1995 (5) TMI 63 - HC - Income Tax

Summary

Issues Involved:

1. Imposition of penalties under section 271(1)(a) and section 273(1)(b).
2. Additions and disallowances made in the assessment under section 143(3).
3. Condonation of delay in filing appeals.

Issue-wise Detailed Analysis:

1. Imposition of Penalties under Section 271(1)(a) and Section 273(1)(b):
The appeals were filed by the assessee against the imposition of penalties under section 271(1)(a) and section 273(1)(b). The assessee argued that the penalties were unjustified due to various reasons including the illness of a partner and the closure of the firm's business.

2. Additions and Disallowances Made in the Assessment under Section 143(3):
The appeals also contested certain additions and disallowances made in the assessment under section 143(3). However, the primary focus of the judgment was on the procedural aspect of condoning the delay in filing these appeals.

3. Condonation of Delay in Filing Appeals:
The main contention revolved around the condonation of delay in filing the appeals. The appeals were filed late by 266 days and approximately 2 years and 8 months, respectively. The assessee provided reasons such as the illness of a partner, Mr. Kamal Narayan, who had a heart attack in 1989, and the closure of the firm's business in 1983.

Arguments by the Assessee:
- The Tribunal had granted interim stay in these cases, which implied that the delay had been condoned.
- The affidavit filed by Mr. Kamal Narayan stated that the orders remained unperused due to oversight and illness.
- The learned counsel urged the Tribunal to take a liberal view in the matter to subserve the cause of justice.
- Several case laws were cited to support the argument for condonation of delay, emphasizing that the courts should adopt a liberal approach to ensure justice.

Arguments by the Department:
- There is no deeming provision in the IT Act that once stay is granted, condonation of delay is deemed to have been made.
- The proceedings relating to the grant of stay are separate from the admissibility of the appeal.
- The assessee did not provide sufficient evidence to support the claim that the delay was due to reasons beyond their control.
- The affidavit filed by the assessee was vague and contradictory, and no affidavit was filed by the former Advocate, Shri M.L. Khanna, to support the claim.

Tribunal's Findings:
- The Tribunal agreed with the department that the question of condonation of delay cannot be decided without giving the respondent an opportunity of being heard.
- The stay proceedings are different from the proceedings for condonation of delay, and the stay order did not imply that the delay had been condoned.
- The Tribunal examined whether the assessee had sufficient cause for not presenting the appeals within the time allowed under section 253(3).
- The affidavit provided by the assessee was considered vague and contradictory, and no sufficient cause was shown for the delay.
- The Tribunal found that the delay between April 1989 and the filing of the appeals on 7th March 1990 was not properly explained, except for the period of illness from 24-8-1989 to 4-9-1989.

Conclusion:
The Tribunal concluded that the assessee had not demonstrated sufficient cause to support the condonation of delay. The appeals were dismissed as out of time due to the lack of sufficient explanation for the delay in filing. The case law relied upon by the department weighed heavily in favor of rejecting the appeals.

Result:
The appeals were dismissed as out of time.