RALAS INFRAVENTURES,RAIPUR V. DCIT, CIRCLE 1(1), RAIPUR, RAIPUR

ITA 480/RPR/2024

AI Insights

The case involves Ralas Infraventures, an assessee firm, which appealed against the order of the CIT(Appeals) that dismissed their appeal due to a 30-day delay in filing. The delay occurred because the firm initially filed a rectification application under Section 154 of the Income Tax Act, 1961, contesting an addition made by the Centralized Processing Centre (CPC) that resulted in double taxation. The CPC had substituted the declared loss of the firm with an income, leading to the firm's appeal. The CIT(Appeals) dismissed the appeal without considering the merits, citing the delay in filing. The Tribunal found that the delay was justifiable and should be condoned, referencing a similar case by the Hon'ble High Court of Chhattisgarh.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 469757 (ITAT-RAIPUR)
• Duration Of Justice: 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-11-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Next Hearing Date: 19-11-2024
• Assessment Year: 2021-2022
• Appeal Filed On: 31-10-2024
• Other Referred Cases: Siva Industries & Holdings Ltd. Vs Assistant Commissioner of Income-tax, Company Circle VI(3), Chennai [2023] 153 taxmann.com 354 (Madras), Sidharth Co-operative Credit & Thrift Society Limited Vs. The Income Tax Officer, Ward 2(1), Bhilai (C.G.), TAXC No. 140 of 2024, dated 26.07.2024
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MOHAL AGRAWAL
• Assessee Lawyers: PRAVEEN JAIN
• Keywords: Opportunity of being heard; Question of law; Principle of natural justice; Rectification of order
• Section: 250; 154; 143(1)

Judgement Text

"आयकर अपीलȣय अͬधकरण Ûयायपीठ “एक-सदèय” मामला रायपुर मɅ IN THE INCOME TAX APPELLATE TRIBUNAL RAIPUR BENCH “SMC”, RAIPUR Įी रवीश सूद, ÛयाǓयक सदèय क े सम¢ BEFORE SHRI RAVISH SOOD, JUDICIAL MEMBER आयकर अपील सं. / ITA No. 480/RPR/2024 Ǔनधा[रण वष[ / Assessment Year : 2021-22 Ralas Infraventures 15/480, Manjusha, Civil Lines, Raipur (C.G.)-492 001 PAN: AALFR4864N .......अपीलाथȸ / Appellant बनाम / V/s. The Income Tax Officer, Ward-3(1), Raipur (C.G.) ……Ĥ×यथȸ / Respondent Assessee by : Shri Praveen Jain, CA Revenue by : Shri Mohal Agrawal, Sr. DR सुनवाई कȧ तारȣख / Date of Hearing :19.11.2024 घोषणा कȧ तारȣख / Date of Pronouncement : 25.11.2024 2 Ralas Infraventures Vs. ITO, Ward-3(1), Raipur ITA No. 480/RPR/2024 आदेश / ORDER PER RAVISH SOOD, JM: The present appeal filed by the assessee firm is directed against the order passed by the ADDL/JCIT(A)-2, Jaipur, dated 02.09.2024, which in turn arises from the intimation issued by the Centralized Processing Centre (CPC)/A.O under Sec.143(1) of the Income- tax Act, 1961 (in short ‘the Act’) dated 16.11.2022 for the assessment year 2021-22. The assessee firm has assailed the impugned order on the following grounds of appeal: “1. Ground No.1: That on the facts and on the circumstances of the case, CPC has erred in computing income under the Head Business and Profession at Rs.57 as against loss of (-) Rs.3,95,943/- claimed by the assessee. Processing of return by CPC is incorrect and against statutory provisions which is bad in law, against law of natural justice and uncalled for and may kindly be deleted. 2. Ground 2: That double taxation of same Income is incorrect and against statutory provisions which is bad in law, against law of natural justice and uncalled for and may kindly be deleted. 3. Ground 3: Hon. CIT(A) has erred in dismissing the appeal without condoning the delay. Since the delay in filing First Appeal was not intentional as assessee has already filed application for Rectification within the prescribed time limit of Rectification as well as prescribed time limit for First Appeal. Thus, dismissing the appeal by CIT(A) is bad in law and against the law of natural justice. 4. Ground 4: That Hon. CIT(A) has not properly dealt with the merits of the case which is bad in law and against the law of natural justice. 5. Ground 5: The assessee craves leave to add, urge, alter or withdraw any ground/s before or at the time of hearing of this appeal. 3 Ralas Infraventures Vs. ITO, Ward-3(1), Raipur ITA No. 480/RPR/2024 III. Relief Sought That computation by CPC determining Income from Business at Rs.57/- (as against loss of (-) Rs.3,95,943/-claimed by the Assessee) thereby determining Total Income at Rs.2,77,257/- (as against loss of Rs.1,18,743/- filed by the Asseseee) leading to double taxation of Rs. 3,96,000 is incorrect and loss a claimed by assessee may kindly be allowed.” 2. Succinctly stated, the assessee firm had filed its return of income for A.Y.2021-22 on 21.12.2021, declaring a loss of Rs. (-) 1,18,743/-. The return of income filed by the assessee firm was processed u/s. 143(1) of the Act by the CPC, Bengaluru, wherein after making an addition of Rs.3,96,000/-, the loss declared by the assessee firm was substituted by an income of Rs.2,77,257/-. 3. Aggrieved the assessee firm filed an application seeking rectification of mistake u/s.154 of the Act on the ground that the addition of Rs.3,96,000/- had resulted to double taxation in its hand. However, the aforesaid application filed by the assessee firm was rejected by the CPC, Bengaluru vide its order dated 22.12.2022. Thereafter, the assessee firm filed a grievance before the A.O on 03.01.2023 which, however, was disposed off by him by stating that as soon as the solution is received from the helpdesk the issue will be resolved accordingly. 4. Thereafter, the assessee firm assailed the order passed by the CPC/A.O u/s. 143(1) of the Act dated 16.11.2022 before the CIT(Appeals) as regards the impugned addition that was made while processing its 4 Ralas Infraventures Vs. ITO, Ward-3(1), Raipur ITA No. 480/RPR/2024 return of income for the subject year. However, the CIT(Appeals) taking cognizance of the fact that a delay of 30 days was involved in the filing of the appeal before him, therefore, declined to condone the same by exercising the discretion that was vested with him u/s. 249(3) of the Act and, thus, dismissed the appeal. For the sake of clarity, the observation of the CIT(Appeals) is culled out as under: “Decision on Condonation of Delay: - The facts of the case and the grounds raised by the appellant have been considered carefully. It is noticed that there is a delay in filing of appeal. The appeal is to be filed within 30 days of the date of the service of the order. During the appellate proceedings, it is found from the Form No. 35 that the appellant filed the present appeal on 23.01.2023 whereas the date of order u/s 143(1) was on 16.11.2022 and as per Form No. 35, the date of service of order was 16.11.2022. As per the dates given in Form 35, it appears that the appeal is filed beyond the prescribed due date. The reason stated by appellant that it had filed rectification application before CPC is not acceptable as filing of appeal and filing of rectification application are two separate legal processes and filing of rectification application cannot prevent appellant to file the appeal in time. The reasons stated by the appellant have been perused but are not found to be tenable as the appellant has failed to demonstrate sufficient cause or any other hardship for delay in filing of the present appeal and hence, the same cannot be condoned. Considering no hardship or sufficient cause for delay in filing of this appeal, the delay condonation request of appellant is rejected. The above view has also been taken by Hon'ble High Court of Madras in the case of Siva Industries & Holdings Ltd. Vs Assistant Commissioner of Income-tax, Company Circle VI(3), Chennai [2023] 153 taxmann.com 354 (Madras) in a recent decision. Thus, the appeal filed by appellant is not maintainable as the same is filed beyond the time limit permitted u/s 249 of the IT Act for filing of appeal and there is no sufficient cause for delay in filing of appeal, which can be condoned. Accordingly, the appeal of the appellant is treated as dismissed u/s. 250 r.w.s.251 of the Act without considering the merits of the appeal filed. 4. In the end, the present appeal is treated as dismissed.” 5 Ralas Infraventures Vs. ITO, Ward-3(1), Raipur ITA No. 480/RPR/2024 5. The assessee firm being aggrieved with the order of the CIT(Appeals) has carried the matter in appeal before the tribunal. 6. Controversy involved in the present appeal lies in a narrow compass, i.e. as to whether or not the CIT(Appeals) had rightly declined to condone the delay of 30 days involved in filing of the appeal before him by the assessee firm? 7. As observed by me hereinabove, it is a matter of fact borne from record that the delay of 30 days involved in filing of the appeal by the assessee firm before the CIT(Appeals), had occasioned for the reason that it by filing an application for rectification of mistake u/s. 154 of the Act with the CPC/A.O, Bengaluru had taken recourse to an alternative remedy. At this stage, it would be relevant to point out, that the fact that the assessee firm was vigilant about assailing the impugned addition made by the CPC/A.O, Bengaluru can safely be gathered from the fact that the application u/s. 154 of the Act on 05.12.2022, i.e. well within the period of 30 days that would have otherwise been available to it in case it had filed an appeal against the intimation issued u/s.143(1) of the Act, dated 16.11.2022 with the CIT(Appeals). 8. I have heard the Ld. Authorized Representatives of both the parties, perused the orders of the lower authorities and the material available on 6 Ralas Infraventures Vs. ITO, Ward-3(1), Raipur ITA No. 480/RPR/2024 record, as well as considered the judicial pronouncements that have been pressed into service by the Ld. AR to drive home his contentions. 9. As observed by me herein above, it is a matter of fact borne from record that the delay of 30 days in preferring the appeal before the CIT(Appeals) had crept in for the reason that the assessee firm had taken recourse to an alternative remedy by seeking rectification of mistake u/s. 154 of the Act with the CPC/A.O, Bengaluru. As the conduct of the assessee firm does not smack of any lackadaisical approach, therefore, I am of a firm conviction that the delay of 30 days in filing of the appeal before the CIT(Appeals) ought to have been condoned by him. My aforesaid view is fortified by the judgment of the Hon’ble High Court of Chhattisgarh in the case of Sidharth Co-operative Credit & Thrift Society Limited Vs. The Income Tax Officer, Ward 2(1), Bhilai (C.G.), TAXC No. 140 of 2024, dated 26.07.2024. In the aforesaid case, the assessee had preferred an appeal before the Tribunal arising from the intimation issued u/s.143(1) of the Act, which involved a delay of 530 days. Although, it was the claim of the assessee that it had after dismissal of its appeal against the intimation issued u/s.143(1) of the Act by the CIT(Appeals), had filed an application u/s.154 of the Act, and thus, only after rejection of the same had assailed the dismissal of its appeal against intimation u/s. 143(1) of the Act by the CIT(Appeals) before the Tribunal, which by the time involved a delay of 530 days, but the same was 7 Ralas Infraventures Vs. ITO, Ward-3(1), Raipur ITA No. 480/RPR/2024 dismissed by the Tribunal which declined to condone the said delay. Although, it was the claim of the assessee society before thee Tribunal that the delay in filing of the appeal against the order passed by the CIT(Appeals) dismissing its appeal against intimation issued u/s. 143(1) of the Act had occasioned for the reason that it had taken recourse to an alternative remedy by seeking rectification of the mistake u/s. 154 of the Act but the said explanation of the assessee society did not find favour with the tribunal and the appeal was dismissed in limine. However, on appeal the Hon’ble High Court set-aside the order of the Tribunal and taking cognizance of the fact that as the assessee had availed the remedy of rectification u/s.154 of the Act, therefore, the time spent therein after dismissal of the appeal against such order should have been condoned. For the sake of clarity, the observation of the Hon’ble High Court are culled out as under: “10. We have heard learned counsel for the parties and went through the records and documents filed. 11. Indisputably, after the return was filed, the deduction claimed by the appellant was denied on 07.06.2019. Consequently, first appeal was filed under Section 246A, which was dismissed on 19.04.2022. The statute provides for rectification i.e. a review, in case where certain facts have been left out or wrongly considered. The appellant thought it proper to avail such remedy but did not succeed and eventually the rectification prayer was subsequently dismissed, thereby upholding the original order of first appeal on 19.4.2022. Against such rejection of the rectification application process of first appeal and second appeal was availed which were ultimately decided on 27.10.2023 which leads to point out that it only envelops the issue of rectification. Subsequently, the 8 Ralas Infraventures Vs. ITO, Ward-3(1), Raipur ITA No. 480/RPR/2024 main order dated 19.04.2022 was challenged before the ITAT on 30.11.2023. 12. The submission of the appellant and the learned ITAT dismissed the appeal at the threshold on the ground that the delay has not ben properly explained to be a bona fide. 13. After going through the records of the proceeding and the principles, which is laid down by the Supreme Court, we are of the view that the appellant availed the remedy of rectification and in the instant case, if rectification would have been allowed, the subsequent findings of the appeal would have been rendered infructuous. 14. Under the circumstances, the remedy availed which is available under the statute, cannot be said to have been branded with the delay, it was eventually when the prayer for rectification in the appeal were dismissed, the appellant came back to the original order which was already available to him and filed the appeal. The order of the ITAT which records that there has been a delay of one month and four days, even after dismissal of the second appeal on 27.10.2023. We do not concur as the time which has been explained prima facie shown to be bona fide. The record shows that the time spent diligently pursuing the review/ rectification application ought to have been condoned and the facts has to be seen in a cluster not in fagment. 15. Consequently, we allow the appeal and condone the delay of 530 days in filing the appeal before the ITAT and remit back the case to the ITAT to adjudicate afresh, in accordance with law and on its own merits. Accordingly, the question of law is answered in favor of the appellant.” As the facts involved in the present appeal are para-meteria as were there before the Hon’ble High Court in the aforementioned case, therefore, I am of the view that the CIT(Appeals) ought to have condoned the delay of 30 days, which was not only backed by justifiable reasons, but also by no means can be dubbed as inordinate. Accordingly, in terms of my aforesaid observations, I restore the matter to the file of the ADDL/JCIT(A)-2, Jaipur 9 Ralas Infraventures Vs. ITO, Ward-3(1), Raipur ITA No. 480/RPR/2024 with a direction to condone the delay of 30 days and dispose of the appeal qua the issues raised before him on merits. Needless to say, the ADDL/JCIT(A) shall in the course of set-aside proceedings afford a reasonable opportunity of being heard to the assessee firm which shall remain at a liberty to substantiate its claim on the basis of fresh documentary evidence, if any. 10. As I have restored the matter to the file of the ADDL/JCIT(A) for fresh adjudication, therefore, I refrain from adverting to the merits of the case which, thus, are left open. 11. In the result, appeal filed by the assessee firm is allowed for statistical purposes in terms of the aforesaid observations. Order pronounced in open court on 25th day of November, 2024 Sd/- (रवीश सूद /RAVISH SOOD) ÛयाǓयक सदèय/JUDICIAL MEMBER रायपुर/ RAIPUR ; Ǒदनांक / Dated : 25th November, 2024. ****SB, Sr. PS आदेश कȧ ĤǓतͧलͪप अĒेͪषत / Copy of the Order forwarded to : 1. अपीलाथȸ / The Appellant. 2. Ĥ×यथȸ / The Respondent. 3. The CIT(Appeals)-1, Raipur (C.G) 4. The Pr. CIT-1, Raipur (C.G) 5. ͪवभागीय ĤǓतǓनͬध, आयकर अपीलȣय अͬधकरण,रायपुर बɅच, रायपुर / DR, ITAT, Raipur Bench, Raipur. 10 Ralas Infraventures Vs. ITO, Ward-3(1), Raipur ITA No. 480/RPR/2024 6. गाड[ फ़ाइल / Guard File. आदेशानुसार / BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलȣय अͬधकरण, रायपुर / ITAT, Raipur. "