Sahakar Maharshi Kashti Vividh Karyakari Sewa Sahakari Society Limited, Ahmednagar V. Income Tac Offcer, Ward-2, Ahmednagar , Ahmednagar

ITA 367/PUN/2024

• Counselvise Citation: [2024] 101 COUNSELVISE.COM (IT) 7185 (ITAT-PUNE)
• Duration Of Justice: 2 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-05-2024
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 13-05-2024
• Assessment Year: 2018-2019
• Appeal Filed On: 21-02-2024
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: AJAY KUMAR KESARI LD.
• Assessee Lawyers: PRASAD BHANDARI LD.
• Keywords: Revision of order; Condonation of delay
• Section: 263; 143(3); 80P; 153

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, PUNE ‘B’ BENCH, PUNE ITAT-Pune Page 1 of 9 BEFORE HON’BLE SMT ASTHA CHANDRA, JUDICIAL MEMBER AND SHRI G. D. PADMAHSHALI, ACCOUNTANT MEMBER आयकर अपऩल स ं . / ITA No. 367/PUN/2024 निर्धारण वषा / Assessment Year : 2018-19 Sahakar Maharshi Kasti Vividh Karyakari Sewa Sahakari Society Ltd. At Post Kashti., Tal.-Shrigonda, Dist.-Ahmednagar PAN: AAAAK0815A . . . . . . . अपीलार्थी / Appellant बिधम / V/s Principal Commissioner of Income Tax Pune-1. . . . . . . . प्रत्यर्थी / Respondent द्वारा / Appearances Assessee by: Mr Prasad Bhandari [‘Ld. AR’] Revenue by: Mr Ajaykumar Kesari [‘Ld. DR’] स ु नवाई की तारीख / Date of conclusive Hearing : 14/05/2021 घोषणा की तारीख / Date of Pronouncement : 16/05/2021 आदेश / ORDER PER G. D. PADMAHSHALI, AM; This appeal is instituted by the assessee against the revisionary DIN & Order No. ITBA/REV/F/REV5/2022-23/1048661029(1) dt. 12/01/2023 passed u/s 263 of Income Tax Act, 1961 [hereinafter ‘the Act’] by the learned Principal Commissioner of Income Tax, Pune-1 [hereinafter ‘PCIT’] which set-aside the order of assessment passed u/s 143(3) of the Act by National e-Assessment Centre, Delhi [hereinafter ‘AO’] for the assessment year 2018-19 [hereinafter ‘AY’] 2. Briefly stated facts of the case are that; 2.1 The assessee a multipurpose co-operative society registered under the provisions of Maharashtra State Co-operative Society Act, 1960, had filed its Sahakar Maharshi Kasti Vividh Karyakari Sewa Sahakari Society Ltd Vs PCIT ITA No. 367/PUN/2024 AY: 2018-19 ITAT-Pune Page 2 of 9 return of income [hereinafter ‘ITR’] declaring taxable income of ₹NIL/- on 08/10/2018. The case of the assessee was subjected to limited scrutiny to verify the correctness of claim of deduction made u/c VI-A of the Act. By an order dt.20/04/2021 framed u/s 143(3) r.w.s. 144B of the Act the Ld. AO accepted the returned income on the basis of details uploaded by the assessee through e- proceedings. 2.2 Subsequently, within a period of two years from the end of financial year in which the order of assessment was passed, the case records of the assessee were called, perused and pointing out the failure on the part of Ld. AO to conduct inquiries into multiple issue relating to chapter VI-A deductions viz; (a) the source of deposits made from which interest income is earned (b) nexus as to whether those deposits are received from members or out of surplus funds (c) whether the institution with whom deposits are made are registered with Reserve Bank of India [hereinafter ‘RBI’] for carrying out banking business (d) whether the principle of mutuality is satisfied to allow deduction u/s 80P in respect of income earned from deposits made with banks etc. and for resulted under assessment of income, the Ld. PCIT assumed his revisionary jurisdiction u/s 263 of the Act. After considering the assessee’s detailed representation, the Ld. PCIT held the order of assessment as erroneous and prejudicial to the interest of revenue and consequently set-aside the original assessment for reframing it with the bullet directions as dilated at para 10 (Pg 7-8/8) of the impugned order passed u/s 263 of the Act. 2.3 Assessee aggrieved of aforestated revisionary order has set-up the present appeal on as many as two substantive grounds as laid in appeal memo. Sahakar Maharshi Kasti Vividh Karyakari Sewa Sahakari Society Ltd Vs PCIT ITA No. 367/PUN/2024 AY: 2018-19 ITAT-Pune Page 3 of 9 3. At the outset of physical hearing, adverting to an affidavit dt. 22/02/2024 the Ld. AR Mr Bhandari candidly sought our attention to 347 days delay occurred in instituting the present appeal and reiterating contains thereof & reasonings laid therein has prayed for condonation. Per contra the Ld. DR Mr Kesari strongly objected the prayer. The Revenue argued that, the delay of 347 days is inordinate in first place and is without any sufficient reason. Drawing our attention to the para 4 of the affidavit, Mr Kesari submitted that, the assessee was in receipt of impugned order on the date it was passed, the reasons stated in para 5 to 11 suggest that owning to investigation into fraudulent affairs of the society the Secretary & Manager of the assessee were suspended by the Hon'ble President, District Level Committee and then accountant/cashier were also resigned from service. The said suspensions were ordered vide order dt 07/08/2020 and 18/06/2021 respectively which were much time before passing of impugned order under challenge. Further resignation of accountant/cashier were on 31/05/2022 was also much prior to passing of impugned order under contest. Therefore, the plea taken by the assessee in support of its request for condonation of inordinate delay has no nexus with the suspension and resignations of the former officials. The Ld. Mr Kesari avowed further that, since the assessee did neither had any sufficient reasons nor it could bring one on record and as the affidavit badly lacks from affirming such delay was unintentional and was under bonafied belief, the assessee deserves no relief on the ground of limitation. To drive home this contention the Ld. DR has strongly pressed into service the ratio laid in ‘Basawaraj & Anr Vs Spl Land Acquisition Officer’ [2014, AIR 746 (SC)] and ‘Siva Industries & Holding Ltd. Vs ACIT’ [2024, 153 Taxmann.com 354 (Mad)] Sahakar Maharshi Kasti Vividh Karyakari Sewa Sahakari Society Ltd Vs PCIT ITA No. 367/PUN/2024 AY: 2018-19 ITAT-Pune Page 4 of 9 4. Without going into grounds of appeal and merits of the case, we have heard rival contentions on this limited issue of delay condonation and subject to rule 18 of ITAT-Rules, 1963 perused the material placed on records and considered the relevant facts & circumstance concerning the delay, judicial precedents relied upon and settled legal position thereon. 5. We note that the impugned revisionary order was passed u/s 263 of the Act was communicated & was admittedly received by the appellant on 12/01/2023. In terms of provisions of section 253(3) of the Act, the appeal thereagainst was required to be filed within sixty days of the date on which the impugned order was received by the assessee. However, the instant appeal against revisionary order is admittedly filed with a delay of 347 days from the expiry of statutory period prescribed u/s 253(3) of the Act. Thus, the appeal is time barred by limitation and deserves to be dismissed in-limine if not supported by the sufficient reasons behind such delay. This taken us to vouch as to ‘whether appellant had and have explained sufficient cause for condonation of delay in filing the present appeal or not?’ 6. Before we advert to the merits of the prayer for condonation of delay and the sufficiency of reasons behind the said delay occurred in instituting the present appeal, let us first consider the core principles that has been culled out by the Hon'ble Supreme court in ‘Esha Bhattacharjee Vs Managing committee of Raghunathpur Academy and Ors’ reported in 12 SCC 649, which are compelling to be referred herein before we actually vouch the sufficiency of reasons in given facts & circumstances; Sahakar Maharshi Kasti Vividh Karyakari Sewa Sahakari Society Ltd Vs PCIT ITA No. 367/PUN/2024 AY: 2018-19 ITAT-Pune Page 5 of 9 (a) Lack of bonafied imputable to a party seeking condonation of delay is a significant and relevant fact; (b) The concept of liberal approach has to encapsulate the conception of reasonableness and totally unfettered free play is not allowed; (c) The conduct, behaviour and attitude of a party relating to its negligence cannot be given a total go-bye in the name of liberal approach. (d) If the explanation offered is concocted or the grounds urged in the applications are fanciful, the Courts should be vigilant not to expose the other side unnecessarily to face such litigation. (e) It is to be borne in mind that no one gets away with fraud, misrepresentation or interpolation by taking recourse to the technicalities of the law of limitation. (f) An application for condonation of delay should be drafted with careful concern and not in a haphazard manner harbouring the notion that the Courts are required to condone the delay on the bedrock of the principle that adjudication of lis on merits is seminal to justice dispensation system; (g) The increasing tendency to perceive the delay as a non- serious matter and hence lackadaisical propensity can be exhibited in a nonchalant manner requires to be curbed, of course, with legal parameters (Emphasis supplied) 7. With this de lege lata, we now to examine as to whether the reasons put forth by appellant assessee expanses cause of sufficienso within the purview of s/s (5) of section 253 of the Act or not?. 8. It is evident from the averments made in application/affidavit for condonation of delay filed by the appellant society that, the order of assessment and submission Sahakar Maharshi Kasti Vividh Karyakari Sewa Sahakari Society Ltd Vs PCIT ITA No. 367/PUN/2024 AY: 2018-19 ITAT-Pune Page 6 of 9 made in the course of regular assessment proceedings could not be fetched from the custody of key officials who were either suspended or resigned from their services owning to investigation into affairs of assessee society. The sum and substance of appellant’s version that, delay was grossly attributable to the non- availability of relevant & sufficient records to file the appeal. As we note that, during the pendency of e-assessment proceedings the appellant assessee made written submission based on which the returned income was accepted. The revisionary proceedings were initiated much after the suspension of the officials wherein based on written reply/submissions of the appellant the revisionary order was passed. Ostensibly, the averments in the application/affidavit turned out to be vague and are devoid of any basis. On specific queries from the bench the Ld. AR representing the appellant assessee society could hardly submit or answer; (a) as to how in the absence of necessary documents and details the appellant could respond the notices & answered the queries effectively with supporting documents based upon which the impugned revisionary proceedings were culminated and which were taken place much time after the suspension? (b) as to how the appellant was prevented from filing the present appeal within the statutory period prescribed u/s 253(3) of the Act, when impugned order and all relevant documents placed before both the tax authorities were indeed available online to the assessee society? (c) as to how key documents/materials necessary for filing of present appeal were in custody of suspended/resigned officials of the assessee society? And finally (d) as to how the averments in the application/affidavit establishes sufficient cause towards delay of 347 days in filing the present appeal? Sahakar Maharshi Kasti Vividh Karyakari Sewa Sahakari Society Ltd Vs PCIT ITA No. 367/PUN/2024 AY: 2018-19 ITAT-Pune Page 7 of 9 9. In view hereof, we find that the averments in the application/affidavit are vague and not corroborated by any independent evidence while no or much less sufficient reasons for delay in filing the appeal attributable to appellant have been submitted, except narrating the events occurred prior to culmination of revisionary proceedings. There is neither a plausible explanation in the averments nor any whisper in the entire application/affidavit regarding a single step taken by appellant to showcase the required seriousness, and not even an affirmation that the delay was undeliberate or unintentional but an accidental drive. There is lack of bona fide even in explaining the delay and even complete absence of ground for condonation. The assessee had failed to demonstrate that there was ‘sufficient cause’ or ‘sufficient reason’ behind the inordinate delay in filing the present appeal. It is also on record that, the affidavit did also fail to establish that the said delay was unintended or undeliberate in any manner. In this circumstance, we see no cogent reasons in not countenancing with the views canvassed by of the Revenue that, the true length of delay is no matter and the acceptability of explanation is the only criteria as the primary function of Tribunal is to adjudicate dispute between the parties and to advance substantial justice. 10. On the other hand, the facts and circumstance, contents of and reasoning laid in the affidavit placed on records for our consideration per-se capable of suggesting clearly that, the appellant assessee was not at all vigilant rather appellant was admittedly negligent in dealing with the instant appeal. In the event in our considered view the delay in filing the present appeal stands bottomless of adequate, enough & sufficient reasons. Sahakar Maharshi Kasti Vividh Karyakari Sewa Sahakari Society Ltd Vs PCIT ITA No. 367/PUN/2024 AY: 2018-19 ITAT-Pune Page 8 of 9 11. The Hon'ble Supreme Court vide para 15 has summarized the law on the issue in ‚Basawaraj and Anr vs- Special Land Acquisition Officer‛ reported in L4 SSC 8U(SC) as; "15. The law on the issue can be summarized to the effect that where a case has been presented in the court beyond limitation, the applicant has to explain the court as to what was the "sufficient cause" which means an adequate and enough reason which prevented him to approach the court within limitation. In case a party is found to be negligent, or for want of bona fide on his part in the facts and circumstances of the case, or found to have not acted diligently or remained inactive, there cannot be a justified ground to condone the delay. No court could be justified in condoning such an inordinate delay by imposing any condition whatsoever. The application is to be decided only within the parameters laid down by this Court in regard to the condonation of delay. In case there was no sufficient cause to prevent a litigant to approach the court on time condoning the delay without any justification, putting any condition whatsoever, amounts to passing an order in violation of the statutory provisions and it tantamounts to showing utter disregard to the legislature". 12. It is the trite law that, the burden is on the party claiming condonation of delay to place before the appellate authority, in clear and explicit terms, all facts on which the party relies, so that the appellate authority/court can come to the conclusion that it is not a case of want of diligence or inaction on the part of the applicant. In the case under consideration, admittedly, the assessee has not shown any action or vigilance for a period of more than 347 days after the impugned order was served upon it. The appellant assessee has not proved any inaction or negligence on the part of a third party, much less have they pleaded any action or vigilance on their own part. The assessee did not care to file the present appeal for nearly a year posterior to passing of impugned order. The averments made in Sahakar Maharshi Kasti Vividh Karyakari Sewa Sahakari Society Ltd Vs PCIT ITA No. 367/PUN/2024 AY: 2018-19 ITAT-Pune Page 9 of 9 the application/affidavit by the society are not corroborated by any evidence so as to establish ‘sufficient cause’. Thus, the appellant assessee has failed to make out a case that there was sufficient cause for delay in filing the appeal as the assessee remained negligent and did not initiate any steps at all. Inaction and want of diligence on the part of the appellant/applicant would not entitle it to the benefit of the provisions of section 253(5) of the Act. Therefore, keeping in view the propositions of law laid down by the judicial precedents pressed into service and having regard to the totality of the facts and circumstances of present case as discussed above, in our considered view the appellant is found to be casual, non- serious and non-vigilant in preferring/instituting the instant appeal against the impugned order. Hence, in order to avoid injustice to respondent revenue, application for condonation of delay being devoid of reasonable and sufficient cause or much less cause, merits dismissal. Consequently, the instant appeal stands dismissed in-limine on the grounds of limitation. 13. In result, the appeal of the assessee stand DISMISSED on above terms. u/r 34 of ITAT Rules, order pronounced in open court on this Thursday, 16 th day of May, 2024 -S/d- -S/d- ASTHA CHANDRA G. D. PADMAHSHALI JUDICIAL MEMBER ACCOUNTANT MEMBER प ु णे / PUNE; ददना ां क / Dated : 16 th day of May, 2024 आदेश की प्रनिनलनपअग्रेनषि / Copy of the Order forwarded to : 1.अपीलाथी / The Appellant. 2. प्रत्यथी / The Respondent. 3. The Pr. CIT, Pune 4. The NFAC / CIT(A) Concerned 5. DR, ITAT, Bench ‘B’, Pune 6.गार्डफ़ाइल / Guard File. आदेशान ु सार / By Order वररष्ठदनजीसदिव / Sr. Private Secretary आयकरअपीलीयन्यायादधकरण, प ु णे / ITAT, Pune.