TaxTMI 
TaxTMI 
2015 (1) TMI 1073
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....s and circumstances of the case, the Appellate Tribunal was right in dismissing the appeal on the point of limitation without appreciating the reasons stated in the affidavit filed by the appellant? 3. Whether the Appellate Tribunal is correct in not considering the "sufficient cause" for the delay which had been explained by the assessee in filing the appeal with condonation of delay? 4. Whether the finding of the Tribunal is perverse especially after admission of the main case and after granting interim relief dismissed the main case in condonation application by overlooking the earlier decision of another Bench? 5. Whether on the facts and circumstances of the case, the Tribunal was right in not considering the submission made by the counsel for the appellant at the time of argument?" 2. The brief facts relating to the above batch of appeals are as follows: On 10.1.2008, search was conducted in terms of Section 132 of the Income Tax Act at th....
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....ai. 1127 7 2299 of 2013 M/s.EVP Estates and Properties Development Limited, Chennai. 1127 8 2300 of 2013 M/s.EVP Estates and Properties Development Limited, Chennai. 1127 9 2301 of 2013 M/s.EVP Estates and Properties Development Limited, Chennai. 1127 10 2302 of 2013 M/s.EVP Housing Chennai Private Limited, Chennai. 1127 11 2298 of 2013 M/s.EVP Housing Chennai Private Limited, Chennai. 1127 6. The Tribunal, by a common order dated 17.4.2014 dismissed the appeals declining to condone the delay on the ground that the explanation given by the assessees to condone the delay was untenable. The Tribunal in paragraph 3 of the order extracted the petition dated 27.12.2013 filed for condonation of delay. For better clarity, we extract the same as such. "3. In this case, it is to be seen that the appeal is time barred by 1100 days delay in filing. The assessee has filed a condonation petition dated 27.12.2013 as under:- 1. I am the Appellant herein and as such I am well....
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....attached the said award amount under the provisions of Section 226(4) and Rule 31(11 Schedule) of the Act 1961 towards the tax liabilities of:- (i) E.V.P. Estates and Properties Development Ltd., (the Appellant herein) PAN : AABCE1517C (ii)E.V.P. Housing Chennai Pvt.Ltd. PAN :ACQPR0638B (iii) Mr. E.V.Perumalsamy Reddy, PAN: AGMPP5434D (iv) Mrs. P.S. Rajeswari, PAN:ACQPR0638B and (v)Mr. E.V.P. Santhosa Reddy, PAN:AGYPR3116N We filed a writ petition in W.P.No.35073 of 2013 before the Hon'ble High Court of Madras for the following relief:- "To' issue a Writ of Mandamus directing the Respondents to lift the attachment proceedings initiated by the 3rd Respondent u/s.226(4) in Form No.LT.C.P.10 under Rule 31 of the Second Schedule of Income Tax Act, 1961 in respect of the deposit amount of Rs. 16,79,59, 743/ -(Rupees Sixteen Crores Seventy Nine Lakhs Fifty Nine Tho....
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.... In this backdrop, the assessee submits that since delay of 1100 days stands explained and the issue of payment of admitted tax has been adjudicated in writ proceedings before the hon'ble jurisdictional high court, the matter be restored back to the CIT(A) for decision on merits." 7. It is seen that during the year 2010, the Government of Tamil Nadu had acquired the lands of the appellants for the purpose of expansion of the Chennai Airport under the Tamil Nadu Acquisition of Lands for Industrial Purposes Act and the Government of Tamil Nadu had deposited a sum of Rs. 16,79,59,793/- to the credit of the proceedings pending in LAOP No.2 of 2011 on the file of the Sub-Court, Kancheepuram. Thereafter, on 03.11.2010, demand notices were sent to the appellants for recovery of tax. On 25.2.2011, the Tax Recovery Officer wrote a letter under Section 226(4) of the Income Tax Act to the Subordinate Judge, Kancheepuram requesting to hold the amounts deposited and lying before the Sub-Court, Kancheepuram in respect of the properties belonging to the appellants. The letter dated 25.2.2011 reads as follows: "Date:- 25-02-11 To The Hon'ble Judge, Sub-Court, Kancheepu....
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....13, the assessees had filed an affidavit giving consent to adjust the compensation amount awarded in the land acquisition proceedings, which amount is in deposit before Sub-Court, Kancheepuram, as against the tax arrears to the tune of Rs. 10,06,41,779/-. Since payments were not made, the Tax Recovery Officer on 24.1.2014, attached the properties, namely, Land and Building at New No.23, Old No.15, Sir Thiyagaraya Road, T.Nagar, Chennai - 600 017 measuring total extent of 4804 sq.ft. and Land and Building at No.55, 55A, 55B, 56 and 56A, Old Peria Chetty Street, Chengalpet, Kancheepuram Taluk measuring 5323 sq.ft., belonging to the appellants and fixed the date of auction as 10.02.2014. 11. Challenging the said auction proceedings, Writ Petitions have been filed before this Court in W.P.Nos.3431 and 3432 of 2014. This Court, by order dated 10.2.2014, granted an order of interim stay on condition that the entire garnishee amount of Rs. 16,79,59,793/- and interest thereon lying to the credit of LAOP No.2 of 2011 on the file of the Sub Court, Kancheepuram has to be adjusted towards demand made by the Income Tax Department. 12. In the meanwhile, the Tribunal by order dated 14.2.201....
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....aware of the CIT(A) order under challenge. So, it is not a case of lack of knowledge about the CIT(A) 's order. The assessee's averments in the condonotion petition read that her husband had undergone bypass surgery and treatment of diabetes mellitus associated with hypertension from November,2010 to November,2013. She supports this by way of a medical certificate dated 16.11.2013 issued by Mohan Nursing Home, Chennai. However, this only appears to be an untenable explanation. Her contention about Shri.Reddy's sudden illness November, 2010 to November, 2013 and sudden regaining of health is not supported by any evidence that she herself could not have pursued legal remedies in the treatment period. In this regard, the nursing home's certificate only appears to be an after-thought exercise in absence of other details. Moreover, in 'tribunal's proceedings, the assessee's/her husband's personal appearance is not required. Coupled with this, she fails to explain each and every day's delay from 16th November, 2013 till the date of filing the appeal i.e. 30.12.2013 as she is supposed to act with due diligence. Therefore, we hold that the assessee has failed to satisfactorily explain 1100....
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....d counsel appearing for the appellants submitted that Section 260A of the Income Tax Act provides that the provisions of the Civil Procedure Code will apply to the appeal filed before the Appellate Court. He further relies upon Order 41 Rule 27 of the Code of Civil Procedure and submitted that Rule 27 of the Code of Civil Procedure provides for production of additional evidence, if the same is relevant to the disposal of the case. He further submitted that the additional documents now filed are relevant to the facts of the case, as the same are in support of the medical certificate dated 16.11.2013, which was filed before the Tribunal. 20. In this connection, learned counsel appearing for the appellant relies on the judgment of Supreme Court in the case of Tek Ram (Dead) through LRs V. Commissioner of Income Tax, Faridabad in Civil Appeal No.6262 of 2013 dated 05.08.2013 and submitted that if additional documents are necessary to the disposal of the case, the same may be admitted. 21. Learned counsel appearing for the appellants also submitted that the Tribunal without taking into consideration the medical certificate produced by the assessees, dismissed the condonation petit....
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....ted that according to the assessees, Mr.E.V.Perumalsamy Reddy was admitted in the hospital in the month of November, 2012 only. But the Proceedings of the Commissioner of Income Tax (Appeals) is dated 27.10.2010. Before the Assessing Officer, the representative of the assessee has represented the case. Hence, the said representative could have represented the matter before the Tribunal also. Hence, the appellants have not satisfactorily explained the delay in not pursuing the matter before the Tribunal. Consequently, the order of the Tribunal is justified in declining to condone the delay. 23. Heard learned counsel appearing for the appellant and the learned Standing Counsel appearing for the Revenue and perused the materials placed before this Court. 24. Before going into the merits of the case, it is relevant to look into the provisions relied on by the learned counsel appearing for the appellants. 25. Clause 7 of Section 260A of the Income Tax Act provides that the provisions relating to the Code of Civil Procedure may apply in the case of appeal filed under Section 260A of the Income Tax Act. The said provision reads as follows: &....
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....ainst was passed, or (b) the Appellate Court requires any document to be produced or any witness to be examined to enable it to pronounce judgment, or for any other substantial cause, the Appellate Court may allow such evidence or document to be produced, or witness to be examined. (2) Whereever additional evidence is allowed to be produced by an Appellate Court, the Court shall record the reason for its admission." 28. In this connection, the decision relied on by the learned counsel appearing for the appellants needs to be seen. The Supreme Court, in the case of Tek Ram (Dead) through LRs V. Commissioner of Income Tax, Faridabad in Civil Appeal No.6262 of 2013 dated 05.08.2013, held as follows: "3. This Court, while issuing notice to the respondent, by its order dated 03.02.2012, had passed the following order: "....... Issue notice as to why the matter should not be sent back to the High Court as, today, learned counsel for the petitioner has placed before us number of documents which earlier were not placed before the High Court....
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....ovember, 2010 to November, 2013. The certificate dated 16.11.2013 states that Dr.C.Mohan Reddy of Mohan Nursing Home, Chennai had given treatment to Mr.E.V.Perumalsamy Reddy between this period and therefore, it will be necessary to go into these records to find out whether there was sufficient cause in not preferring the appeals before the Tribunal in time. Therefore, in exercise of power under Clause (b) of Rule 27(1) of Order 41 of the Code of Civil Procedure, we admit the production of additional documents. Accordingly, M.P.No.1 of 2014 in T.C.(A)No.535 of 2014 seeking to produce the additional documents is allowed. 31. The next question that arises for consideration is whether the Tribunal is justified in declining to entertain the appeals on the ground that the delay has not been satisfactorily explained. 32. At the outset, we perused the medical records, which appears to be a prime reason for seeking condonation of delay. Paragraph 5 of the petition dated 27.12.2013 extracted in paragraph 3 of the order of the Tribunal (extracted supra) states that the husband of one of the appellants, viz., P.S.Rajeswari underwent bypass surgery and was under treatment for Diabetes Me....
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....f time. A few medical test reference is pointed out. It, however, does not reveal that the said Shri.E.V.Perumalsamy Reddy is seriously ill and was continuously hospitalised as pleaded. 36. Taking into consideration the submissions made by the learned counsel appearing for the appellants, we went through the additional documents filed, which contains medical reports and medical bills, running to 431 pages. From the additional documents, all that we find is that from the year 2003, after the date of surgery, till March, 2005, there was no medical record. In the year 2005, we find that there are certain routine medical tests. Thereafter in the year 2006, there is absolutely no record to show that medical treatment was taken by the said E.V.Perumalsamy Reddy. Therefore, it is clear that there was no serious ailment to complaint in the year 2006. In the month of February, 2007, series of medical tests were taken, but there is nothing on record that he was hospitalised or was under any medical management for serious problem. The series of medical tests show that they are routine check ups. Similarly in the year 2008 also, there is a brief medical admission and series of tests during ....
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....ment. If they had filed the appeal in time before the Tribunal and canvassed the issue, the Tribunal would have gone into the merits of the case including the plea of inability to make the deposit of admitted tax. Having failed to file an appeal in time, the appellants cannot now raise a plea that E.V.Perumalsamy Reddy was not well during the relevant period of time. Further more, it has to be pointed out that even in April, 2011, in a letter dated 25.4.2011 addressed to the Assistant Commissioner, Income Tax, by E.V.P.Santhosha Reddy, there was no mention about the ill health of the said E.V.Perumalsamy Reddy and at no point of time, this plea of ill health was taken except before the Tribunal. 39. Therefore, the Tribunal was justified in stating that sufficient cause has not been shown and that the plea of delay, on the ground of ill health of E.V.Perumalsamy Reddy between November, 2010 and November, 2013, is not supported by any cogent material. The findings of the Tribunal that the Nursing Home Certificate appears to be an after thought exercise, apparently, is correct. On verification of the additional documents, which contain medical records, we find that no major treatme....
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....t proof should not affect public justice and cause public mischief because the courts are required to be vigilant so that in the ultimate eventuate there is no real failure of justice. vii) The concept of liberal approach has to encapsule the conception of reasonableness and it cannot be allowed a totally unfettered free play. viii) There is a distinction between inordinate delay and a delay of short duration or few days, for to the former doctrine of prejudice is attracted whereas to the latter it may not be attracted. That apart, the first one warrants strict approach whereas the second calls for a liberal delineation. ix) The conduct, behaviour and attitude of a party relating to its inaction or negligence are relevant factors to be taken into consideration. It is so as the fundamental principle is that the courts are required to weigh the scale of balance of justice in respect of both parties and the said principle cannot be given a total go by in the name of liberal approach. x) If the explanation offered is concocted or the grounds urged in the application are fanciful, the courts should be vigilant not to expose the other side unnecessarily to face such a litigat....