2021 (3) TMI 271 - HC - Income Tax

Condoning the inordinate delay of '1924 days' for filing appeal before ITAT - Public sector undertaking (PSU) - Dismissal of MA for restoration of appeal since the COD clearance is no more required - reasons stated for the inordinate delay as applicant could not file said Miscellaneous Application due to bona fide reasons of transfer/retirement of concerned officers-in-charge and change in its Tax Consultants resulting in loss of track of proceedings as there were more than 50 appeals pending before this Hon'ble Tribunal - HELD THAT - On allowing the MA filed by the Revenue as per Annexure A/7 order dated 21.10.2011, the Appellant/Assessee could have filed a similar MA to get their appeal as well to be restored, which course was not pursed by them. It was after waiting for nearly 7-8 years, that they had some second thought and have come up on some revelation, that similar MA could be filed with a petition to condone the inordinate delay of '1924 days' as discernible from Annexure A/1. It is in the said circumstance that, the merit of the so-called explanation to condone the delay was considered, leading to an adverse finding. Absolutely no tenable reason or explanation has been offered by the Appellant/Assessee for condoning the inordinate delay of '1924 days'; much less any satisfactory explanation. The finding was rendered by the Tribunal that the inordinate delay cannot be condoned, led to dismissal of the MA for restoration of the appeal. It is quite relevant to note that the merit of the case was not considered by the Tribunal, as the MA for restoration of the appeal came to be dismissed for want of any satisfactory explanation of delay. The finding rendered by the Tribunal is well supported by the reasons; which is more evident from the course and conduct pursued by the Assessee by approbating and reprobating simultaneously; initially by contending before the Tribunal (when MA preferred by the Revenue was allowed years ago in 2011) that the Apex Court ruling in Electronics Corporation of India Limited 2011 (2) TMI 3 - SUPREME COURT was not applicable to their case and now seeking to place reliance on the same.

Summary

Issues Involved:
1. Condonation of delay in filing the appeal.
2. Restoration of the appeal dismissed for want of COD (Committee on Disputes) approval.
3. Substantial question of law for entertaining the appeal.

Detailed Analysis:

1. Condonation of Delay:
The appellant filed an appeal along with an IA for condonation of delay, citing the COVID-19 pandemic as the reason for the delay. The High Court noted that the Apex Court had held that the period of limitation would not apply during the lockdown, thus the appeal was filed within time, and the IA was closed.

2. Restoration of Appeal Dismissed for Want of COD Approval:
The appellant, a Public Sector Undertaking, challenged the order of the Income Tax Appellate Tribunal (ITAT) which dismissed their appeal due to a delay of 1924 days in filing the restoration application. The ITAT initially dismissed the appeal on 03.06.2010 for lack of COD approval but left the option open for revival upon obtaining clearance. The Apex Court later ruled in Electronics Corporation of India Limited that COD approval was no longer necessary. The Revenue's appeal was restored in 2011, but the appellant did not take similar steps until 2019, citing transfer/retirement of officers and change in tax consultants as reasons for the delay. The ITAT found these reasons unsatisfactory, lacking an affidavit, and dismissed the restoration application.

3. Substantial Question of Law:
The High Court examined whether the appellant's case involved any substantial question of law. The appellant argued that the ITAT should have restored their appeal in light of the Apex Court's ruling in Electronics Corporation of India Limited. The respondent countered that the appellant had ample opportunity to act but failed to do so for nearly 8 years, and the delay was not satisfactorily explained.

The High Court found no substantial question of law, noting that the ITAT's decision was based on factual findings regarding the inordinate delay. The appellant was aware of the Apex Court's ruling but did not act promptly. The reasons provided for the delay were deemed insufficient and not supported by an affidavit. The High Court upheld the ITAT's decision, emphasizing that the appellant's conduct did not warrant a liberal approach to condoning the delay.

Conclusion:
The appeal was dismissed as it did not involve any substantial question of law. The High Court supported the ITAT's decision to dismiss the restoration application due to the unexplained and inordinate delay of 1924 days.