prpri ITAT condones Appeal filed with CI(A) by delay of 36 months & 3 days ITAT condones Appeal filed with CI(A) by delay of 36 months & 3 days

Case Law Details

Case Name : K. Hemalatha Vs ACIT (ITAT Chennai)
Appeal Number : I.T.A. No. 1940/Chny/2019
Date of Judgement/Order : 20/10/2020
Related Assessment Year : 2013-14

K. Hemalatha Vs ACIT (ITAT Chennai)

It is an admitted fact that against the assessment order, the assessee filed a manual appeal on 03.05.2016, which is well within the time provided under the Act. On perusal of the appellate order, we find that when the appeal was manually filed on 03.05.2016, no defect notice was issued to the assessee to rectify the defect of e-filing of the appeal. Moreover, we find that no notice under section 250(1) of the Act was served on the assessee fixing the appeal for hearing and without intimation to the assessee, the ld. CIT(A) sumoto passed the appellate order by dismissing the appeal on the ground that the assessee could not e-file the appeal. We are of the considered opinion that it is not possible for each and every assessee to get updated with any amendment issued by the CBDT until and unless it was communicated to the assessee and in this case, no show-cause notice to rectify the defect was issued to the assessee.

Subsequent to the dismissal of the appeal, by way of notarized affidavit, it was the submission of the assessee that the AR of the assessee has filed a petition under section 154 of the Act before the ld. CIT(A) for rectification and also filed appeal papers electronically on 09.05.2019, in order to comply with Rule 45 of the IT Rules with a request for condonation of delay of 36 months and 3 days. We have also perused the copy of the petition under section 154 of the Act filed on 07.05.2019 before the ld. CIT(A). However, no order under section 154 of the Act was found to have been passed by the ld. CIT(A). Thus, to comply with the provision of Rule 45 of the IT Rules, there is a delay of 36 months and 3 days in e-filing the appeal before the ld. CIT(A).

In this case, we find that the delay was on account of the venial breach and as the assessee had filed the manual appeal within the time and no show-cause notice to rectify the defect in filing the appeal was served on the assessee. Moreover, no notice under section 250(1) of the Act was issued to the assessee before concluding the appeal filed by the assessee. Thus, respectfully following the principles laid down by the Hon’ble Supreme Court in the case of State of Punjab v. Shyamalal Murari & Others reported in AIR 1976 (SC) 1177, wherein, it was categorically purported that when technicalities and substantial justice are pitted against each other, the substantial justice deserves to be prevailed over technicalities, the delay in e-filing of the appeal before the ld. CIT(A) stands condoned and the issues in this appeal are restored to the file of the ld. CIT(A) for adjudication on merits in accordance with law by affording an opportunity of being heard to the assessee.

FULL TEXT OF THE ITAT JUDGEMENT

This appeal filed by the assessee is directed against the order of the ld. Commissioner of Income Tax (Appeals) 7, Chennai, dated 30.03.2019 relevant to the assessment year 2013-14. In the grounds of appeal, besides challenging various disallowances made in the assessment order, the assessee has mainly challenged the ex-parte order passed by the ld. CIT(A) on the ground that the assessee could not e-file the appeal.

2. The appeal filed by the assessee is delayed by 24 days, for which, the ld. Counsel for the assessee has filed a petition in support of an affidavit for condonation of the delay, to which; the ld. DR has not raised any serious objection. Consequently, since the assessee was prevented by sufficient cause, the delay of 24 days in filing of the appeal stands condoned and the appeal is admitted for adjudication.

3. Brief facts of the case are that the assessee has filed the return of income for the assessment year 2013-14 on 01.10.2013 declaring total income of ₹. 56,24,690/-. The return filed by the assessee was processed under section 143(1) of the Income Tax Act, 1961 [“Act” in short] and thereafter, the case of the assessee was taken up for scrutiny. After considering the details filed against statutory notices, the assessment under section 143(3) of the Act was completed by assessing total income of the assessee at ₹. 1,07,23,107/-. On appeal, since the assessee could not e-file the appeal, the ld. CIT(A) dismissed the appeal filed by the assessee without adjudicating the issue on merits.

4. On being aggrieved, the assessee is in appeal before the Tribunal. The ld. Counsel for the assessee has submitted that the ld. CIT(A) has erroneously dismissed the appeal summarily without going into the merits of the case and without appreciating the fact that the assessee has filed manual appeal within the time stipulated under the Act. It was further submission that no notice under section 250(1) of the Act was served on the assessee and su moto passed the appellate order is illegal and prayed the that suitable directions may be given to the ld. CIT(A) to adjudicate the issues on merits by giving an opportunity to the assessee.

5. Per contra, the ld. DR referred to the order of the ld. CIT(A) and submitted that the assessee has failed to file the appeal electronically, which is mandated by amendment to Rule 45 of the I.T. Rules, notified by the CBDT vide Notification No. S.O. 637(E) dated 01.03.2016, the manual appeal filed has been rightly treated by the ld. CIT(A) as non-est.

6. We have heard both the sides, perused the materials available on record and gone through the orders of authorities below. It is an admitted fact that against the assessment order, the assessee filed a manual appeal on 03.05.2016, which is well within the time provided under the Act. On perusal of the appellate order, we find that when the appeal was manually filed on 03.05.2016, no defect notice was issued to the assessee to rectify the defect of e-filing of the appeal. Moreover, we find that no notice under section 250(1) of the Act was served on the assessee fixing the appeal for hearing and without intimation to the assessee, the ld. CIT(A) sumoto passed the appellate order by dismissing the appeal on the ground that the assessee could not e-file the appeal. We are of the considered opinion that it is not possible for each and every assessee to get updated with any amendment issued by the CBDT until and unless it was communicated to the assessee and in this case, no show-cause notice to rectify the defect was issued to the assessee.

 6.1 Subsequent to the dismissal of the appeal, by way of notarized affidavit, it was the submission of the assessee that the AR of the assessee has filed a petition under section 154 of the Act before the ld. CIT(A) for rectification and also filed appeal papers electronically on 09.05.2019, in order to comply with Rule 45 of the IT Rules with a request for condonation of delay of 36 months and 3 days. We have also perused the copy of the petition under section 154 of the Act filed on 07.05.2019 before the ld. CIT(A). However, no order under section 154 of the Act was found to have been passed by the ld. CIT(A). Thus, to comply with the provision of Rule 45 of the IT Rules, there is a delay of 36 months and 3 days in e-filing the appeal before the ld. CIT(A).

 6.2 The Mumbai Benches of this Tribunal in the case of All India Federation of Tax Practitioners v. ITO reported in [2018] 166 DTR 276 (Mumbai (Trib) as also the decision of the Delhi Benches of the Tribunal in the case of Shri Gurinder Singh Dhillon v. ITO in ITA No. 6595/Del/2016 dated 19.04.2017 have held that the delay was liable to be condoned. In this case, we find that the delay was on account of the venial breach and as the assessee had filed the manual appeal within the time and no show-cause notice to rectify the defect in filing the appeal was served on the assessee. Moreover, no notice under section 250(1) of the Act was issued to the assessee before concluding the appeal filed by the assessee. Thus, respectfully following the principles laid down by the Hon’ble Supreme Court in the case of State of Punjab v. Shyamalal Murari & Others reported in AIR 1976 (SC) 1177, wherein, it was categorically purported that when technicalities and substantial justice are pitted against each other, the substantial justice deserves to be prevailed over technicalities, the delay in e-filing of the appeal before the ld. CIT(A) stands condoned and the issues in this appeal are restored to the file of the ld. CIT(A) for adjudication on merits in accordance with law by affording an opportunity of being heard to the assessee.

7. In the result, the appeal filed by the assessee is allowed for statistical purposes.

Order pronounced on the 20th October, 2020 in Chennai.

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