Extraordinary Delay of 2590 Days without Sufficient Cause Cannot Be Condoned: ITAT Dismisses Appeal Filed by Private Company [Read Order]

The Kolkata Bench of the Income Tax Appellate Tribunal (ITAT) dismissed the appeal for the Assessment Year (AY) 2012-13, holding that the delay of 2590 days in filing the appeal could not be condoned in the absence of sufficient cause and supporting evidence.

The assessee, Fast-N-Perfect Commercial Pvt., had filed its return of income on 31.03.2013, declaring total income of ₹94,036 which was processed under Section 143(1) of the Income Tax Act, 1961.

Subsequently, the case was selected for scrutiny, and notices under Sections 143(2) and 142(1) were issued. However, the assessee neither appeared nor filed any written submission in response.

On perusal of the records, the Assessing Officer observed that the assessee had issued 21,31,548 equity shares during the financial year 2011–12, raising ₹307.77 crore, including a share premium of ₹305.64 crore.

To verify the genuineness of these transactions and the identity and creditworthiness of the shareholders, notices under Section 131 were issued to the directors of the investing companies. However, none appeared or furnished the required details.

After issuing a Show Cause Notice (SCN) on 11.03.2015, the AO treated the entire share application money as unexplained cash credit under Section 68 and computed total income at ₹307.78 crore.

The CIT(A) partly upheld the addition, noting that the assessee had failed to substantiate its claim by producing relevant documents despite several opportunities.

and inactive, preventing timely filing.

The Tribunal Comprising Duvvuru R.L. Reddy (Vice-President) and Rajesh Kumar (Accountant Member) observed that the assessee had not produced any documentary evidence to substantiate these claims and that a mere affidavit was insufficient to justify such an extraordinary delay.

Holding that the delay was due to the assessee’s gross negligence and lack of due diligence, the Tribunal refused to condone the delay and dismissed the appeal in limine, concluding that it was not a fit case to condone the huge delay of 2590 days.

The assessee was represented by Vijay Kumar Singhal, while Raja Sengupta appeared for the Revenue.

The assessee later filed an appeal before the ITAT with a delay of 2590 days, accompanied by a condonation petition claiming that its bank account was frozen and the Directors’ DINs were disqualified

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