MILLENIUM TELECOM LTD, MUMBAI V. CIT., V, MUMBAI

ITA 4537/MUM/2011

• Counselvise Citation: 453719914 RSA 2011
• Duration Of Justice: 2 year(s) 5 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-12-2013
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 22-11-2012
• Assessment Year: 2004-2005
• Appeal Filed On: 06-06-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Period of limitation
• Section: 263

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL 'B' BENCH, MUMBAI BEFORE SHRI D. MANMOHAN, VICE PRESIDENT AND SHRI RAJENDRA, ACCOUNTANT MEMBER ITA NO. 4537/MUM/2011 (ASSESSMENT YEAR: 2004-05) M/S. MILLENIUM TELECOM LTD. DY. COMMISSIONER OF TELEPHONE HOUSE, 15 TH FLOOR INCOME TAX - 5 PRABHADEVI, V.S. MARG VS. MUMBAI DADAR (W), MUMBAI 400028 PAN - AADCM3056D APPELLANT RESPONDENT APPELLANT BY: SHRI VED JAIN RESPONDENT BY: SHRI RAVI PRAKASH DATE OF HEARING: 19.11.2013 DATE OF PRONOUNCEMENT: 04.12.2013 O R D E R PER D. MANMOHAN, V.P. THIS APPEAL BY THE ASSESSEE COMPANY IS DIRECTED AGA INST THE ORDER BY THE REVISIONARY AUTHORITY. THE IMPUGNED ORDER UNDER SECTION 263 WAS PASSED ON 18 TH MARCH, 2009 AND THE SAME WAS COMMUNICATED TO THE ASSESSEE ON 26 TH MARCH, 2009 WHEREAS THE APPEAL PAPERS WERE SIGNED BY THE DIRECTOR OF THE ASSESSEE COMPANY ON 1 ST JUNE, 2011 AND WAS ULTIMATELY FILED IN THE REGISTRY ON 6 TH JUNE, 2011 RESULTING IN A DELAY OF 742 DAYS. 2. THE DEPUTY GENERAL MANAGER OF THE ASSESSEE COMPANY FILED AN AFFIDAVIT TO SUBMIT THAT THE DELAY WAS ON ACCOUNT O F SUFFICIENT CAUSE AND HENCE IT DESERVES TO BE CONDONED. AS COULD BE NOTIC ED FROM THE AFFIDAVIT, IT WAS SUBMITTED THAT IN RESPECT OF A.Y. 2004-05 THE R ETURN WAS FILED ON 10 TH SEPTEMBER, 2004 AND THE ASSESSMENT WAS COMPLETED ON 25 TH SEPTEMBER, 2006 WHEREAS THE REVISIONARY AUTHORITY, IN EXERCISE OF POWERS VESTED IN HIM UNDER SECTION 263, SET ASIDE THE ASSESSMENT VIDE HI S ORDER DATED 18 TH MARCH, 2009 WHEREIN HE DIRECTED THE AO TO REFRAME T HE ASSESSMENT KEEPING IN MIND THAT THE DEDUCTION UNDER SECTION 80IA MAY N OT BE ALLOWABLE. THOUGH THE SAID ORDER WAS RECEIVED ON 26 TH MARCH, 2009 BY THE OPERATING ITA NO. 4537/MUM/2011 M/S. MILLENIUM TELECOM LTD. 2 OFFICE AT MUMBAI THE SAID ORDER WAS NOT FORWARDED T O THE HEAD OFFICE AT NEW DELHI WHERE THE TAXATION DEPARTMENT LOOKS INTO THE ISSUES OF TAXATION INCLUDING THAT OF M/S. MILLENNIUM TELECOM LTD. IT H AS COME TO THE NOTICE OF THE TAXATION DEPARTMENT THAT AN APPEAL HAS TO BE FI LED AGAINST THE ORDER DATED 18 TH MARCH, 2009 AND IMMEDIATELY THEREAFTER EFFORTS WER E MADE TO PREFER AN APPEAL. IN SHORT, THE DELAY WAS ON ACCOUN T OF THE FACT THAT THE IMPUGNED ORDER WAS NOT FORWARDED BY THE OPERATING O FFICE TO THE TAXATION DEPARTMENT AT NEW DELHI. 3. THE LEARNED COUNSEL FOR THE ASSESSEE FILED A BRIEF NOTE TO SUBMIT THAT IN ASSESSEES OWN CASE FOR A.Y. 2003-04 THE ITAT MU MBAI BENCH WAS PLEASED TO CONDONE THE DELAY AND SET ASIDE THE MATT ER TO THE FILE OF THE AO TO CONSIDER ALLOWABILITY OF CLAIM UNDER SECTION 80IA A FRESH. THE LEARNED COUNSEL FOR THE ASSESSEE ADVERTED OUR ATTENTION TO THE RELE VANT PARAGRAPH FROM THE ORDER OF THE TRIBUNAL (ITA NO. 5959/MUM/2008 DATED 18 TH SEPTEMBER, 2013) WHEREIN THE BENCH OBSERVED THAT THOUGH THE AS SESSEE HAS NOT MADE OUT ANY CASE OF GOOD AND SUFFICIENT REASONS FOR THE SAID DELAY ON ACCOUNT OF THE FACT THAT SERVICE OF THE IMPUGNED ORDER FROM TH E LOCAL OFFICE TO THE TAXATION DEPARTMENT, ETC. IS ONLY ON ACCOUNT OF LAC K OF PROPER COORDINATION WHICH IS PURELY AN INTERNAL MATTER WHICH HAS BEEN O CCURRING TIME AND AGAIN BUT STILL THEY ASSUMED THAT THE ASSESSEES CASE DES ERVES TO BE CONSIDERED ON MERITS, PROBABLY ASSUMING THAT CAUSE OF SUBSTANTIAL JUSTICE IS MORE IMPORTANT THAN THE TECHNICALITIES. THE LEARNED COUN SEL FOR THE ASSESSEE STRONGLY RELIED UPON THE OBSERVATIONS MADE BY THE B ENCH AND SUBMITTED THAT IN THE YEAR UNDER CONSIDERATION ALSO THERE WAS REASONABLE DELAY AND THE REASONS BEING THE SAME THE DELAY IN FILING THE APPE AL DESERVES TO BE CONDONED AND THE MATTER DESERVES TO BE DECIDED ON M ERITS. 4. ON THE OTHER HAND, THE LEARNED D.R. SUBMITTED THAT THE APPEAL FOR A.Y. 2003-04 WAS FILED ON 30.09.2008 WITH A DELAY O F 118 DAYS AND THERE WERE FURTHER PROCEEDINGS BEFORE THE COMMISSIONER OF INCOME TAX FOR A.Y. 2003-04 ON 16.03.2011 WHICH AT LEAST WOULD HAVE MAD E THEM REALISE THAT IT WOULD AFFECT THE OTHER YEARS AND IF THEY REPEAT THE SAME THE LAPSE CANNOT BE CONSIDERED AS REASONABLE AND SUFFICIENT CAUSE. ITA NO. 4537/MUM/2011 M/S. MILLENIUM TELECOM LTD. 3 5. IN FACT, ONE OF US (ACCOUNTANT MEMBER) WAS A PARTY TO THE ORDER PASSED IN THE CASE OF PRASHANT PROJECTS LTD. [37 T AXMANN.COM 137 (MUM)] WHEREIN THE BENCH OBSERVED THAT ADOPTING LIBERAL AP PROACH CANNOT BE EQUATED WITH A LICENCE TO FILE APPEALS AT WILL BY D ISREGARDING THE TIME LIMIT FIXED BY THE STATUTE, PARTICULARLY WHEN THE PARTY D ID NOT BOTHER TO FIND OUT THE OUTCOME OF THE PROCEEDINGS INITIATED BY THE REV ENUE (IN THE INSTANT CASE THE PROCEEDING INITIATED BY THE COMMISSIONER OF INC OME TAX UNDER SECTION 263 FOR A.Y. 2004-05) WHERE A CORPORATE ASSESSEE FI LES RETURN OF INCOME OF LAKHS OF RUPEES AND ASSISTED BY HIGHLY QUALIFIED PE RSONNEL DID NOT TAKE TIMELY ACTION CANNOT TAKE THE BENEFIT OF A TEMPORAR Y OFFICE WHEN THE ASSESSEE COMPANY IS OPERATING ONLY AT THAT ADDRESS. THE LEAR NED D.R., THEREFORE, SUBMITTED THAT THE DELAY IN THE INSTANT CASE IS SUB STANTIAL, I.E. 742 DAYS AND HENCE IT DOES NOT DESERVE TO BE CONDONED. IN FACT, IN THE INSTANT CASE EVEN FROM THE DATE OF VERIFICATION THERE IS A DELAY OF F IVE DAYS WHICH IN ITSELF SHOWS THAT THEY HAVE NOT GIVEN ANY IMPORTANCE TO TAKE TIM ELY ACTION. HE, THEREFORE, DISTINGUISHED THE ORDER PASSED BY THE ITAT IN RESPE CT OF THE EARLIER ASSESSMENT YEAR. 6. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE RECORD. THERE ARE CATENA OF DECISIONS ON THE ISSUE AS TO WHAT CONSTITUTES SUFFICIENT CAUSE AND THE LATEST DECISION IS IN THE CASE OF BASAWARAJ & ANR VS. THE SPECIAL LAND ACQUISITION OFFICER (CIVIL APPEAL NO. 6974 & 6975 OF 2013 DATED 22 ND AUGUST, 2013) WHEREIN THE APEX COURT OBSERVED AS U NDER : - THE LAW OF LIMITATION MAY HARSHLY AFFECT A PARTICUL AR PARTY BUT IT HAS TO BE APPLIED WITH ALL ITS RIGOUR WHEN THE STATUTE SO PRESCRIBES. THE COURT HAS NO POWER TO EXTEND THE PERIOD OF LIMITATION ON EQUITABLE GROUNDS. A RESULT FLOWING FROM A STATUTORY PROVISION IS NEV ER AN EVIL. A COURT HAS NO POWER TO IGNORE THAT PROVISION TO RELIEVE WH AT IT CONSIDERS A DISTRESS RESULTING FROM ITS OPERATION. THE STATUTO RY PROVISION MAY CAUSE HARDSHIP OR INCONVENIENCE TO A PARTICULAR PAR TY BUT THE COURT HAS NO CHOICE BUT TO ENFORCE IT GIVING FULL EFFECT TO T HE SAME. THE LEGAL MAXIM DURA LEX SED LEX WHICH MEANS THE LAW IS HARD BUT IT IS THE LAW, STANDS ATTRACTED IN SUCH A SITUATION. IT HAS CONSIS TENTLY BEEN HELD THAT, INCONVENIENCE IS NOT A DECISIVE FACTOR TO BE CONS IDERED WHILE INTERPRETING A STATUTE. ..... THE LAW ON THE ISSUE CAN BE SUMMARISED TO THE EFFEC T THAT WHERE A CASE HAS BEEN PRESENTED IN THE COURT BEYOND LIMITAT ION, THE APPLICANT HAS TO EXPLAIN THE COURT AS TO WHAT WAS THE SUFFIC IENT CAUSE WHICH ITA NO. 4537/MUM/2011 M/S. MILLENIUM TELECOM LTD. 4 MEANS AN ADEQUATE AND ENOUGH REASON WHICH PREVENTED HIM TO APPROACH THE COURT WITHIN LIMITATION. IN CASE A PAR TY IS FOUND TO BE NEGLIGENT, OR FOR WANT OF BONAFIDE ON HIS PART IN T HE FACTS AND CIRCUMSTANCES OF THE CASE, OR FOUND TO HAVE NOT ACT ED DILIGENTLY OR REMAINED INACTIVE, THERE CANNOT BE A JUSTIFIED GROU ND TO CONDONE THE DELAY. NO COURT COULD BE JUSTIFIED IN CONDONING SUC H AN INORDINATE DELAY BY IMPOSING ANY CONDITION WHATSOEVER. THE APP LICATION IS TO BE DECIDED ONLY WITHIN THE PARAMETERS LAID DOWN BY THI S COURT IN REGARD TO THE CONDONATION OF DELAY. IT CAN THUS BE SEEN THAT IF A PARTY HAS NOT ACTED D ILIGENTLY OR REMAINED INACTIVE THAT CANNOT BE TREATED AS SUFFICIENT CAUSE FOR NOT FILING THE APPEAL WITHIN THE PERIOD OF LIMITATION. MOREOVER, IN THE I NSTANT CASE THE ASSESSEE HAS BEEN ACTUALLY PURSUING THE MATTER ON THE SAME I SSUE FOR EARLIER YEARS AND PROBABLY FOR THE SUBSEQUENT YEARS BEFORE ONE AU THORITY OR THE OTHER IN THE RELEVANT PERIOD AND IT IS NOT KNOWN AS TO WHY T HEY WERE NOT ABLE TO FIND AS TO WHAT WAS THE OUTCOME OF 263 PROCEEDINGS FOR T HE YEAR UNDER CONSIDERATION. UNDER THESE CIRCUMSTANCES WE HOLD TH AT THIS IS NOT A FIT CASE FOR CONDONATION OF DELAY. THEREFORE, THE APPEAL FIL ED BY THE ASSESSEE COMPANY IS DISMISSED AS BEING BARRED BY LIMITATION. 7. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS DISM ISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 4 TH DECEMBER, 2013. SD/- SD/- (RAJENDRA) (D. MANMOHAN) ACCOUNTANT MEMBER VICE PRESIDENT MUMBAI, DATED: 4 TH DECEMBER, 2013 COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 5, MUMBAI CITY 4. THE DR, B BENCH, ITAT, MUMBAI BY ORDER //TRUE COPY// ASSISTANT REGISTRAR ITAT, MUMBAI BENCHES, MUMBAI N.P.