SHRI BANWARI LAL AGRAWAL, AJMER V. ITO, WARD-2, KISHANGARH

MA 15/JPR/2021

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 3953 (ITAT-JAIPUR)
• Duration Of Justice: 11 month(s) 13 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 12-06-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2011-2012
• Appeal Filed On: 29-06-2021
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: COGNIZANCE
• Keywords: Reasonable cause; Condonation of delay
• Section: 254(2)

Judgement Text

vk;dj vihyh; vf/kdj.k] t;iqj U;k;ihB] t;iqj IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, ‘A’ JAIPUR MkWa- ,l-lhrky{eh] U;kf;d lnL; ,oa Jh jkBksM deys'k t;UrHkkbZ] ys[kk lnL; ds le{k BEFORE: DR. S. SEETHALAKSHMI, JM & SHRI RATHOD KAMLESH JAYANTBHAI, AM M.A. No. 15/JP/2021 (Arising out of ITA No. 1245/JP/2019) fu/kZkj.k o"kZ@Assessment Years : 2011-12 Shri Banwari Lal Agarwal Ward-20, Azad Nagar, Madanganj, Kishangarh, Ajmer- 305801 cuke Vs. ITO, Ward -2, Kishangarh LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: AASPA 0201D vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksj l s@ Assessee by : Sh. Vishal Gupta (CA) jktLo dh vksj ls@ Revenue by : Sh. A. S. Nehara (Addl.CIT) a lquokbZ dh rkjh[k@ Date of Hearing : 28/04/2022 mn?kks"k.kk dh rkjh[k@Date of Pronouncement : 13/06/2022 vkns'k@ ORDER PER: DR. S. SEETHALAKSHMI, J.M. The present miscellaneous application has been filed by the assessee against the order passed by the Tribunal in ITA No. 1245/JP/2019 dated 13/10/2020 for A.Y 2011-12. 2. The assessee has raised the application for condonation of delay in filing miscellaneous application as under: 1. That the miscellaneous application as numbered above was filed by us on 30.06.2021. This miscellaneous application was filed against MA No. 15 /JP/2021 Sh. Banwari Lal Agrawal 2 order of this Hon’ble bench dated 13.10.2020 which was decided ex- parte. The said order was received by the assessee on 03.01.2021 by registered post. The copy of envelope which contained the order has already been enclosed with the miscellaneous application as an evidence of the date of receipt of order. After receipt of the said order only, the assesse came to know that an ex parte order has been passed against him. 2. The assesse while making the miscellaneous application was under honest belief that the application in not delayed due to reasons mentioned hereunder: a. the applicant believed that he is entitled to file miscellaneous application within 6 months from the end of the month in which order has been “received” by the assessee. As without receipt / communication of order, the assessee was not in knowledge about the order itself. The date when the order was passed cannot be solely determined by referring to the date when the same was signed by the Hon’ble ITAT. Under Section 254 (3) of the Act, the law stipulates that the ITAT shall send a copy of the order passed by it to the assessee and the Principal Commissioner. Further, Rule 35 of the ITAT Rules also requires that the orders are required to be communicated to the parties. For ready reference, Section 254 (3) of the Act and the relevant rule are reproduced hereunder: "254. Orders of Appellate Tribunal. xxxx xxxx xxxx (3) The Appellate Tribunal shall send a copy of any orders passed under this section to the assessee and to the Principal Commissioner or Commissioner. 35. Order to be communicated to parties. The Tribunal shall, after the order is signed, cause it to be communicated to the assessee and to the Commissioner." From the above noted provisions, it emerges that the Section and the Rule mandates the communication of the order to the parties. Thus, the date of communication or knowledge, actual or constructive, of the orders sought to be rectified or amended under Section 254(2) of the Act becomes critical and determinative for the commencement of the period of limitation. To hold the date of the order to be the relevant date for the MA No. 15 /JP/2021 Sh. Banwari Lal Agrawal 3 purpose of calculating the period of six months envisaged under Section 254(2) of the Act, can lead to several absurd and anomalous situations. An order passed without the knowledge of the aggrieved party, would render the remedy against the order meaningless as the same would be lost by limitation while the person aggrieved would not even know that an order has been passed. Such an interpretation would not advance the cause of justice and would not be the correct approach and thus cannot be countenanced. A person who is aggrieved or concerned with an order would legitimately be expected to exercise his rights conferred by the provision and unless the order is communicated or is known to him, either actually or constructively, he would not be in a position to avail such a remedy. There are several decisions of the Apex Court and other High Courts, where similar question came up for consideration. The Courts have always leaned in favour of an interpretation which would enable an aggrieved party to avail its remedy in a meaningful manner, so that the right conferred by a provision does not remain fanciful or illusionary. In support of our aforesaid contention, we rely on following precedents: i) Decision in the case of Pacific Projects Ltd. Vs ACIT [2021] 430 ITR 522 (Del) In this decision, H’ble Delhi high court held as under: “As noted above, Section 254(2) of the Act has undergone certain amendments. However, there is no dispute that the provision still retains the distinctive two parts as observed by the Supreme Court in the above noted case. We are presently concerned with a scenario under Section 254 (2) of the Act where the assessee has invoked its jurisdiction seeking rectification/ amendment of the order passed by the ITAT. In this situation, the assessee has claimed that it did not have the knowledge of the earlier order passed by the ITAT on 18.10.2016 and the period of limitation of six months should commence from the date of the receipt of the order. In our opinion, the limitation would begin to run when the affected person has the knowledge of the decision. The date when the order was passed cannot be solely determined by referring to the date when the same was signed by the ITAT. We further find that under MA No. 15 /JP/2021 Sh. Banwari Lal Agrawal 4 Section 254 (3) of the Act, the law stipulates that the ITAT shall send a copy of the order passed by it to the assessee and the Principal Commissioner. Further, Rule 35 of the ITAT Rules also requires that the orders are required to be communicated to the parties. For ready reference, Section 254 (3) of the Act and the relevant rule are reproduced hereinunder: "254. Orders of Appellate Tribunal. xxxx xxxx xxxx (3) The Appellate Tribunal shall send a copy of any orders passed under this section to the assessee and to the Principal Commissioner or Commissioner. 35. Order to be communicated to parties. The Tribunal shall, after the order is signed, cause it to be communicated to the assessee and to the Commissioner." 13. From the above noted provisions, it emerges that the Section and the Rule mandates the communication of the order to the parties. Thus, the date of communication or knowledge, actual or constructive, of the orders sought to be rectified or amended under Section 254(2) of the Act becomes critical and determinative for the commencement of the period of limitation. The ITAT has not applied its mind on this aspect and has been swayed by the literal and mechanical construction of the words "six months from the end of the month in which the order was passed". The ITAT failed to even delve into the question whether the affected party, either actually or constructively, was in knowledge of the order passed by the ITAT. xxxx xxxx xxxx xxxx 15. The assessee had challenged the ex parte order dated 18.10.2016 and consequently, keeping in view, the aforesaid decisions, we are of the considered opinion that the starting point of limitation provided under Section 254 (2) of the Act has to commence from the date of the actual receipt of the judgment and order passed by the ITAT which is sought to be the reviewed." MA No. 15 /JP/2021 Sh. Banwari Lal Agrawal 5 ii) Division Bench judgment of Delhi High Court in 'Golden Times Services Pvt. Ltd. Vs. DCIT' being W.P. (C) No. 402/2020 dated 13th January, 2020 wherein it has been held as under: “Be that as it may, the real question before us is as to what would be the relevant date for the purpose of commencement of period of limitation. To hold the date of the order to be the relevant date for the purpose of calculating the period of six months envisaged under Section 254(2) of the Act, can lead to several absurd and anomalous situations. An order passed without the knowledge of the aggrieved party, would render the remedy against the order meaningless as the same would be lost by limitation while the person aggrieved would not even know that an order has been passed. Such an interpretation would not advance the cause of justice and would not be the correct approach and thus cannot be countenanced. A person who is aggrieved or concerned with an order would legitimately be expected to exercise his rights conferred by the provision and unless the order is communicated or is known to him, either actually or constructively, he would not be in a position to avail such a remedy. The words "six months from the end of the month in which the order was passed" therefore, cannot be given a narrow and restrictive interpretation. There are several decisions of the Apex Court and other High Courts, where similar question came up for consideration. The Courts have always leaned in favour of an interpretation which would enable an aggrieved party to avail its remedy in a meaningful manner, so that the right conferred by a provision does not remain fanciful or illusionary”. iii) Pawan Kumar Jain vs DCIT [2013] 155 TTJ 14 (Mumai – Trib.) wherein it was held by the Hon’ble tribunal that: MA No. 15 /JP/2021 Sh. Banwari Lal Agrawal 6 "16. From the principles and maxims laid down by the Hon'ble Supreme Court in catena of cases as referred to above, it is amply clear that the 'date of order' should be construed and reckoned with the date of knowledge of the order i.e., when the order has been communicated to the party. The legal maxim behind this is how a person concerned or a person aggrieved is expected to exercise the right of remedy conferred by the statute, unless the order is communicated or known to him either actual or constructively. The underlying principle is of fair play that parties, whose rights are effected by an order must have a knowledge or notice of it, otherwise, the legal rights to remedy Is lost to the party, even when he is not at fault” b. The assessee also believed and believes that his application is not delayed as Hon’ble Supreme Court Order dated 27.04.2021 extending the period of limitation [Miss. Application No. 665/2021 in Suo motu Writ Petition (Civil) No. 3 of 2020, In Re: Cognizance for Extension of Limitation] is also applicable to the proceedings in hand and as such the period from 15.03.2020 till 02.10.2021 shall stand excluded while calculating period of limitation. A copy of said order has already been submitted with miscellaneous application. In view of above, the assessee hereby prays for condonation of delay in filing of miscellaneous application owing to the unprecedented circumstances being faced all over the country and especially the assessee and owing to the submissions made hereinbefore. With Regards and hoping of prayer being accepted,” 3. We have heard the rival contentions and perused the material available on record. The ld AR for the assessee has stated that he has sent adjournment application well in advance on 09.10.2020 through email. A copy of email is been verified and perused by this bench, which is as under ; MA No. 15 /JP/2021 Sh. Banwari Lal Agrawal 7 4. Further the Ld AR for the assessee submitted that the extending the period of limitation squarely is applicable by relying on decision of the Hon’ble Supreme Court Order dated 27.04.2021 extending the period of limitation [Miss. Application No. 665/2021 in Suo motu Writ Petition (Civil) No. 3 of 2020, Further the Ld AR for the assessee relied in Re: Cognizance for Extension of Limitation] is also applicable to the proceedings in hand and as such the period from 15.03.2020 till 02.10.2021 shall stand excluded while calculating period of limitation. Accordingly, in the interest of justice, the assessee is also directed not to seek any adjournment in the matter except with the leave of the Bench on showing reasonable cause. The Ld AR for the assesee MA No. 15 /JP/2021 Sh. Banwari Lal Agrawal 8 has submitted the SC decision and CBDT circular in support of his contentions, which are as under : 5. Further the ld AR for the assesee has submitted documentary evidences in the form of Annexures 1 to 6, where the Ld AR for the assesee claimed that his MA No. 15 /JP/2021 Sh. Banwari Lal Agrawal 9 case is genuine in nature and there is reasonable cause to belief that assesee was very much desirous and keen in getting the appeal prosecuted, The affidavits of the assesee in Annexures 6 and 7. MA No. 15 /JP/2021 Sh. Banwari Lal Agrawal 10 MA No. 15 /JP/2021 Sh. Banwari Lal Agrawal 11 MA No. 15 /JP/2021 Sh. Banwari Lal Agrawal 12 6. We therefore find that the assessee deserves one more opportunity whereby he can be heard on merits of his case. Accordingly, in the interest of justice, the consolidated order so passed by Co-ordinate Bench is hereby recalled for providing personal opportunity to the assessee to be heard on merits of the MA No. 15 /JP/2021 Sh. Banwari Lal Agrawal 13 case. The assessee is also directed not to seek any adjournment in the matter except with the leave of the Bench on showing reasonable cause. In the result, miscellaneous applications so filed by the assessee are allowed and disposed off in light of aforesaid discussion. Order pronounced in the open Court on 13/06/2022. Sd/- Sd/- ¼ jkBksM deys'k t;UrHkkbZ ½ ¼,l-lhrky{eh½ (RATHOD KAMLESH JAYANTBHAI) (Dr. S. Seethalakshmi) ys[kk lnL; @Accountant Member U;kf;d lnL;@Judicial Member Tk;iqj@Jaipur fnukad@Dated:- 13/06/2022. *Ganesh Kr vkns'k dh izfrfyfi vxzsf’kr@Copy of the order forwarded to: 1. vihykFkhZ@The Appellant- Shri Banwari Lal Agrawal 2. izR;FkhZ@ The Respondent- ITO, Ward-2, Kishangarh 3. vk;dj vk;qDr@ CIT 4. vk;dj vk;qDr@ CIT(A) 5. foHkkxh; izfrfuf/k] vk;dj vihyh; vf/kdj.k] t;iqj@DR, ITAT, Jaipur. 6. xkMZ QkbZy@ Guard File { MA No. 15/JP/2021} vkns'kkuqlkj@ By order, lgk;d iathdkj@Asst. Registrar