2014 (9) TMI 760 - HC - Income Tax

Appeal before CIT(A) - Non-compliance of Section 249(4)(a) or not - The pre-condition for filing the appeals is requirement of deposit of admitted tax due, which apparently the assessee had deposited with a delay of 534 days. - Levy of penalty u/s 271(1)(c) Held that - Taking note of the nature of business of the assessee and the financial hardship expressed by the assessee, tribunal allowed the assessee to pay the tax due on account of which delay occasioned later on - Revenue contended that the delay has not been properly explained and only on that reason the CIT(A) had dismissed the appeals of the assessee - there appears to be some explanation shown by the assessee showing sufficient cause for the delay in filing the appeals relying upon RAM NATH SAO @ RAM NATH SAHU AND OTHERS Versus GOBARDHAN SAO AND OTHERS 2002 (2) TMI 1280 - SUPREME COURT - there is no reason warranting interference with the order passed by the Tribunal Decided against revenue.

Summary

Issues:
- Delay in filing appeals before the Commissioner of Income Tax (Appeals)
- Dismissal of appeals by the Commissioner of Income Tax (Appeals) for non-compliance with Section 249 (4) (a) of the Income Tax Act
- Tribunal's decision to allow appeals of the assessee for delay of 534 days
- Applicability of Supreme Court judgment in condonation of delay cases
- Assessment of sufficient cause for delay in filing appeals

Analysis:

1. The appeals were filed by the Revenue against the Tribunal's order allowing a delay of 534 days in filing appeals before the Commissioner of Income Tax (Appeals). The assessee initially filed appeals with a delay of 97 days without paying the admitted tax due, leading to dismissal by the Commissioner of Income Tax (Appeals). Subsequently, the assessee paid the tax due and filed six more appeals with a delay of 534 days. The Tribunal, considering the financial hardship expressed by the assessee and relying on the Supreme Court's decision in a similar case, allowed the appeals and remitted the matter back to the Commissioner of Income Tax (Appeals) for a decision on merits.

2. The Tribunal's decision was based on the assessee's explanation for the delay, which included dire financial difficulty in paying the tax initially and subsequent payment after making arrangements for funds. The Tribunal emphasized that the length of delay is not decisive, but the acceptability of the explanation is crucial. The Supreme Court's judgment highlighted that the acceptance of the explanation should be the norm, especially when no negligence or lack of bona fide is evident. In this case, the Tribunal found the assessee's explanation satisfactory and allowed the appeals.

3. The Revenue contended that the delay was not adequately explained, leading to the dismissal of the appeals by the Commissioner of Income Tax (Appeals). However, the Court, after reviewing the Tribunal's order, found that the assessee had shown sufficient cause for the delay. The Court agreed with the Tribunal's interpretation of the Supreme Court's judgment and concluded that there was no justification for interfering with the Tribunal's decision.

4. Consequently, all appeals filed by the Revenue were dismissed, and the Commissioner of Income Tax (Appeals) was directed to dispose of the appeals on merits and in accordance with the law. The Court upheld the Tribunal's decision to allow the appeals based on the assessee's explanation for the delay and the financial hardship faced, emphasizing the importance of balancing the interests of all parties involved.