2017 (10) TMI 1543 - AT - Income Tax

Maintainability of appeal after withdrawal of application filed u/s. 264 - whether assessee has opted to select the route of filing petition before the CIT u/s 264, the assessee has waived its right to file the appeal and the same cannot come back and on this basis? - HELD THAT - In view of the judgment of of M. Jayabalan Vs. CIT 2012 (12) TMI 697 - MADRAS HIGH COURT wherein it is held that the appeal filed by the assessee before CIT (A) after withdrawal of the revision petition u/s. 264 is maintainable and it cannot be said that after filing the revision petition u/s. 264, the assessee cannot file the appeal before the CIT (A) even after withdrawal of the said revision petition. On this aspect, we decide the issue in favour of the assessee. Condonation of delay of 331 days in filing appeal before the CIT (A) - HELD THAT - Assessee was pursuing an alternative remedy available under the law and the delay for that reason should be condoned if it is found that such action of the assessee was bonafide. In the present case, this is not the case of the revenue that the application filed before the CIT for revision was not bonafide action of the assessee and therefore, by respectfully following this judgment of K.S.P. Shanmugavel Nadar 1984 (4) TMI 24 - MADRAS HIGH COURT we hold that the delay in filing appeal has been explained by the assessee and same has to be condoned.

Summary

Issues:
1. Maintainability of appeal before CIT (A) after withdrawal of revision petition u/s. 264
2. Condonation of delay in filing appeal before CIT (A)

Analysis:
1. Maintainability of appeal before CIT (A) after withdrawal of revision petition u/s. 264:
The assessee filed an appeal against the order of ld. CIT (A)-7, Bangalore for Assessment Year 2011-12. The contention was that since the assessee opted for a revision petition u/s. 264 of the IT Act before the CIT, the right to file an appeal was waived. However, the assessee argued that as per a judgment of the Hon'ble Madras High Court, the filing of a revision petition does not bar the filing of an appeal. The ITAT, Bangalore, decided in favor of the assessee, citing the Madras High Court judgment, allowing the appeal before the CIT (A) after withdrawal of the revision petition.

2. Condonation of delay in filing appeal before CIT (A):
The delay in filing the appeal before the CIT (A) was 331 days, which the CIT (A) considered an extraordinary delay. The assessee was required to explain the reason for the delay on a day-to-day basis. The assessee argued that the delay was due to pursuing an alternative remedy available under the law, which was considered a bonafide action. Citing the judgment of the Hon'ble Madras High Court, the ITAT held that the delay was explained by the assessee and should be condoned. The matter was restored back to the file of CIT (A) for a decision on the merit of the appeal.

In conclusion, the ITAT, Bangalore, allowed the appeal filed by the assessee for statistical purposes, based on the maintainability of the appeal before CIT (A) after withdrawal of the revision petition u/s. 264 and the condonation of delay in filing the appeal before CIT (A).