Vatsalya B Wing Co-Operative Housing Society Ltd. Vs ITO (ITAT Mumbai)
ITAT Mumbai: Long Delay in Appeals Condoned Where Assessee Bona Fide Pursued Grievance/Rectification Remedy
The Mumbai ITAT (SMC Bench) condoned extraordinary delays ranging from about 8 to 11 years in filing appeals against intimations issued under section 143(1) for AYs 2011-12, 2013-14, 2014-15 and 2015-16 in the case of a co-operative housing society claiming deduction under section 80P.
The Tribunal held that:
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The assessee was not negligent but was diligently and consistently pursuing remedies through grievances/rectification before CPC and the Assessing Officer under a bona fide belief that the issue was rectifiable.
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Such belief was reasonable since:
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Similar grievances of the assessee for later years (AYs 2017-18, 2018-19, 2019-20) were accepted and deductions u/s 80P were granted.
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Other similarly placed housing societies had also obtained relief through the grievance route.
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Non-response or delayed responses from CPC and repeated communications from the Department contributed to the delay.
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Refusal to condone delay would result in a meritorious matter being thrown out at the threshold, contrary to the principles laid down by the Supreme Court in Collector, Land Acquisition v. Mst. Katiji.
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Following coordinate bench precedent, pursuing a remedy before a wrong forum, when done bona fide and diligently, constitutes “sufficient cause” for condonation.
Accordingly, the ITAT set aside the CIT(A)’s orders, condoned the delays, and restored all appeals to the CIT(A) for adjudication on merits after granting reasonable opportunity to the assessee. The substantive grounds on section 80P were left open and academic at this stage.
FULL TEXT OF THE ORDER OF ITAT MUMBAI
