Maa Tara Foundation Vs ADDL/JCIT (A) (ITAT Visakhapatnam)
Summary: The assessee, a charitable trust, filed its return for AY 2022-23 declaring gross receipts of ₹65.04 lakh and application of income of ₹37.55 lakh, claiming exemption under Sections 11 and 12 and filing Forms 9A and 10B. On processing under Section 143(1), the CPC raised a demand of ₹1.33 lakh, treating ₹8.84 lakh as taxable income, allegedly due to an inadvertent clerical error concerning the 15% accumulation under Section 11(1)(a). The assessee’s rectification application under Section 154 was rejected, following which it filed an appeal before the CIT(A) with a delay of 792 days, attributing the delay to medical circumstances affecting its senior-citizen trustee. The CIT(A) dismissed the appeal in limine after refusing to condone the delay. Before the Visakhapatnam ITAT, the assessee relied upon the affidavits and the decision in Collector, Land Acquisition vs. Mst. Katiji, while the Revenue opposed condonation. The Tribunal found the medical explanation vague and general, unsupported by medical evidence, specific dates or other cogent material, and observed that since the assessee was a trust with several persons involved in its management, the illness of one authorised signatory did not explain why other persons could not attend to the statutory requirement. Although the Tribunal recognised the generally liberal approach adopted by courts in considering sufficient cause, it held that existence of sufficient cause remains a condition precedent and that liberal principles cannot be used to revive stale matters arising from negligence, prolonged inaction or lack of due diligence. Relying upon Pathapati Subbareddy, Balwant Singh and Chief Post Master General v. Living Media India Ltd., the Tribunal refused to condone the 792-day delay and dismissed the assessee’s appeal without adjudicating the substantive exemption claim.
The assessee, a charitable trust, declared gross receipts of ₹65.04 lakh and application of income of ₹37.55 lakh for AY 2022-23 while claiming exemption under Sections 11 and 12. It also filed Forms 9A and 10B. While processing the return under Section 143(1), the CPC treated ₹8.84 lakh as taxable income and raised a demand of ₹1.33 lakh, allegedly because of a clerical error in reporting the 15% accumulation permissible under Section 11(1)(a). The assessee’s rectification application under Section 154 was rejected.
The assessee filed an appeal before the CIT(A) with a delay of 792 days, attributing the delay to unforeseen medical circumstances affecting its senior-citizen trustee. The CIT(A) found that sufficient cause had not been established, refused to condone the delay and dismissed the appeal in limine.
The Visakhapatnam ITAT observed that the medical explanation was vague and unsupported by evidence, specific dates or cogent material. Since the appellant was a trust involving several persons in its management, the illness of one authorised signatory could not, without further evidence, explain why no other person attended to the statutory requirement.
The Tribunal held that although courts ordinarily adopt a liberal approach while considering delay-condonation applications, the existence of sufficient cause remains a mandatory condition. Liberal principles cannot be used to revive stale matters involving negligence, prolonged inaction or lack of due diligence.
Following the Supreme Court decisions in Pathapati Subbareddy v. Special Deputy Collector, Balwant Singh v. Jagdish Singh and Chief Post Master General v. Living Media India Ltd., the Tribunal refused to condone the 792-day delay and dismissed the appeal without examining the substantive Section 11 exemption claim.
List of Cases Discussed / Relied Upon
- Collector, Land Acquisition vs. Mst. Katiji & Ors., [1987] 167 ITR 471 (SC) — Relied upon regarding the liberal approach to condonation of delay and the requirement that substantial justice be preferred where sufficient cause is shown.
- Director of Income Tax (Exemptions) vs. Vishwa Jagriti Mission, MANU/DE/1487/2012 — Cited by the assessee concerning substantive exemption and alleged procedural or clerical defects affecting a charitable trust.
- Pathapati Subbareddy (died) reptd. by his L.Rs & Ors. vs. The Special Deputy Collector-(LA), Special Leave Petition (Civil) No.31248 of 2018, order dated 08.04.2024 — Followed concerning sufficient cause, negligence and the limits on condoning unexplained delay.
- Balwant Singh (Dead) vs. Jagdish Singh & Ors., [2010] 8 SCC 685 — Relied upon concerning conduct of the parties, bona fides, due diligence and the requirement of sufficient cause for condonation of delay.
- O/o. Chief Post Master General & Ors. vs. Living Media India Ltd. & Anr., [2012] 348 ITR 7 (SC) — Relied upon for the proposition that limitation must be applied with its rigour and liberal treatment cannot extend to gross negligence or inaction.
FULL TEXT OF THE ORDER OF ITAT VISAKHAPATNAM
This appeal is filed by the Assessee against the order of Learned Commissioner of Income Tax (Appeals)/Ld. ADDL/JCIT (A)-1, Visakhapatnam [hereinafter in short “Ld. CIT(A)”] vide DIN: ITBA/APL/S/250/2025 -26/1082588681(1) dated 13-Nov-2025 for the Assessment Year 2022-23.
2. The Assessee has raised the following grounds of appeal:
“1. That on the facts and in the circumstances of the case, the learned CIT(A) has erred in law and on facts in refusing to condone the delay in filing the appeal and in dismissing the appeal in limine, without appreciating that sufficient cause was duly shown and that substantial justice demanded adjudication on merits.
2. That the learned CIT(A) has failed to appreciate that the delay in filing the appeal occurred due to bona fide and reasonable cause, namely unforeseen medical circumstances of the appellant’s trustee, a senior citizen, which was duly explained in Form 35 and supported by facts, and therefore ought to have been condoned in terms of section 249(3) of the Act and settled judicial principles.
3. That the learned CIT(A) has erred in not adjudicating the grounds of appeal on m erits against the intimation under section 143(1) dated 17.03.2023 and the demand of Rs. 1,33,460, which arose solely due to an inadvertent and clerical error in reporting the amount accumulated or set apart under section 11(1)(a).
4. That, on merits, the authorities below have erred in treating Rs. 8,83,762 as taxable income and in not granting exemption under sections 11 and 12 to the extent of 15% accumulation under section 11(1)(a), which should correctly have been taken at Rs.9,75,544 on gross receipts of Rs. 65,04,294, thereby wrongly sustaining the demand of Rs. 1,33,460.
5. That the authorities below have failed to appreciate that any inadvertent / clerical error in the return of income or Form 10B which is apparent from record and verifiable from ac companying statements and forms is rectifiable and should not be used to deny substantive exemption otherwise available to a duly registered charitable trust.
6. That the demand raised under section 143(1) and sustained by the impugned order is unjust, exc essive and liable to be deleted or suitably reduced, and full exemption under sections 11 and 12 be granted to the appellant for Assessment Year 2022-23.
7. That the Hon’ble Supreme Court in Collector, Land Acquisition vs. Mst. Katiji [1987] 167 ITR 471 (S C) has held that a liberal approach should be adopted in condoning delay where sufficient cause is shown, and the appellant prays for condonation of delay and restoration of the appeal for adjudication on merits in the interest of justice.
8. That the learned authorities below erred in law and on facts in denying exemption to the appellant trust on the ground of procedural or technical defects. The Hon’ble Delhi High Court in the case of Director of Income Tax (Exemptions) vs. Vishwa Jagriti Mission (MANU/D E/1487/2012) has held that substantive exemption to a charitable trust cannot be denied merely on where the trust is otherwise eligible for exemption and its activities are genuine and charitable in nature, the department ought to allow curing such defects rather than penalizing the assessee by denying exemption. This principle is applicable to the facts of the appellant’s case, where an inadvertent typographical error in reporting the amount accumulated under section 11(1)(a) in Form 10B should not defeat the substantive entitlement to exemption. The doctrine of substantive justice demands that minor procedural errors or clerical mistakes should not be allowed to frustrate the genuine claims of a trust duly registered and carrying out charitable activities.
9. That the appellant craves leave to add, amend, alter, modify or withdraw any of the above grounds of appeal at the time of hearing.”
3. Brief facts of the case are that, assessee is a charitable trust, duly registered under the relevant provisions of law and governed by its Trust Deed and for A.Y.2022- 23, the assessee filed its return of income declaring gross receipts of Rs. 65,04,294/- and application of funds of Rs.37,5 5,381, claiming exemption under sections 11 and 12 of the Income- tax Act, 1961, and duly filing Form 9A and Form 10B. The Centralized Processing Center, Bengaluru (in short “CPC”) / Ld. Assessing Officer [hereinafter in short “Ld.AO”], processed the return and, raised a demand of Rs. 1,33,460/- vide intimation under section 143(1) of the Act on 17.03.2023. The assessee filed a rectification application under section 154 pointing out the inadvertent error, which was rejected by CPC on 22.10.2024.
4. Being aggrieved by the rejection of the rectification application, assessee preferred an appeal before Ld. CIT(A) with a delay of 792 days. Ld. CIT(A), after considering the explanation submitted by the assessee , dismissed the appeal in limine without condoning the delay.
5. Being aggrieved by the order of the Ld. CIT(A), assessee is now in appeal before the Tribunal.
6. Learned Counsel for the assessee, Shri Himanshu Gupta, CA, submitted that, the Ld. CIT(A) without appreciating the reasons stated in the affidavit citing for the delay of 792 days in filing the appeal before Ld. CIT(A), dismissed the appeal of the appeal in limine. Learned Counsel for the assessee relied on the affidavits filed before Ld. CIT(A) for the delay in filing of the appeal. Further, Learned Counsel for the assessee has relied upon Judgment of Hon’ble Supreme Court in the case of Collector, Land Acquisition vs. Mst. Katiji [1987] 167 ITR 471 (SC) and requested the Bench to condone the delay, before Ld. CIT(A). He, therefore, pleaded that appropriate direction may be given to the Ld. CIT(A) to condone the delay and decide the case on merits.
7. Learned CIT(DR), Shri Nilanjan Dey, on the other hand supporting the order of the Ld. CIT(A), strongly objected to remitting the file bac k to the file of Ld. CIT(A). The Ld. CIT(DR) submitted that reasons stated in the affidavit, as cause for the delay in filing the appeal, cannot constitute a valid/sufficient cause and the Ld.CIT(A) has rightly adjudicated and dismissed the appeal in-limi ne without condoning the delay. He, therefore pleaded that the order of the Ld.CIT(A) be upheld.
8. We have heard both the sides, perused the material available on record and had gone through the orders of the authorities below. We find that, reason explained by the assessee in it’s affidavit filed for the delay in filing the appeal before the Ld. CIT( A) within the prescribed date, are vague and general in nature and the assessee has failed to show ‘sufficient and reasonable cause’ for condonation of delay. Further, the reasons explained by the assessee are vague and general in nature which shows the lackadaisical approach of the assessee in filing the appeal before the Ld. CIT(A). Further, the assessee has failed to show ‘sufficient and reasonable cause’ which are beyond the control of the assessee that are prevented the assessee in not filing the appeal before the Ld. CIT(A) within the prescribed period. Although, the assessee claims to have not filed the appeal due to medical reasons of the Authorised Signatory, but, since the appellant is a Trust and many peoples are involved in the day-to-day affa irs of the Management of the Trust, even, if one person is sick and could not attend office but the other persons can take up the issue and comply with the statutory requirement of filing the appeal within the time allowed under the Act. Since, the assess ee has explained the vague reasons without any supporting evidences to prove the medical reasons of Authorised Signatory which prevented the appellant in filing the appeal on or before the date, in our considered view, the reasons explained by the appellan t in their affidavit filed before the Ld. CIT(A), at best, can be considered as a general explanation without there being any supporting evidences. Therefore, for the above reasons, the inordinate delay of 792 days in filing the appeal before Ld.CIT(A) cannot be condoned.
9. No doubt, i t is an admitted legal position of law from the decision of various Courts including the decision of Hon’ble Supreme Court in the case of Collector, Land Acquisition vs., MST. Katiji & Ors. [1987] 167 ITR 471 (SC) that, genera lly, the Courts have adopted a very liberal approach in construing the phrase ‘sufficient cause’ used in section 5 of the Limitation Act, in order to condone the delay, to enable the Courts to do substantial justice and apply law in a meaningful manner, wh ich subserves the ends of justice. The Courts further noted that, in adhering the liberal approach in condoning the delay for ‘sufficient cause’ ordinary litigant does not stand benefit by lodging an appeal late and it is not necessary to explain every day ’s delay in filing the appeal and since, sometimes refused to condone the delay, result in thrown out a meritorious matter. Therefore, it is, in the interest of justice that, cause of substantial justice should be allowed to prevail upon technical consider ation and if the delay is not deliberate, it should be condoned. Notwithstanding the above, howsoever, liberal approach is adopted in condoning the delay, existence of ‘sufficient cause’ for not filing the appeal in time, is a condition precedent for exerc ising the discretionary power of the Court to condone the delay. The phrases ‘liberal approach’, ‘justice- oriented approach’ and cause for the advancement of ‘substantial justice’ cannot be employed to defeat the law of limitation so as to allow stale matters or as a matter-of-fact dead matter to be revived and re- opened by taking aid of Section 5 of the Limitation Act. Therefore, it must always be borne in mind that, while construing ‘sufficient cause’ in deciding an appeal under section 5 of the Limitatio prescribed for filing the appeal, substantive right in favour of the appellant accrues and this right should not be lightly disturbed.
10. The law of limitation is founded on public policy. It is enshrined in the legal maxim “interest reipublicae ut sit finis litium” i.e., it is for the general welfare that, the period of limitation be put to litigation. The object is to, put an end to every legal remedy and to have a fixed period of life for every litigatio n as it is futile to keep any litigation or dispute pending indefinitely. Every public policy requires that there should be an end to the litigation, otherwise, it would be a dichotomy, if the litigant is made immortal vis-a- vis the right in parties i.e., human beings were mortals. Therefore, considering the importance of time, limitations provided under the statutes must be understood in this context. The Income Tax Act, 1961 provided for limitation for filing appeals before various authorities. Further, the Act has also provided a discretionary power to the Authorities for condoning the delay, if ‘sufficient cause’ is made out with reasonable explanation. Therefore, while condoning the delay, the Authorities must keep in mind the importance of limitation provided under the statutes and the discretionary power conferred by the said statute keeping in mind the phrase ‘sufficient and reasonable cause’.
11. In the present case, going by the affidavit filed by the assessee for explaining the reasons, the assessee claims that, it could not file the appeal since the Trustee, Shri Dilip Kumar Verma, was suffering from severe medical problems (without producing medical certificate)” as such there is a delay of 792 days. In our considered view, reasons are not convincing and the said reasons given by the assessee are vague and general in nature, without any substance and failed to take timely steps to file the appeal before the Ld. CIT(A) and, therefore, the argument of the assessee that due to the above reasons, the appeal before the Ld. CIT(A) could not be filed within the time, is not acceptable as there is gross negligence on the part of the assessee in filing the appeal before the Ld. CIT(A). Further, in our considered view, the ‘sufficient cause’ for condonation of delay under section 5 of the Limitation Act is, a cause that prevents an appellant from filing the appeal or application within the prescribed time limit and is beyond their control and not due to negligent or inaction. In the present case, going by the facts available on record, it is purely on account of inaction or negligence of the assessee, the appeal before the Ld.CIT(A) could not be filed with in the time allowed under the Act. Therefore, we are of the considered view that, the reasons given by the assessee for the delay in filling of the appeal, before Ld. CIT(A), does not come under ‘sufficient cause’ and for this reason, the inordinate delay of 792 days in filing appeal before the Ld. CIT(A) cannot be condoned.
12. At this stage, it is relevant to consider the Judgment of Hon’ble Supreme Court in the case of Pathapati Subbareddy (died) reptd. by his L.Rs & Ors. vs., The Special Deputy Collector-(LA) in S pecial Leave Petition (Civil) No.31248 of 2018 vide order dated 0 8.04.2024 wherein the Hon’ble Supreme Court after considering the provisions of sec.3(1) Secs.4 to 24 of the Limitation Act has refused to condone the delay and dismissed t the assessee and uphold the order of the Hon’ble High Court Andhra Pradesh High Court in dismissing the appeal on account of delay. The Hon’ble Supreme Court while dismissing the SLP, after considering the various judicial precedents on the subject matter of condonation of delay, noted that, “where a litigant could not explain the ‘sufficient cause’ which means adequate, enough reasons which prevented him to approach the Court within the period of limitation and could not properly, satisfact orily and convincingly explained the delay to the Court/Tribunal, Court’s has no power to condone such delays”. The Hon’ble Supreme Court further noted that, “t he statutory provisions under Limitation Act may cause hardship or inconvenience to a particular party, but, the Court has no choice, but, to enforce it giving full effect to the same by quoting the legal maxim dura lex sed lex which means “the law is hard but it is the law”, stands attracted when there were negligence/failure to exercise due diligen ce etc., and accordingly dismissed the SLP of the appellants in the aforesaid case”.
13. Further, the Hon’ble Supreme Court yet in an another case Balwant Singh (Dead) vs., Jagdish Singh & Ors. in Civil Appeal No.1166/2006 reported in [2010] 8 SCC 685 in para-16 very clearly held as under:
“16. Above are the principles which should control the exercise of judicial discretion vested in the Court under these provisions. The explained delay should be clearly understood in contradistinction to inordinate unexplained delay. Delay is just one of the ingredients which has to be considered by the Court. In addition to this, the Court must also take into account the conduct of the delay could easily be avoided by the applicant acting with normal care and caution. The statutory provisions mandate that applications for condonation of delay and applications belatedly filed beyond the prescribed period of limitation for bringing the legal representatives on record, should be rejected unless sufficient cause is shown for condonation of delay. The larger benches as well as equi- benches of this Court have consistently followed these principles and have either allowed or declined to condone the delay in filin g such applications. Thus, it is the requirement of law that these applications cannot be allowed as a matter of right and even in a routine manner. An applicant must essentially satisfy the above stated ingredients; then alone the Court would be inclined to condone the delay in the filing of such applications.”
14. Therefore, in our considered view, by following the judicial precedents, as discussed above, assessee has shown negligence in filing appeal before the Ld. CIT(A). The reasons given in their affidavit at best can be considered as vague and general, but not ‘sufficient cause’. From the conduct of the assessee, it is clear that the assessee has shown negligence. Therefore, from the above conduct of the assessee, it appe ars that, the reasons given for delay in filing of the appeal before the Ld. CIT(A) is not bonafide. As we have already stated in earlier part of this order that, the Hon’ble Supreme Court in the case of Balwant Singh (Dead) vs., Jagdish Singh & Ors. (supr a), has clearly held that, Court must also take into account conduct of the parties, bonafide reasons for condonation of delay, whether such day could easily be avoided by the applicant acting with normal care and caution. In the present case, going by the facts available on record, the appellant could have avoided the delay in filing of the appeal before the Ld. CIT(A) care and caution in the income tax matters. Since the appellant has shown casual approach and negligence in pursuing its case before the Ld. CIT(A) in filing the appeal, in our considered view, the reasons given by the appellant for condonation of inordinate delay of 792 days in filing of the appeal before the Ld. CIT(A) cannot be condoned for the said reasons.
15. Further, as per section.253(5) of the Income Tax Act, 1961, the appellate authorities powers can be exercised only upon showing of ‘sufficient cause’ preventing the assessee from filing the appeal within the prescribed period. In the present case, the delay involved is 792 days which is highly inordinate. The reasons adduced by the assessee are general in nature and did not inspire the confidence. The explanation lacks specific dates, supporting evidences or cogent material to demonstrate bonafide. It is well settled law by the decision of Hon’ble Supreme Court yet in another decision in the case of O/o. Chief Post Master General & Ors. vs., Living Media India Ltd., & Anr. [2012] 348 ITR 7 (SC) that, Law of Limitation has to be applied with all its rigor and l iberal approach cannot be extended to cases of gross negligence or inaction.
16. In this view of the matter and considering the facts and circumstances of the case, we are of the considered view that, the assessee has failed to explain delay and the circumstances beyond the control of the assessee in not filing the appeal before the Ld. CIT(A) within the respectfully following the Judgments of Hon’ble Supreme Court in the cases of Pathapati Subbareddy (died) represented by his L.Rs & Ors. v s., The Special Deputy Collector-(LA) (supra); Balwant Singh (Dead) vs., Jagdish Singh & Ors. (supra) and O/o. Chief Post Master General & Ors. vs., Living Media India Ltd., & Anr. (supra), we ar e disinclined to condone the delay of 792 days in filing the appeal before the Ld. CIT(A) and accordingly, the grounds raised by the assessee are dismissed.
17. In the result, appeal filed by the assessee is dismissed.
Order pronounced in the open court on 21st August, 2026.
