THE MALLAPALLY SERVICE CO-OPERATIVE BANK LTD. V. COMMISSIONER OF INCOME TAX (APPEALS)-III

WP(C)/26656/2015

AI Insights

The case involves the Mallapally Service Co-operative Bank Ltd., which filed a writ petition challenging the dismissal of their appeal by the Commissioner of Income Tax (Appeals)-III, Kochi. The appeal was initially dismissed due to a delay in filing, for which the bank sought condonation. The 1st respondent found the explanation for the delay unsatisfactory and dismissed both the condonation application and the appeal. The petitioner contested this decision, leading to the High Court's intervention, which emphasized the need for a liberal and justice-oriented approach in such cases, as per Supreme Court guidelines.

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 763287 (HC-KERALA)
• Appeal Type: Others
• Pronouncement Date: 04-09-2015
• Assessment Year: misc
• Other Referred Cases: Esha Bhattacharjee v. Managing Committee of Raghunathpur Nafar Academy and others - [JT 2013 (12) SC 450]
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: K M V PANDALAI
• Assessee Lawyers: A KUMAR; P J ANILKUMAR; G MINI; P S SREE PRASAD
• Keywords: Appeal Dismissal; Condonation of delay; Penalty order

Judgement Text

"IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR. JUSTICE A.K.JAYASANKARAN NAMBIAR FRIDAY, THE 4TH DAY OF SEPTEMBER 2015/13RD BHADRA, 1937 WP(C).No. 26656 of 2015 (F) ---------------------------- PETITIONER: ------------------- THE MALLAPALLY SERVICE CO-OPERATIVE BANK LTD. , KEEZHVAIPUR, MALLAPPALLY , PATHANAMTHITTA-689 587, REPRESENTED BY ITS SECRETARY MR.THOMAS MATHAI. BY ADVS.SRI.A.KUMAR SRI.P.J.ANILKUMAR SMTG.MINI(1748) SRI.P.S.SREE PRASAD RESPONDENT(S): -------------------------- 1. COMMISSIONER OF INCOME TAX (APPEALS)-III, KOCHI-682018. 2. ADDITIONAL DIRECTOR OF INCOME TAX (INTELLIGENCE), KOCHI-682018. BY SRI.K.M.V.PANDALAI, SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 04-09-2015, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: mbr/ WP(C).No. 26656 of 2015 (F) --------------------------------------- APPENDIX PETITIONER(S)' EXHIBITS: ------------------------------------- P1 : TRUE COPY OF THE PENALTY ORDER DATED 27-10-2014. P2 : A TRUE COPY OF THE APPEAL DATED 25-2-2015. P3 : TRUE COPY OF THE APPLICATION FOR CONDONING THE DELAY IN FILING THE APPEAL DATED 25-2-2015. P4 : A TRUE COPY OF THE ORDER DATED 30-6-2015. RESPONDENTS' EXHIBITS: NIL. //TRUE COPY// P.S. TO JUDGE mbr/ A.K.JAYASANKARAN NAMBIAR, J. =========================================== W.P.(C). No. 26656 of 2015 ===================================================== Dated this the 4th day of September, 2015 JUDGMENT The petitioner in this writ petition was the appellant before the 1st respondent, having filed an appeal against the order of the assessing authority confirming a demand of penalty on him. Inasmuch as there was a delay in filing the appeal before the 1st respondent, the petitioner had also preferred a petition for condonation of delay, supported by an affidavit giving an explanation for the delay occasioned. The 1st respondent, on a consideration of the application for condonation of delay preferred by the petitioner, proceeded to hold that the petitioner had not satisfactorily explained the delay that was occasioned, and therefore proceeded to dismiss the delay condonation petition, and thereafter, the appeal as well. 2. In my view, the order of the 1st respondent, in the delay condonation application preferred by the petitioner, does not reflect a consideration of the facts relevant for consideration of the issue of condonation of delay, under a statutory scheme of litigation. The parameters for exercise of discretion, in cases -2- W.P.(C). No. 26656 of 2015 involving condonation of delay, have been laid down by the Supreme Court in a number of decisions wherein it is stated that, normally when a claim made by an applicant is legally sustainable, the delay must be condoned. It is also mandated that, when substantial justice and technicalities are pitted against each other, then the cause of substantial justice deserves to be preferred. There are cases where the conduct of a party must also be gone into, and where it is established that the conduct of the litigant party is not such as would indicate that he was negligent or callous in pursuing the matter before the Forum, and further, the delay was not so huge as would cause substantial prejudice or harm to the opposite side, the situation would normally call for a condonation of the delay. The legal principle that informs such decisions is that, as far as possible, in a legal arena, the attempt must always be to enable a consideration on merits rather than to throw out the matter, on technicalities. It would be instructive to refer to the judgment of the Supreme Court in Esha Bhattacharjee v. Managing Committee of Raghunathpur Nafar Academy and others - [JT 2013 (12) SC 450], where, at paragraphs 15 and 16, the court culled out the broad principles -3- W.P.(C). No. 26656 of 2015 that should govern an application for condonation of delay. They read as follows: 15. From the aforesaid authorities the principles that can broadly be culled out are: i) There should be a liberal, pragmatic, justice-oriented, non-pedantic approach while dealing with an application for condonation of delay, for the courts are not supposed to legalise injustice but are obliged to remove injustice. ii) The terms “sufficient cause” should be understood in their proper spirit, philosophy and purpose regard being had to the fact that these terms are basically elastic and are to be applied in proper perspective to the obtaining fact-situation. iii) Substantial justice being paramount and pivotal the technical considerations should not be given undue and uncalled for emphasis. iv) No presumption can be attached to deliberate causation of delay but, gross negligence on the part of the counsel or litigant is to be taken note of. v) Lack of bona fides imputable to a party seeking condonation of delay is a significant and relevant fact. vi) it is to kept in mind that adherence to strict proof should not affect public justice and cause public mischief because the courts are required to be vigilant so that in the ultimate eventuate there is no real failure of justice. vii) The concept of liberal approach has to encapsule the conception of reasonableness and it cannot be allowed a totally unfettered free play. viii) There is a distinction between inordinate -4- W.P.(C). No. 26656 of 2015 delay and a delay of short duration or few days, for to the former doctrine of prejudice is attracted whereas to the latter it may not be attracted. That apart, the first one warrants strict approach whereas the second calls for a liberal delineation. ix) The conduct, behavior and attitude of a party relating to its inaction or negligence are relevant factors to be taken into consideration. It is so as the fundamental principle is that the courts are required to weigh the scale of balance of justice in respect of both parties and the said principle cannot be given a total go by in the name of liberal approach. x) If the explanation offered is concocted or the grounds urged in the application are fanciful, the courts should be vigilant not to expose the other side unnecessarily to face such a litigation. xi) It is to be borne in mind that no one gets away with fraud, misrepresentation or interpolation by taking recourse to the technicalities of law of limitation. xii) The entire gamut of facts are to be carefully scrutinized and the approach should be based on the paradigm of judicial discretion which is founded on objective reasoning and not on individual perception. xiii) The State or a public body or an entity representing a collective cause should be given some acceptable latitude. 16. To the aforesaid principles we may add some more guidelines taking note of the present day scenario. They are: a) An application for condonation of delay should be drafted with careful concern and not in a half hazard manner harbouring the notion that the courts are required to condone delay on the bedrock of the principle that adjudication of a lis on merits is -5- W.P.(C). No. 26656 of 2015 seminal to justice dispensation system. b) An application for condonation of delay should not be dealt with in a routine manner on the base of individual philosophy which is basically subjective. c) Though no precise formula can be laid down regard being had to the concept of judicial discretion, yet a conscious effort for achieving consistence and collegiality of the adjudicatory system should be made as that is the ultimate institutional motto. d) The increasing tendency to perceive delay as a non-serious matter and, hence, lackadaisical propensity can be exhibited in a non-challant manner requires to be curbed, of course, within legal parameters. On a consideration of the said principles as laid down by the Supreme Court, I am of the view that in the instant case, the 1st respondent has not considered the application for condonation of delay filed by the appellant in accordance with the decisions laid down by the Supreme Court. Accordingly, I quash Ext.P4 order and direct the 1st respondent, to restore the appeals, stay application and the delay condonation applications to file, and consider the applications filed for condonation of delay afresh within a period of two months from the date of receipt of a copy of this judgment, after hearing the petitioner. There will be a stay of -6- W.P.(C). No. 26656 of 2015 recovery proceedings against the petitioner, for recovery of the amounts confirmed against him by the lower authority, till such time as orders are passed by the 1st respondent, as directed in this judgment and communicated to the petitioner. Sd/- A.K.JAYASANKARAN NAMBIAR JUDGE das "