2019 (6) TMI 232 - AT - Income Tax

Condonation of delay - against two order for penalty U/s. 271AAA and u/s 271(l)(c) joint one appeal was filed - subsequently after decision of CIT(A) separate appeal was filed with delay - bonafide mistake in giving the wrong advice - HELD THAT - We find that the occasion for the ld. Commissioner to dismiss the appeal holding that ignorance of law cannot be a justifiable reason the order cannot be upheld. We find ourselves unable to concur with the conclusion drawn. In the facts of the present case Shri Dinesh Kumar Sood, C.A. as per the copy of his affidavit filed on record has pleaded a bonafide mistake in giving the wrong advice. In the circumstances, we are, even otherwise unable to hold how the assessee can be penalized for no fault of its own. The assessee having engaged a counsel admittedly has acted duly, diligently and responsibly. In the facts of the present case, we have seen that no undue advantage has been derived by the assessee by filing the appeal late and no vested right of the Revenue can be said to have been disturbed in case the delay is condoned. Accordingly, with the aforesaid observations and directions in terms of the pronouncement made in the Open Court, we set aside the impugned order back to the file of the CIT(A) to verify the facts whether the assessee in the year under consideration had challenged the penalty imposed u/s 271(1)(c) and 271AAA by filing a single appeal. In case, on facts the pleadings of the assessee are found to be correct, the mistake at best, we hold, can be said to be a technical mistake which stands corrected. The ld. CIT(A) in the circumstances subject to verification is directed to condone the delay and proceed to pass the order on merits in accordance with law. - Appeal of the assessee is allowed for statistical purposes.

Summary

Issues:
1. Correctness of penalty imposed under section 271 AAA.
2. Delay in filing the appeal against penalty orders.
3. Upholding penalty despite deletion of quantum additions.

Analysis:
1. The appeal challenged the correctness of the penalty imposed under section 271 AAA. The assessee contended that the penalty was unjustified, and the CIT(A) erred in upholding it. The AR argued that the delay in filing the appeal was due to mistaken advice, and since the claim was allowable on merits, the penalty should not be upheld.

2. The issue of delay in filing the appeal was extensively discussed. The AR submitted that a single appeal was filed against two penalty orders, but a separate appeal was required for penalty under section 271 AAA. The AR emphasized that the delay was unintentional and requested condonation. The Tribunal acknowledged the mistake and directed the CIT(A) to verify whether the delay was due to a technical error. The Tribunal emphasized the need for a liberal approach in condoning delays to ensure justice is not denied on technical grounds.

3. Despite the deletion of quantum additions in appeal before the ITAT, the penalty was upheld by the CIT(A). The Tribunal found that the delay in filing the appeal was a technical mistake and not deliberate. Citing the principle of substantial justice, the Tribunal directed the CIT(A) to condone the delay and proceed to decide on the merits of the case. The assessee was granted a reasonable opportunity to present their case before the CIT(A).

In conclusion, the Tribunal allowed the appeal for statistical purposes, emphasizing the importance of ensuring justice is served by correcting technical errors in legal procedures.