506-day delay in appeal filing not condoned due to lackadaisical attitude and negligence under section 253(5)

ITAT Surat dismissed the appeal filed with 506 days delay. The assessee claimed delay occurred because the receiver failed to open the email containing the rejection order, which was only discovered when the CA checked the ITBA portal for assessment order status. The tribunal held that the assessee showed lackadaisical attitude and negligence by remaining inactive after filing the application without proper follow-up. The casual and indifferent approach toward the registration rejection order did not constitute sufficient cause under section 253(5) of the Act. Consequently, the delay was not condoned and the appeal was dismissed.

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Issues Involved:
1. Condonation of delay in filing the appeal.
2. Rejection of the application for registration of trust u/s 12AB.

Summary:

Condonation of Delay:
The appeal was delayed by 506 days. The assessee-trust filed an affidavit stating the delay was due to the receiver not opening the email containing the order. The Chartered Accountant discovered the rejection while checking the ITBA portal for the assessment order. The assessee argued that there was no malafide intention and cited CBDT Circular No.7/2024, which extended the time limit for filing applications for registration u/s 12A till 30.06.2024. The Ld. AR relied on several judicial precedents to support the condonation of delay.

The Ld. CIT-DR opposed the condonation, arguing that the reasons provided did not constitute "sufficient cause" as per section 253(5) of the Act. The delay was attributed to negligence and lack of diligence by the assessee. The Ld. CIT-DR relied on the Supreme Court judgment in Majji Sannemma @ Sanyasirao vs. Reddy Sridevi & Ors., which emphasized that negligence and lack of due diligence are not sufficient grounds for condonation.

The Tribunal, after considering the submissions, found that the assessee was negligent and inactive in pursuing the application and filing the appeal. The Tribunal referred to several Supreme Court judgments, including P. K. Ramachandran vs. State of Kerala & Anr., Basawaraj vs. Special Land Acquisition Officer, and others, which stressed that "sufficient cause" cannot be liberally interpreted if negligence or inaction is attributed to the party. The Tribunal concluded that the reasons provided by the assessee did not constitute "sufficient cause" and refused to condone the delay.

Rejection of Application for Registration u/s 12AB:
Since the delay was not condoned, the Tribunal did not discuss the merits of the case regarding the rejection of the application for registration u/s 12AB. However, the Tribunal noted that the assessee could seek appropriate relief under the benevolent Circular No.7/2024 from the Ld. CIT(E).

Conclusion:
The appeal filed by the assessee was dismissed due to the refusal to condone the delay. The assessee was advised to seek relief under the CBDT Circular from the Ld. CIT(E).

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