The Chhattisgarh High Court has condoned the delay of 55 days in filing appeal before Income Tax Appellate Tribunal (ITAT) on the grounds that there was no allegation that delay in filing the appeal is mala fide or it is deliberate, rather it is bona fide based on wrong advise of his counsel to reapply for registration.
The bench of Justice Sanjay K. Agrawal and Justice Radhakishan Agrawal has observed that the rejection of application for condonation of delay has serious civil consequences upon the status of the Society, as by rejection of the application of the appellant Society, the Society would not be able to claim tax exemption under the provisions contained in Sections 11 and 12 of the Income Tax Act, and that too in absence of counter-affidavit filed by the Revenue opposing the application for condonation of delay supported by affidavit.
The court noted that ITAT ought to have condoned the delay in preferring the appeal as there is no allegation that delay in filing the appeal is mala fide or it is deliberate, rather it is bona fide based on wrong advice of his counsel to reapply for registration.
The assessee/appellant Society having been registered with the Registrar of Societies, Raipur Division on 23-8-2004, submitted application in Form No.10A for provisional registration under Section 12A of the Income Tax Act, 1961 (for short, ‘the IT Act’) on 2-12-2022 and the Commissioner of Income Tax (Exemption), Bhopal on 9-12-2022, issued order in favour of the appellant in Form No.10AC granting provisional registration under Section 12A of the IT Act.
After getting provisional registration, on 25-9-2023, the appellant Society submitted application in Form No.10AB for permanent registration under Section 12A of the IT Act. After due opportunity of hearing having been afforded to the parties including the appellant Society, on 19-2-2024, finally, the CIT(E) rejected the application for registration under Section 12A of the IT Act which was communicated to the appellant on 2-3-2024.
The order dated 2-3- 2024 was appealable before the Income Tax Appellate Tribunal under Section 253 of the IT Act within 60 days from the date of receipt of copy of the order, but it is the case of the appellant that on the wrong advise of his counsel, he has reapplied for registration under Section 12A of the IT Act, however, on account of long pendency of the same, the appellant decided to file statutory appeal under Section 253 of the IT Act and by that time, the appeal has become barred by 55 days of its limitation. By virtue of the provision contained in sub-section (5) of Section 253 of the IT Act, the Income Tax Appellate Tribunal has power to admit an appeal or permit the filing of a memorandum of cross-objections after the expiry of the relevant period referred to in sub-section (3) or sub- section (4), if it is satisfied that sufficient cause for not presenting the appeal within the period of limitation is shown.
The appellant though filed application for condonation of delay along with the affidavit showing sufficient cause as on account of wrong advise of the counsel, he firstly filed fresh application for registration under Section 12A of the IT Act, but ultimately, realising the mistake, he filed appeal under Section 253(1) of the Income Tax Act, which was barred by limitation.
The court noted that appeal preferred by the appellant Society was delayed by 55 days, as noticed above, for which cause much less sufficient cause has to be shown and the appellant has explained that on account of wrong advice of his counsel to reapply for registration, he had firstly preferred application afresh under Section 12A of the Income Tax Act for registration and thereafter, due to delay in deciding the second application for registration and realising the mistake, he preferred appeal with a delay of 55 days, that is how the delay in filing the appeal has taken place.
The court held that the order passed by the Income Tax Appellate Tribunal, Raipur Bench, Raipur is set aside and delay of 55 days in preferring the appeal is hereby condoned. The appeal is restored to its original number to the file of the ITAT. The matter is remitted to the ITAT for considering and deciding the appeal afresh on merits within three months.
Case Details
Case Title: Navodit Samaj Sevi Sanstha Versus ITO
Case No.: TAXC No. 225 of 2024
Date: 09/12/2024
Counsel For Appellant: Nikhilesh Begani
Counsel For Respondent: Ajay Kumrani
