High Court restores appeal for company in liquidation after ITAT dismissal

The High Court allowed the writ petition challenging the ITAT's dismissal of the restoration application for an appeal by a company in liquidation. The Court noted the special circumstances of the company's status and condoned the delay, setting aside the ITAT's order. The Court restored the appeal to the ITAT's file for further proceedings.

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Issues:
Challenge to order of ITAT dismissing restoration application for appeal; Delay in filing restoration application; Power of ITAT to condone delay; Special circumstances due to company being in liquidation.

Analysis:
The writ petition challenged the order of the Income Tax Appellate Tribunal (ITAT) dated 1st February 2016, which dismissed the Miscellaneous Application (M.A.) seeking restoration of ITA No. 4873/Del/1998. The petitioner, a company under liquidation, had its appeal dismissed in default by the ITAT on 3rd June 2003. Subsequently, the Income Tax Department claimed an outstanding demand from the petitioner. A revival petition was filed before the High Court of Punjab & Haryana, granting liberty to the petitioner to approach the Income Tax Department for settlement. The ITAT dismissed the M.A. seeking recall of the ex parte order, citing lack of power to condone the delay beyond four years and disregarding the High Court's observation on taking a sympathetic view due to the company's liquidation status.

Upon examining the documents and circumstances, the Court noted the special circumstances with the petitioner being in liquidation for several years and held that the petitioner should not be prejudiced in pursuing the appeal decided ex parte by the ITAT. Consequently, the Court set aside the ITAT's order, allowing the M.A. and condoning the delay in seeking recall of the ex parte order. The Court also set aside the ex parte order dismissing the appeal and restored ITA No. 4873/Del/98 for AY 1991-92 to the ITAT's file. The appeal was scheduled for listing before the ITAT on 1st August 2016, with the writ petition being allowed in the mentioned terms.

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