Rajendraprasad Hariprasad Jani, Vadodara V. The Income Tax Officer, Ward-4(1)(6), Baroda

ITA 404/AHD/2020

AI Insights

The case involves Rajendraprasad Hariprasad Jani, a retired bank employee and senior citizen, who appealed against a penalty imposed by the Income Tax Officer (ITO), Ward-8(1), Baroda, which was confirmed by the Commissioner of Income Tax (Appeals)-VI, Baroda. The penalty was levied under section 271(1)(c) of the Income Tax Act, 1961, for the assessment year 2009-10, based on additions made to the assessee's income. However, these additions were later deleted by the ITAT in a separate quantum appeal. The assessee filed the current appeal with a significant delay, which was attributed to the COVID-19 pandemic and his personal circumstances. The Tribunal, considering the exceptional circumstances and the principles of substantial justice, condoned the delay and allowed the appeal, thereby removing the penalty.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 133558 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-07-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 19-04-2023
• Assessment Year: 2009-2010
• Appeal Filed On: 09-07-2020
• Other Referred Cases: N. Balakrishnan Vs. M. Krishnamurthy, Collector, Land Acquisition Vs. Mst.Katiji & Others
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Reasonable cause; Condonation of delay
• Section: 271(1)(c)

Judgement Text

आयकर अपीलीय अिधकरण आयकर अपीलीय अिधकरणआयकर अपीलीय अिधकरण आयकर अपीलीय अिधकरण, अहमदाबाद 瀈यायपीठ अहमदाबाद 瀈यायपीठअहमदाबाद 瀈यायपीठ अहमदाबाद 瀈यायपीठ ‘C’ अहमदाबाद। अहमदाबाद।अहमदाबाद। अहमदाबाद। IN THE INCOME TAX APPELLATE TRIBUNAL “C” BENCH, AHMEDABAD BEFORE SHRI RAJPAL YADAV, VICE-PRESIDENT AND SMT.ANNAPURNA GUPTA, ACCOUNTANT MEMBER ITA No.404/Ahd/2020 Assessment Year : 2009-10 Rajendraprasad Hariprasad Jani C-37, Jalaramdham Hsg. Society GIDC Road, Majalpur Vadodara 390 001 PAN : ACAPJ 0043 Q Vs. ITO, Ward-8(1) Baroda. (Applicant) (Responent) Assesseeby : None Revenue by : Shri Rakesh Jha, Sr.DR सुनवाई क琉 तारीख/D a t e o f H e a r i n g : 2 0 / 0 4 / 2 0 2 3 घोषणा क琉 तारीख /D a t e o f Pr o n o u n c e m e n t : 1 2 / 0 7 / 2 0 2 3 आदेश आदेशआदेश आदेश/O R D E R PER ANNAPURNA GUPTA, ACCOUNTANT MEMBER Present appeal has been filed by the assessee against the order of the ld.Commissioner of Income Tax(A)-VI, Baroda by which the ld.CIT(A) has confirmed the action of the AO in imposing penalty under section 271(1)(c) of the Income Tax Act, 1961 (hereinafter referred to as “the Act” for short) for the Asst.Year 2009-10. 2. None appeared on behalf of the assessee. The assessee has filed written submissions. Therefore, we proceeded to dispose of the appeal ex parte the assessee after hearing the ld.DR and considering the material available on record. ITA No.404/Ahd/2020 2 3. At the outset, it was pointed out that the appeal filed by the assessee was time barred by 2084 days, and an application for condonation of delay has been filed along with affidavit of the assessee affirming the facts leading to the delay in filing appeal before the Tribunal. Briefly put, the reasons attributed to the delayin filing appeal in the penalty proceedings, , was that the assessee being a salaried person ,retired as employee of bank, and being senior citizen , filed appeal only on discovering that he was wrongly penalized when the ITAT allowed his appeal in quantum proceedings thus deleting all additions made to his income by the AO on which penalty u/s 271(1)© of the Act had been levied. The contents of the affidavit of the assessee filed before us are reproduced as under: 4. The ld.DR vehemently opposed the maintainability of appeal before us, stating that the assessee has no sufficient and reasonable cause so as to justify the condonation of delay before us and the ITA No.404/Ahd/2020 3 delay was attributable completely to laxity on the part of the assessee. 5. We have heard both the parties and gone through the material placed before us. The appellate order passed by the ld.CIT(A) in penalty proceedings is dated 3.7.2014. The assessee ought to have filed appeal against the same within 60 days. However, the appeal was filedbefore us on 10.7.2020 resulting in delay of 2084 days. However, we havenoted that due to the pandemic of Covid-19, the limitation prescribed for filing appeals was extended till further orders by the Hon’ble Supreme Court vide its order dated 23/03/2020 in Suo Moto Writ Petition (Civil) No.(s) 3/2020. And the same was ultimately extended upto 28th February 2022 in M.A No.21 of 2022 dated 10th January 2022. This period of extension given by the Supreme Court is therefore to be excluded for the purpose of limitation in filing appeal before the various authorities. Therefore, considering the same, the delay in filing present appeal attributed to the COVID period from 23 rd March, 2020 till 10 th July 2020, when the appeal was filed before us, is to be excluded for the purpose of quantifying the period of delay, and therefore, the delay in filing the present appeal before us is 1377 days and not 2084 days as noted by the Registry. 6. Having noted so, we find that on the basis of pleadings of the assessee before us, there appears to be sufficient and justifiable cause for condoning the delay of 1377 days in filing appeal before us. Most importantly is the fact that the penalty levied in the present case u/s 271(1)(c) of the Act for concealing/furnishing inaccurate particulars of income, which has been contested by the assessee, is totally unjustified and unsustainable in law, considering ITA No.404/Ahd/2020 4 the fact that there is no concealment /furnishing of inaccurate particulars of income by the assessee since admittedly all additions made in the order passed in quantum proceedings under section 143(3) of the Act, stand deleted in entirety by the ITAT vide its order passed in the assessee’s case in ITA No.1439/Ahd/2016 dated 29.01.2020.There cannot be a better case where for the mere technicality of delay in filing appeal, justice, which otherwise is outrightly due to an assessee, will be denied. 7. Moreover, we find that the assessee has sufficient cause for not filing the appeal in time. He is a retired bank employee and a senior citizen with his life savings as the only means of sustaining him through the evening of his life. The penalty levied was not substantial, being to the tune of Rs.37,100/-. Considering his not so strong financial position, commercial considerations could very well have prompted him to not file appeal against the small penalty confirmed by the Ld.CIT(A) since it would involve cost of litigating the matter also. And when it was discovered subsequently that there was no case for levy of penalty, any prudent person would have acted as the assessee did by taking corrective action of filing appeal to delete the penalty levied ,which otherwise he would be unjustly required to pay. The assessee consciously took a decision not to file appeal earlier clearly due to commercial considerations and filed appeal subsequently only when he realized that in the changed circumstances, when the quantum additions stood deleted, he was wrongly penalized for an offence he had not even committed. The delay, definitely cannot be attributed to any laxity on the part of the assessee nor can the assessee said to have not acted diligently. In ITA No.404/Ahd/2020 5 fact the assessee has been proactive in taking decision of first not filing appeal and subsequently filing appeal to correct a palpably wrong penalty levied on him. In the facts and circumstances of the case therefore we find that the assessee has adduced sufficient and reasonable cause for the delay and to meet the ends of justice, the delay in filing of the appeal in the present case needsto be condoned, however, large the quantum of delay may be. 8. The Hon’ble Apex Court in the case of N. Balakrishnan Vs. M. Krishnamurthy, 1998 (7) SCC 123held that the law of limitation was founded on public policy, for the general welfare of all so that a period be put to litigation. It held that Rule of Limitation is not meant to destroy the right of the parties, rather they are meant to see that parties do not resort to dilatory tactics, but seek their remedy promptly. In the present case the delay in filing appeal cannot be attributed to any dilatory tactics adopted by the assessee but in fact is on account of a well thought out decision. The Hon’ble Apex Court in the case of Collector, Land Acquisition Vs. Mst.Katiji & Others, 167 ITR 471 (SC) exhaustively dealt with the power conferred by the Legislature to condone the delay by enacting section 5 in the Limitation Act, holding that purpose for the same was to enable Courts to advance substantial justice to the party by disposing of the matters on merit. The Hon’ble Court in the said case held that expression “sufficient cause” for section 5 of Limitation Act was to be applied in a manner to sub- serve the ends of justice and therefore a justifiable liberal approach had to be adopted on principle. The Hon’ble Court while giving ITA No.404/Ahd/2020 6 reasons for adopting a liberal approach stating one of the reasons as by refusing to condone delay, a meritorious matter will be thrown out at the very threshold and cause of justice defeated. This is exactly what will result if the delay in the present case is not condoned since the assessee will be penalized for an act which he undisputedly has not committed. The Hon’ble court in the said decision added that judiciary is respected not 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. This aptly sums up the reason why, we find that the delay in the present case needs to be condoned. It is the consideration of substantial justice in the present case which we find overrides the technical consideration of delay. Procedural laws are primarily intended to achieve the ends of justice and normally not to shut the doors of justice for the parties at the very threshold. 9. Considering the principles laid down as above for condoning delays in filing appeals and applying it to the facts of the present case, we hold that it is a fit case for condoning the delay. We, accordingly condone the delay of 1733 days in filing of the present appeal before us. 10. Adverting now to the merits of the case, since it is an undisputed fact that the additions made in the present case on which penalty was levied stands deleted by the ITAT vide its order passed in ITA No.1439/Ahd/2016 (supra), the penalty levied has no legs to stand upon and is therefore directed to be deleted. ITA No.404/Ahd/2020 7 11. In the result, the appeal of the assessee is allowed in above terms. Order pronounced in the Court on 12 th July, 2023 at Ahmedabad. Sd/- Sd/- (RAJPAL YADAV) VICE-PRESIDENT (ANNAPURNA GUPTA) ACCOUNTANT MEMBER Ahmedabad, dated 12/07/2023 vk* आदेश आदेशआदेश आदेश क琉 क琉क琉 क琉 灹ितिलिप 灹ितिलिप灹ितिलिप 灹ितिलिप अ灡ेिषत अ灡ेिषतअ灡ेिषत अ灡ेिषत/Copy of the Order forwarded to : 1. अपीलाथ牸 / The Appellant 2. 灹瀄यथ牸 / The Respondent. 3. संबंिधत आयकर आयु猴 / Concerned CIT 4. आयकर आयु猴(अपील) / The CIT(A) 5. िवभागीय 灹ितिनिध, आयकर अपीलीय अिधकरण / DR, ITAT, 6. गाड榁 फाईल / Guard file. आदेशानुसार आदेशानुसारआदेशानुसार आदेशानुसार/BY ORDER, True Copy उप उपउप उप/सहायक सहायकसहायक सहायक पंजीकार पंजीकारपंजीकार पंजीकार (Dy./Asstt.Registrar) आयकर आयकरआयकर आयकर अपीलीय अपीलीयअपीलीय अपीलीय अिधकरण अिधकरणअिधकरण अिधकरण, अहमदाबाद अहमदाबादअहमदाबाद अहमदाबाद / ITAT, Ahmedabad 1. Date of dictation- 05-7-2023 2. Date on which the typed draft is placed before the Dictating Member 3. Date on which the approved draft comes to the Sr.P.S./P.S. - 4. Date on which the fair order is placed before the Dictating Member for Pronouncement .................... 5. Date on which the file goes to the Bench Clerk . 6. Date on which the file goes to the Head Clerk.................................. 7. The date on which the file goes to the Assistant Registrar for signature on the order.......................... Date of Despatch of the Order..................