Chowlor Matada Swamy Vs DCIT (ITAT Bangalore)
In the case of Chowlor Matada Swamy vs DCIT, the Income Tax Appellate Tribunal (ITAT) in Bangalore addressed an appeal regarding a significant delay in filing with the CIT(A). The delay of 140 days was attributed to the assessee’s misunderstanding about the prerequisites for filing the appeal. Initially, the assessee believed that a 20% deposit of the tax demand was necessary before lodging the appeal. This belief was compounded by the seizure of ₹24.50 lakhs in cash during a search at the assessee’s premises, leaving him without available funds. Following a penalty notice, the assessee sought new advice from a different tax consultant, who clarified that the deposit was not a condition for appeal, but the delay had already occurred by then.
Upon review, the ITAT found the reasons provided by the assessee to be credible and not merely excuses. The court acknowledged the possibility that the cash seizure created a legitimate financial hardship that impacted the assessee’s ability to act promptly. Given the circumstances and the fact that the delay stemmed from misguidance by a tax consultant, the ITAT determined that there was sufficient cause for condoning the delay. Consequently, the Tribunal directed the CIT(A) to accept the appeal and consider the case on its merits, emphasizing the principles of justice and fairness in tax proceedings.
