9911796707
TMI Blog2012 (11) TMI 1130X X X X Extracts X X X X X X X X Extracts X X X X ..... he fact that for the earlier years, th e Hon'ble Income-tax Appellate Tribunal held that the said reimbursable expenditure does not represent income of the appellant. 3. The Assessing Officer erred in taxing the assess ee in respect of the income derived from the projects sta rted before 1.4.2003 at 20% as against the rate applicab le of 15%. At the outset, we note that these appeals were file d on 12.6.2012 by the assessee with a delay of 175 days. The assessee has filed a petition seeking condonation o f delay which is also accompanied by a sworn affidavit by the aut horised person. The petition submitted by the assessee rea ds as under: "PETITION REQUESTING FOR CONDONATION OF DELAY The petitioner herein is a foreign company incorpor ated under the laws of the United States of America. It renders consultancy services in India in respect of various road projects and other public infrastructu re projects. For the assessment year under considerati on, the return of income was processed u/s 143(1) of th e IT Act on 24.3.2009. Later, the Assessing Officer issu ed a notice u/s 148 of the IT Act on 6.8.2009 on the gro und that the reimbursement of expenditure by the princ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble High Court, the department has to pass the order and in case th e Hon'ble High Court has rejected the 260A petition, it may be considered to file a Miscellaneous petition before the DRP. The Assessing Officer in the assessment or der passed u/s 143(3) r.w.s. 144C, has not made any men tion about the status of the appeal filed by the departm ent before the Hon'ble High Court. The petitioner was u nder the bona-fide impression that no appeal need be fil ed before the Hon'ble ITAT against the order u/s 143(3 ) r.w.s. 144C of the I.T. Act pending the decision of the Hon'ble High Court on the admission of the appeal f iled by the department. Further, the provisions u/s 144C before the Dispute Resolution Panel are new to the petitioner. It is only when the petitioner approached the Advocate in connection with the posting of the case by DRP for t he assessment year 2010-2011, the petitioner was infor med that an appeal lies against the assessment order pa ssed by the Assessing officer u/s 143(3) r.w.s. 144C of the I.T. Act. The petitioner immediately thereafter got the appeal prepared for the assessment year under consideration and the same is being filed before t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... manner. 4. When substantial justice and technical considerations are pitted against each other, cause of substantial justice deserves to be preferred, for the other side cannot claim to have vested right in injustice being done because of a non-deliberate delay. 5. There is no presumption that delay is occasione d deliberately, or on account of culpable negligence, or on account of mala fides. A litigant does not stand to benefit by resorting to delay. In fact he runs a serious risk. 6. It must be grasped that judiciary is respected not on account of its power to legalize injustice on technical grounds but because it is capable of removing injustice and is expected to do so." By showing the above principles, the learned ASG submitted that there is no warrant for according st ep motherly treatment when the "State" is the applican t. It is relevant to mention that in this case, the delay was only for four days. (ii) In G. Ramegowda v. Special Land Acquisition Officer (2 SCC 142) the principles enunciated in paras. 15 and 17 are heavily relied on by the learned ASG. They are: "15. In litigations to which Government is a party there is yet another aspect w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t no appeal n eed to be filed before the Hon'ble Tribunal against the order of the Assessing Officer passed u/s. 143(3) r.w.s. 144C of the Act as DRP gave direction in their order dated 16.9.2011 t hat in case the petition u/s. 260A is admitted by the Hon'ble H igh Court, the Department has to pass an order and in case the Hon'ble High Court has rejected the petition preferred u/s. 260A of the Act, it may be considered to file an MA before the DRP. The Assessing Officer has not made any mention about th e status of the appeal filed by the Department before the Hon'b le High Court in the assessment order passed u/s. 143(3) r. w.s. 144C of the Act. The assessee came to know about the need of filing appeal before the Tribunal only on the advice of ad vocate and accordingly the assessee filed the appeals before t he Tribunal on 12.6.2012 a delay of 175 days was caused. We find that the assessee would not gain anything by filing appeals belatedly. There is no mala-fide imputable to the assessee. T he delay, in our considered opinion, is a result of bona-fide be lief gathered by the assessee out of the order of the DRP. Had t he DRP not given a finding in para 3 that in case a petition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the return of income. The question arose before the Bombay High Court was whether the interest accrued in the fixed deposit w ith Chartered Bank was the income of the assessee or no t. The Bombay High Court after elaborately examining t he issue found that the moneys received by the solicit or from his clients are held by him in fiduciary capacity. Even the income received from such money must equally be he ld by the solicitor in the fiduciary capacity. What t he solicitor actually does with the income, i.e., whet her he appropriates it to himself or not is a matter of no consequence. If the solicitor appropriates the int erest accrued on such deposit to himself that would amoun t to a breach of his fiduciary relationship and whatever may be the consequences in law would follow. But his unauthorised act of converting any part of the corp us or even the income derived there from would not conver t those moneys held by him for his benefit. Accordin gly, it was held that the interest income which was neither disclosed in the return of income nor adjusted to t he clients was held to be not taxable. In the case be fore us the facts are almost similar. The assessee receive d the m ..... X X X X Extracts X X X X X X X X Extracts X X X X
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