Punjab Lease Financing Ltd., Ahmedabad V. Income tax Officer, Ward-3(1)(1), Ahmedabad

ITA 624/AHD/2023

• Counselvise Citation: [2023] 101 COUNSELVISE.COM (IT) 9522 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-12-2023
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Next Hearing Date: 05-12-2023
• Assessment Year: 2009-2010
• Appeal Filed On: 15-08-2023
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Period of limitation; Reasonable cause; Condonation of delay; Revised return
• Section: 143(1); 201; 13

Judgement Text

आयकर अपीलीय अिधकरण आयकर अपीलीय अिधकरणआयकर अपीलीय अिधकरण आयकर अपीलीय अिधकरण, अहमदाबाद 瀈यायपीठ अहमदाबाद 瀈यायपीठअहमदाबाद 瀈यायपीठ अहमदाबाद 瀈यायपीठ ‘SMC’ अहमदाबाद। अहमदाबाद।अहमदाबाद। अहमदाबाद। IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, AHMEDABAD ] ] BEFORE SMT.ANNAPURNA GUPTA, ACCOUNTANT MEMBER ITA No.624/Ahd/2023 Asstt.Year : 2009-10 Punjab Lease Financing Ld. Maruti Centre Opp: Sarkari Vasahat Drive-in-Road Ahmedabad. PAN : AABCP 1834 H Vs ITO, Ward-3(1)(1) Ahmedabad. (Applicant) (Responent) Assesseeby : None – Written Submissions filed Revenue by : Shri V.K. Mangla, Sr.DR स ु नवाई क तार ख/D a t e o f H e a r i n g : 0 6 / 1 2 / 2 0 2 2 घोषणा क तार ख /D a t e o f P r o n o u n c e m e n t : 1 5 / 1 2 / 2 0 2 3 आदेश/ O R D E R The present appeal has been filed by the assesseeagainst order passed by the Commissioner of Income Tax(Appeals), National Faceless Appeal Centre, Delhi [in short referred to as ld.CIT(A)] under section 250(6), dated 31.5.2023pertaining to Asst.Year2009- 10. 2. None on behalf of the assessee was present at the time of hearing. Earlier also on 17.10.2023, the appeal of the assessee was listed for hearing, but there was no appearance on behalf of the assessee. Therefore, I decide toproceed to dispose of the matter ex partequathe assessee-appellant after hearing the ld.DR and ITA No.624/Ahd/2023 2 considering the written submissions filed by the assessee in the light of the material available on record. 3. The grounds raised by the assessee are as under: “Your appellant is aggrieved by the order passed by the learned Commissioner of income tax (Appeals) No. NFAC-2008-09-102-2325 Dt 31.05.2023 Which is received on 05.06.2023 Against order by Assessing officer CPC u/s,143(l) Pt. 13.10.201Q of the Income Tax Act, 1961, present this appeal against the same of the following amongst the same on the following other grounds. 1. The learned assessing Officer has grossly erred in assessing the total income at Rs, 15,79,590/- by making various additions Of Rs.2667448/- refund amount For The A.Y. 2001-2022 as Per order by ITAT Refund claim by us in Computation of total income by technical mistake at the time of preparation of income tax return filling time refund amount Rs.2647448/ -on an estimation basis, Your appellant submits that all details and evidence called for had been provided during the course of the assessment proceedings. Under the circumstances, there is no justification in making such a high-pitch assessment and estimating the total income. It is therefore submitted that the said order be held as bad in Jaw and be canceled. It is submitted that it be so held now. 2. The learned assessing officer has erred in making the addition of Rs, 2667448/- as the amount of refund allowed by ITAT. The said Income was duly taxed in the name of the Company. The said details were submitted at the time of assessment. The same was not considered by the assessing officer. The same cannot be made to tax twice. It Is therefore submitted that the additions made are illegal and therefore require to it be deleted. It is submitted that it be so deleted now. 4, The learned assessing officer has passed the order without granting a proper opportunity of being heard. 5. The appellant craves leave to add or alter any of the grounds of appeal on Of before the date of hearing. 6. The appellant requests you for the proper assessment in the said case. 7. The appellant requests you to waive the income tax amount of Rs. 10,23,270/- and interest, penalty, and any other levied amount, 8. To stay the demand till the disposal of the appeal.” 4. A perusal of the above grounds of appeal would indicate that the main grievance of the assessee before me is against the intimation issued by the CPC under section 143(1) of the Act dated 13.10.2010 for the Asst.Year 2009-10, vide which the ld.AO made ITA No.624/Ahd/2023 3 addition to the extent of Rs.26,67,448/-, which was the IT refund received by the assessee pertaining to the Asst.Year 2001-02, and without considering the details and evidences filed during the assessment proceedings, the AO raised a demand of Rs.10,23,270/- for the impugned assessment year by way of intimation under section 143(1) of the Act. Appeal filed against the said intimation under section 143(1) of the Act was dismissed by the ld.CIT(A), NFAC on the ground that the appeal was not filed by the assessee within the time limit of 30 days prescribed under section 249(2) of the Act, but rather filed after inexplicably staggering delay of 4465 days i.e. almost after 13 years. Dissatisfied with this order of the ld.CIT(A), NFAC, the assessee is now before the Tribunal. 5. Brief facts leading to the present case as emerging out from the relevant orders of the Revenue authorities are that the AO issued an intimation under section 143(1) of the Act dated 13.10.2010 raising tax demand of Rs.10,23,270/- for the impugned assessment year i.e. 2009-10. Against this intimation, the assessee filed an appeal before the ld.first appellate authority on 2.2.2023. The ld.CIT(A) noticed that the appeal filed by the assessee was time barred by staggering delay of 4465 days i.e. after more than 12 years. He noted that the assessee filed the appeal against the intimation dated 13.10.2010 only on 2.2.2023, i.e. after a delay of 4465 days. The ld.CIT(A) recorded the reasons given by the assessee for this inordinate delay of 4465 days in his impugned order at para 4.3 as under: “As the case is related to assessment year 2009-10 since that 13 years had elapsed. After filing of revised return we are at impression that matter has been resolved. After receiving the notice of demand on 29.1.202, we tried to find out old records but won’t found. So, we applied for copy of intimation from the IT Department.” ITA No.624/Ahd/2023 4 The ld.CIT(A) considered the explanation of the assessee, and observed that the inordinate delay of over 12 years could not be accepted as “reasonable cause”which could be passed of as the reason that prevented the filing of appeal within prescribed time and even thereafter for 4465 days. The ld.CIT(A) made a detailed discussion, and in the light of various authorities judgments on the issue of condonation of delay, he held that the assessee was unable to demonstrate sufficient reasons,which caused a long delay of 4465 days, and therefore could not be condoned. The appeal of the assessee was accordingly dismissed as not admitted. The assessee is now in appeal before the Tribunal. 6. Before me, the assessee has filed written submissions containing just one-and-half pages praying for condonation of the impugned delay of 4465 days in filing appeal before the ld.CIT(A), and deciding the appeal on merit. On the other hand, the ld.DR relied on the order of the ld.CIT(A). 7. I have heard ld.DR and also gone through the written submissions filed by the assessee and material available on record. The assessee contested the impugned order of ld.CIT(A) objecting to the non-condonation of the 4465-days delay in challenging the intimation issued under section 143(1) and thereby not deleting the addition made by the ld.AO on merit. The AO issued the intimation on 13.10.2010, and the appeal against it was filed before the first appellate authority on 2.2.2023, after making a substantial delay of 4465 days, i.e. more than 13 years. The reasons adduced by the assessee before the ld.CIT(A) for such an extensive delay were notably very causal and demonstrate palpable inaction and negligence on the part of the assessee. The ld.CIT(A) noticed the explanation given by the assessee in his impugned order at page ITA No.624/Ahd/2023 5 no.4 para-4.3, which I have reproduced in the para-5 of this order (supra). For brevity, the relevant paragraph recorded by the ld.CIT(A) is reiterated hereunder: “As the case is related to assessment year 2009-10 since that 13 years had elapsed. After filing of revised return we are at impression that matter has been resolved. After receiving the notice of demand on 29.1.202, we tried to find out old records but won’t found. So, we applied for copy of intimation from the IT Department.” Except the above casual pleading of the assessee for seeking condonation of delay, there is nothing either in form of evidence or arguments before me that contradict the finding of the ld.CIT(A) on the issue. I find that the ld.CIT(A) meticulously deliberated on the matter, and considering various authoritative precedents, decided not to condone the delay, resulting in dismissal of the assessee’s appeal as un-admitted. The pertinent observation and finding of the ld.CIT(A) are given in para-4 to 4.16 of the impugned order, which for clarity is reproduced hereunder: “4. The present appeal has been filed against intimation u/s. 143(1) dated 13.10.2010 for AY.2009-10. 4.1. The impugned intimation which was served on the registered email id of the appellant and also uploaded on the e-filing portal of the department on the same day, i.e.., 13.10.2010, Any appeal thereagainst ought to have been filed u/s.246A(1)(a) within the prescribed time limit of 30 days from date of service thereof as mandated u/s.249(2) of the Act. In appellant's case, no such appeal was filed against the intimation dated 13.10.2010, within the prescribed time limit of 30 days, which ended on 12.11.2010 and even thereafter for more than 12 years. The present appeal has been filed only on 02.02.2023, after a delay of 4465 days. 4.2. Any delay in filing of appeal within the prescribed time limit of 30 days from date of service as per section 249(2) of the Act may be condoned only subject to the satisfaction that the appellant had sufficient cause for not presenting it within that period, as evident from the plain language of section 249 extracted as under: "249(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: ITA No.624/Ahd/2023 6 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: Provided further that where an application has been made under subsection (1) of section 270AA, the period beginning from the date on which the application is made, to the date on which the order rejecting the application is served on the assessee, shall be excluded, or (c) in any other case, the date on which intimation of the order sought to be appealed against is served. (2A) Notwithstanding anything contained in sub-section (2) where an order has been made under section 201 on or after the 1st day of October, 1998 but before the 1st day of June, 2000 and the assessee in default has not presented any appeal within the time specified in that subsection, he may present such appeal before the 1st day of July, 2000. (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 not presenting it within that period." 4.3. On the reasons for this inordinate delay of 4465 days, the appellant has submitted as under: "As the case is related to assessment year 2009-10 since that 13 year has elapsed. After fling of revised return we are at impression that matter has been resolved. After receiving the notice of demand on 29/11/2022. we tried to find out old records but won't found, so, we applied for copy of intimation from the IT department1 4.4. It is seen that the appellant has simply claimed that they were not aware of the demand raised u/s. 143(1) and that only after receiving recovery letter in respect of the said demand that they came to know about the same. At the outset, the contention of the appellant that it was not aware of the impugned demand is not tenable for the simple reason that the demand status of earlier years get clearly reflected in the registered e-filing account of the assessee. The appellant ought to have accessed the portal from time to time for filing of return, tax audit report and also for filing various responses in connection with income tax proceedings of later years also. The appellant is a corporate entity and all disputed taxes or tax liabilities are required to be duly incorporated in their financial statements. Delay involved in this case is more than 12 years and it is totally unacceptable to hold that the appellant failed to notice the outstanding tax demands for so long. Thus, the vague and casual response filed by the appellant to explain the inordinate delay of over 12 years cannot be accepted as a reasonable cause which could be passed of as the reason that prevented the filing of appeal within prescribed time and even thereafter for 4465 days. 4.5 It is pertinent to note that the delay may be condoned and the appeal may be admitted u/s.249(3) only if the appellant could successfully demonstrate that it had sufficient cause for not presenting the appeal within the period of 30 days. The exercise of discretion in condonation of delay in matters of limitation, such as in the present case u/s.249(3) of the Income Tax Act, 1961 has to be carried out within the meaning of "Sufficient Cause" as envisaged in Section 5 of Limitation Act. Hence, the general rule of law of limitation is that an extension shall not be granted under Section 5 if there is no sufficient cause or cogent ground for the condonation ITA No.624/Ahd/2023 7 of delay, the onus of proving which lies on the appellant/applicant as clearly laid down in the judicial pronouncements by the Highest Courts of Law. 4.6. In the case of PerumonBhagvathyDevaswom, Perinadu Village v. Bhargavi Amma (Dead) by LRs, (2008)8 SCC 321, It was observed by the Hon'ble Court that: "13. ...The words "sufficient cause for not making the application within the period of limitation" should be understood and applied in a reasonable, pragmatic, practical and liberal manner, depending upon the facts and circumstances of the case, and the type of case. The words "sufficient cause" in Section 5 of the Limitation Act should receive a liberal construction so as to advance substantial justice, when the delay is not on account of any dilatory tactics, want ofbona fides, deliberate inaction or negligence on the part of the appellant." (emphasis supplied)". 4.7. The aforesaid view was reiterated in the case of Balwant Singh (Dead) v. Jagdish Singh, (2010) 8 SCC 685, where in the Court held that: "25. We may state that even if the term "sufficient cause" has to receive liberal construction, it must squarely fall within the concept of reasonable time and proper conduct of the party concerned. The purpose of introducing liberal construction normally is to introduce the concept of "reasonableness" as it is understood in its general connotation. 26. The law of limitation is a substantive law and has definite consequences on the right and obligation of a party to arise. These principles should be adhered to and applied appropriately depending on the facts and circumstances of a given case. Once a valuable right has accrued in favour of one party as a result of the failure of the other party to explain the delay by showing sufficient cause and its own conduct, it will be unreasonable to take away that right on the mere asking of the applicant, particularly when the delay is directly a result of negligence, default or inaction of that party. Justice must be done to both parties equally. Then alone the ends of justice can be achieved. If a party has been thoroughly negligent in implementing its rights and remedies, it will be equally unfair to deprive the other party of a valuable right that has accrued to it in law as a result of his acting vigilantly." 4.8. The Courts in the abovementioned cases, highlighted upon the importance introducing the concept of "reasonableness" while giving the clause "sufficient cause* a liberal interpretation. In furtherance of the same, the Courts has cautioned regarding the necessity of distinguishing cases where delay is of few days, as against the cases where the delay is inordinate as it might accrue to the prejudice of the rights of the other party. In such cases, where there exists inordinate delay and the same is attributable to the party's inaction and negligence, the Courts have to take a strict approach so as to protect the substantial rights of the parties 4.9. The Division bench of the Hon'ble Bombay HC in Ornate Traders Private Limited v. The Income Tax Officer, Mumbai emphasized the need for reasonableness and hence, the actions which can be condoned by the court should fall within the scope of normal human conduct or normal conduct of a litigant. The Hon'ble Bombay HC further observed that while Section 5 of the Limitation Act is being interpreted liberally, it cannot be so liberally that it is without any justification, since condonation of delay in a mechanical or routine manner will jeopardize the legislative intent behind Section-5. 4.10. The Hon'ble SC in the.pse of Shiv Dass v. Union of India (UOI) and Ors., AIR 2007 SC 1330 held that the High Courts, while exercising their discretionary powers under Article 226, should consider delay or laches and, refuse to invoke its ITA No.624/Ahd/2023 8 extraordinary powers if it is found that the applicant had neglected/omitted to assert its rights in a timely manner; however, this discretion has to be exercised judicially and reasonably. 4.11. In a recent judgment in the case of University of Delhi Vs Union of India &Ors. in Civil Appeal No. 9488 of 2019 vide Order dated 17712/2019, the Hon'ble Supreme Court has refused to condone delay by holding that, "The entire explanation as noted above, depicts the casual approach unmindful of the law of limitation despite being aware of the position of law. That apart when there is such a long delay and there is no proper explanation, laches would also come into play while noticing as to the manner in which a party has proceeded before filing an appeal. 28. In the matter of condonation of delay and laches, the well accepted position is also that the accrued right of the opposite party cannot be lightly dealt with." 4.12. From the above decisions it becomes clear that 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 appeal within the prescribed period. Litigant must be able to demonstrate that there was "sufficient cause" which obstructed his action to file Appeal beyond the prescribed time limit. The law of limitation is found upon the maxims "Interest Reipublicae Ut Sit Finis L/tf urn "that litigation must come to an end in the interest of society as a whole, and "vigilantibus non dormientibus Jura subveniunf" that the law assists those that are vigilant with their rights, and not those that sleep thereupon. The law of limitation in India identifies the need for limiting litigation by striking a balance between the interests of the state and the litigant. 4.13. The Single Judge bench of the Hon'ble Madras HC, while exercising writ jurisdiction in Kathiravan Pipes Pvt. Ltd., v. CESTAT, 2007 [5] STR 9 (Mad.) has observed that the period of limitation prescribed is not for destruction of a statutory right but only to give finality without protracting the matter endlessly. 4.14. In the present case, it clearly emerges that the appellant had not filed the appeal within a period of 30 days as prescribed u/s.249(2) of the Act and even thereafter for more than 12 years. The appellant has eventually filed an appeal only after a delay of 4465 days. The reason adduced by the appellant for such an inordinate delay in filing the appeal, cat|{i|f|b basis and or credence for the detailedreasons cited above. 4.15. Unless and until it is demonstrated that there was a sufficient cause that prevented the appellant from exercising its, legal remedy of filing appeal within thatprescribed period of 30 days, the delay thereafter cannot be condoned without there being compelling grounds as advocated by the Hon'ble Courts. 4.16. Since the appellant has failed to show any "sufficient cause" u/s.249(3) of the Income Tax Act, 1961 for the appellant's failure* to file the appeal within the prescribed period of limitation u/s.249(2) of the Income Tax Act, 1961 r.w.s 5 of Limitation Act and even thereafter, for over 12 years, i.e., 4465 days to be precise, the inordinate delay in filing of appeal is not condoned and appeal is not admitted. 8. A perusal of the above order of the ld.CIT(A), I am of the view that exceptional delay of 4465 days in this case could be considered ITA No.624/Ahd/2023 9 for condonation if the assessee successfully demonstrated a substantial impediment preventing the timely pursuit of the case. Given the failure of the assessee to establish a justifiable cause for the delay in the filing the appeal before the first appellate authority, and the absence of any material evidence presented during the appellate proceedings or before me, I find no difficult in upholding the ld.CIT(A)’s finding on this matter. Therefore, his decision in the impugned order is upheld, and the grounds of the appeal of the assessee are rejected. 9. In the result, the appeal of the assessee is dismissed. Order pronounced in the Court on 15 th December, 2023 at Ahmedabad. Sd/- (ANNAPURNA GUPTA) ACCOUNTANT MEMBER Ahmedabad,dated 15/12/2023 vk*