2017 (8) TMI 1358 - HC - Income Tax

Non-compliance with the procedural rules - Held that - It is unfortunate that the officials of the Revenue and in charge of filing such Appeals merely hand over the papers to their Advocates and thereafter, refuse to follow up the case. It is convenient for them to thereafter blame the Advocate and upon lapse of more than two and half years. This is what has happened in the instant case and we do not think that paragraph 6 of the affidavit-in-support, which purports to inform the Court that it is only when another Appeal for the assessment year 2005-2006 came up on board on 8th June, 2017, that the Advocate, who had filed the instant/present Appeal, informed the Revenue of the conditional order, can be termed as a sufficient cause. That cause which is bonafide, truthful and reasonable alone can be accepted. This explanation or reason fails to inspire the confidence of this Court. Revenue officials were aware that in subsequent years, the same issue was dealt with by the Tribunal and it was answered against them. The Tribunal follows it s order of prior assessment years and if the issue is identical applies to its subsequent or successive Assessment Years. When an Appeal is brought challenging the Tribunal s order for the subsequent Assessment Year, then, on the date of its presentation, the Revenue officials were aware that it had filed an Appeal for the prior Assessment Year and interest of justice demands that both are tagged and heard together. The same Advocate has been instructed to file both Appeals. Thus, the version is not reliable at all.

Summary

Issues:
Dismissal of Revenue's Appeal for noncompliance with procedural rules - Delay in moving the Notice of Motion to quash the order of rejection - Lack of sufficient cause for the delay - Blame shifting by Revenue officials to the Advocate - Negligence and lackadaisical attitude of Revenue officials - Failure to follow up on the case - Inconsistencies in the explanation provided by the Revenue - Inadequate reasons for not being aware of the conditional order - Consequences of negligence on the part of Revenue officials - Tribunal's order in subsequent assessment years - Tagging and hearing of Appeals for prior and subsequent assessment years together.

Analysis:

The High Court of Bombay dismissed the Revenue's Appeal due to noncompliance with procedural rules, specifically the Bombay High Court (Original Side) Rules. The appellant, the Revenue, was found to be negligent in attending to the matter, as highlighted by the court's observation that the Registry had duly noted the deficiencies and defects in the Appeal on 8th August, 2014. Despite being given time to rectify these issues, the Revenue failed to act promptly, leading to the dismissal of the Appeal on 11th December, 2014. The court expected the Revenue to show a sense of urgency in addressing the matter, which was not demonstrated until June 2017, when a Motion was filed to quash the order of rejection.

The court noted a significant delay of 892 days in moving the Notice of Motion, with the deponent of the affidavit-in-support failing to provide a sufficient cause for this delay. The court criticized the Revenue officials for their lack of awareness regarding the conditional order and their tendency to shift blame to the Advocate handling the case. The court emphasized the importance of a bonafide, truthful, and reasonable cause for such delays, which was lacking in the explanation provided by the Revenue.

Furthermore, the court condemned the casual and negligent attitude of the Revenue officials, highlighting their failure to follow up on the case and their attempts to cover up their negligence by blaming the Advocate. The court stressed that such behavior must have consequences as per the law. The court also pointed out inconsistencies in the Revenue's version of events, especially regarding the filing of Appeals for prior and subsequent assessment years and the need for both to be tagged and heard together for the interest of justice.

In conclusion, the court dismissed the Notice of Motion, indicating its disapproval of the Revenue's actions and emphasizing the need for accountability and diligence in legal proceedings.