Liberal construction of sufficient cause justified condonation where rectification was first pursued in good faith.

A 309-day delay in filing an appeal against an order giving effect to the Tribunal was condoned because the assessee had first pursued rectification under section 154 under a bona fide belief that the apparent mistake in the deduction computation under section 80HHC would be corrected. The Tribunal applied the settled principle that "sufficient cause" must receive a liberal construction to advance substantial justice, especially where there is no mala fide intent or dilatory conduct. The appeal was admitted and directed to be decided on merits.

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Issues: Whether the delay of 309 days in filing the appeal against the order giving effect to the Tribunal should be condoned on the basis of sufficient cause.

Analysis: The assessee explained that it had first invoked rectification proceedings under section 154 of the Income-tax Act, 1961, under a bona fide belief that the apparent mistake in the computation of deduction under section 80HHC would be corrected. The Tribunal noted that the delay was not deliberate or wanton and that the assessee had pursued an alternate remedy promptly before filing the appeal. It also relied on the settled principle that the expression "sufficient cause" must receive a liberal construction so that substantial justice is advanced, particularly where no mala fides or dilatory tactics are shown.

Conclusion: The delay was condoned and the appeal was directed to be admitted and decided on merits. The issue is decided in favour of the assessee.

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