Chief Accountant couldn’t hand over Assessment Order to Tax Consultant without Malafide: ITAT Condones Delay in filing Appeal [Read Order]

The Income Tax Appellate Tribunal (ITAT), Hyderabad has held that the delay in filing Appeal can be condoned if the Chief Accountant, without any bad intention, could not hand over the Assessment to Tax Consultant for filing the appeal.

The assessee filed the first appeal challenging the Assessment Order with a delay of 136 days. For defense, they said that the Chief Accountant and was not aware of any proceedings going on before the Income Tax Department and he forgot to give the notice to Pawan S. Jalan ( assessee ) or their Chartered Accountant. However, the same was handed over to him on 01.04.2016 when the same was found during cleaning of his cupboard.

The appeal was rejected due to delay.

Sub-section 5 of Section 253 of the Act contemplates that the Tribunal may admit an appeal or permit the filing of the memorandum of cross-objections after the expiry of the relevant period if it is satisfied that there was a sufficient cause for not presenting it within that period. This expression “sufficient cause” employed in the section has also been used identically in sub-section 3 of section 249 of Income Tax Act, which provides powers to the ld. Commissioner to condone the delay in filing the appeal before the Commissioner. Similarly, it has been used in section 5 of the Indian Limitation Act, 1963.

Allowing the plea of the assessee, the Tribunal said that “if we consider the explanation of the assessee filed before the ld.CIT(A), which has been partly reproduced in the order of the ld.CIT(A) on page no.3, then it would reveal that the chief accountant of the company was ill and failed to hand over assessment order to the tax consultant for filing the appeal. To our mind, there is no mala fide in this explanation. The delay had occurred on account of bona fide mistake at the end of the chief accountant. By making delay in filing the appeal before the ld.CIT(A) the assessee would not achieve anything. Thus, it cannot be adopted as a strategy. It could only be a result out of a bona fide mistake. We condone the delay and set aside the order of the ld.CIT(A).”