OPG RESOURCES LLP,DELHI V. INCOME TAX OFFICER - WARD 29(1), DELHI

ITA 5240/DEL/2024

AI Insights

The case involves OPG Resources, LLP appealing against the order of the CIT(A) which dismissed their appeal due to a significant delay in filing. The delay was attributed to the change of tax consultants and the subsequent discovery of an outstanding demand. The Tribunal found that the CIT(A) had not adequately considered the reasons for the delay or the supporting affidavit provided by the assessee. Citing precedents that advocate for a liberal approach in such matters, the Tribunal restored the case to the CIT(A) for a fresh examination on merits.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 470520 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-03-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Assessment Year: 2018-2019
• Other Referred Cases: Microtek Balaji Powertronics Private Limited vs. ACTT, Microtek Balaji Powertronics Private Limited vs. ACIT, Kenzo International vs. DCIT, Concord of India Insurance Co. Ltd vs. Smt. Nirmala Devi, Improvement Trust vs. Ujagar Singh, Bombay Mercantile Co-op. Bank vs. CBDT
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AMIT KATOCH
• Assessee Lawyers: S.S.NAGER
• Keywords: Condonation of delay; Opportunity of being heard; Reasonable cause; Period of limitation; Earning of tax free income
• Section: 22; 13

Judgement Text

"ITA No. 5240/DEL/2024 [A.Y. 2018-19] OPG Resources, LLP Vs ITO Wd 29(1) Page 1 of 10 IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI ‘E’ BENCH, NEW DELHI BEFORE MS. MADHUMITA ROY, JUDICIAL MEMBER, AND SHRI NAVEEN CHANDRA, ACCOUNTANT MEMBER ITA No. 5240/DEL/2024 [A.Y. 2018-19] OPG Resources, LLP Vs. The Income-tax Officer D -7, Rohtak Road Ward 29(1) Udyog Nagar, Delhi New Delhi PAN – AADFO 2998 J (Applicant) (Respondent) Assessee By : Shri S.S. Nager, CA Shri Gaurav Sachdeva, CA Department By : Shri Amit Katoch, Sr. DR Date of Hearing : 05.03.2025 Date of Pronouncement : 05.03.2025 ORDER PER NAVEEN CHANDRA, A.M:- This appeal by the assessee is preferred against the order of the ld. CIT(A) dated 21.08.2024 for A.Y 2018-19. ITA No. 5240/DEL/2024 [A.Y. 2018-19] OPG Resources, LLP Vs ITO Wd 29(1) Page 2 of 10 2. The assessee has raised the following grounds of appeal: “1. That on the facts and in the circumstances of the case, the disallowance, Imposition of tax and interest with reference thereto, the quantification of taxable income has been grossly unjustified, erroneous and unsustainable and necessary direction be given to the Ld. AO to give appropriate relief in accordance with law and the tax liability. 2. That on the facts and the circumstances of the case, the Ld. CIT(A) was not justified and grossly erred in dismissing the appeal on account of delay in filing of appeal. 3. That on the facts and the circumstances of the case, the Ld. CIT(A) was not justified and grossly erred in not considering the claim on merits of taxing exempt income being share of profit from partnership firm of Rs. 3,55,64,211/ 4. That on the facts and in the circumstances of the case, the Ld.AO has grossly erred in taxing the exempt income inspite of the fact that same was duly deducted in the schedule BP of ITR, however the appellant inadvertently did not report such income in the schedule of exempt income. 5. That on the facts and circumstances of the case, appellant should be allowed actual brought forward of losses set-off while computing the total taxable income. ITA No. 5240/DEL/2024 [A.Y. 2018-19] OPG Resources, LLP Vs ITO Wd 29(1) Page 3 of 10 6. That on the facts and circumstances of the case, appellant should be allowed relief for consequential deletion of interest levied u/s 234A, 2348 & 234C of the Act. 7. That the appellant craves to add, amend, modify, rescind, supplement, or alter any of the grounds stated here-in-above, either before or at the time of hearing of this appeal.” 3. The assessee had filed an application for condonation of delay before the ld. CIT(A) which reads as under: “A new tax consultant was appointed by the appellant to review its tax records. During the review, the consultant informed the appellant of the fact that a demand of Rs. 1,59,10,220/- is outstanding in the case of appellant and no appeal has been filed against the aforesaid intimation. Post confrontation of the previous tax consultant, the appellant immediately filed an appeal to Ld. CTT-(A) on 02-02-2023 and hence the delay of 1593 days. A copy of the application requesting condonation of delay along with the affidavit submitted before Ld. CIT-(A) is attached. (Kindly refer Page No. 1 to 5 of PB). Hon'ble Supreme Court in Miscellaneous application no. 21 of 2022 has clarified that the period from 15- 03-2020 till 28-02-2022 shall also stand excluded in computing the periods prescribed u/s 23 (4) and 29 A of the Arbitration and Conciliation Act, 1996, and any other laws, ITA No. 5240/DEL/2024 [A.Y. 2018-19] OPG Resources, LLP Vs ITO Wd 29(1) Page 4 of 10 which prescribe period(s) of limitation for instituting proceedings. (Kindly refer Page No. 6 to 13 of PB), Hon'ble Supreme Court in the case of Concord of India Insurance Co. Ltd, vs. Smt. Nirmala Devi (1979 SC 1666) held that a legal advice tendered by a professional and the litigant acting upon it one way or the other could be a sufficient cause to seek condonation of delay and coupled with the other circumstances and factors for applying liberal principles and then said delay can be condoned. (Kindly Refer Page No. 14 to 16 of PB), Microtek Balaji Powertronics Private Limited vs. ACTT (LT.A. No.2208/DEI/2023). (Kindly Refer Page No. 17 to 21 of PB). Microtek Balaji Powertronics Private Limited vs. ACIT (ITA No. 2209/Del/2023). (Kindly Refer Page No. 22 to 23 of PB). Kenzo International vs. DCIT (ГГА No. 3274/Del/2024), (Kindly Refer Page No. 24 to 31 of PB).” 4. However, not satisfied with the explanation of the assessee, the ld. CIT(A) rejected the application. 5. Aggrieved, the assessee is in appeal before us and reiterated what has been stated before the lower authorities. 6. Per contra, the ld. DR relied upon the orders of the authorities below. ITA No. 5240/DEL/2024 [A.Y. 2018-19] OPG Resources, LLP Vs ITO Wd 29(1) Page 5 of 10 7. We have heard the rival submissions and have perused the relevant material on record. There is no dispute that there is a delay of 1593 days. The assessee has furnished explanation before the ld. CIT(A) stating reasonable cause for the delay. We find that the ld. CIT(A) has summarily rejected the application of the assessee for condonation of delay without going into the details and even the affidavit filed by the assessee was not considered. We are, therefore, of the considered view that the ld. CIT(A) ought to have considered the affidavit and should have given adequate opportunity of being heard to the assessee. 8. The coordinate bench in the case of Microtek Balaji Powertronics ITA No. 2209/DEL/2023 order dated 27.11.2024, relied upon by the ld. counsel for the assessee has held as under: “3. It transpires at the outset that the CIT(A) /NFAC's impugned lower appellate discussion has refused to condone assessee's 2132 days delay in filing of the lower appeal instituted on 05.01.2023 against the CPC's processing dated 02.02.2017. The Revenue's fundamental contention raised during the hearing in these facts that it was the assessee's bounden duty to explain a reasonable cause so as to get its aforesaid delay condoned in the lower appellate ITA No. 5240/DEL/2024 [A.Y. 2018-19] OPG Resources, LLP Vs ITO Wd 29(1) Page 6 of 10 proceedings. It could hardly dispute that the assessee had indeed filed its condonation petition before the CIT(A)/ NFAC explaining all the circumstances causing the impugned 2132 days delay and therefore, we quote Collector Land Acquisition vs Mst. Katiji & Ors (1987) 167 ITR 471 (SC) that such a delay ought to have been condoned going by the condonation averments so as to pave way for the adjudication of the corresponding issues on merits. We thus restore the assessee's instant appeal back to the CIT(A)/NFAC for it's afresh appropriate adjudication as per law, within three effective opportunities at the taxpayer's risk and responsibility only, to plead and prove it's case in consequential proceedings. Ordered accordingly.” 9. In yet another case, the coordinate bench in the case of Kenzo International ITA No. 3274/DEL/2023 vide order dated 12.11.2024 has held as under: “4. We have heard both the parties and perused the material available on record. The Co-ordinate Bench of the Tribunal in Assessee's sister concern in ITA No. 2208/Del/2023 while condoning the delay of 1411 days held as under:- \"6. From the conspectus of the circumstances, we are of the view that the assessee has demonstrated the circumstances resulting in delay in filing the captioned appeal in question. Needless to say, there can be no straight jacket formula to come to conclusion as to whether the sufficient and good grounds have been made out or not while seeking condonation of delay. We do not see any malafide written large on the conduct of the assessee for alleged delay. It is trite that an attempt should also be made to allow the matter to be contested on merits ITA No. 5240/DEL/2024 [A.Y. 2018-19] OPG Resources, LLP Vs ITO Wd 29(1) Page 7 of 10 rather than to throw it out on such technicalities. Apart from the above, the assessee does not stand to gain in any manner whatsoever by not filing appeal within the period of limitation. Keeping in view the diligent attendance in the assessment proceedings, one cannot say that the assessee had been callous and negligent in prosecuting the matter. 7. At this point, reference is made to the decision of the Hon'ble Supreme Court in Improvement Trust Vs. Ujagar Singh, (2010) 6 SCC 786 (SC) and Bombay Mercantile Co-op. Bank vs. CBDT (2010) 45 DTR 377 (Bom) for the proposition that in the matter of condonation of delay, a highly pedantic approach should be eschewed and a justice oriented approach should be adopted and a party should not be made to suffer on account of technicalities. The test of 'sufficient cause is purely an individualistic test. It is not an objective of test as observed by the Hon'ble Bombay High Court in Ms. Kenzo International Vs. DCIT the case of Vithhal Dhondiba Chawan vs. Madhav Rao (Bom) Civil Application No.9464 of 2008 judgment dated 06.082009. 8. While considering the bonafides of the delay, an adjudicating authority is expected to bear in mind the principles laid down by Hon'ble Supreme Court in the locus classicus case of Collector of land acquisition vs. Mst. Katiji & Ors. 167 ITR 471 (SC). The Hon'ble Supreme Court laid down the guiding principles for adopting a liberal approach in the matter of condonation of delay. The principles laid down by the Hon'ble Court are reproduced hereunder: \" 1. Ordinarily, a litigant does not stand to benefit by lodging an appeal late. 2. Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As against this when delay is condoned, the highest that can happen is that a cause would be decided on merits after hearing the parties. ITA No. 5240/DEL/2024 [A.Y. 2018-19] OPG Resources, LLP Vs ITO Wd 29(1) Page 8 of 10 1. \"Any appeal or any application, other than an application under any of the provisions of Order XXI of the Code of Civil Procedure, 1908, may be admitted after the prescribed period if the appellant or the applicant satisfies the court that he had sufficient cause for not preferring the appeal or making the application within such period.\" 3. \"Every day's delay must be explained\" does not mean that pedantic approach should be made. Why not every hour's delay, every second's delay? The doctrine must be applied in a rational, common sense and pragmatic manner. 4. When substantial justice and technical considerations are pitted against each other, the cause of substantial justice deserves to be preferred, for the other side cannot claim to have vested right in injustice being done because of a non- deliberate delay 5. There is no presumption that delay is occasioned deliberately, or on account of culpable negligence, or on account of mala fides. A litigant does not stand to benefit by resorting to delay. In fact, he runs serious risk. 6. It must be grasped that the judiciary is respected not on account of its power to legalize injustice on technical grounds but because it is capable of removing injustice and is expected to do so.\" 9. The principles enunciated by the Hon'ble Courts say it all.\" 10. In the light of facts and circumstances narrated hereinabove, we direct the CIT(A) to condone the delay occurred in filing the appeal before it and admit the appeal for adjudication on merits in accordance with law. Accordingly, the captioned appeal is restored to the file of the CIT(A) for de novo adjudication on merits in accordance with law after giving fair opportunity to the assessee.\" ITA No. 5240/DEL/2024 [A.Y. 2018-19] OPG Resources, LLP Vs ITO Wd 29(1) Page 9 of 10 10. In view of the matter, respectfully following the decisions of the coordinate benches and considering the reasons as sufficient for condoning the delay, we direct the CIT(A) to condone the delay. Furthermore, we deem it fit, in the interest of justice and fair play, to restore the entire issues to the file of the CIT(A) for adjudication after affording reasonable and adequate opportunity of being heard to the assessee. The CIT(A) is directed to examine and adjudicate the issues afresh as per law and the assessee is directed to co-operate with the CIT(A) by furnishing all material/documents as required and called for. 11. In the result, the appeal of the assessee in ITA No. 5240/DEL/2024 is allowed for statistical purposes. The order is pronounced in the open court on 05.03.2025. Sd/- Sd/- [MADHUMITA ROY] [NAVEEN CHANDRA] JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: 05th MARCH, 2024. VL/ ITA No. 5240/DEL/2024 [A.Y. 2018-19] OPG Resources, LLP Vs ITO Wd 29(1) Page 10 of 10 Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) Asst. Registrar, 5. DR ITAT, New Delhi Sl No. PARTICULARS DATES 1. Date of dictation of Tribunal Order… 2. Date on which the typed draft Tribunal Order is placed before the Dictation Member 3. Date on which the fair Tribunal Order is placed before the Dictating Member for pronouncement 4. Date on which the approved draft Tribunal Order comes to the Sr. P.S./P.S. 5. Date on which the fair Tribunal Order is placed before the Dictating Member for pronouncement 6. Date on which the signed order comes back to the Sr. P.S./P.S 7. Date on which the final Tribunal Order is uploaded by the Sr. P.S./P.S. on official website 8. Date on which the file goes to the Bench Clerk alongwith Tribunal Order 9. Date of killing off the disposed of files on the judiSIS portal of ITAT by the Bench Clerks 10. Date on which the file goes to the Supervisor (Judicial 11. The date on which the file goes to the Assistant Registrar for endorsement of the order 12. Date of Despatch of the Order "