROPERTY. IN FACT THE DISPUTE BETWEEN THE A SSESSEE AND THE DEPARTMENT IN THIS REGARD WAS PENDING BEFORE THE APPELLATE AUTHOR ITIES FOR AY 2009-10 TO 2012- 13. THE CIT(A) PASSED AN ORDER DATED 29.12.2016 R EJECTING THE CLAIM OF THE ASSESSEE FOR AY 2009-10 TO 2012-13. THE ORDER OF T HE AO FOR THE AY IN THIS APPEAL VIZ., AY 2013-14 WAS PASSED ON 24.3.2016. T HE APPEAL OF THE ASSESSEE WAS FILED BEFORE CIT(A) ON 30.11.2016. THUS THE PL EA OF THE ASSESSEE IN THE STATEMENT OF FACTS FILED BEFORE CIT(A), THAT THE DI SPUTE REGARDING HEAD OF INCOME UNDER WHICH RENTAL INCOME FROM LETTING OUT BUILDING S WITH INFRASTRUCTURE FOR IT AND ITES COMPANIES HAS TO BE ASSESSED, HAD NOT ATTA INED FINALITY AND AT THAT STAGE WHEN THE AO PASSED ORDER OF ASSESSMENT ON 24.3.2016 SUSTAINABILITY OF SUCH CLAIM WAS IN DOUBT AND THEREFORE THE ASSESSEE WAS D EPENDANT ON LEGAL ADVICE OF COUNSEL WHETHER TO FILE APPEAL OR NOT, IS HIGHLY PR OBABLE. THE HONBLE SUPREME COURT IN THE CASE OF N.BALAKRISHNAN VS. M.KRISHNAM URTHY (SUPRA) TOOK THE VIEW THAT IF AN EXPLANATION FOR DELAY IN FILING APPEAL I S ACCEPTABLE THEN THE LENGTH OF DELAY IS NOT RELEVANT. IF THERE IS NO MATERIAL TO SHOW MALAFIDE OR DELIBERATE DELAY AS A DILATORY TACT, COURT SHOULD NORMALLY CONDONE T HE DELAY. 9. THE REASONS GIVEN FOR DELAY IN FILING THE APPEAL , IN OUR VIEW, ARE ACCEPTABLE. WE ARE THEREFORE OF THE VIEW THAT THE CIT(A) OUGHT TO HAVE CONDONED THE DELAY THE DELAY IN FILING THE APPEAL. FOR THE REASONS GIVEN ABOVE, WE CONDONE THE DELAY IN FILING THE APPEAL BY THE AS SESSEE BEFORE THE CIT(A). SINCE THE CIT(A) HAS NOT DECIDED THE APPEAL OF THE ASSESSEE, WE DIRECT THE CIT(A) TO DECIDE THE APPEAL OF THE ASSESSEE ON MERI TS AFTER AFFORDING OPPORTUNITY ITA NO. 2624/B/17 4 TO THE ASSESSEE OF BEING HEARD. THE APPEAL IS TREA TED AS ALLOWED FOR STATISTICAL PURPOSES. 10. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS AL LOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 11 TH APRIL, 2018 . SD/- SD/- (JASON P BOAZ) ( N.V VASUDEVAN) ACCOUNTANT MEMBER JUDICIAL MEMBER BANGALORE DATED : 11 /4/2018 VMS COPY TO :1. THE ASSESSEE 2. THE REVENUE 3.THE CIT CONCERNED. 4.THE CIT(A) CONCERNED. 5.DR 6.GF BY ORDER SR. PRIVAT E SECRETARY, ITAT, BANGALORE ITA NO. 2624/B/17 5 1. DATE OF DICTATION 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER . 3. DATE ON WHICH THE APPROVED DRAFT COMES TO SR. P. S... 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER .. 5. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE S R. P.S. .. 6. DATE OF UPLOADING THE ORDER ON WEBSITE .. 7. IF NOT UPLOADED, FURNISH THE REASON FOR DOING SO .. 8. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK .. 9. DATE ON WHICH ORDER GOES FOR XEROX & ENDORSEMENT.. 10. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK . 11. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER . 12. THE DATE ON WHICH THE FILE GOES TO DISPATCH SEC TION FOR DISPATCH OF THE TRIBUNAL ORDER . 13. DATE OF DESPATCH OF ORDER. ..