Mallur Siddeswara Mills Private Limited, Namakkal V. DCIT Centralized Processing Cell - TDS, Ghaziabad

ITA 2891/CHNY/2018

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 8776 (ITAT-CHENNAI)
• Duration Of Justice: 5 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-04-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: misc
• Appeal Filed On: 12-10-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: G BASKAR
• Keywords: Opportunity of being heard; Bonafide belief; Condonation of delay; TDS; Set aside

Judgement Text

, , IN THE INCOME-TAX APPELLATE TRIBUNAL B BENCH, CHENNAI . , . , BEFORE SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER & SHRI DUVVURU RL REDDY, JUDICIAL MEMBER I T.A. NOS.2889, 2890 & 2891/CHNY/2018 ASSESSMENT YEARS: 2013-14[Q-2 & Q-3] AND 2014-15 [Q-1] M/S. MALLUR SIDDESWARA MILLS PVT. LTD., ATTAIYAMPATTY ROAD, ATHANUR POST, RASIPURAM, NAMAKKAL 636 301. [PAN:AACCM0111B] VS. THE DEPUTY COMMISSIONER OF INCOME TAX, CENTRALIZED PROCESSING CELL TDS, AAYAKAR BHAVAN, SECTOR 3, VAISHALI, GHAZIABAD, UP 201 020. ( /APPELLANT ) ( / RESPONDENT ) / APPELLANT BY : SHRI G. BASKAR, ADVOCATE / RESPONDENT BY : SHRI SRIDHAR DORA, JCIT / DATE OF HEARING : 28.02.2019 /DATE OF PRONOUNCEMENT : 03.04.2019 / O R D E R PER DUVVURU RL REDDY, JUDICIAL MEMBER: THESE THREE APPEALS FILED BY THE SAME ASSESSEE ARE DIRECTED AGAINST CONSOLIDATED ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS), SALEM, DATED 24.08.2018 RELEVANT TO THE ASSESSMENT YEARS 2013-14 [Q-2 & Q-3] AND 2014-15 [Q-1]. THE ONLY COMMON GROUND RAISED IN ALL THE APPEALS IS THAT THE LD. CIT(A) HAS ERRED IN NOT CONDONING THE DELAY IN FILING THE APPEALS AND DISMISSED THE APPEAL BY PASSING EXPARTE ORDER. 2. AT THE OUTSET, THE LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT THE ASSESSING OFFICER, DCIT, CENTRALIZED PROCESSING CELL TDS, VAISHALI, I.T.A. NOS.2889 TO 2891/CHNY/19 2 GHAZIABAD HAS PASSED THE INTIMATION UNDER SECTION 200A OF THE INCOME TAX ACT, 1961. THE ASSESSEE HAS BEEN LOCATED AT AN INTERIOR PLACE IN NAMAKKAL DISTRICT. AGAINST THE ABOVE ORDER OF THE ASSESSING OFFICER, THE ASSESSEE HAS PREFERRED APPEALS BEFORE THE LD. CIT(A), SALEM. HOWEVER, THERE WAS DELAY OF 1478 DAYS, 1543 DAYS AND 1505 DAYS FOR THE ASSESSMENT YEARS 2013-14 [Q- 2 & Q-3] AND 2014-15 [Q-1] RESPECTIVELY IN FILING APPEALS. BEFORE THE LD. CIT(A), THE ASSESSEE HAS FILED AN AFFIDAVIT MAINLY STATING THAT THE INTIMATION UNDER SECTION 200A OF THE ACT APPEARS TO HAVE BEEN PASSED AND INTIMATED BY E-MAIL, WHEREAS INTEREST UNDER SECTION 234E OF THE ACT TOWARDS LATE FILING FEE FOR DELAY IN FILING THE QUARTERLY RETURNS WERE NOT COMMUNICATED TO THEM. IT WAS FURTHER SUBMISSION THAT THE ASSESSEE WAS UNDER BONAFIDE BELIEF THAT TDS RETURNS FILED FOR QUARTERS WERE FULLY ACCEPTED BY THE DEPARTMENT. BESIDES ABOVE, IT WAS STATED THAT THE CHAIRMAN, SHRI S.P. RAJENDRAN WHO WAS LOOKING AFTER INCOME TAX MATTERS SUDDENLY PASSED AWAY ON 06.03.2018 AND THE ASSESSEE HAD TO REORGANIZE THE OFFICE. HOWEVER, THE LD. CIT(A) HAS NOT CONDONE THE DELAY AND DISMISSED THE APPEAL BY PASSING EXPARTE ORDER WITHOUT DECIDING THE APPEAL ON MERITS. IN VIEW OF THE ABOVE, THE LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT THE DELAY IN FILING THE APPEALS BEFORE THE LD. CIT(A) IS NEITHER WILFUL NOR WANTON AND MOREOVER, THERE WAS NO NEGLIGENCE ON THE PART OF THE ASSESSEE AND THUS, PLEADED THAT THE DELAY IN FILING APPEALS BEFORE THE LD. CIT(A) MAY KINDLY BE CONDONED AND ORDERED FOR I.T.A. NOS.2889 TO 2891/CHNY/19 3 ADJUDICATING THE APPEALS ON MERITS AFTER GIVING AN OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 3. ON THE OTHER HAND, THE LD. DR STRONGLY OPPOSED TO CONDONE THE HUGE DELAY SINCE THERE WERE NO GOOD REASONS SUPPORTED BY COGENT AND PROPER EVIDENCE TO CONDONE THE DELAY. 4. WE HAVE HEARD BOTH SIDES, PERUSED THE MATERIALS ON RECORD AND GONE THROUGH THE ORDERS OF AUTHORITIES BELOW. IN THIS CASE, THE ASSESSEE IS LOCATED AT FAR OFF PLACE IN NAMAKKAL DISTRICT. THE CENTRALIZED PROCESSING CELL TDS, VAISHALI, GHAZIABAD HAS PROCESSED THE TDS STATEMENT FURNISHED BY THE ASSESSEE UNDER SECTION 200A OF THE ACT AND THE INTIMATION WAS COMMUNICATED BY E-MAIL. BEING A REMOTE LOCALITY, THE ASSESSEE COULD NOT GET THE LEGAL OPINION AS TO WHETHER AGAINST THE INTIMATION COMMUNICATED BY THE CPC-TDS APPEALED BEFORE HIGHER FORUM AFTER CONSULTING WITH THE HIGHER AUTHORITIES AND THIS PROCESS TOOK SUFFICIENT TIME AND THEREBY CAUSED DELAY IN FILING THE APPEALS BEFORE THE LD. CIT(A). UNDER THE ABOVE FACTS AND CIRCUMSTANCES, WE ARE OF THE CONSIDERED OPINION THAT THERE WAS NO NEGLIGENCE ON THE PART OF THE ASSESSEE. 5. THE EXPRESSION 'SUFFICIENT CAUSE' USED IN SECTION 5 OF THE LIMITATION ACT, 1963 AND OTHER STATUTES IS ELASTIC ENOUGH TO ENABLE THE COURTS TO APPLY THE LAW IN A MEANINGFUL MANNER WHICH SERVE THE ENDS OF JUSTICE. NO HARD AND I.T.A. NOS.2889 TO 2891/CHNY/19 4 FAST RULE HAS BEEN OR CAN BE LAID DOWN FOR DECIDING THE APPLICATIONS FOR CONDONATION OF DELAY BUT OVER THE YEARS VARIOUS COURTS HAVE ADVOCATED THAT A LIBERAL APPROACH SHOULD BE ADOPTED IN SUCH MATTERS SO THAT SUBSTANTIVE RIGHTS OF THE PARTIES ARE NOT DEFEATED MERELY BECAUSE OF DELAY. 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 RISK. REFUSING TO CONDONE DELAY CAN RESULT IN A MERITORIOUS MATTER BEING THROWN OUT AT THE VERY THRESHOLD AND CAUSE OF JUSTICE BEING DEFEATED. AS AGAINST THIS WHEN DELAY IS CONDONED THE HIGHEST THAT CAN HAPPEN IS THAT A CAUSE WOULD BE DECIDED ON MERITS AFTER HEARING THE PARTIES. WHEN SUBSTANTIAL JUSTICE AND TECHNICAL CONSIDERATIONS 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. MOREOVER, IN THE CASE OF N. BALAKRISHNAN V. M. KRISHNAMURTHY (1998) 7 SCC 123, THE HONBLE SUPREME COURT HAS OBSERVED AS UNDER: IT IS AXIOMATIC THAT CONDONATION OF DELAY IS A MATTER OF DISCRETION OF THE COURT. SECTION 5 OF THE LIMITATION ACT DOES NOT SAY THAT SUCH DISCRETION CAN BE EXERCISED ONLY IF THE DELAY IS WITHIN A CERTAIN LIMIT. LENGTH OF DELAY IS NO MATTER; ACCEPTABILITY OF THE EXPLANATION IS THE ONLY CRITERION. SOMETIMES DELAY OF THE SHORTEST RANGE MAY BE UNCONDONABLE DUE TO WANT OF ACCEPTABLE EXPLANATION WHEREAS IN CERTAIN OTHER CASES DELAY OF VERY LONG RANGE CAN BE CONDONED AS THE EXPLANATION THEREOF IS SATISFACTORY. ONCE THE COURT ACCEPTS THE EXPLANATION AS SUFFICIENT IT IS THE RESULT OF POSITIVE EXERCISE OF DISCRETION AND NORMALLY THE SUPERIOR COURT SHOULD NOT DISTURB SUCH FINDING, MUCH LESS IN REVERSIONAL JURISDICTION, UNLESS THE EXERCISE OF DISCRETION WAS ON WHOLE UNTENABLE GROUNDS OR ARBITRARY OR PERVERSE. BUT IT IS A DIFFERENT MATTER WHEN THE FIRST COURT REFUSES TO CONDONE THE DELAY. IN SUCH CASES, THE SUPERIOR COURT I.T.A. NOS.2889 TO 2891/CHNY/19 5 WOULD BE FREE TO CONSIDER THE CAUSE SHOWN FOR THE DELAY AFRESH AND IT IS OPEN TO SUCH SUPERIOR COURT TO COME TO ITS OWN FINDING EVEN UNTRAMMELLED BY THE CONCLUSION OF THE LOWER COURT. THE REASON FOR SUCH A DIFFERENT STANCE IS THUS: THE PRIMARY FUNCTION OF A COURT IS TO ADJUDICATE THE DISPUTE BETWEEN THE PARTIES AND TO ADVANCE SUBSTANTIAL JUSTICE. TIME LIMIT FIXED FOR APPROACHING THE COURT IN DIFFERENT SITUATIONS IN NOT BECAUSE ON THE EXPIRY OF SUCH TIME A BAD CAUSE WOULD TRANSFORM INTO A GOOD CAUSE. RULE OF LIMITATION ARE NOT MEANT TO DESTROY THE RIGHT OF PARTIES. THEY ARE MEANT TO SEE THAT PARTIES DO NOT RESORT TO DILATORY TACTICS, BUT SEEK THEIR REMEDY PROMPTLY. THE OBJECT OF PROVIDING A LEGAL REMEDY IS TO REPAIR THE DAMAGE CAUSED BY REASON OF LEGAL INJURY. LAW OF LIMITATION FIXES A LIFE-SPAN FOR SUCH LEGAL REMEDY FOR THE REDRESS OF THE LEGAL INJURY SO SUFFERED. TIME IS PRECIOUS AND THE WASTED TIME WOULD NEVER REVISIT. DURING EFFLUX OF TIME NEWER CAUSES WOULD SPROUT UP NECESSITATING NEWER PERSONS TO SEEK LEGAL REMEDY BY APPROACHING THE COURTS. SO A LIFE SPAN MUST BE FIXED FOR EACH REMEDY. UNENDING PERIOD FOR LAUNCHING THE REMEDY MAY LEAD TO UNENDING UNCERTAINTY AND CONSEQUENTIAL ANARCHY. LAW OF LIMITATION IS THUS FOUNDED ON PUBLIC POLICY. IT IS ENSHRINED IN THE MAXIM INTEREST REIPUBLICAE UP SIT FINIS LITIUM (IT IS FOR THE GENERAL WELFARE THAT A PERIOD BE PUT TO LITIGATION). RULES OF LIMITATION ARE NOT MEANT TO DESTROY THE RIGHT OF 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. A COURT KNOWS THAT REFUSAL TO CONDONE DELAY WOULD RESULT 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 'SUFFICIENT CAUSE' UNDER SECTION 5 OF THE LIMITATION ACT SHOULD RECEIVE A LIBERAL CONSTRUCTION SO AS TO ADVANCE SUBSTANTIAL JUSTICE VIDE SHAKUNTALA DEVI JAIN VS. KUNTAL KUMARI [AIR 1969 SC 575] AND STATE OF WEST BENGAL VS. THE ADMINISTRATOR, HOWRAH MUNICIPALITY [AIR 1972 SC 749]. IT MUST BE REMEMBERED THAT IN EVERY CASE OF DELAY THERE CAN BE SOME LAPSE ON THE PART OF THE LITIGANT CONCERNED. THAT ALONE IS NOT ENOUGH TO TURN DOWN HIS PLEA AND TO SHUT THE DOOR AGAINST HIM. IF THE EXPLANATION DOES NOT SMACK OF MALA FIDES OR IT IS NOT PUT FORTH AS PART OF A DILATORY STRATEGY THE COURT MUST SHOW UTMOST CONSIDERATION TO THE SUITOR. BUT WHEN THERE IS REASONABLE GROUND TO THINK THAT THE DELAY WAS OCCASIONED BY THE PARTY DELIBERATELY TO GAIN TIME THEN THE COURT SHOULD LEAN AGAINST ACCEPTANCE OF THE EXPLANATION. WHILE CONDONING DELAY THE COURT SHOULD NOT FORGET THE OPPOSITE PARTY ALTOGETHER. IT MUST BE BORNE IN MIND THAT HE IS A LOOSER AND HE TOO WOULD HAVE INCURRED QUIET A LARGE LITIGATION EXPENSES. IT WOULD BE A SALUTARY GUIDELINE THAT WHEN COURTS CONDONE THE DELAY DUE TO LACHES ON THE PART OF THE APPLICANT THE COURT SHALL COMPENSATE THE OPPOSITE PARTY FOR HIS LOSS. I.T.A. NOS.2889 TO 2891/CHNY/19 6 6. IN THE INSTANT CASE, THE ASSESSEE WAS NOT AWARE WHAT TO DO AND HOW TO PROCEED FURTHER AGAINST THE INTIMATION PASSED BY THE DCIT CPC-TDS, GHAZIABAD SINCE THE CHAIRMAN OF THE ASSESSEE COMPANY SUDDENLY PASSED AWAY. THEREFORE, AFTER CONSULTING HIGHER OFFICIALS, INCOME TAX PRACTIONERS/ ADVOCATES, THE ASSESSEE PREFERRED APPEALS WITH DELAY BEFORE THE LD. CIT(A). UNDER THE ABOVE FACTS AND CIRCUMSTANCES AND IN VIEW OF THE LEGAL POSITION, WE CONDONE THE DELAY IN FILING THE APPEALS BEFORE THE LD. CIT(A) AND ACCORDINGLY, WE SET ASIDE THE COMMON ORDER PASSED BY THE LD. CIT(A) AND DIRECT HIM TO ADJUDICATE THE APPEALS ON MERITS AFTER GIVING SUFFICIENT OPPORTUNITIES OF HEARING TO THE ASSESSEE. 7. IN THE RESULT, ALL THE APPEALS FILED BY THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON THE 03 RD APRIL, 2019 AT CHENNAI. SD/ - SD/ - (A. MOHAN ALANKAMONY) ACCOUNTANT MEMBER (DUVVURU RL REDDY) JUDICIAL MEMBER CHENNAI, DATED, THE 03.04.2019 VM/- /COPY TO: 1. / APPELLANT, 2. / RESPONDENT, 3. ( ) /CIT(A), 4. /CIT, 5. /DR & 6. /GF.