Appeal allowed after condoning 1358-day delay; parties to be heard; right of appeal emphasized.

M/s Phoenix Mills Ltd., Versus Asstt. Commissioner of Income-tax, Circle 7 (1), Mumbai.

M/s Phoenix Mills Ltd., Versus Asstt. Commissioner of Income-tax, Circle 7 (1), Mumbai. - TMI Issues Involved:
1. Condonation of delay in filing the appeal.
2. Decision on the merits of payments made to the processing department.
3. Decision on the merits of payments made to the common staff.

Detailed Analysis:

1. Condonation of Delay in Filing the Appeal:
The primary issue was whether the delay of 1358 days in filing the appeal before the CIT(A) could be condoned. The CIT(A) had dismissed the appeal in limine due to the delay, stating that the appellant did not provide sufficient reasons for the delay. The appellant argued that the delay was caused by the previous AR, who failed to advise them on the necessity of filing an appeal against the original assessment order. The appellant provided an affidavit from their Chief Accountant affirming this.

The appellant cited the Supreme Court judgment in Concord of India Insurance Co. Ltd. v. Smt. Nirmala Devi and Others, which states that the mistake of counsel can be considered a sufficient cause for condonation of delay if it is bona fide. The appellant also referred to the case of Areva T and D India Ltd. v. JCIT, where a similar delay was condoned based on an affidavit.

The DR opposed the condonation, arguing that the appeal was not maintainable under Section 253 of the IT Act and that the appellant did not furnish sufficient reasons for the delay. The DR cited several judgments to support their contention.

The Tribunal held that the right of appeal is a statutory one and should not be restricted unless explicitly stated in the statute. The Tribunal referred to the Supreme Court judgment in Mela Ram and Sons v. Commissioner of Income-tax, which established that an appeal presented out of time is still an appeal, and an order dismissing it as time-barred is one passed in appeal.

The Tribunal concluded that the CIT(A) should have condoned the delay, considering the laws laid down by the Apex Court and the Hon'ble Madras High Court. The Tribunal directed the CIT(A) to condone the delay and decide the appeal on merit after providing a reasonable opportunity of being heard to both sides.

2. Decision on the Merits of Payments Made to the Processing Department:
The CIT(A) did not decide on the merits of the payments made to the processing department amounting to Rs. 2,61,36,753/- due to the dismissal of the appeal in limine. Since the matter was sent back to the CIT(A) for condoning the delay, the Tribunal did not express any opinion on the merits of this issue and directed the CIT(A) to decide it afresh.

3. Decision on the Merits of Payments Made to the Common Staff:
Similarly, the CIT(A) did not decide on the merits of the payments made to the common staff amounting to Rs. 20,06,098/- due to the dismissal of the appeal in limine. The Tribunal did not express any opinion on the merits of this issue either and directed the CIT(A) to decide it afresh after condoning the delay.

Conclusion:
The Tribunal allowed the appeal of the assessee, directed the CIT(A) to condone the delay, and instructed the CIT(A) to decide the appeal on its merits after providing a reasonable opportunity of being heard to both parties.