Intimation Of Dismissal Of Appeal By ITAT Not Sent To Assessee By Revenue, Assessee Bonafide Pursued Review Before Tribunal: Delhi HC Condones Delay In Filing Income Tax Appeal
The Delhi High Court has condoned the delay of 79 days in filing an Income Tax Appeal by the Assessee while noting that the Assessee was not intimated by the Revenue about the dismissal of his appeal before the ITAT and that the Assessee was bonafide pursuing a review petition against the ITAT's order without realizing that the same was not maintainable.
The High Court found that in the present case, the assessee had applied for certified copies of the impugned order of the Tribunal immediately upon coming to know about the dismissal of the appeal by the Tribunal, and also promptly filed the review application.
The High Court also noted that upon getting intimated about the dismissal of the review application also, the assessee had promptly applied for certified copies of the same and soon thereafter filed the present appeal.
The Division Bench of Justice Rajiv Shakder and Justice Girish Kathpalia observed that “the time spent by the applicant while pursuing the review proceedings deserves to be excluded even under principles analogous to Section 14 of the Limitation Act because the applicant in good faith was prosecuting the challenge to the impugned order before the Tribunal with due diligence but the Tribunal was unable to entertain the review on account of defect of jurisdiction”.
Advocate Rachna Agrawal appeared for the Appellant/ Assessee, whereas Respondent/ Revenue was represented by Advocate Aseem Chawla.
The brief facts of the case were that the appellant has sought for condonation of delay of 79 days in filing the appeal under Section 260A of the Income Tax Act.
After considering the submission, the Bench observed that in a case reflecting no gross negligence or deliberate inaction or lack of bona fides attributable to the applicant, the discretion contemplated under Section 5 Limitation Act should be exercised in favour of the applicant.
The Bench explained that it is not the number of days of delay but the reason of delay, which must be scrutinized by the court in the sense that if the applicant has successfully setup a sufficient cause, delay of even years can be condoned, otherwise, condonation of delay of even a day can be declined.
The Bench found that the applicant/assessee has explained that the delay in filing the appeal occurred because firstly, the applicant was never informed about the fate of its appeal before the Tribunal after conclusion of final arguments, till the appellant sent a written communication and secondly, the applicant/assessee under good faith initiated and continued to prosecute the review remedy but met failure.
Significantly, the Bench highlighted that the respondents/revenue did not make even a whisper in their reply or even arguments that copies of the impugned order and order of dismissal of the review application or even intimation of those dismissals were ever conveyed by their officials on their own to the applicant/assessee.
“Since after conclusion of final arguments (advanced on behalf of the applicant/assessee by one if its Directors in person) no date for pronouncement of order was fixed, it was the bounden duty of the Tribunal to serve or at least dispatch a copy of the impugned order as well as order of dismissal of review application to the applicant/assessee”, added the Bench.
The Bench clarified that there is nothing on record to even feebly suggest any lack of good faith on the part of the Directors of the applicant/assessee in their having filed review application before the Tribunal.
Therefore, pointing out that a litigant cannot be expected to be conversant with the complex technicalities of law pertaining to the exercise of review and appeal, in which many a time even the experienced lawyers fall in error, the High Court allowed the appeal and concluded that the applicant having brought a cause with sufficient explanation concerning the delay, cannot be shown the door.
Cause Title: Resorts Consortium India Pvt. Ltd v. ITAT [Neutral Citation: 2023: DHC: 8246-DB]
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