2021 (2) TMI 137 - HC - Income Tax

Non filling of appeal electronically within the period of limitation - prayer made by the assessee to reckoned the date of filing as on date on which the appeal was actually filed - Whether Tribunal was right in holding that there is no delay in filing of e-appeal since the date of filing of belated e-appeal relates back to the date of filing of manual appeal? - HELD THAT - Issue held in favour of the assessee and against the Revenue in the decision in the case of CIT Vs. A.A.Antony others 2021 (1) TMI 170 - MADRAS HIGH COURT taking into consideration the Circular issued by CBDT, which in our opinion, appears to be a one time measure, the substantive right of appeal should not be denied to the assessee on hand on a technical ground. We make it clear that this observation cannot be taken advantage by the assessee as of now, when the procedure has been in vogue ever since the year 2016 and stood the test of time and in all probabilities, as of now, all teaching problems would have been solved. Bearing in mind the fact situation in the year 2016, we are of the view that the appeals need not have been rejected by the CIT-A on the ground that they were not e-filed within the period of limitation.

Summary

Issues:
- Appeal challenging order dated 13.06.2019 made in ITA.No.533/Chny/2019 for the assessment year 2007-08.
- Substantial questions of law raised by the Revenue for consideration.
- Interpretation of delay in filing e-appeal by the assessee.
- Application of IT Rules and Circular 20/2016 in condoning the delay in filing the appeal.
- Consideration of the judgment in The Commissioner of Income Tax vs A.A.Antony.
- Discretion exercised by the Tribunal in favor of the assessee.
- Dismissal of appeals by the Revenue based on low tax effect and application of Circular No. 20/16.
- Length of delay in filing appeals by the Revenue.

Analysis:
The High Court of Madras heard an appeal filed by the Revenue challenging the order made by the Income Tax Appellate Tribunal for the assessment year 2007-08. The Revenue raised substantial questions of law regarding the delay in filing e-appeal by the assessee, questioning the Tribunal's decision to remit the case back for disposal on merits and condone the delay. The Tribunal's decision was influenced by a previous judgment in The Commissioner of Income Tax vs A.A.Antony, where it was noted that the substantive right of appeal should not be denied on technical grounds, considering the Circular issued by CBDT as a one-time measure.

The Tribunal's discretion in favor of the assessee was based on the fact that the Circular 20/2016 extended the time for filing e-appeals, preventing the rejection of appeals solely based on technical grounds. The Court acknowledged that directing the assessees to file applications for condonation of delay would lead to further litigation, which was deemed unnecessary. The Court also noted that all appeals filed by the Revenue would have been dismissed due to low tax effect if not for the application of Circular No. 20/16.

The Revenue argued that the delay in filing appeals ranged from more than 400 days to over 900 days in different cases. However, the Court, considering the prevailing circumstances and the CBDT Circular, dismissed the Revenue's appeals, following the precedent set in a specific case. The Court directed that the appeal shall be heard by the Commissioner of Income Tax (Appeals) and decided on merits, leaving the substantial questions of law open for consideration. No costs were awarded in this judgment.