Limras Lottery & Trading Company Pvt Ltd Vs ITO (Madras High Court)
The Madras High Court has condoned a 544-day delay in an income tax appeal filed by Limras Lottery & Trading Company Pvt Ltd against the Income Tax Officer (ITO). The court set aside the Income Tax Appellate Tribunal’s (ITAT) order, which had dismissed the appeal for the appellant’s inability to establish sufficient cause for the delay, and remanded the matter for de novo consideration.
The assessment order against Limras Lottery & Trading Company Pvt Ltd was passed on November 14, 2019, and served on November 18, 2019. The appeal was filed with a total delay of 1260 days. After excluding the period of the COVID-19 pandemic, the ITAT had calculated an unexplained delay of 544 days. The appellant attributed the delay to several factors: the closure of its lottery business long ago, the freezing of its bank deposits, and the critical issue of misplacement of the assessment order due to office renovations. Furthermore, the appellant’s counsel, who handled all income tax matters, passed away due to COVID-19 in March 2020, making it difficult to trace relevant papers and appoint new legal representation for the now defunct company.
Despite these explanations, the ITAT had concluded that the appellant failed to establish sufficient cause for the delay. The Tribunal also controversially commented on the merits of the case while dismissing it on the grounds of limitation, an irregularity highlighted by the High Court.
