2019 (12) TMI 1485 - AT - Income Tax

Condonation of delay - Managing Director and Chairman of the assessee filed an affidavit for each of the appeal pleading that the impugned orders were received electronically. The accounts department did not communicated the impact of those orders for appropriate action within the prescribed limitation period which resulted in the delay in filing these appeals, he was not conversant as well as not comfortable with the e-proceedings at the said point of time - HELD THAT - As pleaded that though the impugned orders were passed from 2009 to 2019, till the recovery notice served, electronically on 25.02.2019, the Revenue had not sent any other communication in respect of any of the demand raised in the impugned orders and reason canvassed by the assessee towards the delay in filing these appeals have sufficient and reasonable cause and hence, it was prayed to condone the delay in filing each of these appeals, we find that the reason canvassed by the assessee towards the delay in filing the impugned appeals appears reasonable and sufficient and hence, we condone the delay in filing each of these appeals and remit these appeals back to the ld.CIT(A) for deciding each of them on merits after affording effective opportunity to the assessee. It is clear from the above that the CPC was processing the orders from January, 2011 onwards. However, the CBDT issued the above notification on 15.01. 2013 only which indicates that there were gaps between the manual system and the electronic system which required proper administration and hence, the CBDT addressed such problems through the impugned notification. Though, the Revenue claimed to have served the impugned orders electronically, the assessee pleads that they were not brought to its notice and the Revenue has not sent any further communication till the date of recovery notice served on 25.02.2019 electronically. Therefore, the assessee was unaware of such orders. Even, if the above notification is applied, the orders passed by the CPC, prior to this date, that is those orders passed from Jan 2011 to Dec2013 should have been served on the assessee by any of the mode mentioned in sub-section (1) to Section 282 of the Act, which, apparently, has not been done by the Revenue, as it has not placed any such material before us. Further, when there is a change from one system, say the manual system to the other system, say the electronic system , apart from relying the rules and regulations, the Revenue as an administrator of the Act must also guide the assessees, in enabling them to comply with the systemic changes in a reasonable manner. Atleast in those cases, like this case, where the demand made on the assessee is pending for long time and the assessee has not responded, the Revenue should also have used other mode of communication Thus we condone the delay in filing each of these appeals and remit these appeals back to the ld.CIT(A) for deciding each of them on merits after affording effective opportunity to the assessee.

Summary

Issues:
Delay in filing appeals against consolidated order by Commissioner of Income Tax (Appeals); Condonation of delay; Proper opportunity to assessee; Electronic service of notices; Justification for delay; Compliance with e-proceedings; Condonation of delay based on bonafide reasons; Communication of impugned orders by Revenue; Condonation of delay based on Supreme Court decision; Service of notice or communication electronically; Date of service of communication; Condonation of delay based on CBDT notification; Gap between manual and electronic system; Effective communication by Revenue; Compliance with systemic changes; Condonation of delay based on reasonable cause.

Analysis:
The Appellate Tribunal ITAT Chennai dealt with 37 appeals filed by the assessee against a consolidated order by the Commissioner of Income Tax (Appeals). The appeals were delayed by varying periods, and the assessee sought condonation of the delay due to reasons beyond their control. The assessee argued that they were unaware of the change to e-system of service for impugned orders and took immediate steps upon receiving a recovery notice electronically. The Tribunal found the reasons provided by the assessee reasonable and condoned the delay, remitting the appeals back to the CIT(A) for merit-based decisions.

The Tribunal considered the gap between the manual and electronic system of service, emphasizing the need for proper administration during such transitions. Despite the Revenue's claim of electronic service, the assessee asserted lack of notice until the recovery notice in 2019. The Tribunal noted the absence of evidence of communication by the Revenue and highlighted the importance of guiding taxpayers through systemic changes. Concluding that the assessee's reasons for delay were valid, the Tribunal allowed the appeals for statistical purposes, emphasizing the need for effective communication and compliance with evolving systems.

The Tribunal's decision focused on the reasonableness of the assessee's explanations for the delay in filing the appeals, emphasizing the importance of effective communication and guidance from the Revenue during transitions to electronic systems. By condoning the delay and remitting the appeals for merit-based decisions, the Tribunal underscored the significance of fair opportunities for taxpayers to address issues arising from systemic changes and electronic proceedings.