2012 (4) TMI 453 - HC - Income Tax

Writ of certiorari - assessee contested that the AO completed the assessment ex-parte under Section 144 delay in filing the revision petition before the CIT- Held that - Assessment order dated 28.2.2003 was never served on the petitioner firm or any of its partners and that it was for the first time that the petitioner firm came to know of the passing of the assessment order when the application filed by the income tax department before the Debt Recovery Tribunal came up for hearing - there existed reasonable cause for the delay in filing the revision petition before the CIT under Section 264 - CIT is directed to take up the revision petition and decide the same on merits in accordant with law after giving due opportunity to the petitioner firm of being heard in favour of assessee.

Summary

Issues:
Delay in filing revision petition under Section 264 of the Income Tax Act and condonation of the delay.

Analysis:
The petitioner firm, engaged in the export business, filed a return declaring a loss for the assessment year 2000-01. The Assessing Officer completed the assessment ex-parte under Section 144 of the Act due to lack of cooperation from the petitioner-firm. A revision petition under Section 264 was filed after a delay, and the Commissioner refused to condone the delay, dismissing the petition without examining the merits of the assessment order.

The High Court considered the reasons for the delay in filing the revision petition. It was found that the partners of the petitioner firm were not aware of the assessment order or the filing of the petition due to various circumstances, including the involvement in litigation. The Court noted that the delay was beyond the partners' control and there was sufficient cause for the delay, as established by the sequence of events leading to the lack of awareness regarding the assessment order.

The Court also highlighted the diligent actions taken by the petitioner firm, such as intimating the change of address to the Assessing Officer and revoking the authority of the tax consultant. The involvement in family disputes and legal proceedings further contributed to the delay in responding to notices and filing the revision petition. The Court emphasized that the delay was not deliberate and should be viewed in the context of the overall circumstances faced by the petitioner firm.

Citing relevant legal precedents, including judgments by the Supreme Court, the High Court exercised its discretion to condone the delay in filing the revision petition. The Court quashed the Commissioner's order, directing a fresh consideration of the petition on merits. The Court emphasized the importance of substantial justice and public policy in condoning delays and ensuring that legal remedies are not foreclosed due to procedural lapses.

In conclusion, the High Court allowed the writ petition, setting aside the Commissioner's order and directing a reevaluation of the revision petition on its merits. The Court stressed the need for expeditious resolution of the matter concerning the assessment year 2000-01, highlighting the importance of a fair and thorough examination of the case.