MBR EDUCATIONAL SOCIETY,HYDERABAD V. ITO., EXEMPTION WARD-1(2), HYDERABAD

ITA 665/HYD/2025

AI Insights

The case involves the MBR Educational Society, which appealed against an order from the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, concerning the assessment year 2018-19. The appeal was initially delayed by 441 days, attributed to a misunderstanding by the society and their Chartered Accountant regarding the filing status of the appeal. The tribunal examined the reasons for the delay, including affidavits from the Chartered Accountant and the society, but found them unconvincing and marked by negligence. The Departmental Representative opposed the condonation of the delay, citing the need for strict adherence to procedural timelines, especially for entities like educational institutions that are expected to comply with statutory requirements diligently.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 792155 (ITAT-HYDERABAD)
• Duration Of Justice: 7 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-12-2025
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB-A
• Assessment Year: 2018-2019
• Appeal Filed On: 16-04-2025
• Other Referred Cases: Balwant Singh vs. Jagdish Singh & Ors, Civil Appeal No. 1166 of 2006
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: B. SATYANARAYANA MURTHY
• Keywords: Reasonable cause

Judgement Text

" ITA No 665 of 2025 MBR Educational Society Page 1 of 9 आयकर अपीलȣय अͬधकरण, हैदराबाद पीठ IN THE INCOME TAX APPELLATE TRIBUNAL Hyderabad ‘ A ‘ Bench, Hyderabad Įी ͪवजय पाल राव, उपाÚ य¢ एवं Įी मधुसूदन सावͫडया, लेखा सदè य क े सम¢ । Before Shri Vijay Pal Rao, Vice-President A N D Shri Madhusudan Sawdia, Accountant Member आ.अपी.सं /ITA No.665/Hyd/2025 (िनधाŊरण वषŊ/Assessment Year: 2018-19) MBR Educational Society Hyderabad PAN:AAAAM6527D Vs. Income Tax Officer Exemption Ward 1(2) Hyderabad (Appellant) (Respondent) िनधाŊįरती Ȫारा/Assessee by: Shri B. Satyanarayana Murthy, CA राज̾ व Ȫारा/Revenue by:: Smt. U Mini Chandran, CIT(DR) सुनवाई की तारीख/Date of hearing: 04/12/2025 घोषणा की तारीख/Pronouncement: 10/12/2025 आदेश/ORDER Per Madhusudan Sawdia, A.M.: This appeal is filed by MBR Educational Society (“the assessee”), feeling aggrieved by the order passed by the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi (“Ld. CIT(A)”) dated 10.11.2023 for the A.Y. 2018-19. 2. At the outset, it is noted that there is an inordinate delay of 441 days in filing the present appeal before this Tribunal. Printed from counselvise.com ITA No 665 of 2025 MBR Educational Society Page 2 of 9 The assessee has filed a condonation petition along with an affidavit explaining the reasons which, according to the assessee, constituted sufficient cause for the belated filing of the appeal. The copy of the affidavit filed by the assessee is to the following effect: Printed from counselvise.com ITA No 665 of 2025 MBR Educational Society Page 3 of 9 3. Inviting our attention to para no. 3 of the affidavit, the Learned Authorized Representative (“Ld. AR”) submits that while filing an appeal against the penalty order passed under section 270A of the Income Tax Act, 1961 (“the Act”), the assessee came to know that the quantum appeal against the order of the Ld. CIT(A) Printed from counselvise.com ITA No 665 of 2025 MBR Educational Society Page 4 of 9 had not been filed by their Chartered Accountant. It is stated that the assessee was under the bona fide belief that the appeal had already been filed, and upon realizing the non-filing, took immediate steps to file the appeal. According to the assessee, this led to a total delay of 441 days. To support the condonation petition, the assessee filed the affidavit of the Chartered Accountant who was entrusted with filing the appeal. The Chartered Accountant states that the order of the Ld. CIT(A) was passed on 10.11.2023, and in the last week of November 2023, the work of preparing and filing the appeal papers was allotted to one Mr. N. Rama Shastry, a staff member in his office. He further states that when the management of the assessee enquired in April 2025 about the status of the appeal, he came to know that the said staff member had not filed the appeal and had kept the papers with him before leaving employment in January 2024. The Chartered Accountant adds that he was under the honest impression that the appeal had been filed by his staff. On the basis of both affidavits, the Ld. AR submitted that there was no negligence or mala fide intention on the part of the assessee and, therefore, prayed that the delay be condoned and the appeal heard on merits. 4. Per contra, the Learned Departmental Representative (“Ld. DR”) strongly opposed the condonation. She submitted that the assessee, being an educational institution, cannot claim the benefit of leniency afforded to an illiterate or rural assessee. She argued that the reasons furnished do not constitute reasonable cause and placed reliance on the judgment of the Hon’ble Printed from counselvise.com ITA No 665 of 2025 MBR Educational Society Page 5 of 9 Supreme Court in Balwant Singh vs. Jagdish Singh & Ors, Civil Appeal No. 1166 of 2006, for the proposition that delay cannot be condoned in the absence of demonstrable diligence. 5. After considering the rival submissions, examining the affidavits, and reviewing the record, we find that the explanation offered by the assessee is neither reasonable nor satisfactory, particularly having regard to the inordinate length of the delay. The delay of 441 days is substantial and cannot be brushed aside lightly. When there is such an inordinate delay, the assessee is under a higher obligation to furnish clear, credible, and cogent reasons demonstrating due diligence. However, in the present case, the explanation is wholly unconvincing. The assessee is running an educational institution, which, by its nature, is required to comply with statutory and regulatory procedures on a continuous basis. It is not believable that such an institution remained unaware for more than 15 months that its quantum appeal had not been filed. During the entire period of delay, no notice or communication was received from the Tribunal, which should ordinarily have prompted inquiry regarding the status of the appeal. The absence of even a single enquiry over such an extended period demonstrates lack of due care. In this regard, we have gone through the affidavit of the Chartered Accountant filed by the assessee, which is to the following effect: Printed from counselvise.com ITA No 665 of 2025 MBR Educational Society Page 6 of 9 Printed from counselvise.com ITA No 665 of 2025 MBR Educational Society Page 7 of 9 Printed from counselvise.com ITA No 665 of 2025 MBR Educational Society Page 8 of 9 6. On perusal of the above, we find that the explanation furnished by the Chartered Accountant does not inspire confidence. It is admitted by the Chartered Accountant that the appellate work was allotted to his staff member in the last week of November 2023, and that the said staff left employment in January 2024, barely one to two months thereafter. It is normal and expected practice that when a staff member leaves an office, the employer reviews the work pending with the outgoing staff, particularly tasks of immediate statutory importance such as filing an appeal before this Tribunal. The work entrusted in the present case was not an old matter nor one that could have been forgotten; it was a recently assigned and legally significant responsibility. Therefore, the contention that the Chartered Accountant remained unaware that the appeal was not filed from January 2024 until April 2025 reflects a casual and negligent approach rather than a bona fide omission. Such an explanation is not acceptable. Additionally, the claim that the staff member took away the papers with him while leaving service is implausible. If the taking away of papers was intentional, then logically, similar papers of other clients too would have been taken. Further, it is unreasonable to accept that a professional Chartered Accountant would fail to verify the filing status of an appeal for nearly 15 months, particularly when the entrusted task had been allotted only recently. These circumstances collectively demonstrate gross negligence and lack of due diligence on the part of both the assessee and its Chartered Accountant. Accordingly, in our considered view, the assessee has not established “sufficient cause” within the meaning of section 253(5) of the Act. Printed from counselvise.com ITA No 665 of 2025 MBR Educational Society Page 9 of 9 7. In view of the foregoing discussion and respectfully following the decision of the Hon’ble Supreme Court in the case of Balwant Singh vs. Jagdish Singh (supra), we hold that the inordinate delay of 441 days in filing the appeal cannot be condoned. Accordingly, the appeal of the assessee is dismissed in limine as barred by limitation. 8. In the result, the appeal of the assessee is dismissed. Order pronounced in the Open Court on 10th December 2025. Sd/- Sd/- ((VIJAY PAL RAO) VICE PREWSIDENT (MADHUSUDAN SAWDIA) ACCOUNTANT MEMBER Hyderabad, dated 10th December 2025 Vinodan/sps Copy to: S.No Addresses 1 MBR Educational Society, D. No. 5-9-22/31, Adarsh Nagar, LIC Division, SO Himayat Nagar, Hyderabad 500063 2 Income Tax Officer Exemption Ward 1(2) Aayakar Bhavan, Hyderabad 500004 3 Pr. CIT – Exemption, Hyderabad 4 DR, ITAT Hyderabad Benches 5 Guard File By Order Printed from counselvise.com "