Income Tax Appellate Tribunal - Mumbai
Chetan Ramniklal Shah , Mumbai vs Ito ,Wd- 3(1), Kalyan on 19 December, 2018
आयकर अपीलीय अधिकरण "E " न्यायपीठ मब
ुं ई में ।
IN THE INCOME TAX APPELLATE TRIBUNAL " E" BENCH, MUMBAI
श्री महावीर स हिं , न्याययक दस्य एविं श्री जी. मंजनु ाथ लेखा दस्य के मक्ष ।
BEFORE SRI MAHAVIR SINGH, JM AND SRI G MANJUNATHA, AM
Aayakr ApIla saM . / ITA No. 2816/Mum/2018
(inaQa- a rNa baYa- / Assessment Year 2010-11)
Aayakr ApIla saM . / ITA No. 2818/Mum/2018
(inaQa- a rNa baYa- / Assessment Year 2011-12)
Shri Chetan Ramniklal Shah, The Income Tax Officer,
Room No. 21, KOteshwar W ard, 3(1)
Dham CHS, Sanetorium Lane, Kalyan
Vs.
Sudarshan Road, B/h/ Hi ndu
Sabha Hospital, Mumbai -400
086
(ApIlaaqaI- / Appellant) .. (p`%yaqaaI- / Respondent)
स्थायी ले खा िं . / PAN No. AVPPS2870N
अपीलाथी की ओर े / Appellant by : Shri Bhadresh Doshi, AR
प्रत्यथी की ओर े / Respondent by : Shri Chaudhary Arun Kumar
Singh, DR
न
ु वाई की तारीख / Date of hearing: 18-12-2018
घोषणा की तारीख / Date of pronouncement : 19-12-2018
AadoSa / O R D E R
महावीर स हिं , न्याययक दस्य/
PER MAHAVIR SINGH, JM:
These appeals of the assessee are arising out of the common order of Commissioner of Income Tax (Appeals)-1, Mumbai [in short CIT(A)], in appeal No. ITA No. 981 & 982/2014-15 dated 28.02.2018. The 2 ITA s No . 2 81 6 & 2 81 8 / Mu m/ 2 01 8 Assessments were framed by the Income Tax Officer, ward-3(1), Mumbai (in short 'ITO/ AO) for the A.Ys. 2010-11 & 2011-12 vide order dated 21.08.2014 under section 143(3) read with section 147 of the Income Tax Act, 1961 (hereinafter 'the Act').
2. At the outset, it is noticed that the CIT(A) while adjudicating the appeals in both the years has first not condoned the delay and appeal was dismissed as not maintainable. The finding of CIT(A) in Para 1.1 as under : -
"1.1 The above submission of the appellant has been considered and found to be general, after thought and without any supporting, hence not tenable, therefore, rejected and appeals are not admitted. On merit also these appeals are not maintenable."
3. After dismissing the appeal as not admitted the CIT(A) also adjudicate the issue on merits and dismiss the appeal of the assessee by a speaking order. Now before us, the assessee has raised the following ground No. 1 for not condoning the delay which is common in both the years, hence we will take up the matter from AY 2010-11 and the same held as under: -
"1. On the facts and circumstances of the case and in law, the learned CIT(A) erred in not condoning delay in filing an appeal and thereby not admitting appeal holding that the submission of the appellant is general and without any supporting. Delay in filing an appeal being unintentional, delay should be condoned and appeal of the appellant should not be admitted."3
ITA s No . 2 81 6 & 2 81 8 / Mu m/ 2 01 8
4. Before us, the learned Counsel for the assessee contended that the assessee wanted to pursue the alternative remedy under section 264 of the Act and for this there was delay of 6 and half months in filing of appeal before CIT(A). The learned Counsel for the assessee only stated that the CIT(A) has not considered the reasons stated by assessee in tis condonation petition filed along with form No. 35. The learned Counsel for the assessee, in view of the above stated facts, the CIT(A) first rejected this condonation petition and dismiss the appeal as not maintainable and specifically passed the order on merits which he cannot do. According to him, the appellate order is perverse and illegal. On the other hand, the learned Senior DR has supported the order of CIT(A).
5. We have heard the rival contentions and gone through the facts of the case. We find that the CIT(A) has dismissed the appeal in limine and not maintenable by not condoning the delay. Further, in the present case before us the CIT(A) has not condoned the delay but he as adjudicated the issues on merits as is evident from the impugned appellate order. We are of the view that in case CIT(A) chose not to condone the delay, he has no business to adjudicate the appeal on merits. For this, we are of the view that first of all, the appeal should be admitted for making a decision on merits because the right to appeal is neither an absolute right nor an ingredient of natural justice the principles of which must be followed in all judicial and quasi judicial adjudications. The right to appeal is statutory right and it can be circumscribed by the conditions in the grant. If the statute gives a right to appeal upon certain conditions, it is upon fulfillment of those conditions that the right becomes vested in and exercisable by the appellant. Here the assessee's appeal is delayed as alleged by CIT(A) and without admitting the appeal he has adjudicated the same on merits. Once the appeal is not admitted nothing is pending before him. A judgment of Hon'ble Bombay High Court (under the old Act of 1922) in the 4 ITA s No . 2 81 6 & 2 81 8 / Mu m/ 2 01 8 case of CIT Vs. Mysore Iron & Steel Works (1949) 17 ITR 478 (Bom), wherein it is held as under:
"Now, the scheme under Sections 30 and 31 of the Act is fairly clear. An assessee has a statutory right to present an appeal within thirty days without any order being required from the Appellate Assistant Commissioner for admission of that appeal. But if the time prescribed expires, then that statutory right to present an appeal goes ; and an appeal can only be entertained provided it is admitted by the Appellate Assistant Commissioner after condemning the delay. Therefore before an appeal could be admitted in this case, an order from the Appellate Assistant Commissioner was requisite that the delay had been condoned, and it was only on such an order being made that the appeal could be entertained by the Appellate Assistant Commissioner. Now Section 31 deals only with such appeals which are presented within the prescribed period or admitted after the delay has been condoned, and the procedure laid down in Section 31 with regard to the hearing of appeals only applies to such appeals. Therefore, in my opinion, when the Appellate Assistant Commissioner refused to condone the delay, there was no appeal before him which he could hear and dispose of as provided under Section 31 of the Act. Section 33 then gives the right of appeal to the assessee 5 ITA s No . 2 81 6 & 2 81 8 / Mu m/ 2 01 8 from an order made by the Appellate Assistant Commissioner either under Section 28 or under Section 31. Therefore the Legislature did not give the right of appeal to the assessee against an order made by the Appellate Assistant Commissioner under Section 30 of the Act.
Now Mr. Banaji has contended that in refusing to condone the delay, the Appellate Assistant Commissioner has really dismissed his appeal and confirmed the order of assessment. In my opinion, that is an entirely erroneous contention because the Appellate Assistant Commissioner can only confirm an assessment and make an order of confirmation or dismissal of the appeal provided the appeal is presented within time or been admitted after condonation of delay and is heard and disposed of on merits. In this case we do not reach the stage of Section 31 at all. The appeal never came to be admitted, and no question can possibly arise of an order made by the Appellate Assistant Commissioner confirming the assessment made by the Income- tax Officer.
Mr. Banaji has relied on two judgments of the Patna High Court which, in my opinion, really have no bearing on the facts before us. One is Kunwarji Ananda v. Commissioner of Income-tax, Bihar and Orissa (1). There a Full Bench of the Patna High Court considered an order made by 6 ITA s No . 2 81 6 & 2 81 8 / Mu m/ 2 01 8 the Assistant Commissioner that the appeal did not lie because it fell under Section 23(4) of the old Income-tax Act ; and the Court held that such an order fell under Section 31 of the old Act as it was an order disposing of the appeal. Now, it is important to note that in that case the appeal was admitted. It was within time, and after it was admitted, a preliminary issue was raised as to whether the appeal lay as it fell under Section 23(4) of the old Income-tax Act. It was from the order on the preliminary point that an appeal was preferred to the Commissioner, and on those facts that Court held that it was an order under Section 31 of the old Act. But as I have pointed out earlier, in the case before us there is no question of the appeal being disposed of either on the preliminary point or on merits, because the appeal was never admitted.
Then there is the case of Maharani Gyan Manjari Kuari v. Commissioner of Income-tax, Bihar and Orissa (2). That was a case where the assessee had failed to prefer an appeal in the prescribed form to the Appellate Assistant Commissioner of Income-tax, and the Appellate Assistant Commissioner refused to admit the appeal holding that the appeal was not in the prescribed form. The Patna High Court merely followed the earlier decision of their own Court to which I have referred and came to the conclusion 7 ITA s No . 2 81 6 & 2 81 8 / Mu m/ 2 01 8 that the order made by the Appellate Assistant Commissioner was an order under Section 31. We have looked in vain through this judgment to find any reason suggested why the order made by the Appellate Assistant Commissioner refusing to entertain the appeal because it was not in proper form fell under Section 31 of the old Act. With respect to the Patna High Court, we (1) (1931) I. L. R. 11 Pat. 187.
(2) [1944] 12 I. T. R. 59.
cannot accept that decision if the effect of the decision is that even though an Appellate Assistant Commissioner may refuse to entertain an appeal, that order should be deemed to be an order disposing of the appeal under Section 31 as if the appeal had been admitted. But there is a direct decision of the Allahabad High Court, and that is reported in Shivnath Prasad v.
Commissioner of Income-tax, Central and United Provinces (1). Although the case was under the old Act, it dealt with the very question with which we are dealing now and there also the Assistant Commissioner had refused to condone the delay and the Allahabad High Court held that the order made by the Assistant Commissioner was not under Section 31 but it was an order made under Section 30 and, therefore, no appeal lay to the Appellate Tribunal. We, with respect, entirely 8 ITA s No . 2 81 6 & 2 81 8 / Mu m/ 2 01 8 agree with the view taken by the Allahabad High Court and also the reasoning on which that decision is based.
The result is that we must hold that there is no appeal from the order of the Appellate Assistant Commissioner refusing to condone the delay under Section 30, subsection (2), of the Income- tax Act."
6. In view of the above decision of Hon'ble Bombay High Court, we are of the view that the CIT(A), once not admitted the appeal as barred by limitation, he should not have adjudicated on merits. The findings given by CIT(A) on merits will have no bearing on fresh adjudication by CIT(A), in the set aside appellate proceedings. In term of the above, we set aside the orders of the CIT(A) and remand the matter back to the file of CIT(A) for fresh adjudication on merits. We direct the CIT(A) accordingly. Both the appeals of assessee are allowed for statistical purposes.
7. In the result, both, the appeals of the assessee are allowed for statistical purposes.
Order pronounced in the open court on 19-12-2018.
Sd/- Sd/-
(जी. मंजनु ाथ /G MANJUNATHA) (महावीर स ह
िं /MAHAVIR SINGH)
(लेखा दस्य / ACCOUNTANT MEMBER) (न्याययक दस्य/ JUDICIAL MEMBER)
मुिंबई, ददनािंक/ Mumbai, Dated: 19-12-2018 सदीप सरकार, व.निजी सधिव / Sudip Sarkar, Sr.PS 9 ITA s No . 2 81 6 & 2 81 8 / Mu m/ 2 01 8 आदे श की प्रनिललपप अग्रेपिि/Copy of the Order forwarded to :
1. अपीलाथी / The Appellant
2. प्रत्यथी / The Respondent.
3. आयकर आयुक्त(अपील) / The CIT(A)
4. आयकर आयुक्त / CIT
5. ववभागीय प्रयतयनधि, आयकर अपीलीय अधिकरण, मुिंबई / DR, ITAT, Mumbai
6. गार्ड फाईल / Guard file.
आदे शािसार/ BY ORDER, त्यावपत प्रयत //True Copy// उप/सहायक पुंजीकार (Asstt. Registrar) आयकर अपीलीय अधिकरण, मुिंबई / ITAT, Mumbai