TaxTMI 
TaxTMI 
2019 (8) TMI 1407
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....s a delay of 27 months in filing the appeal before the ld.CIT(A) against penalty order dated 23.9.2015. The assessee has filed application for condonation of delay before the ld.CIT(A) in both the appeals. Such delay has not been condoned by the ld.CIT(A), and both the appeals were dismissed being time barred. Therefore, common issue involved in both the appeals is, whether the delay in filing the appeal before the ld.CIT(A) deserves to be condoned in both the appeals, and whether they are required to be remitted back for adjudication on merit. 3. The facts on all vital points are common therefore, for the facility of reference, we take up the facts from quantum appeal. 4. Brief facts of the case are that the assessee-company at the relevant time was manufacturing copper tubes. It has filed its return of income on 1.12.2007 declaring total income at Rs. 93,90,600/-. This return was processed under section 143(1) of the Act. The AO has observed that DDIT(Investigation), Unit- 2(2), Ahmedabad vide letter dated 25.3.2014 intimated that office of Director General of Central Excise Intelligence, Ahmedabad had carried out search and investigation in the case of the assessee. During t....
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....st. Year 2007-08, the appellant company is engaged in the business of manufacturing and selling of copper tubes. 5. The books of account of the appellant company are subject to audit under the provisions of Companies Act, 1956 as well as under the provisions of Sec. 44AB of the Income Tax Act, 1961 (hereinafter referred to as the Act). For the Financial Year 2006-07 relevant to Asst. Year 2007-08, Total Turnover (Sales Jobwork Charges & Job work charges) of the appellant company is of Rs. 19,32,38,280/-and Net Profit before Tax is of Rs. 90,33,664/-. 6. The return of income for Asst. Year 2007-08 was e-filed on 01/12/2007 declaring total income of Rs. 93,90,600/-. The same was processed u/s. 143(1) of the Act. (However, the copy of the Intimation u/s. 143(1) of the Act is not available with the appellant company). 7. As per the Panchnama dated 28/08/2012 in Appendix-IIIB, the Assistant Commissioner, Central Excise, Division-Ill, Ahmedabad-l attached the factory premises of the appellant company situated at Plot No. 415/2/1, GIDC, Phase-11, Vatva, Ahmedabad. (This was the registered office and factory premises of the company). Further, as per Appendix-IIIC dated 27/08/2012, ....
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....1/04/2014 at 16:55:00 at Girgaon S.O. (iv) The Dy. CIT, Circle-4(1)(1), Ahmedabad issued the Notice u/s. 179 of the Act dated 30/03/2017 addressed to Shri Chhaganlal M. Shah, director of the appellant company. However, the same was not attended/complied by him. (v) The Dy. CIT, Circle-4(1)(1), Ahmedabad issued the Letter No. DCIT/Cir- 4(1)(1)/Recovery/STPL/2017-18 dated 29/08/2017 in connection with the recovery of arrear demand for AY 2007-08 in case of the appellant company. The said letter dated 29/08/2017 was addressed to Shri Chhaganlal M. Shah, director of the appellant company. (However, the same was not attended/ complied by him). (vi) Subsequently, the Dy. CIT, Circle-4(1)(1), Ahmedabad passed the Order u/s. 179 of the Act dated 02/11/2017 in the name of the appellant company having address as 415/2/1, GIDC, Phase II, Vatva, Ahmedabad - 382440. The copy of the said order u/s. 179 of the Act dated 02/11/2017 was also sent to Shri Chhaganlal M. Shah, Director of f the appellant company at his residence address i.e. 11, Nandan Society, Naranpura, Ahmedabad - 380 013 and to Shri Mafatlal H. Shah, also director of the appellant company mentioning the address of the factor....
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....very proceedings in case of Shriram Tubes Pvt. Ltd (i.e. the appellant company), the copy of the scrutiny assessment order u/s.144 r.w.s. 147 of the Act dated 23/03/2015 for AY 2007-08 was provided to him by the DCIT, Circle-(1)(1), Ahmedabad. This is for the first time that the appellant company came to know and received the copy of the scrutiny assessment order dated 23/03/2015 for AY 2007-08. 14. The AO completed the scrutiny assessment u/s. 144 r.w.s. 147 of the Act vide Order dated 23/03/2015 determining the total income at Rs. 28,91,52,500/- as against the returned income of Rs. 93,90,600/- while making following additions/ disallowances: (i) Addition on account of alleged illicitly 15. manufacturing and clandestinely clearing the copper mother tubes (product) during period from April-2006 to 10/10/2006 Rs. 24,04,65,605/- (ii) Addition on account of Alleged non-payment of Statutory dues u/s. 43B Rs. 3,92,96,299/- Total Rs. 27,97,61,904/- However, as explained hereinabove, the impugned assessment order has not been received by the appellant company since the addressed premises was under seal and possession of the Excise Department since 28/08/2012. ....
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....epartment. 5. That in connection with the recovery of outstanding demand of the company Shriram Tubes Pvt. Ltd., I was summoned u/s. 131 of the Act dated 24/07/2018 to remain present before the CJy. Commissioner of Income Tax, Circle-4(l)(l), Ahmedabad. I attended the, of ice between 02/07/2018 to 05/07/2018 (exact date is not remembered / know due to my old age) 6. That my statement was recorded in the office of Dy. Commissioner of Income Tax, Circle-4(l)(l), Ahmedabad between these dates in relation to recovery of arrear demand of the company Shriram Tubes Pvt. Ltd. It was only during this recording of my statement, the copy of the scrutiny assessment order passed u/s. 144 r.w.s. 147 of the Act dated 23/03/2015 and the Penalty Order passed u/s. 271(l)I of the Act dated 28/09/2015 in the name of the company Shriram Tubes Pvt. Ltd. was provided by the Dy. Commissioner of Income Tax to me. This is for the first time that I came to know and received the copy of the scrutiny assessment and penalty order for the AY 2007-08 in the name of the company. Immediately, I informed this fact to another director Shri Mafatlal H. Shah. 7. That after receipt of both the orders, I being one ....
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....f Income Tax Act, which provides powers to the ld.Commissioner to condone the delay in filing the appeal before the Commissioner. Similarly, it has been used in section 5 of Indian Limitation Act, 1963. Whenever interpretation and construction of this expression has fallen for consideration before Hon'ble High Court as well as before the Hon'ble Supreme Court, then, Hon'ble Court were unanimous in their conclusion that this expression is to be used liberally. We may make reference to the following observations of the Hon'ble Supreme court from the decision in the case of Collector Land Acquisition Vs. Mst. Katiji & Others, 1987 AIR 1353: "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 approach should be made. Why not every hour's delay, every second's delay? The doctrine must be applied in a ....
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....o advance substantial justice vide Shakuntala Devi lain Vs. Kuntal Kumari [AIR 1969 SC 575] and State of West Bengal Vs. The Administrator, Howrah Municipality [AIR 1972 SC 749]. It must be remembered that in every case of delay there can be some lapse on the part of the litigant concerned. That alone is not enough to turn down his plea and to shut the door against him. If the explanation does not smack of mala fides or it is not put forth as part of a dilatory strategy the court must show utmost consideration to the suitor. But when there is reasonable ground to think that the delay was occasioned by the party deliberately to gain time then the court should lean against acceptance of the explanation. While condoning delay the Could should not forget the opposite party altogether. It must be borne in mind that he is a looser and he too would have incurred quiet a large litigation expenses. It would be a salutary guideline that when courts condone the delay due to laches on the part of the applicant the court shall compensate the opposite party for his loss." 10. We do not deem it necessary to re-cite or recapitulate the proposition laid down in other decisions. It is suffice to sa....
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.... not sealed the property. The assessee could use it; could receive notice, and therefore, it is incorrect at the end of the assessee to say that factory premises was attached by the Excise department. The ld.CIT(A) thereafter observed that the assessment proceedings was in the knowledge of the assessee, and it should have participated in the assessment proceedings. It should have ensured the collection of the assessment order from the factory premises. In other words, the ld.CIT(A) was of the opinion that there is no plausible explanation at the end of the assessee to explain huge delay of more than three years in the quantum proceedings, and two years in the penalty proceedings. 13. It is pertinent to note that the assessee has raised specific objection against the reopening of the assessment, pleading therein that notice was not served upon the assessee or even not issued by the department within six years from the end of the relevant assessment year. This aspect has been tried to be established with the help of information collected under RTI. But one thing is clear that this aspect has not been dealt by the AO even in ex parte order. Whether the AO has assumed jurisdiction val....
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.... is required to be deprecated and cannot be absolved completely. The directors, to some extent must have information about the assessment proceedings, and the demand raised against the assessee in an ex parte assessment order. Possibility of non-service of assessment order strictly in compliance with Rules cannot be ruled out. But once the assessee has been facing litigation with the Excise department and directors were aware about the notice under section 148, it should be little more vigilant in conducting the income tax proceedings. Faced with the above situation, and in the light of principle expounded in various authoritative pronouncement as observed earlier, we are of the view that though equity in taxation matters is not a sound principle for adjudicating the controversy, but it is always to be kept in mind that where it is possible to draw two inferences from facts and where there is no evidence of intentional dishonesty or improper motive on the part of the assessee, then it would be just and equitable to draw such inference in such a manner that would lead to equity and justice. Neither the AO has acted in a fair manner nor the assessee has prosecuted its income tax pro....