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TMI Blog2015 (1) TMI 1073X X X X Extracts X X X X X X X X Extracts X X X X ..... , as we are now concerned only with the plea of condonation of delay of approximately more than 1100 days in filing the appeal before the Tribunal in each one of the case. A faint plea has been made by the learned counsel appearing for the appellants that attachment orders have not been served on the appellants and therefore, there is a breach of law and the said issue has not been raised and considered by the Tribunal. The appellants can agitate this issue before an appropriate forum, if legally permissible. At present, we are only concerned with the issue of condonation of delay and this Court, after detailed consideration, finds that the appellants have not shown sufficient cause for condoning the delay. The parameters laid down by the Supreme Court in the above-said decision when not to condone delay gets attracted to the facts of the present case. Therefore, we are not inclined to interfere with the order of the Tribunal. - Decided against assessee. - Tax Case (Appeal) Nos.535 to 545 of 2014 & M.P.No.1 of 2014 - - - Dated:- 6-1-2015 - MR. R.SUDHAKAR AND MR. R.KARUPPIAH, JJ. For the Appellant : Mr. S.R. Rajagopal For the Respondent : Mr. T.R. Senthilkumar Standi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ter affording opportunity to the appellants, the Assessing Officer passed an order of assessment by making additions in respect of all the above appellants. The Assessing Officer also levied interest and penalty. 4. Aggrieved by the order of assessment, the appellants/assessees filed appeals before the Commissioner of Income Tax (Appeals), who, by order dated 27.10.2010 after following the decisions of this Court in the case of S.Alagirisamy V. Income Tax Officer reported in 296 ITR 43 and Commissioner of Income Tax V. Smt.G.A.Samanthakamani reported in 259 ITR 215, dismissed the appeals in limine, on the ground that the appellants have not paid taxes on the admitted income. According to the assessees that between January and April, 2010, they have paid certain amount towards admitted tax. 5. Aggrieved by the orders of the Commissioner of Income Tax (Appeals), the assessees pursued the matter before the Income Tax Appellate Tribunal by filing appeals along with petitions to condone the delay in filing the appeals. The details of the appeals filed by the appellants are as follows: S. No I.T.A.No. Name of the Assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... E. V. P. Santhosa Reddy is the Director of the above said companies. On 01-01-2008 the Income Tax Department conducted search u/ s.132 and subsequently served a notice uj s. 153A of the IT Act. In fact I was planning for filing the return of the income in the month of January 2008 for all the assesses. Accordingly I have filed the return of income and the same has been accepted by the authorities concerned. 3. I humbly submit that the Income Tax Department has seized all the original documents on 10-01-2008. My return of income for the assessment year 2006-2007 and 2007-2008 was duly accepted and filed within the due date as per the provisions of the Income Tax Act. Therefore penalty levied by the Assessing Officer u] s. 271 (1) (c) of the Income Tax Act 1961 is erroneous. Therefore I have filed appeal before the Commissioner of Income Tax(Appeals-I). The said appeal was dismissed in limine on 27-10-2010 on the short ground for non -payment of tax amount. 4. I submit that the entire original documents were seized. Therefore I was not in a position to mobilise the funds for the payment of the tax amount. 5. I submit that my husband underwent bypass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have filed affidavit before the Recovery Officer giving consent to adjust the compensation awarded for land acquisition lying in the Hon'ble Sub-Court, Kancheepuram against the arrears of Tax for the Appellant and other assessee viz. E.V.P. Housing Chennai Pvt. Ltd. PAN:ACQPR0638B, Mr. E.V.Perumalsamy Reddy, PAN: AGMPP5434D, Mrs. P.S.Rajeswari, PAN No.ACQPR0638B and Mr. E.V.P. Santhosa Reddy, PAN:AGYPR3116N a sum of ₹ 10,06,41,779/- Hence the Appellant is entitled to contest this appeal on merit. Now the Tax Recovery Officer conducted survey u] s.133A(3)(ia) of IT Act. Hence I am advised to file this appeal. Now there is a delay of 1127 days in filing this appeal. The delay is not wilful or wanton. It is only due to the reasons stated above. Hence this application to condone the delay of 1127 days in filing this appeal. If the said delay is condoned no prejudice would be caused to the Respondent and on the other hand if the delay is not condoned I would be put to irreparable loss and grave hardship. I have prima facie case and balance of convenience is in my favour. Under the said circumstances the delay of 1127 days in filing the above appeal against the order dated 20-1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2 seeking release of documents seized by the Income Tax Department stating that the EVP group has no regular income and therefore they wanted to sell the property to pay the tax. In that letter, he further stated that the value of the properties was worth more than ₹ 1000 crores and they were also willing for attaching the land acquisition amount awarded/deposited by the Government. Further assurance was given in the letter to pay the tax dues by way of monthly installment of ₹ 75.00 lakhs. The details of the said letter reads as follows: We request u to Release your original Documents seized by income tax Department from our office and house. we have filled our returns to department. Since we have no regular income we have to sell the property and pay the tax. Our tax due is approximately 9 crore for which we request u to have our Chembarampakkam Land and Delhi Land worth more than ₹ 1000 crores. And we also axcept to Attach our ₹ 15.4 cr. which is awarded by Govt. we also give assurence to pay Monthly installment of ₹ 75 Lakhs once our theam park is open. 9. In the meanwhile, 11 appeals have been filed along with petitions to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ne of the assessees Mrs.P.S.Rajeswari, based on medical certificate dated 16.11.2013 issued by Mohan Nursing Home, Chennai, was untenable. The Tribunal further held that the plea of illness between November, 2010 and November, 2013 and sudden regaining of health was not supported by any evidence. That Mrs.P.S.Rajeswari herself could have pursued the legal remedies during the period of treatment. Consequently, the Tribunal came to hold that the delay has not been properly explained; the assessees have failed to act with due diligence and the explanation given was not satisfactory. Accordingly, the Tribunal dismissed the appeals holding that there was no ground to condone the delay. For better clarity, the relevant portion of the order of the Tribunal, viz., the explanation given by the assessee for condonation of delay and the reasoning given by the Tribunal, is extracted hereunder: 5. We have heard both parties and gone through the case file. We find that while framing assessment in order dated 31.12.2009 in furtherance of a search conducted on 10.01.2008, the Assessing Officer had made addition of M25 lakhs as unaccounted investments. The assessee filed appea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the appellants seeking to furnish the medical records in support of the certificate dated 16.11.2013 issued by Mohan Nursing Home, Chennai. The said certificate reads as follows: This is to certify that I have examined Mr.E.V.Perumal Swami Reddy, aged about 57years, sex-Male resident of No-53, Z-block, Annanagar, Chennai-600040 is diabetic with Coronary Artery Bypass Grafting (CABG) with LV remodeling, presented with unstable angina with liable ECG changes and Gallbladder Surgery (Cholecystectomy) was under treatment for recent onset angina and long standing co-morid condition like diabetes mellitus associated with hyptertension. He was under my treatment from 02-Nov-2010 till 15-Nov-2013 with the consultation of respective specialists. In view of the above condition I have advised him to avoid physical and mental stress and complete bed rest which is absolutely necessary. Any little strain may cause anxiety to his life itself. 17. The said Miscellaneous Petition has been filed under Order 41 Rule 27 of the Code of Civil Procedure seeking to produce additional documents in support of the treatment taken, as claimed in the certificate dated 16.11.2013, whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e same was overlooked by the Commissioner of Income Tax (Appeals). He also submitted that there was payment of tax by the orders of the Sub-Court, Kancheepuram, where the amount of approximately ₹ 16.00 crores together with interest totalling to ₹ 22.00 crores was taken over by the Department and therefore, there was no tax due as on date and hence, the appeals should have been taken by the Tribunal after condoning the delay. 22. Per contra, learned Standing Counsel appearing for the Revenue submitted that the appellants are now trying to produce new documents, which are not produced before the Tribunal. He further submitted that the appellants have yet not paid the entire tax due and the amount awarded in respect of the land acquisition proceedings was adjusted towards the tax arrears of the appellants on condition that if there is any third party claim, the same should be refunded to the Court forthwith. Hence, this payment was not in terms of the provisions of the Income Tax Act and it was only a temporary arrangement to secure the tax due. He further submitted that there was no reasonable explanation offered by the assessees in not preferring the appeals in time ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tness to be examined. Clause (2) of Rule 27 provides for recording of reason for admission of such additional evidence. 27. Order 41 Rule 27 of the Code of Civil Procedure reads as follows: R.27. Production of additional evidence in Appellate Court.- (1) The parties to an appeal shall not be entitled to produce additional evidence, whether oral or documentary, in the Appellate Court. But if - (a) the Court from whose decree the appeal is preferred has refused to admit evidence which ought to have been admitted, or (aa) the party seeking to produce additional evidence, establishes that notwithstanding the exercise of due diligence, such evidence was not within his knowledge or could not, after the exercise of due diligence, be produced by him at the time when the decree appealed against was passed, or (b) the Appellate Court requires any document to be produced or any witness to be examined to enable it to pronounce judgment, or for any other substantial cause, the Appellate Court may allow such evidence or document to be produced, or witness to be examined. (2) Whereever additional evidence is allowed to be produced by an A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arise. Hence, the Miscellaneous Petition filed by the appellants cannot be countenanced. Nevertheless, taking note of the certificate dated 16.11.2013 issued by Mohan Nursing Home, Chennai (extracted supra), this Court, in exercise of power under clause (b) of Rule 27(1) of Order 41 of the Code of Civil Procedure, inclined to admit the documents now produced, so as to enable us to arrive at a decision, as we find that these documents are in relation to the treatment said to have been undergone by one of the appellants, namely, E.V.Perumalsamy Reddy for the period November, 2010 to November, 2013. The certificate dated 16.11.2013 states that Dr.C.Mohan Reddy of Mohan Nursing Home, Chennai had given treatment to Mr.E.V.Perumalsamy Reddy between this period and therefore, it will be necessary to go into these records to find out whether there was sufficient cause in not preferring the appeals before the Tribunal in time. Therefore, in exercise of power under Clause (b) of Rule 27(1) of Order 41 of the Code of Civil Procedure, we admit the production of additional documents. Accordingly, M.P.No.1 of 2014 in T.C.(A)No.535 of 2014 seeking to produce the additional documents is allowed. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0 till 15th November, 2013. Therefore, the primary document produced before the Tribunal is a certificate. There is, however, absolutely no record to show that Dr.C.Mohan Reddy had given treatment for the period November,2010 to November, 2013. Hence, the Tribunal was correct in stating that the explanation offered by the assessee is untenable and the certificate is an after thought exercise in the absence of other details. The medical reports now furnished clearly show that the said Doctor, Dr.C.Mohan Reddy never treated the patient for such an extended period of time. A few medical test reference is pointed out. It, however, does not reveal that the said Shri.E.V.Perumalsamy Reddy is seriously ill and was continuously hospitalised as pleaded. 36. Taking into consideration the submissions made by the learned counsel appearing for the appellants, we went through the additional documents filed, which contains medical reports and medical bills, running to 431 pages. From the additional documents, all that we find is that from the year 2003, after the date of surgery, till March, 2005, there was no medical record. In the year 2005, we find that there are certain routine medical tes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . On the contrary, we find that all these appellants have filed appeals before the Commissioner of Income Tax (Appeals). If in the month of October, 2010 they can prosecute the matter before the Commissioner of Income Tax (Appeals), there is no justification for not choosing to file an appeal before the Tribunal in time. It is seen that all the issues raised by the appellants are relating to payment of tax as per the requirement of the Act and the non-return of original documents as per the request made at various point of time by the appellants before the Department. If they had filed the appeal in time before the Tribunal and canvassed the issue, the Tribunal would have gone into the merits of the case including the plea of inability to make the deposit of admitted tax. Having failed to file an appeal in time, the appellants cannot now raise a plea that E.V.Perumalsamy Reddy was not well during the relevant period of time. Further more, it has to be pointed out that even in April, 2011, in a letter dated 25.4.2011 addressed to the Assistant Commissioner, Income Tax, by E.V.P.Santhosha Reddy, there was no mention about the ill health of the said E.V.Perumalsamy Reddy and at no poi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tive to the obtaining fact- situation. iii) Substantial justice being paramount and pivotal the technical considerations should not be given undue and uncalled for emphasis. iv) No presumption can be attached to deliberate causation of delay but, gross negligence on the part of the counsel or litigant is to be taken note of. v) Lack of bona fides imputable to a party seeking condonation of delay is a significant and relevant fact. vi) It is to be kept in mind that adherence to strict proof should not affect public justice and cause public mischief because the courts are required to be vigilant so that in the ultimate eventuate there is no real failure of justice. vii) The concept of liberal approach has to encapsule the conception of reasonableness and it cannot be allowed a totally unfettered free play. viii) There is a distinction between inordinate delay and a delay of short duration or few days, for to the former doctrine of prejudice is attracted whereas to the latter it may not be attracted. That apart, the first one warrants strict approach whereas the second calls for a liberal delineation. ix) The conduct, behaviour and attitude of a party relating to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isical propensity can be exhibited in a non-challant manner requires to be curbed, of course, within legal parameters. 42. In the present case, we find that the appellants have been lackadaisical in their approach and in a nonchalant manner they have tried to seek condonation of delay. The Supreme Court in the decision referred supra has deprecated such practice of showing leniency in condoning the delay. The parameters laid down by the Supreme Court when not to condone delay get squarely attracted to the facts of the present case and we find no reason to condone the delay and the Tribunal was correct in dismissing the appeal on that score. The plea of illness, payment of tax at some point of time, adjustment of payment before the Sub-Court, Kancheepuram are all matters on merit. That stage has not come. In any event, we are not inclined to go into such issue, as we are now concerned only with the plea of condonation of delay of approximately more than 1100 days in filing the appeal before the Tribunal in each one of the case. 43. A faint plea has been made by the learned counsel appearing for the appellants that attachment orders have not been served on the appellants and th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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