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M/s. Sreenivas Charitable Trust v. The Deputy Commissioner of - T.C.No.1059 of 2005  RD-TN 758 (27 October 2005)
IN THE HIGH COURT OF JUDICATURE AT MADRAS
THE HON'BLE MR.JUSTICE P.D.DINAKARAN
THE HON'BLE MR.JUSTICE N.KANNADASAN
T.C.No.1059 of 2005
M/s. Sreenivas Charitable Trust,
New No.7, 1st Cross Street,
Chennai 600 030. ... Appellant
The Deputy Commissioner of
Income-tax, Exemptions III,
Chennai 600 034. ... Respondent
T.C.Appeal filed against the order of Income-tax Appellate Tribunal made in ITA.No.1025/Mds/1999, dated 11.6.2004. For appellant : Mr.Philip George
For respondent : Mr.Muralikumar, Jr.SC. For IT :JUDGMENT
(Delivered by P.D.DINAKARAN,J.)
Against the order of the Appellate Tribunal in ITA.No.1025/Mds/1999, dated 11.6.2004, the assessee has preferred the appeal and raised the following substantial question of law:
"Whether on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was right in law in dismissing the appeal filed by the assessee as barred by limitation?"
2. The assessee is the appellant. The assessment year involved in the appeal is 1998-99. The assessee is a Charitable Trust enjoying the exemption under section 11 of the Income-tax Act. The assessing officer brought to tax the investments made by the assessee in M/s. India Housing Finance and Development Limited in respect of which the renewal application for its approval under section 36(1)(viii) of the Income-tax Act was not disposed of by the Central Board of Direct Taxes. The Commissioner of Income-tax (Appeals) upheld the action of the assessing officer. Aggrieved by the same, the assessee preferred an appeal before the Appellate Tribunal with a petition to condone the delay of 38 days in filing the appeal. The Appellate Tribunal dismissed the appeal as barred by limitation. Hence, the assessee has come forward with this appeal.
3. The Supreme Court in VEDABAI @ VAIJAYANATABAI BABURAO PATIL v. SHANTARAM BABURAO PATIL (253 ITR 798) held as under: "In exercising discretion under section 5 of the Limitation Act the courts should adopt a pragmatic approach. A distinction must be made between a case where the delay is inordinate and a case where the delay is of a few days. Whereas in the former case the consideration of prejudice to the other side will be a relevant factor so the case calls for a more cautious approach but in the latter case no such consideration may arise and such a case deserves a liberal approach. No hard and fast rule can be laid down in this regard. The court has to exercise the discretion on the facts of each case keeping in mind that in construing the expression "sufficient cause", the principle of advancing substantial justice is of prime importance."
4. The Calcutta High Court in C.I.T. V. ORISSA CONCRETE AND ALLIED INDUSTRIES LTD. (264 ITR 186) held as under:
"....what is really indicated in the various decisions cited and in section 5 of the Limitation Act itself, is that a litigant would be required to explain why the appeal and/or application could not be filed within the period prescribed by limitation and explain the delay for such period for the purpose of linking up the circumstances which had caused the delay during the period of limitation and thereafter."
5. Recently, the Allahabad High Court in GANGA SAHAI RAM SWARUP v. INCOME-TAX APPELLATE TRIBUNAL (271 ITR 512) has taken the view that a liberal view ought to have been taken by the authority as the delay was only of a very short period and the appellant was not going to gain anything from it.
6. Applying the ratio laid down by the Apex Court as well as various High Courts, we find, it is stated in the petition filed by the assessee for condonation of delay that the order copy was misplaced and thereafter it was found and sent to the counsel for preparing the appeal and then, the appeal was prepared and filed before the Tribunal and in that process, the delay of 38 days occurred. As held by the Apex Court, no hard and fast rule can be laid down in the matter of condonation of delay and courts should adopt a pragmatic approach and the courts should exercise its discretion on the facts of each case keeping in mind that in construing the expression, 'sufficient cause' the principle of advancing substantial justice is prime importance and the expression, 'sufficient cause' should receive a liberal construction. We are, therefore, of the opinion that the Appellate Tribunal ought to have condoned the delay in filing the appeal, considering the reasons given by the assessee for the delay.
7. Accordingly, we find that the Appellate Tribunal was not right in dismissing the appeal as barred by limitation. The delay in filing the appeal before the Tribunal is condoned. The Tribunal is directed to take the appeal on file and dispose of the same on merits, in accordance with law. The tax case appeal stands allowed and the question of law is answered in favour of the assessee. No costs.
1. The Assistant Registrar,
Income-tax Appellate Tribunal,
Rajaji Bhavan, Besant Nagar,
Chennai (5 copies with records)
2. The Secretary, Central Board of Direct Taxes, New Delhi ( 3 copies)
3. The Commissioner of Income-tax (Appeals)-IX, Madras.
4. The Deputy Director of Income-tax
Exemptions III, Madras.
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