Taxpayers must File Cross-objections within Time Limit: ITAT dismisses ICICI Bank's Cross-objection [Read Order]

The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) has dismissed a cross objection filed by ICICI Bank for being filed late and held that taxpayers must file cross-objections within the time limit prescribed by law and that any cross-objections that are filed after the time limit will be dismissed.

The assessee, Industrial Credit and Investment Corporation of India (ICICI) Bank Ltd, filed an appeal against the revenue assessment order for the fiscal year 2008-09. The revenue filed a cross objection to the assessee's appeal, questioning the validity of the assessee's deduction under section 36(1)(viii) of the Income Tax Act of 1961. The assessee also filed a cross objection to the revenue's assessment ruling, questioning the legitimacy of the assessment reopening.

The assessee contended that reopening the assessment was erroneous since all significant facts were on record at the time of the original assessment and Section 147 of the Income Tax Act does not allow the Assessing Officer to revisit the assessment based only on a change of opinion.

The assessee claimed that the delay in filing the cross objection was because it was only advised to challenge the veracity of the reopening of the assessment after discussing with its legal counsel about the approaching hearing.

The revenue argued that the reassessment was valid because the Assessing Officer had discovered new and material information and also argued that the delay in filing the cross objection was fatal to the assessee's case.

The ITAT found the assessee's explanation for the delay in filing the cross objection unsatisfactory, citing no genuine hardship or reasonable cause and not fulfilling their duty to file appeals within prescribed time limits.

The case M. Balkrishnan Vs M. Krishnamurthy, was cited by the bench to support its decision that the assessee's delay in filing the cross-objection was not justified. In this case, the Supreme Court held that a delay of 14 years in filing an appeal was un-condonable due to want of an acceptable explanation.

The Two Member Bench, consisting of Amit Shukla (Judicial Member) and Amarjit Singh (Accountant Member), upheld the CIT(A)'s decision to disallow expenses from business income. The bench affirmed this decision and rejected the revenue's appeal, stating that the reworking of deductions under section 36(1)(viii) of the Income Tax Act was not supported.

The Tribunal also agreed with the decision and dismissed the appeal of revenue, stating that interest under section 234D should be calculated up to the original assessment order date and dismissed the assessee's cross-objection as time-barred, stating that the delay of 14 years and 30 days was not condoned.

To Read the full text of the Order CLICK HERE

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