Shri Narandar Pugalia, Bengaluru v. Income Tax officer, Ward- 3(2)(3), Bengaluru

ITA 1767/BANG/2019 | 2014-2015
Pronouncement Date: 29-11-2019 | Result: Allowed

Appeal Details

RSA Number 176721114 RSA 2019
Assessee PAN AJKPP0889P
Bench Bangalore
Appeal Number ITA 1767/BANG/2019
Duration Of Justice 3 month(s) 16 day(s)
Appellant Shri Narandar Pugalia, Bengaluru
Respondent Income Tax officer, Ward- 3(2)(3), Bengaluru
Appeal Type Income Tax Appeal
Pronouncement Date 29-11-2019
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted C
Tribunal Order Date 29-11-2019
Last Hearing Date 21-10-2019
First Hearing Date 21-10-2019
Assessment Year 2014-2015
Appeal Filed On 13-08-2019
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL BANGALORE BENCHES : C BANGALORE BEFORE SHRI A.K.GARODIA ACCOUNTANT MEMBER (SMC) ITA NO S . 17 67 & 1768 ( BANG)/201 9 (ASSESSM E NT YEAR S : 201 4 - 15 ) 1. SHRI NARANDAR PUGALIA NO.41/4 MUTHACHARI INDL.ESTATE NAYANDAHALLI MYSORE ROAD BANGALORE - 560 039 PAN NO.A JKPP0889P AND 2. SHRI ROOPCHAND PUGALIA NO.41/4 MUTHACHARI INDL.ESTATE NAYANDAHALLI MYSORE ROAD BANGALORE - 560 039 PAN N O .AALPP7821R APPELLANT VS THE INCOME TAX OFFICER WARD - 3 ( 2 )(3) BANGALORE RESPONDENT APPELLANT BY : SHRI G.S PRASHANTH CA REVENUE BY : SHRI GANESH R GHALE STANDING COUNSEL FOR DEPTT. DATE OF HEARING : 2 1 - 10 - 2019 DATE OF PRONOUNCEMENT : 08 - 11 2019 O R D E R PER A. K. GARODIA ACCOUNTANT MEMBER : BOTH THESE APPEALS ARE FILED BY THE TWO DIFFERENT BUT CONNECTED ASSESSEES AND THESE ARE DIRECTED AGAINST TWO SEPARATE ORDERS OF THE LD.CIT(A) - 3 BOTH DATED 1 9 - 06 - 2019 FOR ASSESSMENT YEARS 2014 - 15. ITA NO S .1 76 7 & 1768 (B)/20 19 PAGE 2 OF 13 BOTH THESE APPEAL S WERE HEARD TOGETHER AND ARE BEING DI S POSED OF BY WAY OF THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. THE GROU NDS RAISED BY ASSESSEE IN ITA NO.1767(B)/2019 (AY: 2014 - 15) ARE AS FOLLOWS: 1(A) THE ORDERS OF THE AUTHORITIES BELOW IN SO FAR AS THESE ARE AGAINST THE APPELLANT IS OPPOSED TO LAW WEIGHT OF EVIDENCE PROBABILITIES FACTS AND CIRCUMSTANCES OF T HE APPELLANTS CASE. B) THE APPELLANT DENIES HIMSELF LIABLE TO BE ASSESSED ON A TOTAL INCOME OF RS.14 30 675/ - AS AGAINST A TOTAL INCOME OF RS.4 01 220/ - RETURNED BY THE APPELLANT UNDER THE FACTS AN D CIRCUMSTANCES OF THE CASE. 2.A) THE LD. CIT(A) ERRED IN NOT CONDONING THE DELAY OF 598 DAYS IN FILING THE APPEAL AND IN NOT ADJUDICATING THE MATTER ON MERITS UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE. B) THE LD. CIT(A) ERRED IN HOLDING THAT THE DELAY IN FILING THE APPEAL IS DUE T O THE APPELLANT NEGLIGENCE UNDER THE FACTS AND CIRCUMSTANC E S OF THE C A SE. C) THE LD.CIT(A) FAILED TO APPRECIATE THAT THERE WAS A SUFFICIENT C A USE OR DELAY IN FILING THE APPEAL UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE. 3. ADDITION OF RS.10 29 455/ - AS UNEXPLAINED CASH CREDIT A) THE LD.AO ERRED IN DISALLOWING THE EXEMPTION C LAIMED BY THE APPELLANT OF RS.10 29 455/ - ON SALE OF ITA NO S .1 76 7 & 1768 (B)/20 19 PAGE 3 OF 13 SHARES OF M/S K A PPAC PHARMA LTD. UNDER THE FACTS AND CIRCUMSTANC E S OF THE C A S E . B) THE LD.AO ERRED IN INVOKING THE PROVISIONS OF S E CTION 68 OF THE ACT AND THUS THE ADDITION MAD OF RS.10 29 55/ - AS UNEXPLAINED CASH CREDITS NEED TO BE DELETED UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE. C) THE AO FAIL E D TO APPRECIATE THE FACT THAT THE APPELLANT COULD NOT HAVE INFLUENC ED THE SHARE PRICES AS THE SALE TOOK PLACE IN A RECOGNIZED STOCK E X CHANGE ON A SCREEN BASED SYSTEM WHERE THE TRADERS IN SHARES ARE UNKNOWN AND THUS THE ADDITION MADE IS ONLY ON SUSPICION & SURMISES A ND NEEDS TO BE DELETED ON THE FACTS OF THE CASE. D) THE AO ERRED IN TREATING THE TRANSACTIONS ENTERED INTO BY THE APPELLANT AS ACCOMMODATIVE IN NATURE WITHOUT ANY CORROBORATIVE EVIDENCE WHICH IS UNACCEPTABLE IN THE EYES OF LAW. E) THE AO FAILED TO APPRECIATE THE FACT THAT THE APPELLANT COULD NOT HAVE IN FLUENCED SHARE PRICES AS THE TRANSACTIONS TOOK PLACE IN A RECOGNIZED STOCK EXCHANGE ON A SCREEN BASED SYSTEM WHERE THE TRADERS IN SHARES ARE UNKNOWN AND THUS THE ADDITION MADE IS ONLY ON SUSPICION & SURMISES AND NEEDS TO BE DELETED ON THE FACTS AND CIRCUMS TANCES OF THE C A SE. 4. A) THE ACTION OF TH E AO IN TREATING ALL THE TRANSACTIONS MADE WITH M/S KAPPAC PHARMA LTD. AS ITA NO S .1 76 7 & 1768 (B)/20 19 PAGE 4 OF 13 SHAM MERELY BECAUSE THE COMPANY WAS INVESTIGATED BY KOLKATA INVESTIGATION DIRECTORATE IS UNTENABLE AND UNSUSTAINABLE IN THE EYE S OF LAW. B) THE ACTION OF THE AO IN MAKING ADDITIONS BASED ON THE INVESTIGATION REPORT OF KOLKATA INVESTIGATION DIRECTORATE WHICH WAS NOT PUT FORTH TO THE APPELLANT FOR REBUTTAL IS VIOLATIVE OF PRINCIPLES OF NATURAL JUSTICE AND THUS THE ADDITIONS MADE NEEDS TO BE DELETED ON THE FACTS AND CIRCUMSTANCES OF THE C A SE. C) THE AO HAS NOT INDEPENDENTLY APPLIED HIS MIND TO THE FACTS OF THE CASE AND HAS MERELY RELIED UPON THE GENERAL REPORT MADE BY THE KOLKATA INVESTIGA T ION DIRECTOR A TE WHICH AMOUNTS TO BORROWED SATISFACTION WHICH IS IMPERMISSIBLE IN THE EYES OF THE LAW AND THEREFORE NEEDS TO BE DELETED IN THE INTEREST OF EQUITY AND JUSTICE. D) THE AO ERRED IN TREA TING HE SHARE TRADING TRANSACTIONS AS SHAM BY DISREGARDING THE SUBMISSIONS MADE BY THE APPELLANT U NDER THE FACTS OF THE C A SE. 5A) THE APPELLANT DENIES HIMSELF LIABLE TO BE LEVIED TO INTEREST UNDER SECTIONS 234A 234B AND 234C OF THE ACT AND FURTHER THE COMPUTATION OF INTEREST WAS NOT PROVIDED TO THE APPELLANT AS REGARD TO THE RATE PERIOD AND METHOD O F CALCULATION OF INTEREST UNDER THE FACTS AND CIRCUM S T ANCES OF THE CAS E . THE APPELLANT EXPRESSLY URGES THAT THE PERIOD OF LEVY OF INTEREST IS ITA NO S .1 76 7 & 1768 (B)/20 19 PAGE 5 OF 13 NOT IN ACCORDANCE WITH S E CTIONS 234A 234B AND 234C OF THE ACT. B) WITHOUT PREJUDICE THE INTEREST LEVIED UNDER SECTIONS 234A 234B AND 234C OF THE ACT REQUIRES TO BE WAIVED OFF UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE. 6. THE APPELLANT CRAVES LEAVE TO ADD ALTER D E LETE OR SUBSTITUTE ANY OF THE GROUNDS URGED ABOVE. 7. IN VI E W OF THE ABOVE AND OTHER GROUNDS THAT MAY BE URGED AT THE TIME OF THE HEARING OF THE APPEAL THE APPELLANT PRAYS THAT THE APPEAL MAY BE A LLOWED IN THE INTEREST OF JUSTICE AND E QUITY. THE GROUNDS RAISED BY ASSESSEE IN ITA NO.176 8 (B)/2019 (AY: 2014 - 15) ARE AS FOLLOWS: 1(A) THE ORDERS OF THE AUTHORITIES BELOW IN SO FAR AS THESE ARE AGAINST THE APPELLANT IS OPPOSED TO LAW WEIGHT OF EVIDENCE PROBABILITIES FACTS AND CIRCUMSTANCES OF THE APPELLANTS CASE. B) THE APPELLANT DENIES HIMSELF LIABLE TO BE ASSESSED ON A TOTAL INCOME OF RS.1 3 42 948/ - AS AGAINST A TOTAL INCOME OF RS. 2 97 150 / - RETURNED BY THE APPELLANT UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE. 2.A) THE LD. CIT(A) ERRED IN NOT CONDONING THE DELAY OF 598 DAYS IN FILING THE APP EAL AND IN NOT ADJUDICATING THE MATTER ON MERITS UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE. ITA NO S .1 76 7 & 1768 (B)/20 19 PAGE 6 OF 13 B) THE LD. CIT(A) ERRED IN HOLDING THAT THE DELAY IN FILING THE APPEAL IS DUE TO THE APPELLANT NEGLIGENCE UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE. C) TH E LD.CIT(A) FAILED TO APPRECIATE THAT THERE WAS A SUFFICIENT CAUSE OR DELAY IN FILING THE APPEAL UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE. 3. ADDITION OF RS.10 45 798 / - AS UNEXPLAINED CASH CREDIT A) THE LD.AO ERRED IN DISALLOWING THE EXEMPTION CLAIME D BY THE APPELLANT OF RS.10 45 798/ - ON SALE OF SHARES OF M/S KAPPAC PHARMA LTD. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE. B) THE LD.AO ERRED IN INVOKING THE PROVISIONS OF S E CTION 68 OF THE ACT AND THUS THE ADDITION MAD OF RS.10 4 5 798 / - AS UNEXPLAI NED CASH CREDITS NEED TO BE DELETED UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE. C) THE AO FAILED TO APPRECIATE THE FACT THAT THE APPELLANT COULD NOT HAVE INFLUENCED THE SHARE PRICES AS THE SALE TOOK PLACE IN A RECOGNIZED STOCK EXCHANGE ON A SCREEN BASE D SYSTEM WHERE THE TRADERS IN SHARES ARE UNKNOWN AND THUS THE ADDITION MADE IS ONLY ON SUSPICION & SURMISES AND NEEDS TO BE DELETED ON THE FACTS OF THE CASE. D) THE AO ERRED IN TREATING THE TRANSACTIONS ENTERED INTO BY THE APPELLANT AS ACCOMMODATIVE IN NAT URE WITHOUT ANY CORROBORATIVE EVIDENCE WHICH IS UNACCEPTABLE IN THE EYES OF LAW. ITA NO S .1 76 7 & 1768 (B)/20 19 PAGE 7 OF 13 E) THE AO FAILED TO APPRECIATE THE FACT THAT THE APPELLANT COULD NOT HAVE INFLUENCED SHARE PRICES AS THE TRANSACTIONS TOOK PLACE IN A RECOGNIZED STOCK EXCHANGE ON A SCREEN BA SED SYSTEM WHERE THE TRADERS IN SHARES ARE UNKNOWN AND THUS THE ADDITION MADE IS ONLY ON SUSPICION & SURMISES AND NEEDS TO BE DELETED ON THE FACTS AND CIRCUMSTANCES OF THE CASE. 4. A) THE ACTION OF THE AO IN TREATING ALL THE TRANSACTIONS MADE WITH M/S KAPPAC PHARMA LTD. AS SHAM MERELY BECAUSE THE COMPANY WAS INVESTIGATED BY KOLKATA INVESTIGATION DIRECTORATE IS UNTENABLE AND UNSUSTAINABLE IN THE EYE S OF LAW. B) THE ACTION OF THE AO IN MAKING ADDITIONS BASED ON THE INVESTIGAT ION REPORT OF KOLKATA INVESTIGATION DIRECTORATE WHICH WAS NOT PUT FORTH TO THE APPELLANT FOR REBUTTAL IS VIOLATIVE OF PRINCIPLES OF NATURAL JUSTICE AND THUS THE ADDITIONS MADE NEEDS TO BE DELETED ON THE FACTS AND CIRCUMSTANCES OF THE CASE. C) THE AO HAS NOT INDEPENDENTLY APPLIED HIS MIND TO THE FACTS OF THE CASE AND HAS MERELY RELIED UPON THE GENERAL REPORT MADE BY THE KOLKATA INVESTIGATION DIRECTORATE WHICH AMOUNTS TO BORROWED SATISFACTION WHICH IS IMPERMISSIBLE IN THE EYES OF THE LAW AND THEREFORE NEE DS TO BE DELETED IN THE INTEREST OF EQUITY AND JUSTICE. D) THE AO ERRED IN TREATING T HE SHARE TRADING TRANSACTIONS AS SHAM BY DISREGARDING THE ITA NO S .1 76 7 & 1768 (B)/20 19 PAGE 8 OF 13 SUBMISSIONS MADE BY THE APPELLANT UNDER THE FACTS OF THE CASE. 5A) THE APPELLANT DENIES HIMSELF LIABLE TO BE LE VIED TO INTEREST UNDER SECTIONS 234A 234B AND 234C OF THE ACT AND FURTHER THE COMPUTATION OF INTEREST WAS NOT PROVIDED TO THE APPELLANT AS REGARD TO THE RATE PERIOD AND METHOD OF CALCULATION OF INTEREST UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE. THE APPELLANT EXPRESSLY URGES THAT THE PERIOD OF LEVY OF INTEREST IS NOT IN ACCORDANCE WITH S E CTIONS 234A 234B AND 234C OF THE ACT. B) WITHOUT PREJUDICE THE INTEREST LEVIED UNDER SECTIONS 234A 234B AND 234C OF THE ACT REQUIRES TO BE WAIVED OFF UNDER THE FACT S AND CIRCUMSTANCES OF THE CASE. 6. THE APPELLANT CRAVES LEAVE TO ADD ALTER DELETE OR SUBSTITUTE ANY OF THE GROUNDS URGED ABOVE. 7. IN VIEW OF THE ABOVE AND OTHER GROUNDS THAT MAY BE URGED AT THE TIME OF THE HEARING OF THE APPEAL THE APPELLANT PRAYS THAT THE APPEAL MAY BE ALLOWED IN THE INTEREST OF JUSTICE AND EQUITY. 2. IN BOTH THESE APPEALS AS PER GROUND NO.2 THE GRIEVANCE OF THE ASSESS E E IS THIS THAT THE LD.CIT(A) WAS NOT JUSTIFIED IN NOT CONDONING T HE DELAY OF 598 DAYS IN FILING O F APPE A L BEFORE HIM. I N COURSE OF HE A RING LD.A R OF THE ASSESSEE SUBMITTED THAT IN PARA - 4 OF HIS ORDER LD.CIT(A) HAS RE - PRODUCED THE EXPLANATION GIVEN BY THE ASSESSEE BEF ORE HIM IN RESPECT OF DEL AY OF 598 DAYS IN FILING OF ITA NO S .1 76 7 & 1768 (B)/20 19 PAGE 9 OF 13 THIS APPEAL BEFORE HIM. HE POINTED OUT THAT AS PER HIS EXPLANATION IT W A S SUBMITTED BY THE AS S ESSEE BEFORE HIM THAT THE ASSE S SEE DECID ED INITIALLY THAT TO AVOID LITIGATION AND TO HAVE PEACE OF MIND AND TO CONCENTRATE ON BUSINESS DEVELOPMENT THE ASSESSEE WILL MAKE THE PAYMENT OF DEMAND AND WILL NOT FILE APPEAL BEFORE THE LD.CIT(A) SUBJECT TO NON - INITIATIO N OF PENALTY PROCEEDINGS. HE SUB MITTED THAT ASSESEE MADE THE PAYMENT OF TAX ON 19 - 01 - 2017 WHICH IS WITHIN THE TIME BECAUSE ASSESSME NT ORDER IS DATED 28 - 12 - 2016. HE FURTHER SUBMITTED THAT SHOW CAUSE NOTICE WAS ISSUED BY AO ON THE ISSUE OF PENALTY ON 28 - 12 - 2016 AND REPLY WAS FILED BY ASSE SSEE BEFORE THE AO IN THIS REG ARD O N 27 - 01 - 2017 IN WHICH THE ASSESSEE SUBMITTED BEFORE THE AO THAT TO HAVE MENTAL PEACE AND TO CONCENTRATE ON BUSINESS ASSESSEE HAD MADE PAYMENT OF ENTIRE TAX ON 19 - 01 - 12017 AND SUBMITTED A COPY OF THE CHALLAN ALSO AND SUBMITTED BEFORE THE AO THAT THE ASSESSEE WILL NOT BE PREFERRING ANY APPEAL BEFORE THE CIT(A) AND REQUESTED THE AO TO DROP PENALTY PR O CEEDINGS. HE SUBMIT TED THAT COPY OF TH IS LETTER IS AVAILABLE ON PAGES2 & 3 OF THE PAPER BO O K AND THE PAYMENT CHALLAN IS AVAILABL E ON PAG E - 4 OF THE PAPER BOOK AND BOTH AR E DULY RECEIVED BY THE OFFICE OF THE AO ON 27 - 01 - 2017 . THEREAFTER HE SUBMITTED THAT THE ASSESSEE DID NOT RECEIVE ANY COMMUNICATION FROM THE AO AND THE ASSESSEE WAS UNDER THE IMPRESSION THAT THE PENALTY PROCEEDINGS WILL BE DROPPED BY THE AO AND HENCE ASSESSEE DID NOT FILE ANY APPEAL BEFORE THE CIT(A). THE AO IMPOSED PENALTY AS PER ITS ORDER DATED 29 - 05 - 201 7 AND ON RECEIPT OF THIS ORDER ASSESSEE PREFERRED TO FILE APPEAL BEFORE CIT (A) AGAINST PENALTY ORDER BUT DID NOT FILE ANY APPEAL AGAINST THE ASSESSMENT ORDER BY HIM BEFORE THE AO . AS PER ORDER DAT E D 20 - 07 - 2018 LD. CIT(A) D ISMISSED THE APPEAL OF THE ITA NO S .1 76 7 & 1768 (B)/20 19 PAGE 10 OF 13 ASS ES SEE IN PEN A LTY PROCEEDINGS AN D THEREAFTER THE ASSESSEE WAS ADVIS E D TO FILE APPEAL BEFORE THE CIT(A) A GAINST THE ASSESSMENT ORDER ALSO AND THEN THE ASSESSEE FILED APPEAL B E FORE THE CIT(A) ON 19 - 09 - 2018 . UNDER TH E SE F A CTS THE DELAY IN FILING APPEAL BEFORE THE CIT(A) SHOULD HAVE BEEN CONDONED BY THE CIT (A) AND SINCE THIS WAS NOT DONE BY THE CIT(A) THE ASSES S EE IS IN APPEAL BEFORE THE TRIBUNAL WITH A REQUEST THAT SUCH DELAY IN FILING BEFORE THE CIT(A) SHOULD BE CONDON E D AND THE MATTER SHOULD BE RESTORED BA CK TO THE FILE OF CIT (A) FOR A DECISION ON MERIT. 3. THE LD. DR OF THE REVENUE SUPPORTED T HE ORDER OF THE LD.CIT(A). HE POINTED OUT THAT IN PARA - 4.5 OF HIS ORDER LD.CIT(A) HAS NOTED VARIOUS JUDICIAL PRONOUNCEMENTS AS PER WHICH IF THE ASSESEE IS NEGLIGENT THEN IT IS NOT EXPECTED F ROM THE JUDICIAL AND QUASI JUDICIAL AUTHORITIES TO ENQUIRE INTO BELATED AND STA L E CLAIMS ON THE GROUNDS OF EQUITY. 4. I HAVE CONSIDERE D THE RIVAL SUBMISSIONS. FIRST OF ALL I RE - PRODUCE PARA - 4 . 0 OF THE ORDER OF THE LD.CIT(A) BECAUSE THE ASSE SSEE S EXPLANATION IS REPRODUCED BY CIT (A) IN THIS PARA. 4.0 . 2. I WISH TO STATE THAT I HAVE RECEIVED THE ASSESSMENT ORDER WITH THE ADDITION OF RS.10 29 455/ - FOR THE YEAR UNDER CONSIDERATION. I FURTHER WISH TO STATE THAT DESPITE THE FACT THAT THERE WAS A FAIR CHANCE OF ADMISSIBILITY OF THE CLAIM ON APPEAL I HAD DECIDED NOT TO PREFER AN APPEAL IN ORDER TO AVOID PROTRACTED LITIGATION A ND TO BUY PEACE WI T H THE DEPARTMENT. 3. IT IS SUBMIT6ED THAT DUE TO IMPROPER ASSISTANCE AND UNFAVOURABLE BUSINESS TREND GOING ON I HAD DESIRED TO HAVE PEACE OF MIND AND CONCENTRATE ON BUSINESS DEVELOPMENT. IT WAS DECIDED BY ME THAT THE DEMAND RAISED OF RS.3 51 960/ - SHALL BE DISCHARGED ONLY TO AVOID PROTRACTED LITIGATION AND BUY PEACE WITH THE DEPARTMENT SUBJECT TO NON INITIATION OF PENAL ACTION AS THERE ITA NO S .1 76 7 & 1768 (B)/20 19 PAGE 11 OF 13 WAS NEITHER CONCEALMENT OF INCOME NOR FURNISHING OF INACCURATE PARTICULARS OF INCOME. 4. THE APPEAL OUG HT TO HAVE BEEN FILED ON OR BEFORE 29 - 01.2017 I WISH TO STATE THAT THE DELAY OF 598 DAYS IN FILING THE APPEAL WAS ONLY DUE TO BONAFIDE BELIEF THAT NO PENAL ACTION WOULD BE INITIATED AGAINST ME. I ALSO WISH TO STATE THAT ADVERSE INFERENCE SHOULD NOT BE DR A WN THAT I HAD INTENTIONALLY NOT FILED THE APPEAL IN TIME FOR THE REASON THAT NO RATIONAL PERSON WOULD INTENTIONALLY DELAY IN FILING THE APPEAL WHICH WOULD PUT HIS OWN INTEREST IN JEOPARDY. 5. I WISH TO STATE THAT I HAD BELIEVED THE DEPARTMENT WHO HAD PROM ISED THAT NO PENALTY WOULD BE LEVIED IF THE TAXES WERE PAID IN FULL AND IF NO APPEAL IS FILED AGAINST THE ADDITION MADE. ACCORDINGLY THE TAXES WERE PAID AND I DID NOT FILE THE APPEAL BEFORE THE CIT(A) AGAINST THE ADDITIONS. HOWEVER THE AO LEVIED THE P ENALT Y WHICH CAME AS A SHOCK TO ME. STILL NOT DISHEARTENED I HAD BELIEVED THAT THE CIT(A) WHOSE POWERS ARE CO - TERMINUS WITH THAT OF THE AO WILL PROVIDE RELIEF AGAINST THE PENALTY LEVIED BECAUSE THE DEPARTMENT HAD PROMISED SO AND HENCE FILED APPEAL ONLY AG AINST THE PENALTY ORDER IN PURSUIT OF JUSTICE BUT WAS UNSUCCESSFUL IN THE APPEAL. I COULD NOT BELIEVE THAT THE DEPARTMENT HAD GONE BACK ON ITS WORDS NOT TO LEVY PENALTY AND RELEASED THAT THE ONLY OPTION AVAILABLE NOW IS TO FILE AN APPEAL AGAINST THE ADDIT IONS MADE AND HENCE I AM PREFERRING THIS APPEAL IN PUR S UIT OF JUSTICE. 6. IT IS SUBMITTED THAT IF THE APPLICATION FOR CONDONATION FOR DELAY IN FILING THE APPEAL IS NOT ALLOWED THE ASSESSEE WOULD BE PUT TO GREAT HARDSHIP AND IRREPARABLE INJURY WILL BE CA USED TO THE ASSESSEE WHEREAS ON THE OTHER HAND THE REVENUE IS NOT PUT TO HARDSHIP IN ANY MANNER WHATSOEVER IF THE DELAY IS CONDONED. RELIANCE IS PLACED ON THE DECISIONS OF THE SUPREME COURT IN THE CASE OF COLLECTOR LAND ACQUISITION & ANR. REPORTED IN 16 7 ITR 471 AND IN THE CASE OF CONCORD OF INDIA INSURANCE CO.LTD. SMT.NIRMALA DEVI AND OTHERS REPORTED IN 118 ITR 507. RELIANCE IS ALSO PLACED ON THE DECISION OF THE APEX COURT IN THE C A SE OF CIT VS WEST BENGAL INFRASTRUCTURE DEVELOPMENT FINANCE CORPORATION LTD. REPORTED IN 334 ITR 269. RELIANCE IS FURTHER PLACED ON THE DECISION OF THE MADRAS HIGH COURT IN THE CASE OF CIT VS SANMAC MOTOR FINANCE LTD. REPORTED IN 2322 ITR 309 WHEREIN THE COURT WHILE CONDONING THE DELAY OF 1826 DAYS HELD THAT RULES OF LIM ITATION ARE NOT MEAN TO DESTROY THE RIGHTS OF THE PARTIES. THEY ARE MEANT TO SEE THAT THE PARTIES DO NOT RESORT TO DILATORY TACTICS BUT SEEK THEIR REMEDY PROMPTLY. THE LAW OF LIMITATION IS THUS FOUNDED ON PUBLIC POLICY. THE CONDONATION OF DELAY IS T HE DISCRETION OF ITA NO S .1 76 7 & 1768 (B)/20 19 PAGE 12 OF 13 THE COURT. SECTION 5 OF THE LIMITATION ACT DOES NOT SAY THAT SUCH DISCRETION CAN BE EXERCISED ONLY IF THE DELAY IS WITHIN CERTAIN LIMIT. LENGTH OF DELAY IS NOT THE MATTER ACCEPTABILITY OF TH E EXPLANATION IS THE ONLY CRITERION. SOMETIMES DELAY OF THE SHORTEST RANGE MAY BE UNCONDONABLE DUE TO WANT OF AN ACCEPTABLE EXPLANATION WHEREAS IN CERTAIN OTHER CASES DELAY OF A VERY LONG RANGE CAN BE CONDONED AS HE EXPLANATION THEREOF IS SATISFACTORY. IN EVERY CASE OF DELAY THERE CAN BE SOME LAPSE ON THE PART OF THE LITIGANT CONCERNED. THAT ALONE IS NOT ENOUGH TO TURN OWN HIS PLEA AND SHUT THE DOOR AGAINST HIM. IF THE EXPLANATION DOES NOT SMACK OF MALAFIDES OR IT I NOT PUT FORTH AS PART OF A DILATORY STRATEGY THE COURT MUST SHOW UTMOST CONSIDER ATION TO THE SUITOR. RELIANCE IS FURTHER PLACED ON THE FOLLOWING DECISIONS FOR PROPOSITION THAT THE DELAY IN FILING THE APPEAL MUST BE CONDONED. A. CIT VS ISRA SATELLITE CENTRE IN ITA NO.532/2008 DATED 28.12.2011 JURISDICTIONAL HIGH COURT. B. M/S RAGHAVENDRA C ONSTRUCTIONS VS ITO FOR THE ASSESSMENT YEAR 2007 - 08 IN ITA NO.425/BANG/2012 DATED 14.12.2012 JURISDICTIONAL BENCH OF THE TRIBUNAL. C. SHAKUNTALA HEGDE L/R OF R K HEGDE VS ACIT IN ITA NO.2785/BANG/2004 FOR AY: 1993 - 94 JURISDICTIONAL BENCH OF THE T RIB U NAL. 7. I PRAY YOUR HONOUR TO TAKE A LENIENT VIEW UNDER THE FACTS OF THE C ASE AND CONDONE THE DELAY OF 598 DAYS IN FILING THE APPEAL BEFORE YOUR HONOUR AND ADJUDICATE AND HEAR THE MATTER ON MERITS FOR SUBSTANTIAL CAUS E OF ADVANCEMENT OF JUSTICE. 8.IN VIEW OF THIS I HUMBLY PRAY YOUR HONOUR TO CONDONE THE DELAY OF 598 DAYS AND ADMIT THE APPEAL FOR THE ADVANCEMENT OF SUBSTANTIAL CAUSE OF JUSTICE. 5. IN VIEW OF THE FA C TS NOTED ABOVE IT COMES OUT THAT THE ASSESSEE WANTED TO AVOID LITIGATION AND THEREFO RE DID NOT FILE APPEAL BEFORE THE LD.CIT(A) IN QUANTUM PROCEEDINGS AND MADE PAYMENTS OF ENTIRE TAX DEMAND AND REQUESTED THE AO TO DROP THE PENALTY PROCEEDINGS. BUT THE PENALTY WAS IMPOSED BY THE AO AND THE APPEAL OF THE ASSESSEE AGAINST THE PENALTY ORDER WAS ALSO ITA NO S .1 76 7 & 1768 (B)/20 19 PAGE 13 OF 13 DISMISSED BY THE LD.CIT(A) . T HEREAFTER THE ASSESSEE CHOSE TO FILE APPEAL AGAINST THE ASSESSMENT ORDER ALSO. 6. UNDER THESE FACTS AND IN MY CONSIDERED OPINION THE DELAY IN FILING OF APPEAL SHOULD BE CONDONED AND HENCE I CONDON E THE D E L A Y AND RESTORE THE MATTER BACK TO THE FILE OF THE CIT(A) IN BOTH THE CASES TO DECIDE THE AP PEAL OF THE ASSESSEE ON MERIT. ACCORDINGLY GROUND NO. 2 OF THE ASSES S EE IS ALLOWED IN BOTH CASES . FOR T HE REMAINING GROUNDS ON MERIT NO ADJUDICATION IS C A LLED FOR AT THE PRESENT STAGE. 7. IN THE RESULT BOTH THE APPEAL OF THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THE DATE MENTIONED ON THE CAPTION ED PAGE. SD/ - (A. K. GARODIA ) ACCOUNTANT MEMBER DATED: 8 TH D AY OF NOVEMBER 2019. *AM COPY OF THE ORDER FORWARDED TO: 1.APPELLANT; 2.RESPONDENT; 3.CIT; 4.CIT(A); 5. DR 6. ITO (TDS) 7.GUARD FILE BY ORDER ASST. REGISTRAR