2024 (8) TMI 42 - AT - Income Tax

Appellant's 380-day delay in filing appeal condoned after CIT(A) rejected application under section 248

ITAT Mumbai allowed appellant's challenge to CIT(A)'s dismissal of condonation application for 380-day delay in filing appeal. CIT(A) rejected condonation ... Condonation of delay in filing the appeal dismissed by CIT(A) - delay of 380 days - as submitted person who was looking after accounting work of the appellant was filed giving detailed reasons as to how the email intimating the penalty order was not noticed inadvertently due to huge number of emails being received by her on behalf of the appellant - HELD THAT:- CIT(A) has adopted a hyper-technical approach while considering the grounds of condonation of delay in the case of the appellant. The right of appeal to the Ld. CIT(A) u/s. 248 is a statutory right granted to the appellant/assessee. The statutory right cannot be denied to an assessee unless there is inordinate delay or gross negligence on the part of the assessee. It is settled law that the rules and procedure is handmade of justice and the adjudicating authorities should not deny a statutory right of appeal on technical grounds. The appellant has very fairly admitted before the Ld. CIT(A) that there is delay of 380 days in filing the appeal. The appellant has very genuinely given the reasons for condonation of delay before the Ld. CIT(A) and has even filed the affidavit of the concerned employee who was responsible for receiving emails on behalf of the appellant. As evident from the affidavit of accounting person/Mrs. Pooja Ashanand Mishra that she inadvertently failed to notice the email containing the order dated 28.02.2022 sent on the email of the appellant. She has given the detail reasons for the said missing of the notices of the email. We have no reason to disbelieve the affidavit so submitted. Nothing contrary has been brought on record by the respondents which may contradict and falsify affidavit of employee of the appellant in support of seeking condonation of delay. Thus the impugned order of the Ld. CIT(A) is not sustainable in the eyes of law and accordingly set aside with the directions to restore the case of the appellant on the file of Ld. CIT(A). Issues Involved:1. Condonation of delay in filing the appeal.2. Imposition of penalty under Section 271(1)(c) of the Income Tax Act, 1961.Issue-wise Detailed Analysis:1. Condonation of Delay in Filing the Appeal:The appellant/assessee filed an appeal against the penalty order dated 28.02.2022, which was dismissed by the Learned Commissioner of Income Tax (Appeals) [CIT(A)] on grounds of delay. The appeal was filed 380 days late, and the CIT(A) did not condone the delay, stating that the appellant failed to show sufficient cause.The appellant argued that the delay was unintentional and due to sufficient causes beyond control. The appellant's staff, Mrs. Pooja Ashanand Mishra, who handled the email account, inadvertently overlooked the email containing the penalty order due to a high volume of emails. An affidavit was submitted to support this claim.The CIT(A) relied on various judgments, emphasizing that the expression 'sufficient cause' cannot be liberally interpreted if negligence, inaction, or lack of bona fides is attributed to the party. However, the Tribunal noted that the CIT(A) adopted a hyper-technical approach, ignoring the statutory right of appeal and the principles of natural justice.The Tribunal referred to the Supreme Court judgments in Sesh Nath Singh & Anr. vs. Baidyabati Sheoraphuli Co-operative Bank Ltd. & Anr. and Sheo Raj Singh (Deceased) Through LRS. & Ors. vs. Union of India & Anr., which highlighted that the condition precedent for condonation of delay is the existence of sufficient cause. Acceptance of the explanation for delay should be the rule, and refusal an exception, particularly when no negligence or inaction can be imputed to the defaulting party.The Tribunal found the appellant's reasons for the delay genuine and supported by an affidavit. The appellant's staff's affidavit detailed the inadvertent oversight and personal circumstances contributing to the delay. The Tribunal concluded that there was sufficient cause for condoning the delay and set aside the CIT(A)'s order, directing the CIT(A) to dispose of the case on merit.2. Imposition of Penalty under Section 271(1)(c) of the Income Tax Act, 1961:The penalty proceedings under Section 271(1)(c) were initiated by the Assessing Officer (AO) on the grounds that the appellant furnished inaccurate particulars of income. The National Faceless Assessment Centre imposed a penalty of Rs. 17,51,503/-.The appellant challenged the penalty order, but the CIT(A) dismissed the appeal due to the delay in filing. The Tribunal did not delve into the merits of the penalty imposition, as the primary issue was the condonation of delay. However, it directed the CIT(A) to consider the material brought on record and dispose of the case on merit.Conclusion:The Tribunal allowed the appeal, setting aside the CIT(A)'s order and directing the CIT(A) to restore the case and dispose of it on merit within 90 days. The appellant was instructed to present its case before the CIT(A) within this period. The Tribunal emphasized the importance of substantive justice over technical considerations, ensuring that the appellant's statutory right of appeal is not denied due to procedural delays.