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 Income Tax Addition Made Towards Unsubstantiated Share Capital Is Eligible For Section 80-IC Deduction: Delhi High Court

Y. P. Trivedi vs. JCIT (ITAT Mumbai)
June, 07th 2013

Delay in filing appeal due to CA’s fault is bona fide & must be condoned

The assessee filed an appeal before the Tribunal which was delayed by 496 days. In the application for condonation of delay, the assessee claimed that he had handed over the papers to his Chartered Accountant and that the latter had mixed up the papers with other papers in his office which led to the delay. The department opposed the application on the ground that there was “gross negligence” on the part of the assessee and that sufficient cause for the delay was not explained. HELD by the Tribunal:

The facts do not suggest that the assessee has acted in a malafide manner or that the reasons explained are only a device to cover an ulterior purpose. It is a settled proposition of law that Courts should take a lenient view on the matter of condonation of delay provided the explanation and the reason for delay is bonafide and not merely a device to cover an ulterior purpose or an attempt to save limitation in an underhand way. The Court should be liberal in construing sufficient cause and should lean in favour of such party. Whenever substantial Justice and technical considerations are opposed to each other, cause of substantial Justice has to be preferred. On facts, the reasons explained by the assessee show that due to bonafide mistake and inadvertence, the appeal could not be filed within the period of limitation. Accordingly, the delay of 496 days has to be condoned (Mst. Katiji 167 ITR 471(SC) referred).

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