2020 (12) TMI 96 - AT - Income Tax

Ex parte order - Intimation u/s 143(1) - delay in filing the present appeal by 242 days - HELD THAT - In case of Collector, Land Acquisition vs MST Katiji 1987 (2) TMI 61 - SUPREME COURT , as held that the expression Sufficient Cause employed by the legislature is adequately elastic to enable the Courts to apply the law in a meaningful manner to sub-serves the ends of justice that being the life-purpose of the existence of the institution of Courts. It was further held by the Hon ble Supreme Court that such liberal approach is adopted on one of the principles that refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As against this, when delay is condoned, the highest that can happen is that a cause would be decided on merits after hearing the parties. In the instant case, applying the same principles, we find that the assessee has all along acted diligently in safeguarding its legal rights and availing the remedies available to it and has acted and taken action basis the advice and assistance sought from its Chartered Accountant. As initially advised not to file an appeal before the Tribunal as the matter relates to processing of return of income and thereafter, he was advised to file the present appeal as there is no legal bar in filing the appeal against the demand raised in terms of processing of return of income and intimation issued u/s 143(1). There is no culpable negligence or malafide on the part of the assessee in delayed filing of the present appeal and it does not stand to benefit by resorting to such delay. On merits as well where the assessee has raised the issue of chargeability of tax at the maximum marginal rate vis- -vis the slab rate of taxation as applicable in the case of beneficiary of trust, we find that the assessee deserve an opportunity to be heard once and the matter shouldn t be dismissed on mere technicality. Therefore, in the facts and circumstances of the present case, the delay in filing the present appeal is condoned and the appeal is admitted for adjudication. As pursuant to filing of return of income by the assessee on 6.2.2014 which was processed by the CPC and an intimation u/s 143(1) of the Act was issued raising a demand of ₹ 25,950/- on the assessee which has been contested in appeal before the CIT(A). The matter has been listed for hearing on couple of occasions however there has been no compliance on part of the assessee and the matter has thereafter been decided ex-parte by the ld CIT(A) - fact of the matter is that the appeal has not been decided on merits and in absence of findings of the ld CIT(A), no useful purpose would be served in adjourning the matter any further and in the interest of justice and fair play, we deem it appropriate to remand the matter to the file of the ld CIT(A) to provide one more opportunity to the assessee to put forward its contentions and submissions which shall be decided on merits after providing reasonable opportunity to the assessee. - Appeal of the assessee is allowed for statistical purposes.

Summary

Issues:
1. Delay in filing the appeal and condonation application.
2. Opportunity provided to the assessee for hearing.
3. Assessment of demand raised in the intimation under section 143(1) of the Act.
4. Decision on the appeal by the ld CIT(A).
5. Remand of the matter for providing another opportunity to the assessee.

Issue 1: Delay in filing the appeal and condonation application:
The appeal was filed by the assessee against the order of ld. CIT(A)-03, Jaipur dated 06.03.2018 for Assessment Year 2013-14. There was a delay of 242 days in filing the appeal, and the assessee filed a condonation application citing wrong advice from a Chartered Accountant as the reason for the delay. The ld DR opposed the condonation application, stating that no reasonable cause was demonstrated by the assessee for the delay. The Tribunal referred to the case law of Collector, Land Acquisition vs MST Katiji (1987) 167 ITR 471, where it was held that the expression 'Sufficient Cause' allows for a liberal approach to condone delay to ensure justice. The Tribunal found that the delay was not deliberate, and the assessee acted diligently based on advice from the Chartered Accountant. Consequently, the delay in filing the appeal was condoned, and the appeal was admitted for adjudication.

Issue 2: Opportunity provided to the assessee for hearing:
The Tribunal noted that the matter was scheduled for a hearing through video conferencing due to the Covid-19 pandemic. The assessee did not appear, but an adjournment application was received citing urgent family health issues. The ld. DR informed that the assessee had been given multiple opportunities by the ld CIT(A) and the Tribunal for hearings, but no attendance or written submissions were made. Despite adjournments sought by the authorized representative, no progress was made. The Tribunal acknowledged the provided opportunities but deemed it appropriate to grant the assessee another chance to be heard.

Issue 3: Assessment of demand raised in the intimation under section 143(1) of the Act:
Following the processing of the assessee's income tax return by the CPC, an intimation under section 143(1) of the Act was issued, raising a demand of ?25,950. The matter was contested before the ld CIT(A) but was decided ex-parte due to non-compliance by the assessee. The Tribunal decided to remand the matter back to the ld CIT(A) to allow the assessee another opportunity to present its contentions and submissions for a decision on merits after providing a reasonable opportunity.

Issue 4: Decision on the appeal by the ld CIT(A):
The ld CIT(A) had decided the appeal ex-parte due to non-compliance by the assessee. However, as the appeal was not decided on merits, the Tribunal found it necessary to remand the matter back to the ld CIT(A) to ensure justice and fair play by providing the assessee with another opportunity to present its case.

Issue 5: Remand of the matter for providing another opportunity to the assessee:
In the interest of justice and fairness, the Tribunal allowed the appeal of the assessee for statistical purposes. The decision was made to remand the matter back to the ld CIT(A) to provide the assessee with another opportunity to present its contentions, which would be decided on merits after a reasonable opportunity was given to the assessee.

In conclusion, the Tribunal addressed the delay in filing the appeal, provided insights into the opportunities given to the assessee for hearings, discussed the assessment of the demand raised in the intimation under section 143(1) of the Act, highlighted the decision-making process of the ld CIT(A), and ultimately decided to remand the matter for the benefit of the assessee's right to be heard and considered on merits.