Rajesh Khurana, Hyd, Hyderabad V. DCIT, Central Circle-4, Hyderabad

ITA 806/HYD/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 66103 (ITAT-HYDERABAD)
• Duration Of Justice: 1 year(s) 3 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-08-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2005-2006
• Appeal Filed On: 03-05-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DAYASAGAR
• Assessee Lawyers: AJAY GANDHI
• Keywords: Period of limitation; Reasonable cause; 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 NO. 806/HYD/2011 ASSESSMENT YEAR: 2005-06 RAJESH KHURANA, APPELLANT HYDERABAD (PAN ACBPK 9831G) VS. DY. COMMISSIONER OF INCOME TAX, RESPONDENT CENTRAL CIRCLE 4, HYDERABAD APPELLANT BY : MR. AJAY GANDHI RESPONDENT BY : MR. DAYA SAGAR DATE OF HEARING : 23/07/2012 DATE OF PRONOUNCEMENT : 03/08/ 2012 ORDER PER ASHA VIJAYARAGHAVAN, J.M.: THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST THE ORDER OF CIT(A)-V, HYDERABAD, DATED 11/04/2011 FOR THE ASSESSMENT YEAR 2005-06. 2. BRIEFLY THE FACTS OF THE CASE ARE THAT AGAINST THE PENALTY ORDER U/S 271(1)(C) PASSED BY THE ASSESSING OFFICER , THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE CIT(A), WHI CH WAS FILED BEYOND THE STATUTORY TIME OF 30 DAYS. THEREFORE, TH E CIT(A) DID NOT ADMIT THE APPEAL AND DISMISSED THE SAME IN-LIMI NE. 3. AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFORE US R AISING THE FOLLOWING GROUNDS OF APPEAL:- ITA NO. 806/HYD/2011 RAJESH KHURANA 2 1. THE ORDER OF THE CIT(A) IS ERRONEOUS ON FACTS AN D BAD IN LAW. 2. THE CIT(A) HAS ERRED IN NOT CONSIDERING THE SUBM ISSIONS MADE BEFORE HIM. 3. THE CIT(A) HAS IGNORED THE AFFIDAVIT AND THE CON DONATION PETITION FILED BEFORE HIM. 4. THE CIT(A) HAS ERRED IN CONCLUDING THAT THE APPE AL HAS BEEN FILED BEYOND STATUTORY TIME OF 30 DAYS. 5. THE CIT(A) HAS ERRED IN DISMISSING THE APPEAL IN IN-LIMINE 6. THE CIT(A) HAS ERRED IN SUSTAINING THE LEVY OF P ENALTY. 4. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE R ECORD AS WELL AS THE ORDERS OF THE AUTHORITIES BELOW. THE H ON'BLE, SUPREME COURT IN COLLECTOR, LAND ACQUISITION V. MST. KATIJI AND ORS. (1987) 167 1TR 471 (SC) HAS OBSERVED THAT WHEN SUBSTANTIAL JUSTICE AND TECHNICAL CONSIDERATIONS ARE PITTED AGAINST EACH OT HER, THE CAUSE OF SUBSTANTIAL JUSTICE DESERVES TO BE PREFERRED, FO R THE OTHER SIDE CANNOT CLAIM TO HAVE A VESTED RIGHT IN INJUSTICE BE ING DONE BECAUSE OF A NON-DELIBERATE DELAY. THUS, CONSIDERIN G THE HARDSHIP OF THE ASSESSEE, WE ARE OF THE OPINION THAT THERE E XIST SUFFICIENT REASONS FOR NOT FILING A VALID EFFECTIVE APPEAL BEF ORE THE US. IT IS APTLY SAID THAT FACTS SHOULD BE VIEWED IN A NATURAL PERSPECTIVE HAVING REGARD TO THE COMPULSION OF CIRCUMSTANCES OF A CASE WHERE IT IS POSSIBLE TO DRAW INFERENCES FROM THE FACTS AN D WHERE THERE IS NO EVIDENCE OF ANY DISHONEST OR IMPROPER MOTIVE ON THE PART OF THE ASSESSEE IT WOULD BE JUST AND EQUITABLE TO DRAW SUCH INFERENCE IN SUCH A MANNER THAT WOULD LEAD TO EQUIT Y AND JUSTICE. TOO HYPER TECHNICAL OR LEGALIZED APPROACH SHOULD BE AVOIDED IN LOOKING AT A PROVISION WHICH MUST BE EQUITABLY INTE RPRETED AND JUSTLY ADMINISTERED. IN OUR OPINION, THE REASONS AD VANCED BY THE ASSESSEE IN FILING OF THE APPEAL BELATEDLY AS EXPLA INED IN THE UPPER PART OF THIS ORDER ARE FOUND TO BE BONA-FIDE AND THE ASSESSEE HAVING REASONABLE CAUSE FOR NOT FILING THE APPEAL IN TIME. HENCE, TAKING INTO CONSIDERATION THE OVERALL FACTS AND CIRCUMSTANCES OF THE CASE, WE ARE OF THE OPINION TH AT THE DELAY IN ITA NO. 806/HYD/2011 RAJESH KHURANA 3 FILING THIS APPEAL DESERVES TO BE CONDONED AND, ACC ORDINGLY THE DELAY IS CONDONED AND THE APPEAL IS ADMITTED TO DEC IDE THE ISSUES ON MERIT. 5. 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 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. 6. 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 ITA NO. 806/HYD/2011 RAJESH KHURANA 4 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.' 7. THE HONBLE SUPREME COURT IN THE CASE OF IMPROVEMENT TRUST VS. UJAGAR SINGH. 6 SCC 786 HELD AS UNDER:- (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. 8. HAVING REGARD TO THE FACTS OF THE CASE AND KEEPI NG 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, THEREFORE, W E CONDONE THE ITA NO. 806/HYD/2011 RAJESH KHURANA 5 DELAY OF THE APPEAL FILED BY THE ASSESSEE BEFORE TH E CIT(A) BEYOND THE STATUTORY LIMIT OF 30 DAYS. ACCORDINGLY, WE SET ASIDE THE IMPUGNED ORDER OF THE CIT(A) AND RESTORE THE IS SUE TO THE FILE OF THE CIT(A) TO ADJUDICATE THE SAME ON MERITS AFTE R PROVIDING REASONABLE OPPORTUNITY OF THE ASSESSEE AND DECIDE T HE ISSUE AFRESH IN ACCORDANCE WITH LAW. 9. IN THE RESULT, APPEAL OF THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON 3 RD AUGUST, 2012. SD/- SD/- (CHANDRA POOJARI) (ASHA VIJAYARAGHA VAN) ACCOUNTANT MEMBER JUDICIAL MEM BER HYDERABAD, DATED:3 RD AUGUST, 2012. KV COPY TO:- 1) RAJESH KHURANA, C/O GANDHI & GANDHI, CAS. 1002, PAIGAH PLAZA, BASHEERBAGH,HYDERABAD 500 063. 2) DCIT, CENTRAL CIRCLE 4, AAYAKAR BHAVAN, BASHEERBAGH , HYDERABAD 500 001. 3) THE CIT (A)-V, HYDERABAD 4) THE CIT-IV, HYDERABAD 5) THE DEPARTMENTAL REPRESENTATIVE, I.T.A.T., HYDE RABAD.