Kempegowda Credit Co-operative Society Limited Vs ITO (ITAT Bangalore)
Summary: The assessee, Kempegowda Credit Co-operative Society Limited, filed its appeal before the Tribunal with a delay of 125 days. It explained that its Chief Executive Officer had been dismissed for mismanagement and that the appointment of a new CEO was delayed, resulting in the belated filing. The Revenue opposed condonation, alleging a callous approach on the part of the society. The Bangalore ITAT accepted the explanation and found that the delay was neither deliberate nor mala fide. Referring to the Supreme Court’s decision in Collector, Land Acquisition v. Mst. Katiji, the Tribunal reiterated that when substantial justice and technical considerations are in conflict, substantial justice must prevail. It observed that a litigant ordinarily gains nothing by filing an appeal late and that refusing condonation could result in a meritorious matter being rejected without examination. The Tribunal further held that the length of delay is not decisive when a reasonable and sufficient cause is established. A delay of 125 days could not be regarded as excessive or inordinate in the facts of the case. Accordingly, the delay was condoned and the appeal was admitted for adjudication. On merits, the Tribunal noticed that the AO had passed an ex parte reassessment order under Sections 147 read with 144, making additions aggregating to ₹3.95 crore. The CIT(A) had also sustained the additions because the assessee failed to respond despite being given five opportunities. Considering the society’s explanation regarding internal mismanagement and its inability to represent the case properly, the Tribunal restored the entire matter to the AO for fresh adjudication in accordance with law. The AO was directed to provide the assessee a reasonable opportunity of being heard, while the assessee was required to furnish all relevant documents and cooperate with the proceedings. The Tribunal cautioned that no further leniency would be available in the event of another default.
