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TMI Blog2019 (1) TMI 746X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the assessee in the succeeding year relate to recording of income as well as expenses. The action of authorities below by taking only the income aspect in earlier year and not allowing corresponding expenses in the same year is not justified. The addition, if sustained, will result into double addition as the assessee himself during succeeding year has credited the same amount in the books of account and therefore, the action of authorities below in making and sustaining the addition in the year under consideration is not justified. - Decided in favour of assessee. - I.T.A. No.202 & 203/Lkw/2017 - - - Dated:- 11-1-2019 - Shri T. S. Kapoor, Accountant Member For the Appellant : Shri K. R. Rastogi, C. A. For the Respondent : Shri C. K. Singh, D.R. ORDER These two appeals have been filed by the assessee against the separate orders of learned CIT(A)-I, Lucknow dated 25/08/2014 and 11/06/2012 respectively pertaining to assessment year 2007-2008 and 2008-09. 2. At the outset, Learned A. R. invited our attention to petition for condonation of delay and submitted that there is delay in filing the appeal of 872 days in I.T.A. No.202 and 1662 days in I.T.A. No. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t. It was submitted that similarly in the succeeding year i.e. assessment year 2008-09 the income 3 was credited in the similar account and our attention was invited to page 10 of the paper book. Learned A. R. submitted that the only reason for making addition in these years is that the assessee had not declared the same in its profit loss account in the respective year whereas in Form-26 AS these were reflected as receipts of the assessee. Learned A. R. submitted that in subsequent year the assessee had duly disclosed the incomes and therefore, there is no loss to the Revenue. It was submitted that though the assessee was following mercantile system of accounting but these incomes had always been declared in the succeeding years. Learned A. R. relied on the order of Hon'ble Supreme Court in the case of Sutlej Cotton Mills Limited vs. CIT 116 ITR 1 (SC) for the proposition that where the entries are made by the assessee in its books of account which are not in conformity with the principles of accountancy, that does not mean that he has concealed profit. Learned A. R. further relied on a judgment of Hon'ble Allahabad High Court in the case of CIT vs. U.P. Electronics C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enivas Charitable Trust v. Dy. CIT (280 ITR 357) and held that mixing up of papers with other papers are sufficient cause for not filing the appeal in time. The Madras High Court further observed that the expression sufficient cause should be interpreted to advance substantial justice. Therefore, advancement of substantial justice is the prime factor while considering the reasons for condoning the delay. 6.1 On merit the issue is in favour of the assessee. But there is a technical defect in the appeal since the appeal was not filed within the period of limitation. The assessee filed an affidavit saying that the appeal was not filed because of the Counsel s inability to file the appeal. The Revenue has not filed any counter affidavit to deny the allegation made by the assessee. While considering a similar issue the Apex Court in the case of 5 Collector, Land Acquisition v. Mst. Katiji and I.T.A. No.288/C/2017 9 Ors. (167 ITR 471) laid down six principles. For the purpose of convenience, the principles laid down by the Apex Court are reproduced hereunder: (1) Ordinarily, a litigant does not stand to benefit by lodging an appeal late. (2) Refusing to condone ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the State by retaining the tax relatable thereto. Under the scheme of Constitution, the Government cannot retain even a single pie of the individual citizen as tax, when it is not authorised by an authority of law. Therefore, if we refuse to condone the delay, that would amount to legalise an illegal and unconstitutional order passed by the lower authority. Therefore, in our opinion, by preferring the substantial justice, the delay of 2819 days has to be condoned. 6.3 The next question may arise whether 2819 days was excessive or inordinate. There is no question of any excessive or inordinate when the reason stated by the assessee was a reasonable cause for not filing the appeal. We have to see the cause for the delay. When there was a reasonable cause, the period of delay may not be relevant factor. In fact, the Madras High Court in the case of CIT v. K.S.P. Shanmugavel Nadai and Ors. (153 ITR 596) considered the delay of condonation and held that there was sufficient and reasonable cause on the part of the assessee for not filing the appeal within the period of limitation. Accordingly, the Madras High Court condoned nearly 21 years of delay in filing the appeal. When ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as not filed any counter-affidavit opposing the application of the assessee, therefore, as held by the Apex Court, there is sufficient cause for condonation of delay. The Supreme Court observed that when the delay was of short duration, a liberal view should be taken. It does not mean that when the delay was for longer period, the delay should not be condoned even though there was sufficient cause. The Apex Court did not say that longer period of delay should not be condoned. Condonation of delay is the discretion of the Court/Tribunal. Therefore, it would depend upon the facts of each case. In our opinion, when there is sufficient cause for not filing the appeal within the period of limitation, the delay has to be condoned irrespective of the duration/period. In this case, the non-filing of an affidavit by the Revenue for opposing the condonation of delay itself is sufficient for condoning the delay of 2819 days. 8 6.6 In case the delay was not condoned, it would amount to legalise an illegal and unconstitutional order. The power given to the Tribunal is not to legalise an injustice on technical ground but to do substantial justice by removing the injustice. The Parli ..... X X X X Extracts X X X X X X X X Extracts X X X X
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