Substantial Justice Over Technicalities: ITAT Condones 98 Days Delay in Filing Appeal Citing Taxpayer’s Illiteracy [Read Order]

The Rajkot Bench of the Income Tax Appellate Tribunal (ITAT) has condoned a 98-day delay in filing an appeal and remanded the matter to the Assessing Officer (AO) for fresh adjudication, emphasizing substantial justice over technical considerations.

Ramjibhai Devjibhai Mokariya (assessee) faced scrutiny for the Assessment Year (AY) 2012-13. The AO reopened the case under Section 147 of the Income Tax Act, 1961, based on cash deposits of Rs. 17,00,000, and passed an ex-parte assessment order adding the amount as unexplained income.

Aggrieved by the AO’s order, the assessee appealed to the Commissioner of Income Tax (Appeals) [CIT(A)] beyond the statutory time limit under Section 249(2)(c). The CIT(A) dismissed the appeal for non-compliance and confirmed the AO’s addition.

Also Read: Income Tax Portal Woes: Is Infosys or FinMin to Blame?

3000 Illustrations, Case Studies & Examples for Ind-AS & IFRS Click here

The CIT(A) held that there was no sufficient cause for condoning the delay. Aggrieved by the CIT(A)’s order, the assessee filed an appeal before the ITAT. The assessee’s counsel argued that the delay was unintentional due to the assessee’s illiteracy and lack of knowledge about income tax provisions.

The counsel submitted that the assessee was unaware of the CIT(A)’s order until the Department attached his bank account and issued a penalty notice under Section 271(1)(c). The assessee’s previous tax consultant failed to comply with notices or inform him of the CIT(A)’s order which contributed to the delay.

The single-member bench comprising Dr. Arjun Lal Saini (Accountant Member) observed that the assessee’s illiteracy and reliance on a negligent tax consultant constituted sufficient cause for the delay.

The tribunal relied on the judgement of the Supreme Court’s ruling in Collector, Land Acquisition vs. Mst. Katiji emphasized that substantial justice should prevail over technicalities when the delay is non-deliberate.

The tribunal condoned the 98-day delay and admitted the appeal for adjudication on merits. The tribunal set aside the CIT(A)’s order and remanded the matter to the AO for de novo adjudication.

Also Read: ITAT Orders Fresh Appeal Hearing for Assessee, Cites Denial of Proper Opportunity by CIT(A) [Read Order]

Know the complete aspects of tax implications of succession, Click here

The tribunal directed the AO to provide the assessee a fair opportunity to submit evidence and contest the addition of Rs. 17,00,000. The tribunal directed the assessee to comply with notices and avoid adjournments without valid reasons. The appeal of the assessee was allowed for statistical purposes

To Read the full text of the Order CLICK HERE

Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates