The Income Tax Appellate Tribunal (ITAT) Jaipur Bench has recently dismissed an appeal filed against the revision order passed under Section 263 of the Income Tax Act, 1961 due to failure to prove sufficient cause to condone delay in filing appeal against revision order passed.
Assessee, Marathon India Ltd.’s return was filed through electronically. Thereafter assessee’s case was selected for scrutiny. The assessment was then completed under Section 143(3) Income Tax Act.
Further the Principle Commissioner of Income Tax (Pr.CIT) examining the assessment order observed certain contradictions in the claim of deduction under Section 80IE Income Tax Act on the part of the assessee, the same is not found verifiable/allowable and the AO has allowed the same in the assessment proceedings .Thus the Pr.CIT held that the order erroneous as well as prejudicial to the interest of the revenue.
Further, the assessment in this case was completed under Section 143(3) Income Tax Act which was revised under Section 263 Income Tax Act on 29-03-2022. Appeal against this order before the tribunal has been preferred by the assessee on 17-04-2023 with delay of 324 days.
Counsel for the assessee submitted that Appeal against the revision order was filed before the jaipur ITAT was filed on 17-04-2023. The assessee company remained under the bonafide belief that remedy would lie when the order pursuant to the direction under Section 263 of the Income Tax Act would be passed.
Hence, appeal under Section 263 could not be filed in time due to ignorance of law and bona fide belief as mentioned above.Therefore, when appeal was filed before the Tribunal, Jaipur against order under Section 263 Income Tax Act as aforesaid, delay of 324 days happened due to the above mentioned reason.
Thus delay so made of 324 days in filing the appeal is not intentional but it is because of ignorance of law and bona fide belief on the part of the assessee.
Counsel for revenue supported the order of the PCIT and objected to grant of delay of 324 days in filing the appeal by the assessee.
It was observed by the tribunal that the assessment order was passed by the AO on 29-06-2019. Subsequently, the said order was revised by the PCIT by issuing show cause notice and providing opportunity of hearing to the assessee vide order dated 29-03- 2022.
Further Sufficient cause is a condition precedent for exercise of discretion by the Court for condoning the delay. Moreover the said order was not challenged by the assessee initially rather the assessee participated in the subsequent proceedings initiated by the AO after passing of revision order dated 29-03-2022.
The tribunal found that assessee is a limited company and assisted by a number of professionals including legal experts and they had been engaged in the litigation with Revenue Deptt. at different stages before different forums and non-filing of appeal against the impugned order under Section 263 of the Income Tax Act because of ignorance of law and bona fide belief cannot be termed as ‘’sufficient cause’’ as explained under Section 5 of the Limitation Act.
After carefully analysing the material facts the two member bench of Sandeep Gosain (Judicial Member) and Rathod Kamlesh Jayantbhai (Accountant Member) dismissed the appeal and held that assessee has failed to show sufficient cause to condone the delay.
Dr. Rakesh Gupta appeared for assessee and Arvind Kumar Jain appeared for the revenue.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
