2023 (3) TMI 1051 - HC - Income Tax

E-filling of appeal - Maintainability of appeal on failure to comply with the mandate/requirements under Rule 45 of the Income Tax Rules - writ petitioner has filed an appeal manually, despite the fact that Rule 45 of the Income Tax Rules mandates/specifically provides for electronic filing of appeal before the Commissioner of Income Tax - HELD THAT - Single Judge proceeded to hold that, inasmuch as the appeal is admittedly manually filed in the present case and that the Commissioner of Income Tax has also heard the matter on more than one occasion, was of the view that appeal being a statutory and substantive right, ought not to be denied, in view of procedural lapses in filing of appeal manually, instead of electronically as provided under Rule 45 of the Income Tax Rules. A reading of the order of the learned Single Judge would show that the learned Single Judge while granting leave to the petitioner/respondent herein to comply with Rule 45 within period of three weeks, made it clear that this case shall not be treated as a precedent with regard to the mode of filing an appeal. No reason to interfere with the impugned order passed by the learned Single Judge - this case shall not be treated as a precedent and the question as to whether Rule 45 of the Income Tax Rules must be treated as mandatory or directory, is left open.

Summary

Issues:
1. Challenge to order mandating electronic filing of appeal under Rule 45 of Income Tax Rules.
2. Compliance with procedural requirements for filing appeal.
3. Statutory right of appeal versus procedural infirmity.

Detailed Analysis:
1. The Writ Appeal challenges an order requiring electronic filing of an appeal under Rule 45 of the Income Tax Rules. The learned Single Judge found that the respondent filed a manual appeal despite the rule mandating electronic filing. The Single Judge emphasized the importance of the appeal as a statutory and substantive right, deciding not to deny it due to procedural lapses. The Rule specifies the form and manner of filing appeals to the Commissioner (Appeals), including electronic filing requirements and verification procedures.

2. The Senior Standing Counsel for the Income Tax Department argued that the manual appeal had been pending for over two years without compliance with Rule 45, potentially rendering the appeal not maintainable. The Single Judge granted the respondent three weeks to comply with the rule, clarifying that the case should not set a precedent regarding the mode of appeal filing. The order allowed the appeal to proceed for adjudication on merits without being constrained by the limitation period, given the timely filing and payment of necessary fees.

3. The judgment highlights the balance between the statutory right of appeal and procedural requirements. The Single Judge acknowledged the manual appeal was filed on time, with the Commissioner of Income Tax having already heard the matter on two occasions. Despite the procedural infirmity, the Judge upheld the substantive right of appeal, directing compliance with Rule 45 within a specified timeframe. The judgment emphasized the unique circumstances of the case and clarified that it should not be considered a precedent, leaving open the question of whether Rule 45 should be deemed mandatory or directory.

In conclusion, the Writ Appeal was disposed of without costs, affirming the Single Judge's order to allow the appeal to proceed while emphasizing the importance of complying with procedural requirements without setting a binding precedent on appeal filing modes or the mandatory nature of Rule 45 of the Income Tax Rules.