Mahendra Kumar Sanwalka Vs ITO (ITAT Kolkata)
Kolkata ITAT Condones 59-Month Delay: Bona Fide Pursuit of Section 154 Rectification Is ‘Sufficient Cause’ for Delayed Appeal
Summary: The Kolkata Bench of the Income Tax Appellate Tribunal, in ITA No. 1846/KOL/2026 for Assessment Year 2020-21, partly allowed the assessee’s appeal for statistical purposes and restored the matter to the Addl/JCIT(A)-3, Ahmedabad for adjudication on merits. The assessee had filed the original return of income on 31.12.2020 declaring total income of ₹44,29,080/- and subsequently filed a revised return u/s 139(5) on 15.01.2021 claiming carry forward of loss of ₹39,23,825/-, comprising short-term capital loss of ₹3,81,248/- and long-term capital loss of ₹35,42,577/-. The CPC processed the return u/s 143(1) on 03.02.2021, disallowed the carry forward of loss on the ground that the return was filed beyond the due date of 10.01.2021, levied a fee of ₹10,000/- u/s 234F and computed a refund of ₹10,890/-, which was adjusted against outstanding demand u/s 220(2). The assessee subsequently filed an application u/s 154 on 04.05.2021 and awaited its disposal before filing the statutory appeal, resulting in a delay of more than 59 months. The Addl/JCIT(A) declined to condone the delay and also upheld the disallowance on merits. Before the Tribunal, the assessee contended that pursuing the rectification remedy constituted sufficient cause. The Tribunal held that since the assessee had filed a rectification application and was awaiting its disposal, the delay in filing the appeal against the intimation u/s 143(1) ought to have been condoned. The Tribunal therefore set aside the order of the Addl/JCIT(A) and restored the appeal for disposal of the grounds on merits by a speaking order, with a reasonable opportunity of hearing to the assessee and compliance with Rule 46A of the Income-tax Rules, 1962. The Tribunal expressly did not decide the substantive issues concerning carry forward of loss, the effect of the original and revised returns, the applicability of Notification No. 93/2020, the fee u/s 234F or the other grounds on merits.
