Liberal construction of sufficient cause under section 249(3) justified condonation of delay where no mala fides were shown.

The expression "sufficient cause" under section 249(3) of the Income-tax Act is to be construed liberally where no mala fides, deliberate delay or dilatory tactic is shown. Length of delay is not decisive; the governing test is whether the explanation is acceptable on the facts. Here, the delay was attributed to the assessee having forwarded the orders to its tax consultant, with no apparent benefit from late filing and no indication of bad faith. Applying substantial justice, the delay was condoned, the appeals were restored to the first appellate authority, and costs were imposed.

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Issues: Whether the delay in filing the appeals before the first appellate authority deserved to be condoned under section 249(3) of the Income-tax Act, 1961.

Analysis: The expression "sufficient cause" in section 249(3) is to receive a liberal construction where no mala fides, deliberate delay, or dilatory tactic is shown. Length of delay is not decisive by itself; the acceptability of the explanation is the governing test. On the facts, the assessee had forwarded the orders to its tax consultant for action, the delay was attributable to the consultant's inaction, no benefit accrued to the assessee by late filing, and the explanation did not indicate any mala fide intention. In the interest of substantial justice, the delay was held to deserve condonation, though costs were imposed.

Conclusion: The delay was condoned and the appeals were restored to the first appellate authority for decision on merits, subject to payment of costs.

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