Lockdown Period should be excluded from 90 Days Period to pronounce Tribunal Order, says ITAT [Read Order]

Dealing with an issue of delay in pronouncing order by the Income Tax Appellate Tribunal (ITAT), the Kolkata bench has held that since such delay was occurred due to lockdown because of COVID-19 pandemic, this period should be excluded from the 90 days- the time limit to pronounce the order by the Tribunal.

The Assessing Officer disallowed the expenses claimed by the assessee-Company in their income tax return mainly on the ground that they failed to produce direct evidence in respect of the expenses claimed and therefore, according to the AO, genuineness of the expenses could not be verified.

The assessee argued before the appellate authorities that they have a genuine reason to not produce the documents before the AO since the assessee company’s managing director’s parents had expired during this period and due to their ailments, the said director was held up in the hospital.

After verifying the documents and arguments, the Tribunal earlier granted relief to the assessee and directed him to produce all the evidence on or before 15^th April 2020alongwith the order. However, the Tribunal could not pronounce the order due to the COVID-19 pandemic and lockdown ordered by the Govt. of India.

The Tribunal directed that “In the light of the lockdown, I direct the assessee/ld. A/R to approach the office of the Assessing Officer after the lockdown [as per the instructions of the Union Government] and thereafter the AO to give dates of hearing and then the AO shall decide the issue of expenses incurred by the assessee afresh in accordance to the law.”

“Before parting, it is noted that the order is being pronounced after ninety (90) days of the hearing. However, taking note of the extraordinary situation in the light of the COVID-19 pandemic and lockdown, the period of lockdown days need to be excluded. For coming to such a conclusion, I rely upon the decision of the Co-ordinate Bench of the Mumbai Tribunal in the case of DCIT vs. JSW Limited in ITA No. 6264/Mum/2018 & 6103/Mum/2018, Assessment Year 2013-14, order dt. 14th May 2020. In light of the above discussion, the appeal of the assessee is allowed for statistical purposes,” the Tribunal added.