Tribunal Grants Relief by Allowing Delayed Appeals, Finds Revenue's Rectification Unsustainable for TDS Recovery.

The Tribunal condoned the 547-day delay in filing seven appeals due to health issues, emphasizing substantial justice. It ruled against the Revenue's sec. 154 rectification, which erroneously treated the assessee as "assessee-in-default" for TDS recovery. The Tribunal found the rectification unsustainable, thus favoring the assessee for all assessment years.

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Issues involved: Delay in filing appeals due to health complications and technical objections by the Revenue, challenge to rectification proceedings treating assessee as "assessee-in-default" for TDS recovery under sec. 154.

Delay in filing appeals: The assessee's seven appeals for assessment years 2009-2010 to 2015-2016 faced a delay of 547 days, attributed to health complications and lack of communication. The Revenue objected to the delay, claiming the assessee failed to provide a reasonable cause. However, the Tribunal condoned the delay based on the assessee's submissions and medical records, citing the principle of substantial justice from the case of Collector, Land Acquisition vs. MST Katiji [1987] 167 ITR 471 (SC).

Challenge to rectification proceedings: The main grievance of the assessee was regarding the lower authorities' action under sec. 154 rectification, treating the assessee as an "assessee-in-default" for TDS recovery under sec. 201 r.w.s. 201(1A) of the Income Tax Act. The TDS recoveries in question related to payments of licence fees for CT and X-ray machines, treated as rental income under sec. 194I of the Act. The Assessing Officer had initially passed orders not holding the assessee as the assessee-in-default, followed by a sec. 154 rectification in favor of the assessee. However, a subsequent rectification attempted to treat the assessee as the assessee-in-default, which the Tribunal found to be erroneous in law and on facts. The Tribunal concluded that the rectification was not sustainable and ordered in favor of the assessee in all assessment years.

Outcome: The Tribunal allowed the assessee's seven appeals, rejecting the applicability of sec. 154 rectification and holding the lower authorities' actions as not sustainable in law. The other contentions of the assessee were considered academic in light of the decision on the rectification issue.

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