SHREE NARSINHA NAGARI SAHAKARI PATSANSTHA,PUNE V. I.T.O, WARD-10(1), PUNE, PUNE

ITA 177/PUN/2025

AI Insights

The case involves Shree Narsinha Nagari Sahakari Patsanstha, a cooperative credit society, which appealed against the orders of the Ld. CIT(A)/NFAC concerning the assessment years 2018-19 and 2020-21. The appeals included quantum appeals and penalty appeals under sections 270A and 271AAC(1) of the Income Tax Act. The primary contention was the non-condonation of delay by the CIT(A) and the dismissal of the appeals without considering the merits. The Tribunal noted the substantial delay in filing the appeals and the reasons provided by the assessee, including the impact of the COVID-19 pandemic. The Tribunal decided to condone the delay and restore the matters to the CIT(A) for a decision on merits.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 669578 (ITAT-PUNE)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-06-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2018-2019
• Other Referred Cases: State of West Bengal v. Administrator, Howrah Municipality AIR 1972 SC 749, Sterlite Industries (India) Ltd. v. Addl. CIT/Jt. CIT [2006] 6 SOT 497 (Mum.), OP Kathpaliya v. Lakhmir Singh AIR 1984 SC 1744, UOI v. Suresh N. Shetty [1986] 26 Taxman 398 (Kar.), J.K. Chaturvedi v. Asstt. CIT [2004] 3 SOT 456 (Ahd.), Collector, Land Acquisition, Anantnag v. Mst. Katiji, AIR 1987 SC 1353, Vijay Kumar Sood v. Dy. CIT [2019] 106 taxmann.com 3 (Chandigarh - Trib.), Inder Singh vs. State of Madhya Pradesh in SLP No.6145 of 2024 dated 21.03.2025, Mool Chandra v. Union of India, 2024 SCC OnLine SC 1878, decided on 5-8-2024
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AMOL KHAIRNAR; RAMNATH P. MURKUNDE
• Assessee Lawyers: ABHAY AVCHAT
• Keywords: Condonation of delay; Opportunity of being heard; Reasonable cause; Unexplained cash credit; Principle of natural justice
• Section: 144

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH “A”, PUNE BEFORE SHRI MANISH BORAD, ACCOUNTANT MEMBER AND SHRI VINAY BHAMORE, JUDICIAL MEMBER आयकर अपील सं. / ITA Nos.177, 178, 386, 387 & 388/PUN/2025 िनधाᭅरण वषᭅ / Assessment Years : 2018-19, 2020-21 Shree Narsinha Nagari Sahakari Patsanstha, Narsinh Building, A/p Ranjani, Tal. Ambegaon, Dist.- Pune- 410504. PAN : AAAAN4056G Vs. ITO, Ward- 10(1), Pune. Appellant Respondent आदेश / ORDER PER BENCH : By way of above captioned appeals, the assessee’s appeal in ITA Nos.177 – 178/PUN/2025 for A.Ys. 2018-19 and 2020-21 are directed against the order of Ld. CIT(A)/NFAC dated 30.07.2024 and for remaining assessee’s appeals relating to penalty levied u/s 270A for A.Ys. 2018-19 and 2020-21 and u/s 271AAC(1) for A.Y. 2020-21 are directed against the order of Ld. CIT(A)/NFAC dated 13.01.2025 and 07.01.2025 respectively. Assessee by : Shri Abhay Avchat Revenue by : Shri Amol Khairnar & Shri Ramnath P. Murkunde. Date of hearing : 26.06.2025 Date of pronouncement : 26.06.2025 ITA Nos. 177, 178, 386, 387 & 388/PUN/2025 2 2. Since all the above captioned appeals relates to the same assessee of which ITA Nos.177 – 178/PUN/2025 are the quantum appeals and remaining three are penalty appeals, all the appeals were heard together and are being disposed of by this consolidated order for the sake of convenience and brevity. 3. At the outset, Ld. Counsel for the assessee referring to the following written submissions has mainly contended that Ld. CIT(A)/NFAC has either not condoned the delay or has not passed the orders on merits of the case and, therefore, prayer is made for restoring the issues raised in all the instant appeals relating to the quantum/penalty to the file of Ld. CIT(A)/NFAC for necessary adjudication :- “SHREE NARSINHA NAGARI SAHAKARI PATSANSTHA NARSINH BUILDING, A/P RANJANI, TAL. AMBEGAON, AMBEGAON, DIST. PUNE - 410504, Maharashtra June 25, 2025 The Assistant Registrar, The Income Tax Appellate Tribunal, Pune ‘A’ Bench, Pune Dear Sir, ITA No.s Assessment Year 177/PUN/2025 – quantum appeal 2018-19 178/PUN/2025– quantum appeal 2020-21 386/PUN-2025 – penalty appeal section 270A 2018-19 387/PUN-2025 – penalty appeal section 270A 2020-21 388/PUN-2025 – penalty appeal section 271AAC(1) 2020-21 Re : Shree Narsinha Nagari Sahakari Patsanstha PAN : AAAAN4056G A.Y. : 2018-19 and 2020-21 ITA Nos. 177, 178, 386, 387 & 388/PUN/2025 3 Subject : Filing of affidavit requesting to condone delay in filing of CIT appeal and furnishing of explanation with respect to delay condonation Date of hearing –June 26, 2025 1. In the captioned matter, this refers to the hearing of appeal before your honour scheduled on June 26, 2025.This is assessee’s appeal against appeal dismissed by the NFAC, Delhi. There are total 5 appeals filed by assessee before your honour. Background and facts 2. The Appellant assessee is a cooperative credit society registered in Taluka Ambegaon Pune. It is engaged in providing loans and advances to members, accepting deposits from members and rendering ancillary services. 3. Its case was selected for scrutiny for both the years AY 2018-19 and AY 2020-21. Assessment order was passed by the FAO u/s 144 in both the years. 4. The subject matter of addition / issues in both the appeal are - disallowance of entire deduction claimed u/s 80P, addition of members’ deposits as unexplained cash credit, disallowance of provision of expenses on adhoc basis, etc. 5. The aggregate demand due to assessment and penalty order has mounted to around Rs. 30 crores. Affidavit for delay condonation - year wise 6. The assessee society is filing two separate affidavits signed by its chairman explaining reasons of delay and requesting to condone delay in filing of appeal before the CIT A. It has already furnished copy of affidavit explaining delay in filing of ITAT appeal along- with Form 36. 7. There are total five appeals filed before your honour. In 4 appeals, the CIT A has not condoned delay and dismissed assessee’s appeal as not admissible / not maintainable. The CIT A has condoned delay in respect of penalty appeal of AY 2020-21 u/s 271AAC(1), having ITA No. 388/PUN-2025. 8. In case of AY 2018-19, there was delay of 20 months in filing of appeal in Form 35 before the CIT A in respect of both the appeals after considering credit of relaxation period of Covid pandemic as per the hon. SC’s guidelines. In order to explain reasons of delay, we are enclosing copy of affidavit duly signed by director of the assessee. (quantum appeal having ITA No. 177/PUN/2025 and penalty appeal having ITA no. 386/PUN/2025). There is delay in filing of quantum appeal before the ITAT of 113 days. However, there was no delay in filing of penalty appeal u/s 270A before the ITAT for AY 2018-19. 9. In case of AY 2020-21, there was delay of 12 months in filing of appeal in Form 35 before the CIT A in respect of quantum appeal. (Quantum appeal having ITA No. 178/PUN/2025). There is delay in filing of quantum appeal before the ITAT of 113 days. 10. In case of AY 2020-21, there was delay of 6 months in filing of appeal in Form 35 before the CIT A in respect of penalty appeal u/s 270A. (Penalty appeal having ITA No. 387/PUN/2025).However, there was no delay in filing of penalty appeal u/s 270A before the ITAT for AY 2020-21. 11. In case of AY 2020-21, there was delay of 6 months in filing of appeal in Form 35 before the CIT A in respect of penalty appeal u/s 271AAC(1). (Penalty appeal having ITA No. 388/PUN/2025). However, in this case, the CIT A has condoned the delay and dismissed ITA Nos. 177, 178, 386, 387 & 388/PUN/2025 4 appeal for reason of non-response. There was no delay in filing of penalty appeal u/s 270A before the ITAT for AY 2020-21. Assessee’s explanation and discussion 12. The assessee is a law-abiding entity. It has no intention to delay the procedure of appeal filing. Since the delay happened in filing of appeal due to inadvertent reasons and not out of deliberate action, your honour is requested to condone the delay in filing of appeal before the CIT A as well as before the ITAT. 13. The CIT A has not considered merits of the case during hearing of appeal and while passing appellate order. If one more opportunity is afforded to us, we shall remain diligent and comply with the same without further default. 14. The power to condone the delay in filing of income tax appeals rest with the appellate forums such as ITAT including courts and CIT A. 15. As per section 5 of the Limitation Act, any appeal or any application other than an application under order XXI of CPC, may be admitted after the prescribed period, if the applicant/appellant satisfies the Court that he had sufficient cause for not preferring an appeal, or making an application, within such period. 16. Thus an appellant is to establish that he has / had sufficient cause for not preferring appeal in time. 17. The expression \"sufficient cause\" for condonation of delay in section 5 of Limitation Act should receive a liberal construction so as to advance the substantial justice when no negligence or inaction or want of bona fide is imputable to party. [refer- State of West Bengal v. Administrator, Howrah Municipality AIR 1972 SC 749 (SC); Sterlite Industries (India) Ltd. v. Addl. CIT/Jt. CIT [2006] 6 SOT 497 (Mum.)] 18. If refusal to condone the delay results in grave miscarriage of justice, it would be a ground to condone the delay. [refer- OP Kathpaliya v. Lakhmir Singh AIR 1984 SC 1744] 19. The words 'sufficient cause' must generally receive a liberal construction so as to advance substantial justice when no negligence or inaction or want of bona fides is imputable to appellant, [refer- UOI v. Suresh N. Shetty [1986] 26 Taxman 398 (Kar.)] because the judiciary is expected not to legalize injustice on technical grounds but because it is capable of removing injustice and is expected to do so. [refer- J.K. Chaturvedi v. Asstt. CIT [2004] 3 SOT 456 (Ahd.)]. 20. For evaluating sufficiency of cause and while deciding condonation of delay, the following principles laid down by the Hon'ble Apex Court in the case of Collector, Land Acquisition, Anantnag v. Mst. Katiji, AIR 1987 SC 1353 should be kept in mind- [also refer- Vijay Kumar Sood v. Dy. CIT [2019] 106 taxmann.com 3 (Chandigarh - Trib.)] (i) Ordinarily, a litigant does not stand to benefit by lodging an appeal late. (ii) 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. (iii) \"Every day's delay must be explained\" does not mean that a pedantic approach should be taken. Why not every hour's delay, every second's delay? The doctrine must be applied in a rational common-sense pragmatic manner. ITA Nos. 177, 178, 386, 387 & 388/PUN/2025 5 (iv) When substantial justice and technical considerations are pitted against each other, 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. (v) 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 a serious risk. (vi) It must be grasped that 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.\" 21. Liberal Approach Be Adopted In Condoning Delay When Case's Merits Need Examination: Supreme Court in case of Yash Mittal. 22. The Hon’ble Supreme Court while condoning delay, in the case of Inder Singh vs. State of Madhya Pradesh in SLP No.6145 of 2024 dated 21.03.2025 observed that - “14. There can be no quarrel on the settled principle of law that delay cannot be condoned without sufficient case, but a major aspect which has to be kept in mind is that, if in a particular case, the merits have to be examined. It should not be scuttled merely on the basis of limitation.” 23. The Supreme Court recently observed that although a delay cannot be condoned without sufficient cause, the case's merit cannot be discarded solely on the technical grounds of limitation. The Court further emphasized that a liberal approach should be taken in condoning delays when the limitation ground undermines the merits of the case and obstructs substantial justice. “There can be.... (Mool Chandra v. Union of India, 2024 SCC OnLine SC 1878, decided on 5-8-2024). 24. The Hon'ble Supreme Court in the case of Collector, Land Acquisition vs. Mst. Katiji& Ors. (supra) has held that when substantial justice and technical considerations are pitted against each other, 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. 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. Prayer 25. In light of the Hon’ble Apex Court judgements cited above, it is requested that liberal approach needs to be taken in condoning the delay when the limitation ground undermines the merits of the case and obstructs substantial justice. 26. Further the appellate order of NFAC did not consider merits of the case since no submission could be filed by assessee at the appellate level. 27. In view of the foregoing submission and contentions, your honour is requested to set- aside the order passed by the Ld. CIT(A)/NFAC and restore the matter back to him with a direction to condone the delay in appeal filing and to decide the appeal afresh on merits of the case as per fact and law after providing opportunity of hearing. 28. Further, the honourable Pune ITAT in various cases had condoned the delay of varying quantum of days in filing of appeals and rendered justice to assessees. Few of the judgements are also enclosed. ITA Nos. 177, 178, 386, 387 & 388/PUN/2025 6 29. It is once again prayed to afford the assesseecompany an opportunity of being heard before the NFAC in the interest of natural justice, so that, the NFAC can decide our appeal on merits. Thanking You and with regards For Shree Narsinha Nagari Sahakari Patsanstha Appellant s/d- Director” 4. Ld. DR did not oppose the request of the assessee. 5. We have heard rival contentions and perused the records placed before us. From perusal of the written submissions, we notice that in the appeals arising out of the order of Ld. CIT(A)/NFAC vide ITA Nos.177 – 178/PUN/2025 and ITA Nos.386 – 387/PUN/2025, Ld. CIT(A)/NFAC has dismissed the appeals in limine by not condoning the delay. So far as ITA No.388/PUN/2025 regarding penalty u/s 271AAC(1), the appeal of the assessee was dismissed by Ld. CIT(A)/NFAC on account of non-appearance. Ld. Counsel for the assessee on the strength of various judgements referred hereinabove has made out a case that a reasonable cause prevented the assessee from filing the appeal before Ld. CIT(A)/NFAC within the statutory time limit. It is also being demonstrated that the delay is not intentional and, therefore, in the larger interest of justice, we hereby condone the delay in ITA Nos. 177, 178, 386, 387 & 388/PUN/2025 7 filing of the appeals before Ld. CIT(A)/NFAC in ITA Nos.177 – 178/PUN/2025 and ITA Nos.386 – 387/PUN/2025. We also observe that the appeal for A.Y. 2020-21 regarding penalty u/s 271AAC(1), assessee failed to avail the opportunity granted by Ld. CIT(A)/NFAC. 6. Since the quantum appeals for A.Ys. 2018-19 and 2020-21 has not been decided by Ld. CIT(A)/NFAC on merits, we are of the considered opinion that all the issues raised in the instant appeals are hereby restored to the file of Ld. CIT(A)/NFAC for necessary adjudication for which fair and proper opportunity shall be granted to the assessee. Ld. CIT(A)/NFAC shall decide in accordance with law as contemplated in section 250(6) of the Act. 7. In the result, all the above captioned five appeals filed by the assessee are allowed for statistical purposes. Order pronounced on 26th day of June, 2025. Sd/- Sd/- (VINAY BHAMORE) (MANISH BORAD) JUDICIAL MEMBER ACCOUNTANT MEMBE पुणे / Pune; ᳰदनांक / Dated : 26th June, 2025. Sujeet ITA Nos. 177, 178, 386, 387 & 388/PUN/2025 8 आदेश कᳱ ᮧितिलिप अᮕेिषत / Copy of the Order forwarded to : 1. अपीलाथᱮ / The Appellant. 2. ᮧ᭜यथᱮ / The Respondent. 3. The Pr. CIT concerned. 4. िवभागीय ᮧितिनिध, आयकर अपीलीय अिधकरण, “A” बᱶच, पुणे / DR, ITAT, “A” Bench, Pune. 5. गाडᭅ फ़ाइल / Guard File. आदेशानुसार / BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण, पुणे / ITAT, Pune. "