TaxTMI 
TaxTMI 
2024 (6) TMI 1567
X X X X Extracts X X X X
X X X X Extracts X X X X
....gainst the different orders of NFAC dated 15.3.2024. Since the issue in all these appeals is common in nature, these are clubbed together, heard together and disposed of by this common order for the sake of convenience and brevity. 2. First, we deal with delay in filing appeals before NFAC. The assessee has raised various grounds of appeals on merit as well as non-admitting of appeals by NFAC on the reason of delay in filing these appeals before NFAC as follows: ITA No. AY Particulars Penalty / Quantum Appeal Date of passing order Appeal before CIT(A) Due date of filing appeal Date of filing appeal Delay in days 699/ Bang/ 2024 2013-14 Order u/s 147 r.w.s. 144 r.w.s. 144B Quantum 23.03.22 24.04.22 06.01.23 259 702/ Bang/ 2024 2014-15 -do- -do- 17.03.22 16.04.22 06.01.23 265 701/ Bang/ 2024 2013-14 Penalty u/s 271(1)(c) Penalty 20.09.22 20.10.22 01.10.23 346 704/ Bang/ 2024 2014-15 -do- -do- 20.09.22 20.10.22 01.10.23 346 700/ Bang/ 2024 2013-14 Penalty u/s 271(1)(b) -do- 20.09.22 20.10.22 06.10.23 351 703/ Bang/ 2024 2014-15 ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....remand report was to be obtained from the assessing officer on mutuality aspect and opportunity of hearing will be provided for penalty appeal. However, the NFAC dismissed the quantum & penalty appeal together on the same day. Thus, the assessee was prevented by reasonable cause in filing the condonation petition with regard to the penalty appeals. He submitted that the professional who filed the appeal against the quantum order was of the belief that there was no requirement to file a separate appeal against the penalty order and if the assessee succeeds on quantum appeal, the penalty would be deleted automatically. He submitted that the professional while discussing a separate matter with the present counsel was advised that appeal against penalty order was also required to be filed, though the quantum appeal was challenged, thus, there was a further delay in filing the appeal against the penalty order. 4. The ld. D.R. submitted that the assessee is not vigilant in taking the legal remedies by filing appeals before the NFAC and the assessee not properly explained the delay before NFAC. Hence, the appeals are not admitted by the NFAC. 5. We have heard the rival submissions a....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d Accountant has ascertained that the notices were served on the primary mail id and upon the appellant being informed of the outstanding demand raised by the department, the appellant thereafter approached the present counsel who sought documents and records relating to the year under consideration, the same were collated by the appellant and produced before the counsel in early January 2023. 6. The appellant was given an advice by the present counsel, that is has very good and prima facie on merits of the matter, to file an appeal against the order of the Assessing officer before the learned CIT(A) and advised the appellant to file an appeal against the order passed by the learned Commissioner. 7. The appellant submits that immediately after the advice was given by the present counsel, within a few days thereafter, all the efforts were made to files this appeal challenging the order passed by the Assessing Officer before your Honours and accordingly the appeal came to be filed before your Honours on 06.01.2023. 8. In view of the above, the Appellant could not file the Appeal before the Hon'ble CIT(A) well in time and by the time the appellant sought....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ved as follows: "I do not find any merit in the plea taken by the appellant. The grounds for condonation of delay as mentioned by the appellant, are merely a bald assertion without any basis, which is not supported by cogent and proper evidence, and the same would not, as such, constitute "sufficient cause" within the meaning of section 249(3) of the Act. In fact, the reasons put forward only show lack of due diligence on part of the appellant company in making statutory compliances viz. presenting of appeal within the prescribed period, and attending to statutory notices." ITA No.700/Bang/2024 (AY 2013-14) (Penalty appeal): 5.3 This appeal emanated from the penalty levied u/s 271(1)(b) of the Act. There was a delay of 351 days in filing the appeal before NFAC. The assessee filed a condonation petition before NFAC explaining the reasons for the inordinate delay in filing the appeal before NFAC and the NFAC has observed as follows: "5 ........... The penalty order, which is subject matter of present appeal, was passed by the AO in September, 2022; whereas the appeal against the same has been presented in October' 2023. The appellant has stated that this i....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nding to statutory notices." ITA No.703/Bang/2024 (AY 2014-15) (Penalty appeal): 5.5 This appeal emanated from the penalty levied u/s 271(1)(b) of the Act. There was a delay of 351 days in filing the appeal before NFAC. The assessee filed a condonation petition before NFAC explaining the reasons for the inordinate delay in filing the appeal before NFAC and the NFAC has observed as follows: "5. ....... The appellant has stated that this inordinate delay in presenting the appeal took place as it was not aware of the ongoing assessment/penalty proceedings, and for that reason it could not comply with the notices. The appellant has further stated that the notices were issued at the e-mail id of an employee of its Chartered Accountant, who had left the employment, without intimating the appellant about the emails." 5.5.1 The NFAC further observed as follows: "I do not find any merit in the plea taken by the appellant. The grounds for condonation of delay as mentioned by the appellant, are merely a bald assertion without any basis, which is not supported by cogent and proper evidence, and the same would not, as such, constitute "sufficient cause "' within t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....#39;s Chartered Accountant has left the job after receipt of first set of orders on 6.1.2023 i.e. after lapse of 259 days is not in a position to receive other set of orders i.e. on 1.10.2023 and 6.10.2023. Being so, the explanation given by assessee is not bonafide. 6.1 The assessee herein has not made any affidavit on oath neither before us nor before NFAC to give any details. The notice of hearing has been sent by NFAC to the e-mail address of the employee of assessee's Chartered Accountant who had left the employment, instead the assessee made averments in a general way that the notice of hearing by NFAC has been sent to e-mail of an employee of assessee's Chartered Accountant. This is only hearsay statement and no facts were verified whether true or not. It is to be noted that provisions of Limitation Act must not be considered so liberally that it would have an effect of taking away the benefit accruing to the other party in the mechanical manner, where the legislature spells out a period of limitation and provides for power to condone the reasons supported by the cogent and proper evidence. It is settled principle of law that the provisions relating to specific pe....
X X X X Extracts X X X X
X X X X Extracts X X X X
....o a question of law for determination. It is clear from the impugned order that the authorities concerned have given three reasons for not condoning the delay. a) Affidavit of person who was dealing with the file, was not filed. b) The relevant records were not produced before the authorities concerned. c) Affidavit filed on behalf of the applicant was based on hearsay and no facts were true to the knowledge of the persons who filed the affidavit in support of the application for condonation of delay. It will be appropriate to refer to the findings recorded by the Ld. Tribunal in the impugned order, which reads as under: "It is quite clear that the Ld. Departmental Representative himself asked time to produce the relevant affidavit of the relevant person, i.e., 'receipt clerk'. Even at the time of reference application no such 'affidavit' is available. The Income-tax Appellate Tribunal has given finding of fact and as such no question of law arises out of the finding of the Income- tax Appellate Tribunal. The reference application filed by the Revenue is accordingly dismissed." The Supreme Court of India....
X X X X Extracts X X X X
X X X X Extracts X X X X
....see for the above inordinate delay. It was the utmost duty of the assessee to keep track of this matter of filing appeal before NFAC and this gross negligence on the part of assessee to keep track of this important matter cannot constitute "sufficient cause" for inordinate delay within the meaning of section 253(5) of the Act. In other words, the assessee acted in a non-challant way with lackadaisical propensity for delay and the grounds on which condonation of delay has been sought, not only lack bonafides completely, but also, are not only fanciful and seems to be fully concocted on over all consideration of the facts and circumstances of this case. This gross negligence is absent from sufficient cause. The assessee seeking an unfettered free play in filing the appeal at whatever time it pleases even after substantial delay without sufficient cause. The assessee sought the condonation of delay on fanciful and without any reasonable grounds. We do not wish to promote the notion that this Tribunal is required to condone the delay in filing the appeal even when there is complete absence of "sufficient cause" for the delay. We wish to discourage the tendency of perceive delay as a no....
X X X X Extracts X X X X
X X X X Extracts X X X X
....an Singh AIR 1960 Purj 512 and Pandit Krisha Rao vs. Trimbak AIR 1938 Nag 156. It is also settled that a mistaken advice given by a lawyer negligently and without due care is not a sufficient cause; as held in Rejputana Trading Co. Ltd. vs. Malaya Trading Agency AIR 1971 Cal 313; Constancie vs. Casteano AIR 1971 Goa 38; Badrinath vs. Hari Bhagat AIR 1971 J&K 41 (FB); Chunilal vs. State of MP AIR 1967 MP 127, Municipal Board, Lucknow vs. Kali Krishna Narain AIR 1944 Oudh 135 and Sahai vs. Devi Chand AIR 1968 J&K. It is not as if mistake of a legal advisor, however, gross and inexcusable, will not entitle an assessee to condonation of delay in filing of appeal. The facts of the case are to be examined to ascertain if there had been negligence or gross want of skill, competence or knowledge on the part of the legal advisor; or whether there was only a mistake that even a skilled legal advisor, well-versed and experienced in law might make that mistake. It is only in the latter case that an assessee may justifiably seek condonation of delay. In any case, the assessee, in the case before us, has not proved that the assessee had indeed received wrong advice by Counsel or its counsel not ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... plead mistaken legal advice." The basis of mistaken legal advice should also be disclosed to enable the court to see whether the advice tendered was bona fide or reckless ...... " (emphasis added by us) 6.7 In view of the foregoing, we are of the unequivocal view, in the facts and circumstances of this case; that there was absence of "sufficient cause", within the meaning of Section 253(5) of I.T. Act, for not presenting the appeal within period referred to in Section 253(3) of I.T. Act, leading us unhesitatingly to reject assessee's request for condonation of delay in filing of this appeal within time prescribed U/s 253(3) of I.T. Act. 6.8 Further, at this stage, it is pertinent to mention the various precedents as follows: (i) Hon'ble Supreme Court in the case of Ramlal, Motilal and Chhotelal Vs. Rewa Coalfields Ltd. (1962) 2 SCR 762, observed as under: "In construing s.5 it is relevant to bear in mind two important considerations. The first consideration is that the expiration of the period of limitation prescribed for making an appeal gives rise to a right in favour of the decree-holder to treat the decree as binding between the parties. In other w....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ut at the same time laws of limitation are a means to ensure private justice suppressing fraud and perjury, quickening diligence and preventing oppression. The object for fixing time limit for litigation is based on public policy fixing a lifespan for legal remedy for the purpose of general welfare. They are meant to see that the parties do not resort to dilatory tactics but avail their legal remedies promptly. Salmond in his Jurisprudence states that the laws come to the assistance of the vigilant and not of the sleepy." (iv) Hon'ble Supreme Court in the case of Basawaraj and Anr. Vs. Special Land Acquisition Officer (2013) 14 SCC 81, held as under: "The discretion to condone the delay has to be exercised judiciously based on facts and circumstances of each case. It is further observed that the expression "sufficient cause" cannot be liberally interpreted if negligence, inaction or lack of bona fides is attributed to the party. It is further observed that even though limitation may harshly affect rights of a party but it has to be applied with all its rigour when prescribed by statute. It is further observed that in case a party has acted with negligence, lack of b....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d June 9, 2015. As regards Dr. Sudha's case is concerned, matter relates to refund of tax deducted at source. In view of these facts and circumstances and preceding analysis, the writ petition stands dismissed." (vi) Hon'ble Karnataka High Court in the case of Praxair India (P) Ltd. Vs. CIT 78 CCH 70 (Karn.), held as under: "9. If the Tribunal had exercised its discretion to appreciate the explanation offered by the petitioner-company in its appeal before the Tribunal for condoning the delay and found there was no sufficient cause made out by the petitioner and had consequently dismissed the application seeking for condonation of delay and as a sequel of the dismissal of the application and also the appeal. We do not find any illegality in the order of the Tribunal. The Tribunal is justified in observing as to in what manner the petitioner-company runs its business is its own concern and that cannot be accepted as a legitimate or bona fide reason for seeking a delay of 229 days in preferring the appeal." 10. That apart, though it is sought to be urged that the petitioner-company was genuinely ignorant of the order of the Commr. having come into existenc....
X X X X Extracts X X X X
X X X X Extracts X X X X
....es. However, at the same time, a party cannot sleep over its right ignoring the statute of limitation and without giving sufficient and reasonable explanation for the delay, except its appeal to be entertained merely because the assessee is a Bank. Appeals filed beyond a period of limitation have been entertained by us where the delay has been sufficiently explained such as in cases of bonafide mistake. Thus, the assessee should be well aware of the statutory provisions and the period of limitation and should pursue its remedies diligently. It cannot expect their appeals be entertained because they are after all the assessee, notwithstanding the fact that delay is not sufficiently explained. Hence, the delay is not condoned and the appeals are unadmitted. (Para 6)" (viii) In the case of T. Kishan Vs. ACIT (2012) 32 CCH 463, where in it was held as under: "There is no hard and fast rule which can be laid down in the matter of condonation of delay and Courts should adopt a pragmatic approach and discretion on the facts of each case keeping in mind that in considering the expression 'sufficient cause' the principles of advancing substantial justice is of prime i....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ook into the prima facie merits of an appeal. However, in this case, the Petitioners failed to make out a strong prima facie case for appeal. Furthermore, a liberal approach, may adopted when some plausible cause for delay is shown. Liberal approach does not mean that an appeal should be allowed even if the cause for delay shown is glimsy. The Court should not wave limitation for all practical purposes by condoning inordinate delay caused by a tardy lackadaisical negligent manner of functioning. 23. It is true that the High Court has rejected the appeal on the misconceived ground that delay in filing an appeal under Section 37 of the Arbitration and Conciliation Act is not condonable beyond 120 days by relying upon a two Judge Bench judgment of this Court in N.V. International v. State of Assam and Ors. [(2020) 2 SCC 109], which has since been overruled by a three Judge Bench of this Court in Government of Maharashtra (Water Resources Department) Represented by Executive Engineer v. Borse Brothers Engineers and Contractors Private Limited [(2021) 6 SCC 460] . 24. Mr. Rana Mukherjee, Senior Advocate appearing on behalf of the Petitioners strenuously argued, and rig....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... of the Tribunal on 8.8.2018 and showed the same to Mrs. Jaya Patel who was surprised to see it as she was not shown the same earlier. 9. We also notice that on 26.10.2016 when the Tribunal heard the appeal, it was the husband of the director of the company who was present before the Tribunal and who even going by the account of the deponent, was heard by the Tribunal on appeal despite his reluctance. If that is so, nothing prevented the appellant company and its officials from making inquiries with the Tribunal through their Tax Practitioner to 'find out the outcome of the appeal. 10. All in all, we do not find that the explanation rendered is either sufficient or one which would inspire confidence. Under these circumstances, Notices of Motions are dismissed." 6.8.1 Further, in the case of Majji Sannemma @ Sanyasirao Vs. Reddy Sridevi & Ors. In Civil Appeal No.7696 of 2021 dated 16.12.2021, their Lordship relied on various judgements as under: a) In the case of Ramlal, Motilal and Chhotelal Vs. Rewa Coalfields Ltd. (1962) 2 SCR 762 b) P.K. Ramachandran Vs. State of Kerala and Anr., (1997) 7 SCC 556 c) Pundlik Jalam Patil Vs. Exec....