Jubilant Energy (Kharsang) Pvt. Ltd., Noida V. ACIT, Circle- 4(1), New Delhi

MA 280/DEL/2022

AI Insights

The case involves Jubilant Energy (Kharsang) Pvt. Ltd., which filed a Miscellaneous Application seeking to recall an ex-parte order of the Tribunal concerning the Assessment Year 2009-10. The ex-parte order was issued due to the non-appearance of the appellant on the scheduled hearing date. The appellant argued that their non-appearance was due to the company undergoing CIRP, which was admitted shortly before the scheduled hearing and led to a moratorium that included a prohibition on continuing legal proceedings against the company. The Tribunal considered the circumstances of the CIRP and the legal provisions under the IBC, along with precedents that supported the recall of ex-parte orders under similar circumstances.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 121599 (ITAT-DELHI)
• Duration Of Justice: 3 month(s) 21 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 05-01-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 05-01-2023
• Assessment Year: 2009-2010
• Appeal Filed On: 14-09-2022
• Other Referred Cases: Vedabai Alias Vaijayanatabai Baburao Patil V. Shantaram Baburao Patil, Collector, Land Acquisition V. Mst. Katiji, N. Balakrishnan vs M. Krishnamurthy, Binod Bihari Singh v. Union of India, CIT vs. Prajapati Bababhai Nathabhai, DCIT v. Global Softech Ltd., Mahavir Roads & Infrastructure Pvt. Ltd. v. DCIT, Reliance Communications Limited v. ADIT, Kishan Lal vs. CIT, Bhilai Engineering Corporation Limited vs. DCIT, Five Star Health Care (P) Ltd. vs. ITO, G.P. Srivastava v. R.K. Raizada, Om Prakash Sangwan v. ITO, CIT v. Ansal Housing & Construction Limited, CIT v. Hitech Flexotext (P.) Ltd, CIT v. Siel Ltd, Rainbow Agri Ind. Ltd V. ITAT, Sourav Jhunjhunwalla V. CIT, Partha Mitra v. CIT, Multiplan India (P.) Ltd., Mysore Minerals Ltd. v. CIT, Bharat Singh v. Narendra Kumar
• Laws Referred To: Income Tax (Appellate Tribunal) Rules, 1963, Section 254 (2) of the Act, Insolvency and Bankruptcy Code (IBC), 2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: ROHIT JAIN
• Keywords: Opportunity of being heard; Period of limitation; Question of law; Right to appeal; Set aside
• Section: 10; 250; 274

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “D” DELHI BEFORE SHRI CHANDRA MOHAN GARG, JUDICIAL MEMBER & SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER MA No.280/DEL/2022 (Arising from ITA No.3050/Del/2014) Assessment Year 2009-10 Jubilant Energy (Kharsang) Pvt. Ltd., A-80, Sector-2, Noida, Noida. vs. ACIT, Circle-4(1) New Delhi. TAN/PAN: AABCE2251K (Appellant) (Respondent) Appellant by: Shri Rohit Jain, Adv. Shri Deepesh Jain, CA Shri Shorya Jain, CA Respondent by: Shri Vijay Kumar Kataria, Sr.DR Date of hearing: 06 01 2023 Date of pronouncement: 06 01 2023 O R D E R PER PRADIP KUMAR KEDIA - A.M.: The captioned Misc. Application arises from the appellate order of the Tribunal dated 20.03.2017 passed in ITA No.3050/Del/2014 concerning Assessment Year 2009-10, the assessee has filed the Misc. Application for recalling of the ex-parte order under Rule 24 of the Income Tax (Appellate Tribunal) Rules, 1963 r.w. Section 254 (2) of the Act. 2. To support its Misc. Application, the assessee submitted as under: “The captioned application has been filed by the applicant in terms of Rule 24 of the ITAT Rules, which provides for recall of appeal heard ex-parte by the Tribunal. The said Rule reads as under: MA No.280/Del/2022 2 “Hearing of appeal ex parte for default by the appellant. 24. Where, on the day fixed for hearing or on any other date to which the hearing may be adjourned, the appellant does not appear in person or through an authorised representative when the appeal is called on for hearing, the Tribunal may dispose of the appeal on merits after hearing the respondent: Provided that where an appeal has been disposed of as provided above and the appellant appears afterwards and satisfies the Tribunal that there was sufficient cause for his non-appearance, when the appeal was called on for hearins. the Tribunal shall make an order settins aside the ex parte order and restoring the appeal. ” The aforesaid Rule provides that: - in case of non-appearance by the appellant on the date of hearing, the Tribunal is empowered to decide the appeal on merits of the matter; and - the Tribunal may recall/ restore the appeal disposed ex-parte by the Tribunal on being satisfied with “sufficient cause” of non-appearance by the appellant. It is, thus, respectfully submitted that the solitary condition laid down in Rule 24 of the ITAT Rules, for recall of ex-parte order of the Tribunal shall be satisfactory explanation of sufficient cause/ reason for non-appearance of the appellant on the date of hearing. In facts of present case, there was, in our submission, sufficient cause on part of applicant for non- appearance on 20.03.2017 as explained hereinbelow: Re: Proceedinss under Insolvency and Bankruptcy Code (IBC), 2016 It is respectfully submitted that at the time the captioned appeal was dismissed ex-parte, the applicant company was under Corporate Insolvency Resolution Proceedings (CIRP) under the Insolvency and Bankruptcy Code (IBC), 2016 [‘IBC’]. The brief facts in relation to the CIRP in case of the applicant are under: The applicant (Corporate Debtor) filed an application dated 03.03.2017 under section 10 of the IBC before the National Company Law Tribunal (‘NCLT'- Allahabad Bench) for initiation of CIRP. The said application was admitted by the NCLT vide order dated 17.03.2017 in terms of section 10(4) of IBC. In terms of section 10(5) of IBC, CIRP shall commence from date of such admission of the application by NCLT. The moratorium in terms of section 14 of IBC was also declared vide the said order. Further, the Resolution Professional was also appointed in terms of section 16 of IBC to look after the affairs of the company. Copy of order dated 17.03.2017 is attached herewith as Annexure 3. MA No.280/Del/2022 3 After following the due process including publishing Expression of Interest for Resolution Plan, meetings of Committee of Creditors (CoC), examination of Resolution Plans etc., Atyant Capital India Fund-I (‘Atyant Capital') emerged as the successful Resolution Applicant. The Resolution Plan submitted by the successful Resolution Applicant was first approved by the NCLT on 15.12.2017. Meanwhile, one Financial Creditor (‘Exim Bank') filed an application before the National Company Law Appellate Tribunal (‘NCLAT’) for the inclusion of its debt in the Resolution Plan. The NCLAT vide order dated 14.08.2018 directed inclusion of the aforesaid financial creditor and directed the corporate debtor to reconstitute the CoC. After rounds of bidding and complying with all the provisions of IBC, Atyant Capital filed the revised plan and emerged as the successful Resolution Applicant. The revised Resolution Plan was approved by COC on 28.06.2019. Finally, the NCLT approved the revised resolution plan under section 31 of IBC on January 17, 2020 (as amended vide order dated 04.02.2020). The NCLT further approved the extension to the implementation date of approved Resolution Plan to 30.09.2020. Copy of orders dated 17.01.2020, 04.02.2020 and 09.09.2020 are attached herewith as Annexure 4, Annexure 5 and Annexure 6 respectively. The aforesaid facts make it clear that the CIRP proceedings were admitted against the applicant company on 17th March 2017, and the same were concluded on 30.09.2020. It is submitted that in terms of section 14 of the IBC, with effect from the insolvency commencement date (17.03.2017 in the present facts), the NCLT declares moratorium for prohibiting, inter alia, the institution of suits or continuation of pending suits or proceedings against the corporate debtor including in any court of law or tribunal. The said moratorium shall have the effect till completion of CIRP. In that view of the matter, as on 20.03.2017, when the captioned appeal was dismissed ex-parte, the moratorium period was applicable [refer Alchemist Asset Reconstruction Co. Ltd. v. Hotel Gaudavan (P.) Ltd: [2017] 88 taxmann.com 202/, Pr. CIT v. Monnet Ispat & Energy Ltd.: SLP (C) No. 6487 of 2018, dated 10-8-2018]. It is respectfully submitted that such appeals/ proceedings shall be revised/ recalled post completion of the moratorium period, i.e., on completion of CIRP per the resolution plan approved by the NCLT. Attention in this regard is further invited to the decision of the Mumbai Bench of the Tribunal in the case of DCIT v. Global Softech Ltd.: [2022] 140 taxmann.com 103 (Mum), wherein appeal filed during moratorium period under section 14 of IBC was dismissed, with liberty to file the appeal afresh after completion of moratorium period upon the revival of the Corporate Debtor as per Resolution Plan as approved by the NCLT. Similarly, the Mumbai Bench of the Tribunal in the case of Mahavir Roads & MA No.280/Del/2022 4 Infrastructure Pvt. Ltd. v. DCIT: ITA No. 646 to 651/Mum/2019dated 08.06.2022 held that the pending appeals shall be dismissed in limine during the CIRP in view of prevailing moratorium in terms of section 14 of the Act. The Tribunal, however, expressly stated that liberty is given to the parties to revive/restitute all the aforesaid appeals after the moratorium period expires. In the case of Reliance Communications Limited v. ADIT: ITA No.476/Mum./2016, the Mumbai Bench of the Tribunal dismissed cross appeals preferred by the Revenue and the assessee as not maintainable for being filed during the moratorium period under IBC. In view of the aforesaid, the captioned appeal filed by the applicant which has been dismissed ex-parte vide order dated 20.03.2017 in the moratorium period (albeit for non-appearance), calls for being recalled/ revived now as CIRP stands completed. That apart, it is respectfully submitted that the Resolution Professional in the case of the applicant was appointed by the NCLT vide order dated 17.03.2017 in terms of section 16 of the IBC. As per section 17 of the IBC, on appointment of the Resolution Professional, the management of the affairs of the Corporate Debtor are vested with Resolution Professional; and powers of Board of Directors of the Corporate Debtor stands suspended. Being so, the powers of the management/ board of the applicant company stood suspended w.e.f 17.03.2017, few days prior to date of hearing before this Hon'ble Tribunal (20.03.2017). The responsibility of the appearing/ representing the appeal was thus of the Resolution Professional, who, it is understood, did not appear and the appeal was dismissed ex-parte. Being so, there is, in our respectful submissions, clearly a sufficient cause for non-appearance on behalf of the applicant on 20.03.2017 before the Hon’ble Tribunal; such non-appearance thus cannot, in any case, be attributable to the applicant company or its new management. On conclusion of the CIRP proceedings and implementation of the Resolution Plan, new management of the applicant company has been instated on 30.09.2020. Thereafter, on examination and due diligence of the matters/ files relating to the applicant company including pending tax appeals/ matters, it has been discovered that the captioned appeal filed by the applicant has been dismissed by the Hon’ble Tribunal ex-parte during the pendency of CIRP proceedings. Being so, the applicant now seeks place its request for recall/ restoration of the captioned appeal before this Hon’ble Bench. It is also submitted that the applicant does not have any intention to give up its valuable right to appeal which is evident from the fact that -(i) similar appeal for immediately preceding year, i.e., assessment year 2008-09, was duly argued by the applicant; (ii) the issue is squarely covered in favor of the applicant as detailed supra. The aforesaid facts also clearly demonstrate that non-appearance on the date of hearing was not attributable to any fault of the applicant or its management; applicant never had any intention to give up its valuable right to appear before the Hon'ble Tribunal; the non-appearance was only due to the peculiar MA No.280/Del/2022 5 circumstances mentioned above. Recall of Ex-parte order - Legal Position In view of the foregoing, it is respectfully submitted that there was sufficient cause for non- appearance on the last date of hearing. It is, therefore, respectfully prayed that the ex-parte order V- may kindly be recalled, and the appeal may be directed to be listed for being adjudicated on merits. Affidavit in this regard is attached with the present application (enclosed as Annexure 7). Re: Sufficient cause - judicial precedents The Supreme Court in the case of Vedabai Alias Vaijayanatabai Baburao Patil V. Shantaram Baburao Patil: 253 ITR 798(SC) held that the Court has to exercise the discretion on the facts of each case keeping in mind that in construing the expression “sufficient cause", the principle of advancing substantial justice is of prime importance. The Court held that the expression "sufficient cause " should receive liberal construction. The Supreme Court in the case of Collector, Land Acquisition V. Mst. Katiji: 167 ITR 471 observed as under: “ The Legislature has conferred the power to condone delay by enacting section 51 of the Limitation Act of 1963 in order to enable the courts to do substantial justice to parties by disposing of matters on de merits”. The expression "sufficient cause” employed by the Legislature is adequately elastic to enable the courts to apply the law in a meaningful manner which subserves the ends of justice that being the life-purpose of the existence of the institution of courts. It is common knowledge that this court has been making a justifiably liberal approach in matters instituted in this court. But the message does not appear to have percolated down to all the other courts in the hierarchy. ” (emphasis supplied) The apex Court in the case of N. Balakrishnan vs M. Krishnamurthy: 1998 (7) SCC 123, in respect of condonation of delay, had examined the term “sufficient cause and held that the length of delay is of no great significance, rather the acceptability of explanation is what matters. The Court specifically held that non-follow up by the assessee with the advocate regarding the matter shall not be the ground to leave assessee to bear drastic consequences. The relevant findings of the apex Court in this regard are reproduced as under: "Though, the trial court was pleased to accept the aforesaid explanation and condoned the delay a single judge of the High Court of Madras who heard the revision, expressed the view that the delay of 883 days in filing the application has not been properly explained. Hence the revision was allowed, and trial court order was set aside. An application for review was made, but that was dismissed. Hence these appeals. MA No.280/Del/2022 6 The reasoning of the learned single Judge of the High Court for reaching the above conclusion is that the affidavit filed by the appellant was silent as to why he did not meet his advocate for such a long period. According to the learned single Judge: 'Tf the appellant was careful enough to verify about the stage of the proceedings at any point of time and had he been misled by the counsel then oily it could have been said that due to the conduct of the counsel the party should not be penalized." Learned single judge then observed that when the party is in utter negligence, he cannot be permitted to blame the counsel. Learned single judge has further remarked that: "A perusal of the affidavit does not reveal any diligence on the part of the respondent in the conduct of the proceedings. When already the suit has been decreed ex-parte, the respondent ought to have been more careful and diligent in prosecuting the matter further, the conduct of the respondent clearly reveals that at any point of time, he has not relished his responsibility as a litigant.” Appellant's conduct does not on the whole warrant to castigate him as an irresponsible litigant. What he did in defending the suit was not very much far from what a litigant would broadly do. Of course, it may be said that he should have been more vigilant by visiting his advocate at short intervals to check up the progress of the litigation. But during these days when everybody is fully occupied with his own avocation of life an omission to adopt such extra vigilance need not be used as a ground to depict him as a litigant not aware of his responsibilities, and to visit him with drastic consequences. It is axiomatic that condonation of delay is a matter of discretion of the court Section 5 of the Limitation Act does not say that such discretion can be exercised only if the delay is within a certain limit. Length of delay is no matter, acceptability of the explanation is the only criterion. Sometimes delay of the shortest range may be un condonable due to want of acceptable explanation whereas in certain other cases delay of very long range can be condoned as the explanation thereof is satisfactory. Once the court accepts the explanation as sufficient it is the result of positive exercise of discretion and normally the superior court should not disturb such finding, much less in reversional jurisdiction, unless the exercise of discretion was on whole untenable grounds or arbitrary or perverse. But it is a different matter when the first cut refuses to condone the delay. In such cases, the superior cut would be free to consider the cause shown for the delay afresh and it is open to such superior court to come to its own finding even untrammeled by the conclusion of the lower court. The reason for such a different stance is thus: The primary function of a court is to adjudicate the dispute between the parties and to advance substantial justice. Time limit fixed for approaching the court in different situations in not because on the expiry of such time a bad cause would transform into a good cause. ” The Supreme Court in the case of Binod Bihari Singh v. Union of India: AIR 1993 SC 1245, held that pragmatic view should be taken by the Court while considering “sufficient cause’ for condonation of delay under the provisions of MA No.280/Del/2022 7 the Limitation Act and that the Court cannot straightway dismiss such plea on grounds of being unworthy. Reliance is also placed on the decision of the Gujarat High Court in the case of CIT vs. Prajapati Bababhai Nathabhai: ITA No. 809 to 811 of 2005, where the assessee had preferred appeals before Commissioner (Appeals) against the assessments framed by the assessing officer. The said appeals came to be decided ex-parte for non-appearance, as recorded by CIT(A). Thereafter, the assessee moved rectification application seeking recall of the ex-parte order inviting attention of CIT(A) to the fact that the assessee had attended before CIT(A) on the date of hearing, but as the CIT(A) was preoccupied with other work the hearing could not take place. Consequently, the CIT(A) being satisfied that the appellant was prevented by sufficient cause to give proper opportunity of being heard, recalled the ex-parte order and fixed the appeals for hearing. Aggrieved by the order of the CIT(A), the Revenue preferred appeal before the Tribunal contending that the CIT(A) has no power to re-call its order. However, the Tribunal dismissed the appeal of the Revenue and held that the CIT(A) had rightly re-called its order, since every authority has ancillary and incidental power to recall an order, if it is satisfied that the absence was for the reasons beyond the control of the assessee. On further appeal preferred by the Revenue, the High Court confirmed the order of the Tribunal by observing as under: 9. Section 250(1) of the Act specifically lays down that Commissioner (Appeals) shall fix a day and place for hearing of the appeal. The learned Counsel for the appellant herein does not dispute that Commissioner (Appeals) is bound to hear an appeal before him, when the assessee who has filed the appeal after fulfilling all the necessary requisite conditions appears on the appointed day. However, it is submitted that Section 250 of the Act cannot be considered on the specious plea that once the order was made under section 251(1) of the Act the Commissioner (Appeals) would have no occasion to revert back to the provisions of Section 250(1) of the Act. 10. The contention is based on a fallacious premise. The provision is not meant for only making a show of granting hearing. The Commissioner (Appeals) is required to give an effective hearing to the appellant before him and in case where it is found from the record, of his own office, that appellant before him was not granted any hearing, much less an effective hearing, it cannot be stated that provisions of Section 250(1) of the Act have been complied with. As already noticed hereinbefore, it is not disputed on behalf of the appellant revenue that the assessee was never heard by Commissioner (Appeals). It is submitted that in the facts as are obtaining in the present case, the only remedy available to an assessee is to approach the Tribunal, have the order of Commissioner (Appeals) set aside and get the appeals restored to the file of Commissioner (Appeals). 11. The approach of revenue cannot be accepted. It is necessary for revenue to appreciate that litigation is not a luxury, so far as an assessee is concerned, but a necessity. To drive an assessee to file an appeal before the Tribunal after MA No.280/Del/2022 8 payment of filing fees, await his turn and then obtain order of remand is nothing else but a luxury litigation which need not be indulged in. In the meantime the assessee would have to face recovery proceedings for no fault of his. The revenue does not stand to gain anything by adopting such an attitude. The State cannot be permitted to act in such cavalier manner so as to result in harassment of the citizen of this nation. 13. In the aforesaid circumstances not only the impugned order of Tribunal does not suffer from any infirmity so as to give rise to any substantial question of law, but is the only order which could have been made in the facts and circumstances of the case. The appeals are accordingly dismissed” (emphasis supplied) Reliance, in this regard, is also placed on the decision of the Hon'ble Apex Court in the case of Bharat Singh v. Narendra Kumar: 2004 (13) SCC 691 in which it was held that ordinarily a litigant should not he denied liberty of contesting the case on merits. The apex Court in the case of CIT v. S. Chenniappa Mudalia: [1969] 74 ITR 41 (SC)held that Tribunal is bound to give proper decision on question of fact as well as law on merits and it cannot dismiss an appeal owing to default of appearance. Reference in this regard may also be made to the following decisions wherein it has been held that where the assessee demonstrates sufficient cause for non- appearance on the date fixed for hearing, the ex-parte order should be set aside and the appeal should be restored for hearing: • CIT V. Ansal Housing & Construction Limited: 274 ITR 131 (Del.) • CIT v. Hitech Flexotext (P.) Ltd: 167 Taxman 237 (Del) • CIT v. Siel Ltd: 284 ITR 381 (Del) • Rainbow Agri Ind. Ltd V. ITAT: 266 ITR 38 (Bom.) • Sourav Jhunjhunwalla V. CIT: 273 ITR 225 (Cal.) Moreover, it is pertinent to mention here that the Third Member at Kolkata Bench of the Tribunal in the case of Partha Mitra v. CIT: 183 TTJ 330 (Kol)(TM), held that even in cases where the assessee was unable to satisfactorily explain the non-appearance during the course of hearing leading to an ex-parte order, the order must be recalled and be heard on merits. The Tribunal, relying upon the decision in the case of Chenniappa Mudalia (supra), held that the appeal must be heard on merits and should not be disposed of ex- parte. The Hon'ble Third Member further observed that the decision in the case of CIT v. Multiplan India (P.) Ltd. [1991] 38 ITD 320 (Del) (relied upon in the present ex-parte order) does not hold the field anymore It is further respectfully submitted that it is settled law that no party should be allowed to suffer on account of non-appearance if the party acted bona fide. Reference, in this regard, may also be made to the following decisions wherein it has been held that the assessee should not be made to suffer even on account of MA No.280/Del/2022 9 the mistake of the counsel (Resolution Professional in the present case): - In the case of Kishan Lal vs. CIT: 303 ITR188 (All.), the Tribunal rejected the miscellaneous application filed by the assessee seeking recall of the ex-parte order on the ground that the hearing of the appeal went unattended on account of misapprehension of the counsel of the assessee. In further appeal filed by the assessee against the order of the Tribunal rejecting the miscellaneous application, the Court held that when an application was filed by the assessee for recall of the ex-parte order it which incumbent upon the Tribunal to consider the same sympathetically if the reasons mentioned therein are bona fide and the applicant was prevented from sufficient cause for appearing on the date. Misapprehension of the counsel was held by their Lordships to be sufficient cause and the order of the Tribunal was reversed by holding that by not recalling the ex-parte order, miscarriage of justice had resulted. The Nagpur Bench of the Tribunal in the case of Bhilai Engineering Corporation Limited vs. DCIT: 81 ITD 282 held that delay in filing the miscellaneous application due to mistake of the counsel constituted reasonable cause for filing the belated application. The Tribunal observed that the procedure prescribed should be handmaiden of justice and not the mistress of legal justice. The Tribunal further observed that the cause of justice should not be subservient to the rules of procedure. The pertinent observations of the Tribunal are reproduced hereunder: In arriving at this conclusion we have taken into consideration the legal prasmatism vis-a-vis the basic tenets of law. We are reminded of the dictum: Fiat juistitiaruat et coeluim (Justice should be done even if the heaven falls). The procedure should be the handmaid and not the mistress of legal justice. Cause of justice should not be subservient to the rules of procedure. We have gone through the file. The issue involved in the present case is prima facie appears to be covered by the decision of the Apex Court rendered in the case of Mysore Minerals Ltd. v. CIT[1999] 239 ITR 775 (SC). Under article 141 of the Constitution of India, the decision pronounced by the Supreme Court is a binding precedent.............” It has been similarly held in the following cases: Kuldip Singh v. Krishan Kumar [1974] AIR 145 (Del.): Held that assessee cannot be made to suffer for the mistake of the clerk of the counsel. Accordingly, delay in that case due to clerk of the counsel misplacing the relevant documents was condoned. - Santosh Kumari v. Kewal Krishan AIR 1985 Del. 393: The Delhi High Court condoned the delay in filing appeal which had occurred due to the counsel's clerk misplacing the certified copy of the order with other papers in the office. MA No.280/Del/2022 10 The Delhi Bench of the Tribunal in the case of Five Star Health Care (P) Ltd. vs. ITO: 145 TTJ 537 [TM] recalled ex-parte order where the counsel did not appear on the date of hearing since he had wrongly recorded the date of hearing in his diary. The Tribunal held that there was sufficient cause for his non- appearance on the date of hearing. Reference in this regard may be made to the decision in the case of G.P. Srivastava v. R.K. Raizada: Special Leave Petition (Civil) 17942-43 of 1999, wherein the Hon’ble Supreme Court, in the context of ex-parte dismissal, inter alia, held that in the absence of any mala fide intention and remedy sought not barred by limitation, the Courts should favor the litigant unless there are sufficient grounds to the contrary. It would be further be appreciated that post restoration of the management of the applicant company after completion of CIRP and on examination of tax records/ due diligence and becoming aware about the ex-parte dismissal, the appellant has diligently proceeded to take remedial actions in filing the captioned application, without any delay. In any case, it is submitted that the aforesaid Rule 24 of the Rule does not lay down any time limit for recall of ex-parte order by the Tribunal. The solitary condition laid down in the Rule is satisfactory explanation as to sufficient cause/ reason for non-appearance before the Tribunal on the date of hearing. Reliance in this regard is placed on the recent decision of the jurisdictional Delhi High Court in the case of Om Prakash Sangwan v. ITO: [2018] 94 taxmann.com 394 (Del) dated 22.05.2018 where it has been held by the Tribunal that Rule 24/25 of the Rules does not provide for any time limit for recall of an ex-parte order and the Tribunal must consider the appeals on merits instead of dismissing ex-parte. The relevant extract of the judgment is reproduced hereunder for ready reference: “Rule 24 of the Income Tax Appellate Tribunal’s Rules and the other provisions of both the Income Tax Act and Rules indicate that the IT AT has to decide the appeals or matters before it on the merits. In these circumstances, the IT A T’s failure to do so, implies that it exceeded its jurisdiction and instead of deciding on the merits, rejected the appeal merely for non-prosecution. In the given circumstances and keeping in view the fact that Rule 25 does not stipulate any period of limitation within which the aggrieved party can approach the Tribunal, it is open to the appellant to approach the Tribunal with a suitable application for restoration of the appeals; in such event, the appeals could be considered on their merits and decided in accordance with law after hearins both the parties, provided, the application is presented before the IT AT within thirty days from today." (emphasis supplied) Based on the aforesaid facts and circumstances of the case and having regard to (a) sufficient cause for non-appearance explained; and (b) diligent approach of the applicant to seek remedial actions; it is respectfully prayed that the captioned miscellaneous applications be allowed, and appeal be restored for adjudication on merits in terms of Rule 24 of the Rules. MA No.280/Del/2022 11 In any case, it is submitted that when the appeal was dismissed ex-parte on 20.03.2017, the applicant was under CIRP in terms of provisions of IBC, which stood Concluded in 2020. The management/ Board of the applicant was thereafter restored/ re-organized on 30.09.2020. Subsequently, due to ongoing Covid-19 pandemic since then, the exercise of examination of records/ due diligence have taken time. Now on discovery of the ex-parte dismissal of the captioned appeal, the assessee is promptly approaching this Hon'ble Bench for recall/ revival of the captioned appeal.” 3. In the light of the submissions made it was urged for recalling of appellate order of the Tribunal under Rule 24 of the ITAT Rules. 3. The reasons set out on behalf of the assessee in justification of recall of ex-parte order are overtly bona fide. As stated, the assessee was undergoing CIRP proceedings which resulted in non attendance leading to ex-parte order. The legal contentions for recalling of ex-parte order also squarely covers the case of the assessee. Hence, we find merit in the plea of the assessee for recalling of the ex-parte order to prevent miscarriage of justice in the light of the decision of Hon’ble Delhi High Court in the case of Om Prakash Sangwan vs. ITO (2018) 94 taxmann.com 394 (Del.). Hence, we recall the impugned order of the Tribunal passed in ITA No.3050/Del/2014 dated 20.03.2017 and direct the Registry to fix the appeal for fresh hearing in due course. 4. In the result, the Misc. Application filed by the assessee is allowed. Order was pronounced in the open Court on 06 January, 2023. Sd/- Sd/- [CHANDRA MOHAN GARG] [PRADIP KUMAR KEDIA] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: January, 2023 Prabhat