Condonation of delay and merits review must both be considered before dismissing an income-tax appeal in limine.

Dismissal of an appeal in limine for delay without merits adjudication was found improper where the assessee had not been given a final opportunity to explain the delay. The ITAT held that, in the interest of substantive justice and natural justice, the first appellate authority must first examine condonation of delay under Section 249(3) of the Income-tax Act, 1961 and then decide the appeal on merits in accordance with Sections 250(4) and 250(6). The dismissal order was set aside and the matter remanded for fresh disposal in accordance with law.

---

---

Issues: Whether the first appellate authority was justified in dismissing the appeal in limine on the ground of delay without adjudicating the matter on merits, and whether the matter required remand for consideration of condonation of delay and fresh disposal in accordance with law.

Analysis: The appeal before the first appellate authority had been rejected for want of condonation of a substantial delay. The Tribunal noted that, in the interest of substantive justice and natural justice, the assessee should be given one final opportunity to explain the delay before the appellate authority. It further held that, once the question of condonation is examined, the appellate authority must then dispose of the appeal on merits in accordance with the statutory scheme governing appellate procedure.

Conclusion: The order dismissing the appeal in limine was set aside and the matter was remanded to the first appellate authority to decide condonation of delay under Section 249(3) of the Income-tax Act, 1961 and thereafter adjudicate the appeal on merits in accordance with Sections 250(4) and 250(6) of the Income-tax Act, 1961.

---