AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2008 (5) TMI 651
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....matter involved inasmuch as it was a simple case of disallowance of net interest paid and brokerage expenses of Rs. 2,55,682 together with some other minor disallowance and trading additions. The amount of additions confirmed and the tax thereon was also not substantial being below Rs. 1 lac. He therefore never anticipated any seriousness in the matter and moreover with a view to bring the litigation (to) an end, he advised the assessee not to file further appeal, which would have otherwise costed him substantially. However, on the other hand the AO imposed penalty under s. 271(1)(c) and the Department also launched prosecution vide order under s. 279(1) of the Act passed by the learned CIT(A), Jaipur II, Jaipur alleging that the assessee committed an offence punishable under s. 276C(1) of the Act and accordingly, the AO was authorized to file a complaint under s. 276C(1) r/w s. 277 of the Act, before the Economic Offence Court. Unfortunately however, prior thereto no opportunity of (hearing) all was given before passing the said order under s. 279. Thereafter, a summon was served on 19th March, 2007. However the assessee was never aware of this development till 26th April, 2007.....
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....ng a layman could not decide to file an appeal within limitation. 6. That these circumstances were beyond the control of the humble assessee. 7. That the assessee is an old income-tax assessee and as (and) when need arose and when advised, he immediately filed appeals within limitation. Notably in the past no appeal was filed at any stage after limitation. By not filing the present appeal or by a delayed filing thereof, the humble appellant assessee was not going to gain anything. The conduct of the assessee was not therefore contumacious/dishonest. Hence there was no deliberate intention on its part to delay the filing of the present appeal nor any of the learned counsel so intended ever. 8. Under these facts and circumstances, the present appeal was filed on 20th July, 2007. 9. That in support of the aforesaid facts, an affidavit of the assessee is being filed and enclosed along with this application. It is therefore humbly prayed that this application may kindly be allowed by condoning the delay, taking a sympathetic view, in the interest of justice." 2. The learned Departmental Representative on the other hand opposed the condonation of delay. 3. We have heard the....
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....nferred the power to condone delay by enacting s. 5 of the Limitation Act of 1963 in order to enable the Courts to do substantial justice to parties by disposing of matters on 'merits'. The expression 'sufficient cause' employed by the legislature is adequately elastic to enable the Courts to apply the law in a meaningful manner which subserves the ends of justice that being the life purpose of the existence of the institution of Courts. It is common knowledge that this Court has been making a justifiably liberal approach in matters instituted in this Court. But the message does not appear to have percolated down to all the other Courts in the hierarchy. And such a liberal approach is adopted on principle as it is realized that : 1. Ordinarily, a litigant does not stand to benefit by lodging an appeal late. 2. Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As against this, when delay is condoned, the highest that can happen is that a cause would be decided on merits after hearing the parties. 3. Every day's delay must be explained does not mean that a pedantic appro....
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....sfied that sufficient cause exists for the delay. The order of the High Court dismissing the appeal before it as time barred, is therefore, set aside. Delay is condoned. And the matter is remitted to the High Court. The High Court will now dispose of the appeal on merits after affording reasonable opportunity of hearing to both the sides. Appeal is allowed accordingly. No costs. Appeal allowed." Reliance is placed on the decision of Hon'ble Supreme Court of India in the case of N. Balakrishnan vs. M. Krishnamurthy (1998) 7 SCC 123 where it has been held by the Hon'ble Supreme Court of India as under : "The primary function of a Court is to adjudicate the dispute between the parties and to advance substantial justice. The time-limit fixed for approaching the Court in different situations is not because on the expiry of such time a bad cause would transform into a good cause. Rules of limitation are not meant to destroy the rights of parties. They are meant to see that parties do not resort to dilatory tactics, but seek their remedy promptly. The object of providing a legal remedy is to repair the damage caused by reason of legal injury. The law of limitation fixes a lif....
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....a different matter when the first Court refuses to condone the delay. In such cases, the superior Court would be free to consider the cause shown for the delay afresh and it is open to such superior Court to come to its own finding even untrammelled by the conclusion of the lower Court. (Para 9) However, while condoning the delay, the Court should not forget the opposite party altogether. It must be borne in mind that he is a loser and he too would have incurred quite large litigation expenses. It would be a salutary guideline that when Courts condone the delay due to laches on the part of the appellant, the Court shall compensate opposite party for his loss. (Para 13) In the present case the appellant's conduct does not on the whole warrant to castigate him as an irresponsible litigant. What he did in defending the suit was not very much far from what a litigant would broadly do. Of course, it may be said that he should have been more vigilant by visiting his advocate at short intervals to check up the progress of the litigation. But during these days when everybody is fully occupied with his own avocation of life an omission to adopt such extra vigilance need not be used ....
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....rd and hence the sustained addition may kindly be deleted in full. 7. Brief facts of the case are that the assessee continues to derive income from sale of milk, curd, sweets, namkeens etc. under the name and style M/s Chawala Sweets, Moti Doongri Road under the proprietorship of the assessee. The assessee had declared a turnover of Rs. 23,89,358 and a GP of Rs. 7,14,174 at GP rate of 29.88 per cent. A survey under s. 133A was carried out on 10th Jan., 2000. The assessee had not started the regular books of account till the date of survey. During the course of assessment proceedings, despite all possible posting of all the invoices in the books of account, few invoices were found unposted, the difference in stock and cash was also found for which explanation was not found satisfactory and the AO rejected the books of account by invoking the provisions of s. 145(3) of the Act and estimated the turnover of the assessee at Rs. 25 lacs and applied the GP rate of 34 per cent on the estimated turnover which resulted into trading addition of Rs. 1,35,826. The learned CIT(A) vide para 6 of his order confirmed the action of the AO. 8. We have heard the rival contentions and perused the fa....
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....ed is totally contrary to the provisions of law and facts on the record and hence the same may kindly be deleted in full. 9. Brief facts of the case are that the assessee has claimed interest of Rs. 2,55,682 as business expenditure on various loans raised. The assessee has made the investment in personal immovable properties consisting of agricultural land, residential plot, etc. The AO disallowed the said interest as the loans were (not) taken for business purposes. The learned CIT(A) confirmed the action of the AO. 10. We have heard the rival contentions and perused the facts of the case. The assessee submitted the explanation before the authorities below and the learned counsel for the assessee, Shri Mahendra Gargieya, advocate, has argued before us that the assessee had started purchasing the subjected properties since the asst. yr. 1990-91 which continued upto the asst. yr. 1998-99 which were purchased out of the interest-free funds in the shape of share capital, etc. The loans raised were for the business of M/s Chawala Sweets and very much utilized for the purpose of the business of M/s Chawala Sweets as is evident from the bank statements of the relevant years and not eve....