Chathamangalam Service Co-Op. Bank Ltd Vs ACIT (Kerala High Court)
The Kerala High Court considered an appeal against an order of the Income Tax Appellate Tribunal (ITAT), Cochin Bench, which had refused to admit a statutory appeal for the Assessment Year 2015–16 due to an unexplained delay of 542 days. The Tribunal found the explanation for the delay to be lacking credibility, as the appellant merely stated that its work had been outsourced to an external agency without providing basic details such as the agency’s identity or relevant particulars. The appellant’s counsel conceded that the affidavit filed in support of the condonation application was not properly drafted but argued that this alone should not deprive the appellant of its statutory right to appeal, especially when supported by a binding Supreme Court judgment. The respondent contended that the Tribunal was correct in limiting its consideration to the issue of delay and not the merits of the case.
The High Court upheld the Tribunal’s reasoning that the delay was substantial and inadequately explained, noting that essential details were missing. However, it also observed that the appellant was pursuing a statutory remedy and claimed support from binding precedent. Considering these factors, the Court held that the appellant should be given one more opportunity to properly explain the delay. Accordingly, the Court set aside the Tribunal’s order and remanded the matter for fresh consideration, permitting the appellant to file an additional affidavit within three weeks. The Tribunal was directed to reconsider the matter after hearing both sides. The Court also ordered that recovery proceedings be deferred until compliance with these directions and communication of the resultant order.
