Deciphering Legal Judgments: A Comprehensive Analysis of Case Law

Reported as:

2024 (4) TMI 986 - CHHATTISGARH HIGH COURT

Introduction

This article provides a detailed analysis of a recent judgment delivered by the High Court regarding the condonation of delay in filing an appeal before the Income Tax Appellate Tribunal (ITAT). The case involved a substantial delay of 166 days, and the assessee sought condonation of the delay, citing various reasons. The High Court examined the facts, arguments presented, and the decisions of the lower authorities to arrive at its conclusion.

Arguments Presented

Assessee's Arguments

The assessee's counsel, Mr. Manoj Kumar Sinha, contended that the assessment order was passed by the Assessing Officer (AO) on 16.12.2018 but was issued on 29.12.2018 without providing reasons for the delay. Additionally, the reasons recorded u/s 148(2) of the Income Tax Act were not supplied to the assessee by the AO. The assessee's appeal before the Commissioner of Income Tax (Appeals) [CIT(A)] was dismissed ex-parte on 29.03.2023.

Mr. Sinha argued that the delay in filing the appeal before the ITAT was not deliberate but rather due to the migration from the physical mode to the faceless mode of appeal proceedings. He claimed that the order of the CIT(A) was uploaded on the assessee's e-filing portal without any real-time alert, contrary to the legal provisions. He cited several cases where similar delays occurred due to the transition to the faceless mode.

Mr. Sinha relied on various judgments, including MUNJAL BCU CENTRE OF INNOVATION AND ENTREPRENEURSHIP, LUDHIANA THROUGH ITS AUTHORIZED SIGNATORY SH. BHARAT GOEL Versus COMMISSIONER OF INCOME TAX EXEMPTIONS, CHANDIGARH - 2024 (3) TMI 479 - PUNJAB & HARYANA HIGH COURT, Sakthi Steel Trading Rep. by its Proprietor M.S. Bakkir Mydeen Versus The Assistant Commissioner (ST) , Vandavasi Assessment Circle, Vandavasi. - 2024 (2) TMI 357 - MADRAS HIGH COURT, and decisions by the Supreme Court and the ITAT, to support his contentions.

Revenue's Arguments

Ms. Naushina Afrin Ali, counsel for the respondent/Revenue, submitted that the orders passed by the AO, CIT(A), and the ITAT did not suffer from any illegality, and the assessee's appeal deserved to be rejected.

Discussions and Findings of the Court

Conduct of the Assessee

The High Court observed that the assessee had failed to file his return of income and had evaded participation in the proceedings before the AO and the CIT(A). Despite being provided sufficient opportunities, the assessee did not comply with the notices issued or furnish any explanation regarding the source of the cash deposits in his bank account.

Assessment Order and Subsequent Proceedings

The AO, in the absence of any return of income or explanation from the assessee, treated the cash deposits of Rs. 34,67,700/- as unexplained money u/s 69A of the Income Tax Act and framed the best judgment assessment. The CIT(A) upheld the AO's order, noting the assessee's evasive approach and failure to participate in the proceedings or provide submissions to substantiate his claim.

Delay in Filing the Appeal

The High Court found no substance in the assessee's claim that the delay in filing the appeal was due to bona fide reasons. The court observed that the assessee's conduct before the AO and the CIT(A) smacked of a lackadaisical approach, and in the totality of the facts, the request for condonation of the substantial delay of 166 days did not merit acceptance.

Analysis and Decision by the Court

Doctrine of Sufficient Cause

The High Court relied on the Supreme Court's decision in State of West Bengal vs. Administrator, Howrah, which held that the expression "sufficient cause" should receive a liberal construction to advance substantial justice, particularly when there is no motive behind the delay. However, the action that can be condoned should fall within the realm of normal human conduct or normal conduct of a litigant.

Dismissal of the Appeal

The High Court observed that the assessee had habitually acted in defiance of the law, not only delaying the filing of the present appeal but also adopting a lackadaisical approach and not participating in the proceedings before the CIT(A). Consequently, the court found no reason to allow the application and condone the substantial delay of 166 days in preferring the appeal. Since the assessee failed to provide any good and sufficient reason to justify the delay, the High Court dismissed the appeal, upholding the reasons assigned by the ITAT.

Relied Upon or Followed Judgments

The High Court relied on the following judgments:

• STATE OF WEST BENGAL Versus ADMINISTRATOR, HOWRAH MUNICIPALITY & ORS. - 1971 (12) TMI 106 - Supreme Court

Summary of the Judgment

The High Court dismissed the assessee's appeal, upholding the ITAT's decision not to condone the substantial delay of 166 days in filing the appeal. The court found that the assessee had failed to provide any plausible explanation for the delay and had adopted a lackadaisical approach throughout the proceedings before the AO and the CIT(A). The court held that the assessee's conduct did not warrant condonation of the delay, as it did not fall within the realm of normal human conduct or normal conduct of a litigant.

Full Text:

2024 (4) TMI 986 - CHHATTISGARH HIGH COURT