2005 (7) TMI 46 - HC - Income Tax

Appeal limitation condonation - Whether the Commissioner of Income-tax (Appeals) as well as the Tribunal are justified in refusing to condone the delay and rejecting the appeal as barred by limitation. - held that expression each day s delay must be explained , does not mean that a pedantic approach should be made and it must be applied in a rational commonsense pragmatic manner - In the result, the appeal is allowed. The order of the Tribunal and the order of the Commissioner of Income-tax (Appeals) are set aside. The matter is remanded back to the Commissioner of Income-tax (Appeals) to decide the appeal on the merits after giving opportunity of hearing in accordance with the law

Summary

Issues:
Delay in filing appeal - Condonation of delay under section 5 of the Limitation Act.

Analysis:
The appeal under section 260A of the Income-tax Act, 1961 challenged the rejection of the appellant's appeal by the Tribunal for the assessment year 1997-98, as it was considered barred by limitation by the Commissioner of Income-tax (Appeals). The main issue revolved around whether the delay in filing the appeal should be condoned. The appellant received the assessment order on March 18, 2000, with a deadline for filing the appeal by April 17, 2000. However, the appeal was filed on September 29, 2000, 158 days late. The appellant sought condonation of delay under section 5 of the Limitation Act, citing the involvement of legal complexities and consultations with various legal experts, including retired judges, which led to the delay. Both the Commissioner of Income-tax (Appeals) and the Tribunal rejected the appeal as time-barred.

The High Court, after hearing arguments from both parties, emphasized the need for a liberal and pragmatic approach in matters of condonation of delay. Referring to legal precedents, the Court highlighted that the law of limitation aims to ensure justice is served without being hindered by technicalities. Citing the Supreme Court's stance in various cases, the Court stressed that the expression "sufficient cause" in the Limitation Act allows for a broad interpretation to serve the ends of justice. The Court noted that delay should not automatically lead to dismissal of a meritorious case, and every delay must be explained, but not in a pedantic manner. The judiciary's role is to remove injustice, not legalize it on technical grounds.

Drawing from legal principles established in previous judgments, the Court underscored the importance of reasonable diligence in prosecuting appeals and the need to differentiate between inordinate delays and minor delays. The Court also highlighted that unless bad faith or negligence is proven, delay should not be a reason to deny condonation. Moreover, the Court emphasized that refusal to condone delay resulting in grave miscarriage of justice warrants condonation. Ultimately, the Court allowed the appeal, setting aside the orders of the Tribunal and the Commissioner of Income-tax (Appeals), and remanded the matter back to the Commissioner of Income-tax (Appeals) for a decision on the merits after providing an opportunity for a hearing in accordance with the law.