GB Trading and Investments Pvt.Ltd.,Hyd, Hyderabad V. Income Tax Officer, Ward-2(2), Hyderabad

ITA 598/HYD/2012

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 66091 (ITAT-HYDERABAD)
• Duration Of Justice: 3 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-08-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2008-2009
• Appeal Filed On: 25-04-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AMISHA GUPTA
• Assessee Lawyers: P MURALI MOHAN RAO
• Keywords: Period of limitation; Condonation of delay

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B, HYDERABAD BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SMT. ASHA VIJAYARAGHAVAN, JUDICIAL MEMBER ITA NOS. 597 & 598/HYD/2012 ASSESSMENT YEARS: 2006-07 & 2008-09 GB. TRADING & INVESTMENTS PVT. LTD., APPELLAN T HYDERABAD (PAN AABCG7496A) VS. INCOME TAX OFFICER, RESPONDENT WARD - 2(2), HYDERABAD APPELLANT BY : SHRI P. MURALI MOHAN RAO RESPONDENT BY : SMT. AMISHA GUPTA DATE OF HEARING : 23/07/2012 DATE OF PRONOUNCEMENT : 03/08/ 2012 ORDER PER ASHA VIJAYARAGHAVAN, J.M.: BOTH THESE APPEALS FILED BY THE ASSESSEE ARE DIREC TED AGAINST THE RESPECTIVE ORDERS OF CIT(A)-III, HYDERA BAD, DATED FOR THE ASSESSMENT YEARS 2006-07 & 2008-09. SINCE IDENT ICAL ISSUE IS INVOLVED IN BOTH THESE APPEALS, THEY WERE HEARD TOG ETHER AND THEREFORE A COMMON ORDER IS PASSED FOR THE SAKE OF CONVENIENCE. ITA NO. 597/HYD/2012 FOR AY 2006-07. 2. BRIEFLY THE FACTS OF THE CASE ARE THAT THE ASSES SEE COMPANY IS IN THE BUSINESS OF AN INVESTMENT AND FILED RETUR N OF INCOME FOR THE YEAR UNDER CONSIDERATION DISCLOSING THE TOTAL L OSS OF RS. 28,26,373/-, WHICH WAS PROCESSED BY THE AO U/S 143( 3) OF THE ITA NOS. 597 & 598/HYD/2012 GB TRADING AND INVESTMENTS PVT. LTD. 2 ACT ON 20/07/2009 BY DISALLOWING SHORT TERM CAPITAL LOSS AND LONG TERM CAPITAL GAIN ON WHICH STT NOT PAID AMOUNTING T O RS. 46,95,547/- AND LOSS FROM OTHER SOURCES AMOUNTING T O RS. 3,47,066/- TOTALING (LONG TERM CAPITAL GAIN) TO RS. 43,48,481/- RAISING DEMAND OF RS. 6,82,483/-. 3. AGGRIEVED, THE ASSESSEE CARRIED THE MATTER IN AP PEAL BEFORE THE CIT(A) AND FILED THE APPEAL WITH A DELAY OF 27 DAYS, AS THE APPEAL SHOULD HAVE BEEN FILED ON OR BEFORE 20/08/20 09, BUT, THE ASSESSEE FILED THE APPEAL ON 17/09/2009, RESULTING INTO THE SAID DELAY. SINCE THE ASSESSEE HAS NOT FILED ANY CONDON ATION PETITION, THE CIT(A) DID NOT ADMIT THE APPEAL AND DISMISSED T HE SAME. 4. AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFORE US. 5. WE HAVE HEARD THE ARGUMENTS OF BOTH THE PARTIES, PERUSED THE RECORD AND GONE THROUGH THE ORDERS OF THE AUTHO RITIES BELOW. THE LEARNED COUNSEL FOR THE ASSESSEE FILED AN AFFID AVIT WHEREIN IT WAS AFFIRMED AS UNDER:- THE APPEAL IN RESPECT OF THE ASSESSMENT YEAR 2006-0 7 HAS BEEN RECEIVED ON 20/07/2009, AND THEREFORE THE DUE DATE FOR FILING OF APPEAL IS 20/08/2009. THE SA ME COULD NOT BE FILED IN TIME AS THE DOCUMENTS HAD BEE N MISPLACED BY THE OFFICE STAFF. THE DOCUMENTS COULD BE TRACED AND THE APPEAL COULD BE FILED ON 17/09/2009 WITH THE DELAY OF 28 DAYS. IN VIEW OF THE ABOVE, THE DELAY MAY PLEASE BE CONDONED AND THE APPEAL MAY PLEASE BE CONSIDERED AS THE DELAY OCCURRED DUE TO CIRCUMSTANCES WHICH WERE BEYOND THE CONTROL OF THE ASSESSEE 6. IN THIS CONNECTION, WE REFER TO THE FOLLOWING JU DICIAL PRONOUNCEMENTS REGARDING THE CONDONATION OF DELAY: ITA NOS. 597 & 598/HYD/2012 GB TRADING AND INVESTMENTS PVT. LTD. 3 7. THE HON'BLE, SUPREME COURT IN COLLECTOR, LAND AC QUISITION V. MST. KATIJI AND ORS. (1987) 167 1TR 471 (SC) HAS OB SERVED THAT WHEN SUBSTANTIAL JUSTICE AND TECHNICAL CONSIDERATIO NS ARE PITTED AGAINST EACH OTHER, THE CAUSE OF SUBSTANTIAL JUSTIC E DESERVES TO BE PREFERRED, FOR THE OTHER SIDE CANNOT CLAIM TO HAVE A VESTED RIGHT IN INJUSTICE BEING DONE BECAUSE OF A NON-DELIBERATE DELAY. THUS, CONSIDERING THE HARDSHIP OF THE ASSESSEE, WE ARE OF THE OPINION THAT THERE EXIST SUFFICIENT REASONS FOR NOT FILING A VALID EFFECTIVE APPEAL BEFORE THE US. IT IS APTLY SAID THAT FACTS S HOULD BE VIEWED IN A NATURAL PERSPECTIVE HAVING REGARD TO THE COMPU LSION OF CIRCUMSTANCES OF A CASE WHERE IT IS POSSIBLE TO DRA W INFERENCES FROM THE FACTS AND WHERE THERE IS NO EVIDENCE OF AN Y DISHONEST OR IMPROPER MOTIVE ON THE PART OF THE ASSESSEE IT WOUL D BE JUST AND EQUITABLE TO DRAW SUCH INFERENCE IN SUCH A MANNER T HAT WOULD LEAD TO EQUITY AND JUSTICE. TOO HYPER TECHNICAL OR LEGALIZED APPROACH SHOULD BE AVOIDED IN LOOKING AT A PROVISIO N WHICH MUST BE EQUITABLY INTERPRETED AND JUSTLY ADMINISTERED. I N OUR OPINION, THE REASONS ADVANCED BY THE ASSESSEE IN FILING OF T HE APPEAL BELATEDLY AS EXPLAINED IN THE UPPER PART OF THIS OR DER ARE FOUND TO BE BONA-FIDE AND THE ASSESSEE HAVING REASONABLE CAU SE FOR NOT FILING THE APPEAL IN TIME. HENCE, TAKING INTO CONSI DERATION THE OVERALL FACTS AND CIRCUMSTANCES OF THE CASE, WE ARE OF THE OPINION THAT THE DELAY IN FILING THIS APPEAL DESERVES TO BE CONDONED AND, ACCORDINGLY THE DELAY IS CONDONED AND THE APPEAL IS ADMITTED TO DECIDE THE ISSUES ON MERIT. 8. IN ITA NO. 2075/H/11 IN THE CASE OF SMT. BANU BEGUM VIDE ORDER DATED 30 TH APRIL, 2012, THE COORDINATE BENCH HELD AS FOLLOWS: 10. ON PLAIN READING OF SUB-SECTION (3) OF SECTION 249 SHALL REVEAL THAT IF THE ASSESSEE SHOWED SUFFICIENT REASO NS FOR LATE FILING OF HIS APPEALS, THEN SUCH DELAY CAN BE CONDO NED AND CONTROVERSY WOULD BE SILENCED ON MERIT. SIMILARLY, FOR THE ITA NOS. 597 & 598/HYD/2012 GB TRADING AND INVESTMENTS PVT. LTD. 4 SAKE OF EXPLANATION, IF AN ASSESSEE DID NOT HAVE SU FFICIENT FUNDS FOR COMPLYING WITH THE REQUIREMENT OF SECTION 249(4) AND HAS NOT FILED THE APPEAL WITHIN THE TIME PROVID ED UNDER SECTION 249(2), SUBSEQUENT TO EXPIRY OF LIMITATION, HE MADE COMPLIANCE OF SECTION 249(4) AND FILED THE APPEAL W ITH A PRAYER OF CONDONATION OF DELAY THEN IT WOULD BE IN DISCRETION OF THE FIRST APPELLATE AUTHORITY TO SEE WHETHER SUF FICIENT REASONS FOR LATE FILING OF APPEAL EXIST OR NOT. IF THE LEARNED CIT(A) ARRIVED AT A CONCLUSION THAT SUFFICIENT REAS ONS EXIST THEN AGAIN THE CONTROVERSY WOULD BE DECIDED ON MERI T. THUS, ON CONJOINT READING OF SUB-SECTIONS (3) AND (4), IT IS INFERRED THAT DEFECT ARISES DUE TO NON-COMPLIANCE OF SECTION 249(4) IS A CURABLE ONE AND IN A GIVEN CASE IF THE TRIBUNA L IS SATISFIED THAT THERE EXIST SUFFICIENT REASONS FOR CURING SUCH DEFECTS AFTER EXPIRY OF LIMITATION, IT WOULD BE IN THE REALM OF TRIBUNAL'S DISCRETION TO RESTORE SUCH MATTERS TO TH E FILE OF THE CIT(A) FOR DECIDING THE CONTROVERSY ON MERIT BE CAUSE SUB-SECTION (1) OF SECTION 254 PROVIDES WIDE POWERS TO THE TRIBUNAL FOR PASSING SUCH ORDERS THEREON AS IT THIN KS FIT IN THE INTEREST OF JUSTICE. 9. THE COORDINATE BENCH HAS ALSO REFERRED TO THE DE CISION OF THE HONBLE FULL BENCH OF DELHI HIGH COURT IN J.T. (IND IA) EXPORTS AND ANR. VS. UNION OF INDIA AND ANR. , 262 ITR 269 (DEL)(FB) WHE REIN THE BENCH HAS DRAWN SUPPORT FROM THE DECISION OF THE HONBLE ORIS SA HIGH COURT IN THE CASE CIT VS. KALIPADA GHOSE (1987) 167 ITR 173 (ORI .) AND REPRODUCED THE RELEVANT EXTRACT OF THE ORDER WHICH IS AS FOLLO WS: 'ON THE AFORESAID ANALYSIS, IT HAS TO BE HELD THAT THE ORDER OF THE AAC DISMISSING THE APPEALS FOR NON-COMPLIANC E WITH SECTION 249(4) OF THE ACT CAME WITHIN THE AMBIT OF SECTION 250 OF THE ACT AND WAS APPEALABLE BEFORE THE TRIBUN AL UNDER SECTION 253 OF THE ACT. THE TRIBUNAL, THEREFORE, CO MMITTED NO ILLEGALITY IN ENTERTAINING THE APPEALS AND IN CO NDONING THE DELAY ON BEING SATISFIED, ON THE FACTS AND CIRCUMST ANCES OF THE CASE, THAT THERE WAS SUFFICIENT CAUSE FOR THE A SSESSEE'S FAILURE TO COMPLY WITH SECTION 249(4) OF THE ACT AN D IN REMITTING THE CASES TO THE FIRST APPELLATE FORUM FO R DISPOSAL ON MERITS. ACCORDINGLY, THE QUESTION REFERRED IS AN SWERED IN THE AFFIRMATIVE.' 10. THE HONBLE SUPREME COURT IN THE CASE OF IMPROVEMENT TRUST VS. UJAGAR SINGH. 6 SCC 786 HELD AS UNDER:- ITA NOS. 597 & 598/HYD/2012 GB TRADING AND INVESTMENTS PVT. LTD. 5 (I) WHILE CONSIDERING AN APPLICATION FOR CONDONATI ON OF DELAY NO STRAIT-JACKET FORMULA IS PRESCRIBED TO COME TO THE CONCLUSION IF SUFFICIENT AND GOOD GROUNDS HAVE BEEN MADE OUT OR N OT. EACH CASE HAS TO BE WEIGHED FROM ITS FACTS AND THE CIRCUMSTAN CES IN WHICH THE PARTY ACTS AND BEHAVES. FROM THE CONDUCT, BEHAVIOUR AND ATTITUDE OF THE APPELLANT IT CANNOT BE SAID THAT IT HAD BEEN ABSOLUTELY CALLOUS AND NEGLIGENT IN PROSECUTING THE MATTER ; (II) JUSTICE CAN BE DONE ONLY WHEN THE MATTER IS FO UGHT ON MERITS AND IN ACCORDANCE WITH LAW RATHER THAN TO DISPOSE I T OF ON SUCH TECHNICALITIES AND THAT TOO AT THE THRESHOLD; (III) UNLESS MALAFIDES ARE WRIT LARGE ON THE CONDUCT OF T HE PARTY, GENERALLY AS A NORMAL RULE, DELAY SHOULD BE CONDONED . IN THE LEGAL ARENA, AN ATTEMPT SHOULD ALWAYS BE MAD E TO ALLOW THE MATTER TO BE CONTESTED ON MERITS RATHER THAN TO THR OW IT ON SUCH TECHNICALITIES. APART FROM THE ABOVE, THE APPELLANT WOULD NOT HAVE GAINED IN ANY MANNER WHATSOEVER, BY NOT FILING THE APPEAL WITHIN THE PERIOD OF LIMITATION . IT IS ALSO WORTH NOTICING THAT DELAY WAS ALSO NOT THAT HUGE, WHICH COULD NOT HAVE BEEN CONDONED, WITHOUT PUTTING THE RESPONDENTS TO HARM O R PREJUDICE. IT IS THE DUTY OF THE COURT TO SEE TO IT THAT JUSTICE SHOULD BE DONE BETWEEN THE PARTIES. 11. HAVING REGARD TO THE FACTS OF THE CASE AND KEEP ING IN VIEW THE SPIRIT OF JUDICIAL PRONOUNCEMENTS DISCUSSED ABO VE, AND CONSIDERING THE HARDSHIP OF THE ASSESSEE WE ARE OF THE OPINION THAT THERE EXISTS SUFFICIENT CAUSE FOR THE DELAY IN FILING THE APPEAL BY THE ASSESSEE BEFORE THE CIT(A) AND TO THIS EFFEC T THE ASSESSEE FILED AN AFFIDAVIT, THEREFORE, WE CONDONE THE DELAY OF 27 DAYS IN FILING THE APPEAL BY THE ASSESSEE BEFORE THE CIT(A) . ACCORDINGLY, WE SET ASIDE THE IMPUGNED ORDER OF THE CIT(A) AND R ESTORE THE ISSUES TO THE FILE OF THE CIT(A) TO ADJUDICATE THE SAME ON MERITS AND IN ACCORDANCE WITH LAW AFTER PROVIDING REASONAB LE OPPORTUNITY OF HEARING TO THE ASSESSEE. ITA NOS. 597 & 598/HYD/2012 GB TRADING AND INVESTMENTS PVT. LTD. 6 ITA NO. 598/HYD/2012 12. IN THIS APPEAL THERE WAS A DELAY OF 11 DAYS IN FILING THE APPEAL BY THE ASSESSEE BEFORE THE CIT(A). SINCE THE ISSUE IN THIS YEAR IS MATERIALLY IDENTICAL TO THAT OF AY 2006-07 (SUPRA), RESPECTFULLY FOLLOWING THE CONCLUSIONS DRAWN IN AY 2006- 07(SUPRA), WE RESTORE THIS APPEAL ALSO TO THE FILE OF THE CIT(A) WITH IDENTICAL DIRECTIONS. 13. IN THE RESULT, BOTH THE APPEALS OF THE ASSESSEE ARE TREATED AS ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON 3 RD AUGUST, 2012. SD/- SD/- (CHANDRA POOJARI) (ASHA VIJAYARAGHAVA N) ACCOUNTANT MEMBER JUDICIAL MEMBE R HYDERABAD, DATED: 3 RD AUGUST, 2012. KV COPY TO:- 1) GB TRADING & INVESTMENTS PVT. LTD., C/O P. MURALI & CO., CHARTERED ACCOUNTANTS, 6-3-655/2/3, ! FLOOR, SOMAJIGUDA, HYDERABAD 82. 2) ITO, WARD- 2(2), HYDERABAD 3) THE CIT (A)-III, HYDERABAD 4) THE CIT-II, HYDERABAD 5) THE DEPARTMENTAL REPRESENTATIVE, I.T.A.T., HYDE RABAD.