Mere impression that Auditor will file appeal is not a Sufficient Cause: ITAT  refuses to Condone Delay [Read Order]

The Chennai bench of the Income Tax Appellate Tribunal (ITAT) has held that the mere impression that the auditor will file an appeal is not a sufficient cause and refused to condone the delay. 

Shri T. Vasudevan, Advocate appeared for the appellant and Ms T.M. Sugunthamala appeared for the respondent.

M/s. Devaraj Construction, the assessee was time-barred by 407 days in filing the appeal before the Tribunal. In support of an affidavit, the assessee has filed a petition for condonation of delay in filing the appeal, wherein, the assessee has stated as under:

The petitioner avers that the income tax matters were dealt with by Shri. S.Muthiah, F.C.A., all along. He died on 02.03.2015 as a result of which there was no proper coordination between his office and your appellant firm. There was no proper guidance available to your petitioner after his death regarding income tax matters.  Since the firm was dissolved, there was no communication among the partners. Since there was a loss, partners left the place of business. There was no working partner. 

 The petitioner submits that the firm did not have any assets and hence there was no proper understanding between the partners. The petitioner submitted that the delay is neither wilful nor wanton but due to circumstances beyond the control of the appellant petitioner.

It was viewed that when the department started pressurising for payment of demand, the managing partner consulted tax practitioners and they advised to file an appeal before the Tribunal as the reopening of assessment after a period of four years is prima facie incorrect as there was no failure to disclose the material facts fully and truly at the time of original assessment. 

 When the assessee received a show cause notice for payment of tax, the assessee firm enquired with the auditor’s office and it has to come to the knowledge of the assessee that no appeal has been filed against the assessment.

It was evident that the assessee was not serious about pursuing the appeal either before the CIT(A) or before the ITAT. A bench consisting of Shri V. Durga Rao, JM & Shri G. Manjunatha, AM observed that there is no sufficient cause to condone the delay and the petition for condonation of delay was rejected. The appeal filed by the assessee was dismissed.

To Read the full text of the Order CLICK HERE

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