Procedural Lapses Should Not Override Substantial Justice: ITAT condones Appeal filing delay

Atlantic Bio Medical Pvt. Ltd. Vs DCIT (ITAT Mumbai)

Income Tax Appellate Tribunal (ITAT) Mumbai has ruled in favor of Atlantic Bio Medical Pvt. Ltd., allowing the condonation of a 314-day delay in filing an appeal against the disallowance of deductions under Sections 80IC and 43B of the Income Tax Act, 1961. The appeal was initially dismissed by the Commissioner of Income Tax (Appeals) [CIT(A)] solely on the grounds of delay, without examining the merits of the case. The tribunal held that the delay was not deliberate but caused by a genuine misunderstanding of filing requirements.

The assessee attributed the delay to its accountant, who was responsible for handling tax matters. The accountant mistakenly believed that Form 10CCB, required for claiming deductions under Section 80IC, could be filed manually with the Assessing Officer rather than electronically with the income tax return. The intimation order denying deductions was sent to the accountant’s email in October 2018, but the company was only informed in January 2019. The assessee argued that this was a case of bona fide oversight rather than intentional non-compliance.

The Revenue opposed the condonation, arguing that the delay reflected negligence and a lack of due diligence. However, the tribunal referred to the Supreme Court’s decision in Land Acquisition Collector vs. MST Katiji & Others [(1987) 167 ITR 471 (SC)], which held that substantial justice should take precedence over technical lapses. The Supreme Court emphasized that when technicalities and justice are in conflict, courts should favor substantial justice to prevent undue hardship.