2020 (8) TMI 325 - AT - Income Tax

Condonation of delay - delay of 442 days - Exemption u/s 11 denied - exemption u/s 12A allowed - HELD THAT - The negligence on the part of the assessee for not taking necessary steps for filing the appeal within the limitation period provided by statute cannot be considered as a reasonable or sufficient cause. Even the assessee is very casual in explaining the reasons in the application of condonation of delay which is not supported by a affidavit. The cause explained by the assessee is much less then the sufficient cause as to why the appeal was not filed within the limitation or immediately after expiry of limitation period. In the absence of any detail as to what steps the assessee took to reach to the decision of challenging the impugned order and filing the present appeal and why the assessee has not filed the present appeal as soon as possible even after expiry of the limitation period. The explanation for delay of 442 days in our view is insufficient, unsatisfactory and unreasonable. Therefore, the vague explanation without any particulars or details cannot be accepted as a reasonable cause. Accordingly, the application for condonation of delay is dismissed and consequently the appeal of the assessee is not maintainable being barred by limitation. Since the appeal of the assessee is found to be barred by limitation, therefore, we do not propose to go to the merits of the appeal. Appeal of the assessee is dismissed.

Summary

Issues:
Delay in filing the appeal for condonation of delay in granting registration under Section 12A with retrospective effect.

Analysis:
The appeal was filed against the order of the CIT(E) granting registration under Section 12A w.e.f. 01.04.2017 instead of the retrospective effect sought by the assessee from 31.12.2005. The delay of 442 days in filing the appeal was explained by the assessee due to non-realization of the impact of the registration granted prospectively. The assessee, an educational institution, argued for condonation of delay based on bonafide reasons. However, the Department opposed the delay condonation, labeling the appeal as luxury litigation without reasonable cause.

The Tribunal considered the submissions and emphasized the importance of a bonafide explanation for delay. It noted that the assessee failed to provide a detailed cause for the delay, relying only on vague reasons. The Tribunal highlighted the need for a reasonable cause for delay, especially for an educational institution managed by educated officials with access to tax experts. It stressed that condoning delay should be based on substantial justice rather than technicalities.

The Tribunal analyzed the provisions of Section 12A/12AA of the Act, which restrict registration from the 1st day of the financial year unless specific reasons are recorded for retrospective registration. The Tribunal found the assessee's explanation insufficient and unsatisfactory, dismissing the application for condonation of delay. Consequently, the appeal was deemed not maintainable due to being time-barred. The Tribunal declined to address the merits of the appeal, ultimately dismissing the appeal of the assessee.

In conclusion, the Tribunal dismissed the appeal due to the delay being insufficiently explained and unreasonable. The decision highlighted the importance of providing a valid and detailed cause for delay in filing appeals, especially in tax-related matters.