Where assessee filed appeal before High Court with a delay of 507 days and sought condonation of delay stating that ex-employee of assessee who received order of Tribunal put it in his drawer and left company without informing anybody about such orders and it was only about a month before filing of instant appeal when his substitute new employee found papers from drawer, there was no sufficient explanation for delay. [
FULL TEXT OF THE HIGH COURT ORDER / JUDGMENT
1. None appears on behalf of the respondent despite service.
2. Both these Motions are filed in respective Tax Appeals seeking condonation of delay. The applicant / org. appellant is a company common in both the appeals. Extent of delay is also common and the explanation rendered for the delay is also common. We have, therefore, perused the facts from Notion of Motion No. 1011 of 2018.
3. Applicant – assessee is challenging the judgment of the Income Tax Appellate Tribunal (“the Tribunal” for short) dated 30.11.2016. The appeal is presented on or around 5.10.2018. There is, thus, delay of 507 days in filing the Tax Appeal. In order to explain such delay, the applicant has principally offered the following explanation:
“6. I say that the impugned order has come to my knowledge on or about 30th May 2018 even though the Impugned Order dated 30.11.2016 was received by our office staff member on 17.1.2017 and an Appeal ought to have been filed within 120 days i.e by 17.5.2017 (impugned order dated 30.11.2016. A copy of the envelop containing the impugned order from the Income Tax Department is annexed as Exhibit-“B”. However, unfortunately, this Impugned Order was kept away in the office drawer of an Ex-employee Mr. Yogendra Damania, who was a part time employee and who appears to have received the Impugned Order and but forgot to show it to the Management and kept it in his drawer. It was only about one month ago that a new employee Mr. Prabhu who was assigned to that table, found in on 8.8.2018 mixed up with other papers in the drawer which was used by the ex-employee Mr. Damania. The affidavit of Mr. Prabhu Naidu, being the new employee of the Appellant Company is annxed as Exhibit-“C”.
11. The Appellant prays that the delay may be condoned, and the Appellant begs to prefer this Appeal u/S. 260A of the Act. It is only about one month ago that this Order was found, and it was realized that no steps had been taken to challenge the order.”
4. Thus, explanation of the applicant for the delay is that the order passed by the Tribunal was received by the staff of the applicant – company on 17.1.2017, however, the staff member Mr. Yogendra Damania who received the same, put it in his drawer and did not inform the management about it. He left the service and only when his substitute employee Mr. Prabhu Naidu looked into the drawer that the papers of the Tribunal order was found. This happened about a month or so before filing the appeal.
5. Further explanation sought to be rendered is that the husband of one of the directors of the appellant – company was facing criminal proceedings pursuant to an FIR which was filed on 12.2.2017 by one of the family members.
6. Learned counsel for the applicant submitted that the delay is thus, properly explained. Mere length of delay should not be a decisive factor. There was no intention on the part of the applicant to abandon the challenge. The delay was occasioned due to the reasons beyond the control of the applicant. He relied on the decision of the Supreme Court in the case of N. Balakrishnan Vs. M. Krishnamurthy1 to contend that in the matter of delay, the Court should adopt a liberal approach.
7. Having heard the learned counsel for the applicant and having perused the documents on record, we do not find that the applicant has appropriately explained the delay which is of 507 days. We are not insisting on the applicant explaining each day of delay. Nevertheless when the delay is substantial, at least a proper explanation for the bulk of the period should be necessary. In the present case, principally, the explanation of the applicant, as noted above is that the ex-employee who received the order of the Tribunal put it in his drawer and left the company without intimating anybody. It was only about a month before filing of the appeal when his substitute new employee found the papers from the drawer.
8. For multiple reasons, this explanation does not inspire confidence. We had inquired with the learned counsel for the applicant why the ex-employee had not filed affidavit. It was stated that he was a part time employee and now having left the service was not traceable. It is intriguing that the applicant – company had entrusted such an important task of receiving Court’s order to a part-time employee whose whereabouts within short time of his leaving the service are not be available with the company. Further, there are inconsistencies in the declaration made by and on behalf of the applicant. In the present Motion, Mrs. Jaya Patel, the director of the company states that she came to know about the Tribunal’s order on 30.5.2018. It is also stated, as noted earlier, that the new employee Mr. Naidu was the first one to to tumble upon the order lying in the drawer of the previous employee. The applicant has filed affidavit of said Mr. Naidu who states that he had found the order of the Tribunal on 8.8.2018 and showed the same to Mrs. Jaya Patel who was surprised to see it as she was not shown the same earlier.
9. We also notice that on 26.10.2016 when the Tribunal heard the appeal, it was the husband of the director of the company who was present before the Tribunal and who even going by the account of the deponent, was heard by the Tribunal on appeal despite his reluctance. If that is so, nothing prevented the appellant company and its officials from making inquiries with the Tribunal through their Tax Practitioner to find out the outcome of the appeal.
10. All in all, we do not find that the explanation rendered is either sufficient or one which would inspire confidence. Under these circumstances, Notices of Motions are dismissed.
11. In view of this order, the Appeals do not survive and the same are disposed of accordingly.