AARA Agro Pvt. Ltd., Agra V. Dy.CIT., Circle-2(1)(1), Agra

ITA 54/AGR/2021

• Counselvise Citation: [2021] 104 COUNSELVISE.COM (IT) 8003 (ITAT-AGRA)
• Duration Of Justice: 4 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-11-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2018-2019
• Appeal Filed On: 15-07-2021
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: TDS; Capital Gains
• Section: 234B; 115JB; 143(1); 201

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AGRA BENCH: AGRA BEFORE SHRI LALIET KUMAR, JUDICIAL MEMBER AND DR. MITHA LAL MEENA, ACCOUNTANT MEMBER LT.A No. 54/AGR/2021 (ASSESSMENT YEAR: 2018-19) Vs. CIT Circle-2 (1)(1) Agra Agro Private Limited Anjana Cinema, 3/2 D.M.G. Road Agra U.P. Agra U.P. 282007 PAN: AAGCA8595F (Assessee) (Revenue) Assessee by Sh. K.K. Jain, Adv. Revenue by | WaseemArshad, Sr. DR Date of Hearing_ Date of Pronouncement |14.10.2021 23.11.2021 ORDER PerBench: This appeal is filed against the Order u/s 143(1) of the Income Tax Act, 1961 (herewinafter referred as 'the Act') dated 19.05.2019, assed by the DCIT, CPC, Bengaluru. The appellant filed return of income for the assessment year 2018-19 on 2809-2018 which was subsequently revised on 30-09-2018 LT.A No. 54/AGR/2021 2 declaringg total income of Rs. 26,60,05,400/- under the normal provisions of the Act and book profit of Rs. 35,05,03,102/- under the provisions of section 115JB. During the year appellant hassold fixed asset on 07-03-2018. While processing the ITR the CPC Bengaluru charged interest u/s 234B amounting to Rs. 7,66,824/- and u/s 234C amounting to Rs. 29,74,897/-. Aggrieved with the charging of interest u/s 234C, the appellant has filed this appeal. 2.2 The appeal was e-filed in Form No-35 on 04-03-2020 accompanied by statement of facts, groundsof appeal and details of paymentof appeal fee. 2.3 In the statement of facts, it has been submitted that "The appellant company had no business. However, during the year capital asset has been sold in the month of March 2018 on which long term capital gains arise. The liability of advancetax arose only after sale of property in accordance with the provisions of section207 to 211. The e return was filed showing normal income of rupees 266005400 and income under section 115JB of rupees 3 50503 102. The intimation under section 143(1) was received on 3rd June 2019 determining demand of rupees 37,41,720 which comprises interest charged under section 234C amounting to rupees 29,74,897 on account of deferment of payment of advance tax and 234B of rupees 7,66,824. The appellant had paid the interest charged under section 234B. The interest234C has also been paid at rupees 88,140 for deferment of last installment of advance tax. The appellant moved rectification requestbefore CPC for modifying interest charged under section 234C on 9th June 2019. The said rectification LT.A No. 54/AGR/2021 3 request was rejected by CPC vide order dated 28th June 2019 but sent on Email on 21st February 2020 which could be seen on 2nd March 2020. On receipt of rectification order, it is noticed that CPC has repeated the liabilityas determined in the intimation under section 143(1). Section 143(1) authorized to make adjustmentto the returned income in certain cireumstances enumerate therein. The interest under section 234C is to be charged only for the month of March as the capital gains arise in the month of March duly reported in ITR. The present appeal is delayed by 275 days for which condonation application is being separately moved." 2.4 The appellant had taken three grounds in the appeal which are as under- 2.4 () Because the CPC has erred in charging interest under section 234C for first, second and third quarter as there was no liability to pay advance tax as the capital gains arise in the month of March 2018. (i) Because the capital gains arise on the sale of asset in the month of March 2018 the interest under section 234C is to be charged only for the month of March as per the provisions of section 207 to 211. (ii) Because the appellant craves leave to add, modified, subtract any grounds of appeal at the time hearing. 2.5 In appeal memo appellant has submitted the condonation of delay in the column no 15, which is reproduced here under: 4 LT.A No. 54/AGR/2021 "THE APPELLANT EARNED INCOME FROM CAPITAL GAINS IN MARCH 2018 THEREFORE THE ADVANCE TAX LIABILITY AROSE ONLY IN MARCH. THE RETURN WAS PROCESSED ON 17 MAY 2019 CHARGING INTEREST US 234C.THE APPELLANT INSTEAD OF FILING APPEAL PREFER TO FILE RECTIFICATION REQUEST AT CPC ON 9 JUNE 2019. THE RECTIFICATION ORDER RECEIVED ON EMAIL ON 21 FEB 2020 SEEN ON 2/3/2020. THE APPEAL FILED IS DELAYED BY 275 DAYS FOR WHICH SEPERATE APPLICATION IS BEING FILED." 3. During the appellate proceedings the appellant submitted the written submission, produced here under: "The appeal filed is delayed by 275 days for which separate application for condonation of delay has been filed on 5/3/2020 (copy enclosed) and in view of the facts and circumstances enumerated therein, the delay may please be condoned and appeal be entertained. The sequence of events in the matter is summarized below: - Date of service | Date of order/application 17-05-2019 Event 03-06-2019 Intimation /s 143(1) Rectification request at CPC Rectified intimation not received till 10-02-2020 09-06-2019 Grievance for not receiving 10-02-2020 Rectified order dated 28-06- I.T.A No, 54/AGR/2021 5 rectified intimation 2019 sent on email on 21- 02-2020 2020 seen on 02-03- Appeal filec 04-03-2020 In brief the appellant after having knowledge on 02-03-2020 about passing of order u/s 154 on 28-06-2019 and sent on email on 21-02-2020 immediately thereafter without any loss of time, against the intimation dated 17-05-2019 served on 03-062019 has filed the present appeal on 04-03-2020 which clearly show the due diligence of the appellant in filing appeal. The delay in service of the rectified order is not attributable to the appellant. On identical facts Hon'ble Allahabad High Court in Subhash Malik vs CIT [2010) 3251 TR 243 (AlI) has condoned the delay in filing appeal. Copy of order is placed in paper book. On the facts and circumstances the delay of 275 days with no malafide intention for the cause of delay and was not deliberate as a dilatorytactic. The cause of justice will suffer in case the delay is not condoned. Your good self has been vested with inherent powers to condone the delay under sub section (3) of section 249 of the Act where delay has occurred due to sufficient and reasonable cause. In the present matter the delay is occurred due to sufficient and reasonable cause as explained herein before which may please be condone." 4. On perusal of Form-35, it is seen that the Order /s 143(1) dated 17-05- 2019 was served upon the assessee on 03-06-2019, while the appeal was filed on 6 L.T.A No. 54/AGR/2021 04-032020, which is beyond the statutory time limit provided for filing of the appeal. As per Section 249(2%c) the appeal shall be presented within 30 days of the following date on which the intimation of the order sought to be appealed against is served. For the sake of clarity relevant provision of section 249 of the Income-tax 5. Act,1961 in respect of appeal to the CIT(A) and limitation, is reproduced here under 249. (1) Every appeal under this Chapter shall be in the prescribed form and shall be verified in the prescribed manner and shall, in case of an appeal made to the Commissioner (Appeals) on or after the 1st day of October, 1998, irrespective of the date of initiation of the assessment proceedings relating thereto be accompanied by a fee of,- where the total income of the assessee as computed by the Assessing Officer in the case to which the appeal relates is one hundred thousand rupees or less, two hundred fifty rupees; where the total income of the assessee, computed as aforesaid, in the case (iv) to which the appeal relates is more than one hundred thousand rupees but not more than two hundred thousand rupees, five hundred rupees; L.T.A No. 54/AGR/2021 7 (where the total income of the assessee, computed as aforesaid, in the case to which the appeal relates is more than two hundred thousand rupees. one thousand rupees (vi)where the subject matter of an appeal is not covered under clauses (). and (ii), two hundred fifty rupees. (2) The appeal shall be presented within thirty days of the following date, that is to say, (a)where the appeal is under section 248, the date of payment of the tax, or (b)where the appeal relates to any assessment or penalty, the date of service of the notice of demand relating to the assessment or penalty: Provided that, where an application has been made under section 146 for reopening an assessment, the period from the date on which the application is made to the date on which the order passed on the application is served on the assessee shall be excluded, on (c) in any other case, the date on which intimation of the order sought to be appealed against is served. (2A) Notwithstandinganything contained in sub-section (2), where an order has been made under section 201 on or after the Ist day of October, 1998 but before the lst day of June, 2000 and the assessee in default has not presented any appeal within the time specified in that sub-section, he may present such appeal before the 1st day of July, 2000. L.TA No. 54/AGR/2021 8 (3) The Commissioner (Appeals) may admit an appeal after the expiration of the said period if he is satisfied that the appellant had sufficient cause for notpresenting it within that period. (4) No appeal under this Chapter shall be admitted unless at the time of filing of the appeal- (a) where a return has been filed by the assessee, the assessee has paid the tax due on the income returned by him; or (b) where no return has been filed by the assessee, the assessee has paid an amount equal to the amount of advance tax which was payable by him: Provided that, in a case falling under clause (b) and] on an application made by the appellant in this behalf, the Commissioner (Appeals) may, for any good and sufficient reason to be recorded in writing, exempt him from the operation of the provisions of that clause." 6. In the instant case, the appellant filed the appeal against the Order u/s 143(1) of the Act, which was served upon him on 03-06-2019. The appeal was required to be filed within 30 days i.e. by 04-07-2019. However, it was belatedly filed on 04-032020. It is seen from columns 14 & 15 of the appeal filed and submission made that it is due to late receiving of order u/s 154 of the Act. 7.1 Further, the provisions of Section 249(3) lay down that an appeal may 7.1 be admitted after the expiration of the said period, if the CIT(A) is satisfied LT.A No. 54/AGR/2021| 9 that the appellant had sufficient cause for not presenting the appeal within that period. In this case the appellant should have filed the appeal against order u/s 143(1) by 03-072019 within 30 thirty days of receipt of order under reference. If appellant has filed rectification petition against the order u/s 143(1) and if said rectification order has been received then if any appeal was required then should have been filed against the order u/s 154 of the Act and not against the order u/s 143(1) of the Act. As such it cannot be said as sufficient cause for delay in filling of appeal. Under the circumstances it is admitted fact that the appellant did not comply with the provisions of Sec. 249 pertaining to the procedure for filing of an appeal, the appeal filed on 0403-2020 is held to be not maintainable. The appellant has placed his reliance in the case of decision of honorable High Court of Allahabad in Subhash Malik V/s CIT (2010) 325 ITR 347. The facts of the case are not the same as per facts of the present case being in the said case, the counsel has advised to take up the matter before CIT( Appeal) to get the order rectified u/s 154 of the Act. However, in this case there is no such facts. Therefore, the ratio of this case law is not applicable to the present case. In the case of Senior Bhosale Estate (HUF) Vs Assistant Commissioner of Income Tax, the Hon'ble Apex Court allowed the condonation of delay in filing the concerned appeal pronouncing the principles behind condoning the delay in LT.A No. 54/AGR/2021 10 filing appeals before the Courts by applying section 5 of the Limitation Act, 1963. The Hon'ble Apex Court is of the view that the law of limitation is founded on public policy. The idea behind the law of limitation is not destroy the rights of the parties but to ensure that they do not resort to dilatory tactics and seek remedy without delay. The objection of the law of limitation is to keep alive the legal remedy with in a prescribed limited time but does not restrict courts to condone the delay in the interest of justice. There are certain genuine grounds which the courts may consider for the condonation of delay in cases where Appeals are filed after the expiry of period as laid down under the limitation Act, 1963. In the case of condonation of delay where the appeal was filed beyond the limitation of period, the courts are empowered to condone the delay, provided that the Appellant can prove his claim of inability to file the appeal within the prescribed period. Litigant must be able to demonstrate that there was "Sufficient Cause" which obstructs his action to file appeal in the prescribed time limit. Courts have also held that the expression "Sufficient Cause" shall receive liberal consideration for the sake of justice. Thus, the condonation of delay is not automatic but is based upon on the facts of the case. Courts while condoning delays in filing appeals have power to examine the case and after ascertain the facts if delay was due to "Sufficient Cause" may condone the delay. 11 I.T.A No. 54/AGR/2021 6. Considering the above discussion and facts, the appeal filed is not in conformity with the provisions of Sec 249(2) of the Act, and there is no sufficient cause for condonation of the delay in filing of the appeal, the present appeal is dismissed as not maintainable. Thus, the appeal filed by the appellant is dismissed as not maintainable. SYNOPSIS Brief facts 1. The 'appellant is a Private Limited Company and had no business since last severalyears. During the year under consideration immovable property bearing number 3/2D Khasra No.513 Mauja Lashkarpur, M.G. Road, Agra along with depreciable assets was sold through Sale Deed(Page No.82 to 98) Registered on 7.3.2018 (A.Y 2018-19) for a consideration of Rs.35,25,00,000/-. The breakup of sale consideration is as under:- Land Building Plant & Total Nature of asset Machinery sold 31,17,40,000 Non Depreciable 31,17,40,000 3,97,60,000 10,00,000 4,07,60,000 Depreciable Assets Total B1,17,40,000 3,97,60,000 10,00,000 35,25,00,000| 12 I.T.A No. 54/AGR/2021 On Condonation of Delay (Ground No.1) 2 For the disposal of Ground No.1, it is considered expedient to invite the kind attention ofthe Hon'ble Bench to the sequence of events which are tabulated below Date of PBP Date Event service 18-51 30.09.2018| Return of Income filed under 17.05.2019| 03.06.2019 by64-68 The said Return stood processed Post section 143(1) of the Act and'Original' Intimation issued 69 09.06.2019 Upon receipt of Original Intimation Rectification Application filed at CPC for rectifying interestexcessively/wrongly charged under section 234C of the Act 70 Since unheard. Grievance filed at CPC for not receiving 10.02.2020| Rectified Intimation' CPC alleges having issued 'Revised 28.06.2019 Intimation. However, no such 'Revised Intimation' was| In response to the Grievance filed at CPC, 21.02.2020| 21.02.2020 71- 5 Rectified Intimation sent on registerede mail for the first time to the appellant. Rectified Intimation seen on e-mail giving rise to 02.03.2020| present appeal Assessee being unsuccessful in 04.03.2020 Rectification proceedings as conveyed vide 11- Application for condonation of delay filed beforel05.03.2020 4 CIT(A) 13 LT.A No. 54/AGR/2021 From the sequence of events as tabulated above your good self may be kind 3. toappreciate that the appellant. after receipt of 'Intimation' on 03.06.2019, acted promptly filed application under section 154 of the 'Act' on 09.06.2019 and hearing no response from the CPC for long also raised grievance on 10.02.2020 in response to which the 'appellant' was informed that CPC had already raised 'Rectified Intimation' on 28.06.2019. 4. 'Appellant' affirms that the so-called 'Rectified Intimation 'never reached/served on the 'appellant' on 28.06.2019 or on any date near to this date. The 'Rectified Intimation' for thefirst time was sent on e-mail on 21.02.2020 and which was seen by the 'appellant' on 02.03.2020. Therefore, as such the cause of grievance arose either on 21.02.2020 or on 02.03.2020 against which Appeal was filed on 04.03.2020 well within 30 days'. 5. 'Appellant' affirms that 'Revised Intimation' was never served on the date of 28.06.2019 or on any date near to such date either by Post or by e-mail. 'Appellant' furnishes herewith Affidavit of the Managing Director of the 'Appellant' Company in order to establish its case. . That since in the case of 'appellant mistake pertains to excess/wrong charging of Interest the 'appellant' upon being so advised, was pursuing alternate remedy provided under the Income Tax Act by virtue of Section 154 of the Act' therefore, complete period starting from 09.06.2019 to 02.03.2020 deserves to be condoned as the 'appellant' was pursuing alternate remedy for deletion of disputed demand. I.TA No. 54/AGR/2021 14 7 The alleged delay in service of 'Rectified Intimation' from 28.06.2019 to 02.03.2020 cannot be attributed to the 'appellant' as no such 'Rectified Intimation' ever got served upon the appellant' either by Post or by e-mail. Thus, there was no mala fide or deliberate delay as a dilatory tactic in filing the appeal delayed by 275 days. As per section 249(3), the CIT(A) may admit an appeal after the 8. expiration of prescribed period if he is satisfied that the appellant had sufficient cause for not presenting it within that period. The power of condonation is expected to be exercised liberally so as to advance the cause of justice. 9. The 'appellant' had placed reliance on various decisions for condonation of delay before CIT(A) NFAC but the same were not discussed much less distinguished. 'NFAC' has only discussed the Judgment of Hon'ble Allahabad High Court in Subhash Malik vs CIT [2010] 325 ITR 243 (All) (Page No.60 to 65) and has distinguished it too on flimsy ground,placing reliance on hyper technical consideration mentioned in Para 7.1 of the impugned order (Page No.8 of appeal memo) as under: The facts of the case are not the same as per facts of the present case being the said case, the counsel has advised to take up the matter before CIT(Appeal) to get the order rectified u/s 154 of the Act. However, in this case there are no such facts. Therefore, the ratio of this case law is not applicable to the present case." LT.A No. 54/AGR/2021| 15 In the case of Subhash Malik (supra) the facts of the case were that the 10. Assessment orderunder section 144 was passed by the ITO by an order dated 5- 3-2002. The assessee filed an appeal on 08.04.2002 before the Commissioner (Appeals). The said appeal was dismissed by the Commissioner (Appeals) by an order dated 25.09.2002 and the said order was served upon the assessee on 18.11.2002. An application under section 154 for the rectification of the order dated 25.09.2002 was filed on 23.12.2002 but the same was rejected by the Commissioner (Appeals) by an order dated 20.10.2003. The said order dated 20.10.2003 was served on the assessee on 25.11.2003, thereafter the assessee filed an appeal on 28.11.2003 after a delay of 279 days before the Tribunal against the order dated 25.09.2002 passed by the Commissioner (Appeals). The said appeal was dismissed by the Tribunal as barred by limitation. The Hon'ble High Court reversed the order passed by the ITAT holding that "/t was also noteworthy that an application under section 154 was filed against the order dated 25.09.2002 well within time. There was no reason to disbelieve the contention of the assessee. that he as advised by his counsel to file an application under section 154 for the rectification of the order dated 25.09.2002 and the pendency of the said application had caused the delay in filing the appeal before the Tribunal. ' The Hon'ble High Court further held that" It has been consistently held by the Apex Court that in matter of condonation of delay a liberal and pragmatic view should be taken. The Apex Court in Ramji Dass v. Mohan Singh ARC 1978 Page 496 has held thatas far as possible Court's discretion should be exercised in favour of the hearing and not to shut out hearing" and while allowing the appeal held "Thus, while deciding LTA No. 54/AGR/2021 16 such an application justice oriented approach is required to be adopted." The Hon'ble Jurisdictional High Court while arriving at the above view referred and relied upon the Judgement delivered in the case of 'Bharat Auto Centre v. CIT (2005) 149 Taxman 228 (All.) in which matter too while dealing with the similar situation the Hon'ble High Court held that where the delay in filing the appeal before the Commissioner of Income-tax (Appeals) was caused due to the pendency of the application under section 154 of the Act the delay is condonable. 11. The facts of Subhash Malik's case are summarized below:- Date Event 05.03.2002 Order passed u/s 143(3) Appeal filed before CIT(A) Appeal dismissed by CIT(A) Service of order Application u/s 154 filed before CIT(A) Application rejected by CIT(A) Service of order u/s 154 of CIT(A) Appeal filed before ITAT against the order dated 28.11.2003 08.04.2002 25.09.2002 18.11.2002 23.12.2002 20.10.2003 25.11.2003 18/11/2002 with delay of 279 days Appeal dismissed by ITAT 08.07.2005 Delay condoned by Hon'ble High Court vide order dated 10.07.2009 The following decisions on the issue are relevant and may please be considered:- 17 LT.A No. 54/AGR/2021 12.1 167 ITR 471(SC)Collecotr, Land Acquisition vsMst.Qatiji& Other (page No.105 to 108 of paper book) It has been held that when substantial justice and technical consideration are pitted against each other, the cause of substantial justice deserves to be preferred, the other side cannot claim to have vested right in injustice being done because of non deliberate delay. There is no presumption that delay isoccasioned deliberately or on account of culpable negligence or on a malafide. The litigation does not stand to benefit by resorting to delay, in fact he is on serious risk. 12.2 Improvement Trust vs. Uijaqar Singh (Supreme Court) CIVIL APPEAL NOS. 2395 of 2008 dated 26.06.2010 (Page No.109 to 122 of paper book) Unless mala fides are writ large. delay should be condoned. Matters should be disposed of on merits and not technicalities. 12.3 431 ITR 148 (Del) HL Malhotra& Co. Pvt. Ltd. Vs DCIT(page No.123 to 128 of paper book) (Relevant Para 16) It was held that in absence of anything male fide or deliberate delay as a dilatory tactic, the Court should normally condone the delay as the intent is always to promote substantial justice following the Hon'ble Supreme Court decisions in the case of Collector, Land Acquisition, Anantnag&Anr. VsMst. Katiji and others (1987) 2 SCC 107 and N. Balakrishnan Vs M. Krishnamurthy 1998 (7) SCC 123. L.T.A No. 54/AGR/2021 18 12.4 ITA No.2494/Mum/2018 Shri NibeshJabarmalChandanivs 1TO order dated 28.11.2018 (Page No.l129 to 135 of paper book) (Para 6) "Nevertheless, a liberal approach has to be adopted by the appellate authorities where delay has occurred for bona fide reasons on the part of the assessee or the Revenue in filing the appeals. In matters concerning the filing of appeals, in exercise of the statutory right, a refusal to condone the delay can result in a meritorious matter being thrown out at the threshold, which leads to miscarriage of justice. The 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." In view of the facts and overall circumstances of the case the CIT(A) NFAC has grossly erred in refusing to condone the delay of 275 days which may kindly be condoned and appellant may kindly be heard on merits. Submissions on merits (Ground No.2, 3 and4) 13. These grounds relates to the charging of excessive interest under section 234C of the Act. The appellant company had filed e-return declaring income of Rs.26,60,05 400/- under normal provisions of the Act which inter alia included only capital gains viz a viz long term capital gains worked out on sale of land and short term capital gains worked out on sale of depreciable assets. As the book profit was more than normal income, the tax was calculated under the LT.A No. 54/AGR/2021 19 provisions of section 115JB on the book profit of Rs.35,05,03,102/-which inter alia included profit on sale of fixed assets. Since the entire income accrued on 07.03.2018, therefore, there was no liability to pay advance tax before 07.03.2018. The entire profit on sale of assets arisen on 07.03.2018 could not have been foreseen by the appellant so as to enable it to estimate such income for the purpose of payment of advance tax on an anterior date. may it be 15.06.2017 or 15.09.2017 or 15.12.2017. The appellant was thus not liable to pay advance tax on or before 15.6.2017, 15.09.2017 and 15.12.2017 as the income was not estimable at the relevant point of time and such event has taken place after the due dates of first, second and third installments. The interest charged for the first, second and third quarter is patently illegal and is in unsustainable. The interest could be charged only for the month of March view of the unambiguous provisions contained in statute vide section 207 to 211 of the Act. 13.1 The advance tax payable only in the last installment as per the normal provisions of the Act at Rs.6.31 80.751/- against which tax paid by way of TDS and advance tax at Rs.6,59,88,880/-. Thus the tax paid in advance was much more than payable as per normal provisions. However, there is short fall of advance tax as per the provisions of section 115JB. The tax payable as per the provisions of section 115JB worked out at Rs.7,48,02,970/- and the short fall of advance tax for the month of March worked out at Rs. 88,14,082/- on which interest u/s 234C is leviableat Rs.88,140/- only as against Rs.29,74,897/- charged while issuing intimation u/s 143(1).Thus the order passed by CIT(A) NFAC resulted into substantial miscarriage of justice, LT.A No. 54/AGR/2021 20 greatly prejudiced the cause of justice and the appellant has been saddled with the excessive liability of interest u/s 234C of the Act. 13.2. The similar issue of charging interest under section 234C had come up for consideration before the Hon'ble Mumbai Bench in the case of Sidhmicro Equities Private Ltd. vs ACIT (ITA No.710/Mum/2018) (Page No.136 to 142) order dated 27/3/2019 wherein the Hon'ble after due consideration of the matter has held that the assessee cannot be saddled with the liability of interest prior to earning of income/gain. The AO was directed to work out the interest under section 234C from the date of accrual of capital gain only. The fact of the appellant's case is identical. Similar view was adopted in the case of ACIT vs Jindal Irrigation Systems Ltd. [56 ITD 164](Hyd.) (Page No.147 & 148) wherein it has been held that an assessee could not be defaulted for a duty, which was impossible to be performed. The Bench also considered levy of interest u/s 234C of the Act in a situation where on the relevant dates assessee was not in a position to estimate receipt of such income. Again a similar view has been taken by the Hon'ble Chennai Bench of Tribunal in the case of Express Newspaper Ltd. [103 TTJ 122](Chennai) (Page No.143 to 146) and Hon'ble Mumbai Bench in the case of Kumari Kumar Advanivs ACIT (ITA No.7661/Mum/2013) (Page No.148 to 154) order dated 13/7/2016.The Hon'ble Rajasthan High Court in CIT vs Smt.Premlata Jalani [264 ITR 744] (Page No.155 to 167) has held that the interest payable u/s 234C only in respect of LT.A No. 54/AGR/2021 21 installm nt due after accrual of capital gains and not on the entire amount of tax. On consideration of the facts and provisions of law the interest charged excessively u/s 234C needs to be modified and may please be direct the AO to modify it. 2. The Ld.DR for the revenue had submitted that the assessee is not entitled for any indulgence from the Bench as the assessee failed to file the appeal within the statutory period as provided by the Act and therefore the CIT(A) was right in disposing of the appeal without adjudicate them grounds on merit. 3. We have considered the rival contention of the parties and perused the material available on record, including the judgments cited at bar during the course of hearing by both the parties. 4. As is clear from the undisputed fact argued before us that the assessee had preferred application under section 154 before the assessing officer for rectification of mistake however no order was communicated to the assessee within the statutory. The respondent on receipt of the reminder from the assessee, had only provided the copy of the order passed in section 154 to the assessee. Immediately after receiving the order under section 154, the assessee preferred the appeal before the CIT(A), the CIT(A), had failed to consider the explanation given by the assessee for delay in pursuing the appeal and had 22 LT.A No. 54/AGR2021 summarily rejected the appeal of the assessee on the ground that the appeal was not filed within the statutory period as provided by the act. 5. As per record intimation under section 143(1) was issued to the assessee on 17 May 2019 and thereafter the application was filed under section 154 for rectification on 9 June 2019., The grievance of the assessee was not redressed by the assessing officer and therefore the assessee was constrained to file an application on 10" Feb 2020, in response thereto the respondent had informed to the assessee that the rectification application had already been disposed of on 28th June 2019 and the said order of rejecting application under section 154 was sent to Ld.AR for the assessee, through email communication on 21 February 2020. 6. Immediately thereafter the assessee preferred the appeal before the CIT(A) on 4th March, 2020. Ordinarily the appeal is required to be filed by the assessee efore the CIT(A) within the. of 30 days from the date of receipt of the order/intimation in the present court case it was 17" May 2019. 7. In our considered opinion the delay in filing the appeal before the alleged impression that the rectification application is pending adjudication before the assessing officer. At this stage it would be difficultfor us to find out whether the communication dated 28 June 2019, was sent by the assessing officer or the CPC to the assessee or to his AR or not. In any case, the purpose of tax adjudication is to collect due and legal taxes from the assessee and for those purposes, the liberal approach is required to be followed by the authorities below. 23 IT.A No. 54/AGR2021 Undoubtedly, the assessee was required to be vigilant and diligent in following the remedies before the statutory authority, in the present case it cannot be said they the assessee was negligent in prosecuting is right. Moreover the purpose of filing the appeal before the CIT(A) was to get the things set right by citing the correct provision, the same could have been done by the assessing officer if the assessing officer had considered the application of section 154 filed by the assessee. 8. Needful was not done by the assessing officer as well as by the CIT(A). 9. In the light of the above we are of the considered opinion that the delay in filing the appeal before the CIT(A) is required to be condoned and we accordingly condone the same. 10. As we have condoned the delay in filing the appeal before the CIT(A) and there was no adjudication by the CIT(A) on merit, it would be are in the interest of justice that appeal is remanded back to the file of the CIT(A) with the direction to decide the appeal on merit after affording opportunity of hearing to the assessee and granting the opportunity to file any document as deemed appropriate in accordance with law and rules framed for the said purpose. We made it clear that we have not expressed any opinion on meritof the case and whatever expression used in order is only with a view to bring on record the correct facts which were necessaryfor adjudicatingthe condonationof delay. LT.A No. 54/AGR/2021 Hence the appeal is allowed for statistical purposes. Dr. MITHA LAI. VEENA) ACCOUNTANT MEMBER (LALIETKUMAR) JUDICIALMEMBER Appellant Respondent CIT DR. iA True Copy By Order