MOHD. GAFURDUDDIN F. SIDDIQUI, MUMBAI V. ITO 15(3)(3)NOW ITO 17(2)(3), MUMBAI

ITA 4821/MUM/2017

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 6580 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 7 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-02-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2006-2007
• Appeal Filed On: 10-07-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NIKESH MEHTA SHR
• Keywords: Unexplained cash credit; Period of limitation; Reasonable cause; Condonation of delay
• Section: 271(1)(c); 143(3); 264; 68

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES D , MUMBAI , . , , BEFORE SHRI AMARJIT SINGH, JUDICIAL MEMBER, AND SHRI G. MANJUNATHA, ACCOUNTANT MEMBER ITA NO.4821/MUM/2017 ASSESSMENT YEAR: 2006-07 MOHD. GAFOORUDDIN F. SIDDIQUI, FLAT NO.1, GR. FLOR, SAADATH MANZIL, 35, BORA ST. NULL BAZAR, BEHIND SAFAI MASJID, MUMBAI-400003 / VS. ITO - 15(3)(3), (NOW, ITO-17(2)(3)], R. NO.117, 1 ST FLOOR, MATRU MANDIR, TARDEO ROAD, MUMBAI-400007 ( ! /ASSESSEE) ( ' / REVENUE) P.A. NO.AAPPS1966C # '$%& / DATE OF HEARING : 17/01/2019 %& / DATE OF ORDER: 20/02/2019 / O R D E R PER G. MANJUNATHA (ACCOUNTANT MEMBER) THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST ORDER OF THE LD. CIT(APPEALS)-28, MUMBAI, DATED 08/05/2017 AND IT PE RTAINS TO ASSESSMENT YEAR 2006- 07. THE ASSESSEE HAS RISEN FOLLOWING GROUNDS OF APP EAL. ' !' / REVENUE BY SHRI DHAVAL SHAH & SHRI NIKESH MEHTA ! !' / ASSESSEE BY SHRI MANOJ KUMAR SINGH 2 ITA NO.4821/MUM/2017 MOHD. GAFURDUDDIN F. SIDDIQUI 1. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ER RED IN LAW AND FACTS IN DISMISSING THE APPEAL OF THE APPELLANT IN LIMINE AN D NOT CONDONING THE DELAY IN FILING THE APPEAL. 2. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ER RED IN LAW AND FACTS IN NOT APPRECIATING THAT NO PENALTY COULD HAVE BEEN LEVIED AS THE QUANTUM PROCEEDINGS WERE PENDING FOR DISPOSAL BEFORE THE LD. CIT(A). 3. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ER RED IN LAW AND FACTS IN IS NOT APPRECIATING THAT THE PENALTY LEVIED WAS NOT IN ACC ORDANCE WITH THE PROVISIONS OF S.271(1)(C) OF THE ACT. 4. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ER RED IN LAW AND FACTS IN CONFIRMING THE PENALTY OF RS.5,41,378/- LEVIED BY T HE ASSESSING OFFICER U/S 271(1)(C) OF THE ACT. 2. THE BRIEF, FACTS OF THE CASE ARE THAT THE ASSESS EE HAS FILED ITS RETURN OF INCOME FOR ASSESSMENT YEAR 2006-07 ON 21/09/2006, DECLARING TO TAL INCOME OF RS.1,97,956/-. THE ASSESSMENT HAS BEEN COMPLETED UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961, ON 29/12/2008, DETERMINING THE TOTAL INCOME AT RS.17,7 5,040/- BY MAKING ADDITIONS TOWARDS UNEXPLAINED CREDITS FOR RS.15,77,081/- UNDER SECTIO N 68 OF THE INCOME TAX ACT. THEREAFTER, THE ASSESSING OFFICER INITIATED PENALTY PROCEEDINGS UNDER SECTION 271(1)(C) OF THE ACT AND AFTER CONSIDERING THE SUBMISSIONS OF TH E ASSESSEE, THE ASSESSING OFFICER LEVIED PENALTY OF RS.5 41,378/- U/S 271(1)(C) OF TH E ACT. 3. AGGRIEVED BY THE ORDER OF THE ASSESSING OFFICER, THE ASSESSEE PREFERRED APPEAL, BEFORE THE LD CIT(A). APPEAL FILED BY THE ASSESSEE BEFORE THE LD. CIT(A), WAS BELATED BY 157 DAYS. THE ASSESSEE FILED A PETITION FOR CONDONA TION OF DELAY IN FILING THE APPEAL BEFORE THE LD. CIT(A) WITH A REASON THAT THERE IS A REASONABLE CAUSE FOR NOT FILLING APPEAL WITHIN THE TIME ALLOWED UNDER THE ACT, AS PER WHICH , THERE WERE WRONG ADVICE OF THE TAX CONSULTANT WHO HANDLED THE TAX MATTERS BEFORE LOWER AUTHORITIES. THE ASSESSEE FURTHER CONTENDED THAT THE TAX CONSULTANT HAS ADVISED FOR A REVIEW PETITION UNDER SECTION 264 OF 3 ITA NO.4821/MUM/2017 MOHD. GAFURDUDDIN F. SIDDIQUI THE ACT INSTEAD OF FILING APPEAL BEFORE THE LD. CIT (A), CHALLENGING THE ADDITIONS MADE BY THE ASSESSING OFFICER ALONG WITH PENALTY ORDERS. IT WAS CAME TO OUR NOTICE WHEN THE MATTER HAS BEEN CONSULTED WITH DIFFERENT TAX CONSUL TANT WHO ADVISED US TO FILE A REGULAR APPEAL BEFORE THE LD. CIT(A) CHALLENGING THE ADDITI ONS MADE BY THE ASSESSING OFFICER. IN THE MEANTIME THERE IS A LAPSE OF 157 DAYS WHICH IS BEYOND CONTROL OF THE ASSESSEE. THE LD. CIT(A), AFTER CONSIDERING THE SUBMISSIONS OF TH E ASSESSEE AND ALSO BY FOLLOWING CERTAIN JUDICIAL PRECEDENCE INCLUDING THE DECISION OF THE HONOURABLE SUPREME COURT IN THE CASE OF J. B. ADVANI & COMPANY PRIVATE LIMITED (72 ITR 395), DISMISSED THE APPEAL FILED BY THE ASSESSEE ON THE GROUND THAT CONDONATIO N OF DELAY, THOUGH AN EQUITABLE RELIEF, HOWEVER CANNOT BE ACCORDED MERELY ON SYMPAT HY OR COMPASSION AND THE GROUNDS OFFERED HAVE TO BE EVALUATED TO TEST WHETHER THE PA RTY IN DEFAULT HAD BEEN GUILTY OF CONSCIOUS AND DELIBERATE INACTION, CULPABLE NEGLIGE NCE AND INEXCUSABLE INDIFFERENCE TO THE PERIOD OF LIMITATION MANDATORILY PRESCRIBED BY THE LAW. THEREFORE, HE OPINED THAT THE ASSESSEE HAS FAILED TO GIVE ANY BASIS EITHER LEGAL OR OTHERWISE TO ADMIT THE APPEAL. HENCE, APPEAL FILED BY THE ASSESSEE IS DISMISSED. 4. AGGRIEVED BY THE ORDER OF THE LD CIT(A), THE ASS ESSEE IS IN APPEAL BEFORE US. THE LD AR OF THE ASSESSEE SUBMITTED THAT THE LD CIT(A) WAS ERRED IN DISMISSING THE APPEAL BY NOT CONDONING THE DELAY IN FILING OF APPEAL, WIT HOUT APPRECIATING THE FACT THAT NO ASSESSEE WOULD TAKE UNDUE ADVANTAGE BY FILING ITS A PPEAL BELATEDLY RATHER THE ACTION OF THE ASSESSEE IN NOT FILING THE APPEAL WITHIN THE TI ME ALLOWED UNDER THE ACT, WOULD CAUSE INJUSTICE TO THE ASSESSEE. THEREFORE, MERELY FOR TH E REASON THAT THERE IS DELAY IN FILING 4 ITA NO.4821/MUM/2017 MOHD. GAFURDUDDIN F. SIDDIQUI APPEAL, THE APPEAL CANNOT BE DISMISSED WHEN THE REA SONS GIVEN FOR CONDONATION OF DELAY IS REASONABLE AND BEYOND THE CONTROL OF THE A SSESSEE. THE LD AR FURTHER SUBMITTED THAT WHEN TECHNICALITIES AND THE MERITS O F THE CASE ARE PITTED EACH OTHER, THE MERITS OF THE CASE DESERVES TO BE PREFERRED, FOR TH E OTHER SIDE CANNOT CLAIM TO HAVE VESTED RIGHT IN INJUSTICE BEING DONE BECAUSE OF THE NON-DELIBERATE DELAY. THEREFORE, THE DELAY IN FILING APPEAL BEFORE THE LD CIT(A) MAY BE CONDONED AND THE ISSUE MAY BE SET- ASIDE TO THE FILE OF THE LD CIT(A) FOR ADJUDICATION ON MERITS. 5. THE LD DR, ON THE OTHER HAND, SUPPORTED THE ORDE R OF THE LD CIT(A). THE LD. DR FURTHER SUBMITTED THAT REASONS GIVEN BY THE ASSESSE E FOR CONDONATION OF DELAY IS NOT COMES WITHIN THE REASONABLE CAUSE AS THE ASSESSEE H AS STATED THAT IT COULD NOT FILE WITHIN THE TIME ALLOWED UNDER THE ACT, BECAUSE OF W RONG ADVICE OF TAX CONSULTANT, BUT SUCH CLAIM IS NOT SUPPORTED BY ANY EVIDENCE OR AFFI DAVIT OF TAX CONSULTANT. THEREFORE, THERE IS NO REASON TO INTERFERE WITH THE FINDINGS O F THE LD CIT(A) AND HENCE ITS ORDER SHOULD BE UPHELD. 6. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THE LD CIT(A) HAS DISMISSED TH E APPEAL FILED BY THE ASSESSEE ON TECHNICAL GROUNDS BY NOT CONDONING THE DELAY IN FIL ING APPEAL FOR A REASON STATED IN HIS ORDER. AS PER WHICH, THE REASONS GIVEN BY THE ASSES SEE ARE NOT COMES WITHIN THE MEANING OF REASONABLE CAUSE. THEREFORE, THERE IS NO REASON TO CONDONE THE DELAY IN FILING APPEAL FILED BY THE ASSESSEE. THE ASSESSEE H AS GIVEN REASONS BEFORE THE LD CIT(A) FOR NOT FILING THE APPEAL WITHIN THE TIME AL LOWED UNDER THE ACT. ACCORDING TO THE 5 ITA NO.4821/MUM/2017 MOHD. GAFURDUDDIN F. SIDDIQUI ASSESSEE, THE DELAY IS BECAUSE OF THE WRONG ADVICE OF TAX CONSULTANT WHO HANDLED THE TAX MATTERS BEFORE THE BELOW AUTHORITIES. AS PER WH ICH, TAX CONSULTANT HAS ADVISED US TO FILE A REVIEW PETITION U/S 264 OF THE ACT, WITHOUT FILING REGULAR APPEAL AGAINST THE ORDER OF THE LD AO, CHALLENGING THE ADDITIONS AS WELL AS PEN ALTY U/S 271(1)C OF THE ACT. WE FURTHER NOTE THAT ALTHOUGH THE SAID REASONS WAS NOT SUPPORT ED BY ANY AFFIDAVIT OF THE PERSON WHO GAVE WRONG ADVICE, BUT THE FACT REMAINS THAT NO PER SON WOULD GETS BENEFIT BY NOT PREFERRING AN APPEAL BEFORE THE AUTHORITIES RATHER IT CAUSES UNDUE HARDSHIP TO THE ASSESSEE. FURTHER, IT IS SETTLED POSITION IN LAW TH AT WHERE NO NEGLIGENCE, NOR INACTION OR WANT OF BONA-FIDES COULD BE IMPUTED TO THE ASSESSEE , A LIBERAL CONSTRUCTION OF THE PROVISION HAS TO BE MADE IN ORDER TO ADVANCE SUBSTA NTIAL JUSTICE. FURTHER, THE HONBLE SUPREME COURT IN THE CASE OF COLLECTOR, LAND ACQUIS ITION VS MST. KATJU (167 ITR 471) WHILE CONDONING THE DELAY IN FILING APPEAL OBSERVED THAT WHEN SUBSTANTIAL JUSTICE AND TECHNICAL CONSIDERATIONS ARE PITTED AGAINST EACH OT HER, CAUSE OF SUBSTANTIAL JUSTICE DESERVES TO BE PREFERRED FOR THE OTHER SIDE CANNOT CLAIM TO HAVE VESTED RIGHT IN INJUSTICE BEING DONE BECAUSE OF THE NON-DELIBERATE DELAY. THE HONBLE SUPREME COURT IN THE CASE OF N. BALAKRISHNAN VS M. KRISHNAMOORTHY (AIR) (1998 ) SC 3222) OBSERVED THAT RULES OF LIMITATION ARE NOT MEANT TO DESTROY THE RIGHTS OF P ARTIES. THEY ARE MEANT TO SEE THAT PARTIES DO NOT RESORT TO DILATORY TACTICS, BUT SEE THEIR REMEDY PROMPTLY. THE OBJECT OF PROVIDING LEGAL REMEDY IS TO REPAIR THE DAMAGE CAUS ED BY REASON LEGAL INJURY. IF YOU DO NOT CONDONE THE DELAY FOR SOME REASONS, WHEN THE AS SESSEE HAS GIVEN SUFFICIENT EXPLANATION FOR NOT FILING THE APPEAL, IT WOULD ADV ERSELY AFFECT THE ASSESSEE AS THE 6 ITA NO.4821/MUM/2017 MOHD. GAFURDUDDIN F. SIDDIQUI ASSESSEE WOULD BE PRECLUDED FROM PUTTING FORTH THER E OTHERWISE MERITORIOUS CASE BEFORE THE AUTHORITIES BUT BY NOT CONDONING THE DELAY, THE REVENUE WOULD, IN ANY MANNER, BE AFFECTED BECAUSE THE ISSUES INVOLVED IN THE APPEAL IS ALWAYS DEALT ON THE MERITS OF THE CASE. THEREFORE, WE ARE OF THE CONSIDERED VIEW, THE RE IS NO REASON FOR THE LD. CIT(A) FOR NOT CONDONING THE DELAY IN FILING OF APPEAL BEFORE HIM. THE ASSESSEE HAS GIVEN REASONS WHICH IS BEYOND HIS CONTROL, THEREFORE, WE CONDONE THE DELAY IN FILING APPEAL OF 157 DAYS BEFORE THE LD CIT(A) AND RESTORE THE ISSUE BACK TO THE FILE OF LD CIT(A) TO DECIDE THE ISSUE ON MERIT. 7. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS A LLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 20/02/2019. SD/- SD/- ( AMARJIT SINGH ) (G. MANJUNATHA) #'$ /JUDICIAL MEMBER %'$ / ACCOUNTANT MEMBER MUMBAI; ( DATED : 20/02/2019 F{X~{T? P.S / /. .. &#'()*)+' / COPY OF THE ORDER FORWARDED TO : 1. )*+ / THE APPELLANT (RESPECTIVE ASSESSEE) 2. ,-*+ / THE RESPONDENT. 3. .. / ( ) ) / THE CIT, MUMBAI. 4. .. / / CIT(A)- , MUMBAI, 5. 1'23,4 , .)&45 , / DR, ITAT, MUMBAI 6. 3 6 / GUARD FILE. ' / BY ORDER, /' (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI