The Chennai bench of the Income Tax Appellate Tribunal ( ITAT ) dismissed the appeal due to the non-filing of Tax Deducted at Source ( TDS ) under Section 234E of the Income Tax Act, 1961, for a period spanning eight years.
The assesse faced charges under Section 234E of the Income Tax Act, 1961, by the Tax Deducted at Source ( TDS ) Centralized Processing Center ( CPC ) for the late filing of quarterly TDS returns. The assessee contested these charges, but with a significant delay of over 3000 days in each appeal.
Consequently, the first appellate authority dismissed the appeals due to the lack of condonation of such extensive delays. The Learned Commissioner of Income Tax ( Appeals ) noted that there was no adequate justification for such prolonged delays of over 8 years, leading to the rejection of the appeals.
The counsel for the assessee Sathyanarayanan argued that the delay was neither intentional nor deliberate, but rather attributed to the time required for gathering relevant data. This delay was exacerbated by the Chartered Accountants being preoccupied with year-end book closure, return filings, and other audit commitments.
The Commissioner of Income Tax ( Appeals ) noted that the assessee failed to provide any documentary evidence supporting a sufficient cause for the delay. The only submission made was an old affidavit reiterating the same reasons, such as staff resignations. Upon examination, it was apparent that the assessee lacked any valid reason to seek condonation of the delay, and it seemed to be a conscious decision not to contest the imposition of the fees, given its mandatory nature.
The two member bench of the tribunal comprising Manomohan Das ( Judicial member ) and Manoj Kumar Agarwal ( Accountant member ) concluded that there was no sufficient cause with the assesse seeking condonation of inordinate delay of more than 8 years before first appellate authority.
The bench should consider the nature of the application and circumstances, interpreting “sufficient cause” liberally for justice. If a delay was due to negligence or inaction, courts must protect parties’ rights strictly. Neglecting to assert rights promptly can lead to courts refusing discretionary powers. The current case demonstrates the assessee’s negligence in filing appeals, resulting in their dismissal for lack of delay condonation. Moreover, there’s no valid reason for condoning an excessive 8-year delay.
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