Biren Dhirajlal Shah Vs ITO (ITAT Ahmedabad)
A. Whether the delay of 1607 days in filing the appeal deserves to be condoned?
The Income Tax Appellate Tribunal (ITAT) Ahmedabad addressed the condonation of a significant delay of 1607 days in filing an appeal by Biren Dhirajlal Shah against the Income Tax Officer (ITO), alongside the validity of a penalty imposed under Section 271(1)(c) of the Income Tax Act pertaining to the Assessment Year 2008-09. Regarding the delay, the Tribunal emphasized that the length of the delay is secondary to the existence of a “sufficient cause.” Despite acknowledging the substantial delay, the ITAT cited precedents like CIT v. K.S.P. Shanmugavel Nadai & Ors. where a 20-year delay was condoned due to ongoing legal remedies, and Collector, Land Acquisition v. Mst. Katiji, which laid down principles prioritizing substantial justice over technicalities and cautioning against a pedantic approach to explaining “every day’s delay.” The assessee attributed the delay to continuous health issues spanning from 2008 to 2020, being declared insolvent, involvement in a cheque bouncing case leading to fear of the police and societal avoidance, and a general unsound mental state hindering the pursuit of legal recourse. The Tribunal also noted the Revenue’s failure to file an affidavit opposing the condonation and the absence of any allegation of deliberate or mala fide intent behind the delay. Referencing Baswaraj v. Land Acquisition Officer and Ajay Dabre v. Pyare Ram, the ITAT acknowledged that “sufficient cause” implies a reason beyond negligence or lack of diligence, requiring the party to have acted bona fide. However, considering the precedents and the specific circumstances presented, the Tribunal leaned towards substantial justice, stating that rejecting the application would “amount to legalise injustice on technical ground.”
