2020 (12) TMI 765 - AT - Income Tax

Delay in filing appeal - condonation delay filling against levying late filing fee under Section 234E demands were raised under Sections 200A and 154 - appeals have been filed belatedly before the learned CIT(A), and there is a substantial delay in filing of these appeals varying from 223 days to maximum of 927 days - HELD THAT - It is very much known in law that when substantial justice is pitted against technicalities, then substantial justice must prevail. Similarly in the case of the company, M/s. Thirumurugan Plastics P. Ltd. 2019 (12) TMI 1424 - ITAT CHENNAI in which the assessee was a Director, also there was delay in filing of these appeals on identical grounds, the Co-ordinate Bench of the Tribunal in that cases has held Revenue claimed to have served the impugned orders electronically, the assessee pleads that they were not brought to its notice and the Revenue has not sent any further communication till the date of recovery notice served on 04.03.2019, manually. Assessee was unaware of such orders. When there is a change from one system, say the manual system to the other system, say the electronic system, apart from relying the rules and regulations, the Revenue as an administrator of the Act must also guide the assessees, in enabling them to comply with the systemic changes in a reasonable manner. Atleast in those cases, like this case, where the demand made on the assessee is pending for long time and the assessee has not responded, the Revenue should also have used other mode of communication, mentioned in sub-section (1) to section 282. After condoning the delay, the issues had been restored to the file of learned CIT(A) for adjudication on merits.

Summary

Issues:
Appeals against consolidated order of CIT (Appeals) - Late filing fee under Section 234E - Demands under Sections 200A and 154 - Delay in filing appeals - Reasons for delay - Dispute between Accountant and Management - Condonation of delay - Merits of the issue - Comparison with similar case - Condonation of delay based on substantial justice - Restoration of issues for adjudication.

Analysis:
The judgment pertains to 20 appeals filed by the Assessee against the consolidated order of the Commissioner of Income Tax (Appeals)-17, Chennai, for various assessment years. The appeals were related to the levy of late filing fee under Section 234E of the Act and demands raised under Sections 200A and 154. The main contention was the substantial delay in filing these appeals, ranging from 223 days to 927 days. The reason cited for the delay was a dispute between the Accountant handling tax matters and the Management, leading to issues in receiving and responding to notices. The Assessee argued that the delay should be condoned, emphasizing the merits of the issue in their favor, citing precedents where similar delays were condoned.

The Assessee's representative highlighted that the delay was due to the Accountant not informing about notices received, causing confusion and subsequent delay in filing the appeals. The Assessee sought condonation of delay and restoration of the issues for adjudication on merits. The Revenue, represented by the Departmental Representative, opposed the condonation of delay, stating ignorance of e-filing procedures is not an acceptable reason. The Department argued that the delay was rightly considered by the CIT (Appeals) in dismissing the appeals.

The Tribunal, after considering the submissions, emphasized that substantial justice must prevail over technicalities. Referring to a similar case involving M/s. Thirumurugan Plastics P. Ltd., where delay in filing appeals was condoned, the Tribunal held that the reasons for delay in the present case were reasonable. The Tribunal, based on the principle of substantial justice, condoned the delay in filing the appeals by the Assessee and restored the issues to the file of the CIT (Appeals) for adjudication on merits. Consequently, all 20 appeals filed by the Assessee were partly allowed for statistical purposes.

In conclusion, the Tribunal's decision focused on balancing substantial justice with technicalities, leading to the condonation of the delay in filing the appeals and the restoration of issues for further adjudication on merits before the CIT (Appeals). The judgment highlighted the importance of reasonable grounds for delay and the need for fair consideration of circumstances in tax matters.