Condonation of delay and restoration of revision granted where the matter was pursued before a wrong forum and merits review was preserved.
Delay of 71 days in filing the appeal was condoned because the explanation showed sufficient cause for not preferring the appeal within time. The revision petition dismissed for default was restored, as the appellant had pursued the matter before a wrong forum and the revisional remedy under the Income-tax Act should be examined on merits. The Court allowed restoration subject to compliance with a monetary condition within the stipulated time, and directed consideration of the revision on merits if that condition was met.
Issues: (i) Whether the delay of 71 days in filing the appeal should be condoned. (ii) Whether the order dismissing the revision petition for default should be set aside and the revisional application heard on merits, subject to terms.
Issue (i): Whether the delay of 71 days in filing the appeal should be condoned.
Analysis: The explanation for the delay was accepted and the Court found sufficient cause for not preferring the appeal within time.
Conclusion: The delay was condoned and the application for condonation was allowed.
Issue (ii): Whether the order dismissing the revision petition for default should be set aside and the revisional application heard on merits, subject to terms.
Analysis: The Court held that the appellant had been pursuing the matter before a wrong forum, that the revision under section 264 of the Income-tax Act, 1961 ought to be decided on merits, and that an opportunity could be granted on payment of 15% of the assessed tax amount within the stipulated time. The revisional authority was directed to consider the revision petition on merits if the condition was complied with.
Conclusion: The dismissal of the revision petition for default was set aside, and the revision was directed to be decided on merits upon compliance with the condition imposed.
Final Conclusion: The appeal was allowed to the extent of restoration of the revisional proceeding, subject to deposit of 15% of the assessed tax, with the connected application also disposed of.
Ratio Decidendi: Where a revisional remedy under the Income-tax Act has been pursued before a wrong forum and the dismissal for default would otherwise deny adjudication on merits, the Court may restore the matter and require compliance with a monetary condition to enable consideration on merits.
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