Order not barred by limitation when it was ready to be served upon assessee before limitation period

The issue before the High Court was as under:

Whether the Tribunal erred in law in holding that the assessment order under section 143(3) received by the assessee was barred by limitation and as such perverse?

The High Court held in favour of revenue. The aggrieved-assessee filed the SLP in Supreme Court against such order. The Apex Court dismissed the SLP.

The observations of the High Court are given hereunder:

1) A representative of the assessee, on his own volition and without intimation to the Department, visited the office and found the assessment order ready to be served upon him.

2) The probability of the order being made and ready to be collected by the representative of the assessee before the period of limitation, could not also be ruled out. Thus, assessment order was not barred by limitation. - BINANI INDUSTRIES LTD. V. CIT - [2016] 73 taxmann.com 191 (SC)

Undue delay in filing of appeal was not condonable when assessee was working with professional advice of CA

Delay in filing appeal not acceptable when it was found that assessee was acting on professional advice of Chartered Accountant.

Facts:

a)The Commissioner invoked the revsional jurisdiction directing the Assessing Officer to redo the assessment, and, accordingly, the Assessing Officer (‘AO’) passed an order under section 143(3). The assessee filed an appeal before the CIT(A), which was dismissed.

b)The assessee submitted that it was not in his knowledge that an appeal laid against the order under Section 263, and it was only when he approached an Advocate, it came to his knowledge that appeal was not filed.

c)The assessee prayed that since the delay was neither intentional nor deliberate, but was for valid reasons, it might be condoned.

The Tribunal held in favour of revenue as under:

1)The assessee had filed the appeal against the consequential order passed by the AO and a Chartered Accountant represented it.

2)It was clear that the assessee was acting on the professional advice of the Chartered Accountant. Therefore, it could not be accepted that the assessee was unaware of the legal remedy available to it.

3)However, the assessee had filed the present appeal, nearly more than a year after the filing of the original appeal. Thus, the assessee had not satisfactorily explained the delay in the filing of the appeal against the order under section 263.

4)It proved that the assessee had not been vigilant enough in pursuing its legal remedies. Therefore, the delay in the filing of the appeal could not be condoned and, consequently, the appeal was to be dismissed as time-barred. - PIONEER E BIZZ. (P.) LTD. V. DY./ACIT [2014] 46 taxmann.com 456 (Hyderabad - Trib.)

Delay in filing of appeal due to resignation of key employee dealing with case was condonable

Where assessee directed its CA to file appeal before Tribunal but its manager resigned at crucial stage and CA delayed filing of appeal, delay could not be said to be entirely on account of assessee and, hence, was to be condoned

Facts:

a)The AO made assessment on assessee under section 143(3) and made additions to its income. On appeal, the CIT(A) confirmed the additions.

b)Further, the Tribunal rejected appeal of assessee against the order of the CIT(A) on the ground that there was delay of forty five days in filing the appeal. The aggrieved-assessee filed the instant writ.

The High Court held in favour of assessee as under:

1)The assessee could not be held entirely responsible for the delay. It had engaged a firm of Chartered Accountants to represent it. It had prosecuted the appeals for the other three years duly and diligently and, in fact, successfully. 2)It instructed the CA to file the said appeal prior to the last date

for filing the same. Even if there was any delay, it was not on account and certainly not on account of the assessee. The assessee's manager had resigned at a crucial stage was another factor in its favour.

3)The assessee had been put to incur considerable expenses and effort merely to obtain a hearing on merits. The assessee could, by no stretch of imagination, be said to have waived off its rights. This was clear from the fact that the assessee had duly and diligently prosecuted the appeals in respect of the three other assessment years.

4)But for the unfortunate circumstances, this appeal would also have been heard on merits in the normal course. The assessee was not entirely at fault for the delay and negligence in prosecuting the fourth appeal. Thus, there was no justification in denying the assessee an opportunity of having its appeal considered on merits. Even assuming that there was some negligence on its part, the same had caused the revenue no prejudice whatsoever. - BAJAJ BHAVAN OWNERS PREMISES CO-OP. SOCIETY LTD. V. ITAT [2014] 45 taxmann.com 231 (Bombay)