Assessee couldn’t Realize the Effect of Assessment Order: ITAT condones Delay of 41 Months, says 'There is No Supposition That Everybody is the Custodian of Law' [Read Order]

The ITAT, Mumbai bench has condoned a delay of 41 months and held that the fact that the assessee could not realize the effect of assessment order issued by the CPC can be a valid ground for condonation of delay in filing appeal.  

Earlier, the first appellate authority held that no opportunity was being provided to assessee by CPC, Bangalore while processing return u/s. 143(1) of the Income Tax Act, 1961. About the scope of section 143(1) of the Act, need not discuss here as we are dealing with the matter of condonation of delay and merits has to be decided by the office of Ld. CIT (A).

The CIT(A), however, dismissed the appeal of the assessee, as un-admitted being not satisfied with the reasons adduced by the assessee for delay of 41 months in filing the appeal.

The assessee explained that the delay occurred since the effect of consequence of the intimation under sub-section 1 of section 143 was not realized immediately, that is to say that it was not clear to the assessee as to what was the nature of the disallowance resulting to a higher demand and the assessed income getting higher than the returned income.”

A two-member bench comprising Shri Kuldip Singh (Judicial Member) And Shri Gagan Goyal (Accountant Member) observed that “Upon hearing the parties, we find that this is a harsh decision as there is no supposition that everybody is the custodian of law, though ignorance of law is not an excuse for any wrong action. But in the instant case, according to the assessee, it could not realize the effect and consequence of the order passed under section 143(1). This, according to us, is a convincing reason.”

To Read the full text of the Order CLICK HERE

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