A two-judge bench of the Delhi High Court, while upholding the validity of a revision petition, held that the time spent in prosecuting a tax appeal before an authority devoid of jurisdiction shall be excluded while computing the limitation period for filing a revision petition under the Income Tax Act, 1961.
A Bench of Delhi High Court, consisting of Justices Manmohan and Navin Chawla was considering a writ petition challenging the order passed by the Commissioner of Income Tax (International Taxation) (CIT (IT)) dismissing Assessee’s Revision Petition under Section 264 of the Income Tax Act, 1961 on the ground of limitation. The Assessee also sought a direction from the court to the CIT (IT) to consider Assessee’s Revision Petition on merits after condoning the delay in filing the petition.
The counsel for the Assessee submitted that the Assessee’s Revision Petition under Section 264 of the Act was arbitrarily dismissed by the CIT (IT) on the ground of limitation. He stated that the Assessee filed an appeal under Section 248 of the Act against a March 2018 order passed under Section 195 (2) of the Act, under a bona fide mistake of law that the said order is appealable. The Assessee pursued the appeal until June, 2019 when he came to know that the said appeal is not maintainable as the Assessee had not paid the tax determined in the order. The counsel for the Assessee also submitted that, immediately thereafter, the Assessee withdrew the appeal and filed a Revision Petition under Section 264 of the Act in June, 2019. The Assessee states that the impugned order dismissing the Revision Petition of Assessee as time-barred is erroneous since there was sufficient cause for the delay. The counsel for the revenue authorities submits that the reasoning given by the Assessee for seeking condonation of delay in filing the Revision Petition is untenable in law.
The court, after analyzing the facts, held that, the Assessee was entitled to exclusion of time spent in bona fide prosecution before a court without jurisdiction, in view of Section 14 of the Limitation Act, 1963. “In the opinion of this Court, Section 14 of the Limitation Act, 1963 is attracted to the facts of the present case, and the Petitioner is entitled to exclusion of time spent in prosecuting the proceeding bona fide in a court without jurisdiction”.
The court observed that if the time spent by the Assessee in prosecuting the appeal under Section 248 of the Act is excluded, then the Revision Petition filed under Section 264 would be within the limitation period. The court, allowing the writ petition, remanded the matter to the CIT (IT) to decide the Assessee’s Revision Petition on merits in accordance with the law.
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