Kaikara construction co.,, Kollam v. JTCIT, Kollam

ITA 10/COCH/2012 | 2007-2008
Pronouncement Date: 27-07-2012 | Result: Allowed

Appeal Details

RSA Number 1021914 RSA 2012
Assessee PAN AADFM7277N
Bench Cochin
Appeal Number ITA 10/COCH/2012
Duration Of Justice 6 month(s) 15 day(s)
Appellant Kaikara construction co.,, Kollam
Respondent JTCIT, Kollam
Appeal Type Income Tax Appeal
Pronouncement Date 27-07-2012
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted DB
Tribunal Order Date 27-07-2012
Assessment Year 2007-2008
Appeal Filed On 12-01-2012
Judgment Text
1 ITA NO. 10/COCH/2012 IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH COCHIN BEFORE SHRI N.R.S. GANESAN (JM) AND SHRI B.R. BASKA RAN(AM) I.T.A NO. 10/COCH/2012 (ASSESSMENT YEAR 2007-08) KAIKARA CONSTRUCTION COMPANY VS J.C.I.T. CIR.1 KAITHAVARAM BUNGALOW KOLLAM KANKATHU MUKKU KOLLAM PAN : AADFM7277N (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI A.S. NARAYANAMURTHY RESPONDENT BY : SMT. S VIJAYAPRABHA DATE OF HEARING : 07-06-2012 DATE OF PRONOUNCEMENT : 27-07-2012 O R D E R PER N.R.S. GANESAN (JM) THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST TH E ORDER OF COMMISSIONER OF INCOME-TAX(A) TRIVANDRUM DATED 16-12-2011 AND PERT AINS TO ASSESSMENT YEAR 2007-08. 2. THE ONLY ISSUE ARISES BEFORE THIS TRIBUNAL IS CO NDONATION OF DELAY IN FILING THE APPEAL BEFORE THE COMMISSIONER OF INCOME-TAX(A). 3. SHRI A.S. NARAYANAMURTHY THE LD.REPRESENTATIVE FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE IS ENGAGED IN THE BUSINESS OF CIVIL CO NSTRUCTION. THE ASSESSMENT ORDER DATED 24-12-2009 WAS SERVED ON THE ASSESSEE ON 29-1 2-2009. THEREFORE THE ASSESSEE WAS EXPECTED TO FILE THE APPEAL ON OR BEFORE 30 TH JANUARY 2010. HOWEVER THE APPEAL BEFORE THE COMMISSIONER OF INCOME-TAX(A) WAS FILED ON 11-05-2010. THEREFORE THERE 2 ITA NO. 10/COCH/2012 WAS A DELAY OF 100 DAYS. ACCORDING TO THE LD.REPRE SENTATIVE THE REASON FOR NOT FILING THE APPEAL BEFORE THE COMMISSIONER OF INCOME-TAX(A) IS BEYOND THE CONTROL OF THE ASSESSEE. FROM THE YEAR 2005-06 DUE TO NON HONOURING OF THE B ILLS BY THE CUSTOMERS THE ASSESSEE WAS FACING SEVERE FINANCIAL PROBLEM. THE ASSESSEE OBTAINED A LOAN OF RS.7 CRORES FROM SOUTH INDIAN BANK LTD. DUE TO FINANCIAL CRISIS TH E LOAN TURNED OUT TO BE A NON PERFORMING ASSET AND THE BANK INITIATED RECOVERY PR OCEEDINGS BEFORE THE DEBT RECOVERY TRIBUNAL AND UNDER THE PROVISIONS OF SECURITISATION AND RECONSTRUCTION OF FINANCIAL ASSET AND ENFORCEMENT OF SECURITY INTEREST (SARFAESI) ACT . MOREOVER THERE WAS ARBITRATION PROCEEDINGS AGAINST THE KERALA STATE PWD IN CONNECT ION WITH THE EXECUTION OF NATIONAL HIGHWAY. HUGE AMOUNT WAS DUE FROM THE STATE GOVERN MENT. THE ASSESSEE HAD TO APPEAR PERSONALLY BEFORE THE DRT AND THE ARBITRATOR . 4. THE LD.REPRESENTATIVE FURTHER SUBMITTED THAT THE ASSESSEE HAD ALSO DISPUTE WITH PUBLIC WORK DEPARTMENT GOVERNMENT OF PONDICHERRY. THE ASSESSEE HAD ALSO FILED AN APPLICATION FOR APPOINT OF ARBITRATOR BEFORE THE MA DRAS HIGH COURT. DUE TO FINANCIAL CRISIS AND THE MULTIPLE LITIGATION AND COURT PROCEE DINGS THE ASSESSEE COULD NOT CONCENTRATE ON BUSINESS; THEREFORE THE ASSESSEE CO ULD NOT FILE THE APPEAL WITHIN THE PRESCRIBED TIME BEFORE THE COMMISSIONER OF INCOME-T AX(A). ACCORDING TO THE LD.REPRESENTATIVE THE DELAY WAS BEYOND THE CONTROL OF THE ASSESSEE. 5. ON THE CONTRARY SMT. VIJAYAPRABHA THE LD.DR SU BMITTED THAT THERE WAS NO REASONABLE CAUSE ON THE PART OF THE ASSESSEE FOR NO T FILING THE APPEAL BEFORE THE COMMISSIONER OF INCOME-TAX(A). ACCORDING TO THE LD .DR THE COURT PROCEEDINGS AND OTHER LITIGATIONS WERE NOT SUFFICIENT CAUSE FOR NOT FILING THE APPEAL IN TIME. 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. ADMITTEDLY THERE WA S DELAY OF 100 DAYS IN FILING THE APPEAL BEFORE THE COMMISSIONER OF INCOME-TAX(A). T HE ASSESSEE CLAIMS THAT IT WAS PREVENTED BY SUFFICIENT CAUSE FROM FILING THE APPEA L WITHIN THE DUE DATE. IT IS NOT IN 3 ITA NO. 10/COCH/2012 DISPUTE THAT THE BILLS RAISED AGAINST THE CUSTOMERS OF THE ASSESSEE WERE DISHONOURED AND THE LOAN OBTAINED FROM SOUTH INDIAN BANK TO THE EXTENT OF RS.7 CRORES BECAME NON PERFORMING ASSET. THE BANK HAS ALSO INITIATED PROC EEDINGS BEFORE THE DEBT RECOVERY TRIBUNAL. A SIMILAR LITIGATION HAS ALSO ARISEN WIT H KERALA STATE PWD AND PONDICHERY PWD. WHEN A BUSINESS MAN IN FINANCIAL CRISIS AND FACING MULTIPLE LEGAL PROCEEDINGS HE MAY NOT BE IN A POSITION TO CONCENTRATE ON HIS BUSINESS AND PROSECUTE THE INCOME-TAX MATTERS. THIS TRIBUNAL IS OF THE OPINION THAT THE FINANCIAL CRISIS MIGHT HAVE PREVENTED THE ASSESSEE FROM FILING THE APPEAL WITHIN THE DUE DATE. WHEN A BUSINESS MAN IS IN ACUTE FINANCIAL PROBLEM THE FIRST ATTEMPT WOULD BE TO RESTORE THE FINANCIAL POSITION IN ORDER TO RUN THE BUSINESS SMOOTHLY. IN THOSE FACTU AL SITUATIONS THIS TRIBUNAL IS OF THE OPINION THAT THERE WAS A REASONABLE CAUSE IN NOT FI LING THE APPEAL BEFORE THE COMMISSIONER OF INCOME-TAX(A). WHEN THERE IS A CON FLICT BETWEEN TECHNICALITIES AND SUBSTANTIAL JUSTICE THE SUBSTANTIAL JUSTICE HAS TO BE PREFERRED RATHER THAN TECHNICALITIES. THIS VIEW OF THIS TRIBUNAL IS FORTIFIED BY THE JUDG MENT OF THE APEX COURT IN COLLECTOR LAND ACQUISITION VS MST. KATTIJI & ORS 167 ITR 471 (SC). BY FOLLOWING THE JUDGMENT OF THE APEX COURT IN MST KATTIJI & ORS (SUPRA) AND FOR THE REASONS STATED THEREIN THE DELAY OF 100 DAYS IN FILING THE APPEAL BEFORE COMMISSIONE R OF INCOME-TAX(A) IS CONDONED. ACCORDINGLY THE ORDER OF THE COMMISSIONER OF INCOM E-TAX(A) IS SET ASIDE AND THE APPEAL OF THE ASSESSEE STANDS RESTORED ON THE FILE OF THE COMMISSIONER OF INCOME-TAX(A). THE COMMISSIONER OF INCOME-TAX(A) SHALL DISPOSE OF THE APPEAL ON MERIT AFTER GIVING REASONABLE OPPORTUNITY TO THE ASSESSEE. 7. IN THE RESULT THE APPEAL OF THE ASSESSEE STANDS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 27 TH JULY 2012. (B.R. BASKARAN) (N.R.S. GANESAN) ACCOUNTANT MEMBER JUDICIAL MEMBER COCHIN DT : 27 TH JULY 2012 PK/- 4 ITA NO. 10/COCH/2012 COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE COMMISSIONER OF INCOME-TAX 4. THE COMMISSIONER OF INCOME-TAX(A) 5. THE DR (TRUE COPY) BY ORDER ASSTT. REGISTRAR INCOME-TAX APPELLATE TRIBUNAL COCHIN BENCH