2024 (6) TMI 1342 - AT - Income Tax

Condonation of delay in filing appeal before CIT(A) - delay of 335 days - HELD THAT - It appears that the plea taken by the assessee to explain for not been able to prefer the appeal before the CIT (A) in time, is sufficient enough to prove that there was no intentional latches on the part of the assessee in doing so. The documents in regard to payment of tax in Norway and other details in support of such payment was the main documents to be considered by the assessee s advisor in preferring the appeal before the FAA, fact whereof needs consideration. It naturally took time particularly considering the situation emancing from covid 19 which was still persistent during the period when the assessee was required to get the details from Norway. Thus no negligence on the part of the assessee is found in preferring the appeal before the First Appellate Authority. With our humble understanding, find that the sufficient cause pleaded by the assessee before the First Appellate Authority and before us is in affirmity, in favour of the assessee without finding any deliberate delay or gross negligence on the part of him and therefore infact relying upon the judgment and the observations made by the Hon ble Supreme Court in its proper perspective declined to accept the reason given by the First Appellate Authority in rejecting the explanation rendered by the assessee in preferring the appeal before it. In fact, the explanation was not taken into consideration by the First Appellate Authority in its proper perspective and/or judiciously. We, therefore, condoning such delay in preferring the appeal before the Ld.CIT(A), remit the issue to the file of CIT (A) to adjudicate the issue afresh upon giving an opportunity of being heard to the assessee and upon considering the relevant evidence on record or which the assessee may choose to file at the time of hearing of the matter. The Ld.CIT (A) is directed to pass order strictly in accordance with law. Appeal filed by the assessee stands allowed for statistical purposes.

Summary

Issues:
1. Delay in filing appeal before the CIT (A) due to the rejection of explanation for the delay.
2. Consideration of sufficient cause for condonation of delay in filing the appeal.
3. Applicability of legal principles and judgments in condoning the delay.

Detailed Analysis:

Issue 1: The appeal was filed by the assessee against the order of the CIT (A) dismissing the appeal due to a delay in filing. The delay was explained by the assessee as being caused by a misunderstanding regarding the intimation received and subsequent actions taken. The CIT (A) rejected the explanation, citing lack of documentary evidence and the assessee's familiarity with tax procedures. The CIT (A) concluded that there was no sufficient cause for the delay, leading to the dismissal of the appeal without considering the merits of the case.

Issue 2: The ITAT considered the reasons for the delay provided by the assessee and found that there was no intentional negligence on the part of the assessee. The ITAT noted that gathering necessary details for the appeal, especially during the COVID-19 pandemic, required time and did not indicate deliberate delay. The ITAT held that the assessee had shown sufficient cause for the delay, emphasizing the elastic nature of the term "sufficient cause" and the absence of gross negligence on the part of the assessee.

Issue 3: The ITAT referenced legal principles and judgments, including the Supreme Court's stance on condoning delay based on facts and circumstances of each case. The ITAT highlighted the need for judicious exercise of discretion in condoning delay and the importance of considering sufficient cause without negligence or lack of bona fides. The ITAT differentiated the present case from prior judgments by finding no deliberate delay or gross negligence by the assessee, ultimately allowing the appeal for statistical purposes and remitting the issue back to the CIT (A) for fresh adjudication.

In conclusion, the ITAT's decision focused on the assessee's explanation for the delay, the absence of intentional negligence, and the proper application of legal principles in condoning the delay. The ITAT's ruling emphasized the need to consider the facts of each case and the elastic nature of "sufficient cause" while ensuring that statutory principles are upheld.