Ita/47/2019 Of M/S.avathar Jewellers v. The Deputy Commissioner Of Income Tax

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE S.V.BHATTI & THE HONOURABLE MR.JUSTICE BASANT BALAJI FRIDAY, THE 1 DAY OF APRIL 2022 / 11TH CHAITHRA, 1944 ITA NO. 45 OF 2019 ITA 580/2017 OF I.T.A.TRIBUNAL,COCHIN BENCH APPELLANT/S: AVATHAR JEWELLERSALWA TOWERS,EDAPPAL,MALAPPURAM REPRESENTED BY ITS MANAGING PARTNER MR.U.ABDULLA.BY ADVS.ANIL D. NAIRSRI.SREEJITH R.NAIRSRI.ACHYUT K PADMARAJSMT. ARYA ANILSMT. NILOOFAR O. NIZAMSHRI.GOKULRAJ L. RESPONDENT/S: THE DEPUTY COMMISSIONER OF INCOME TAX,CENTRAL CIRCLE,THRISSUR. BY ADVS.SRI.P.K.RAVINDRANATHA MENON (SR.)JOSE JOSEPH, SC, FOR INCOME TAX THIS INCOME TAX APPEAL HAVING COME UP FOR ADMISSION ON01.04.2022, ALONG WITH ITA.51/2019, 47/2019 AND CONNECTEDCASES, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: -2- IN THE HIGH COURT OF KERALA AT ERNAKULAMPRESENT THE HONOURABLE MR.JUSTICE S.V.BHATTI & THE HONOURABLE MR.JUSTICE BASANT BALAJI FRIDAY, THE 1 DAY OF APRIL 2022 / 11TH CHAITHRA, 1944ITA NO. 51 OF 2019 ITA 581/2017 OF I.T.A.TRIBUNAL,COCHIN BENCH APPELLANT/S: M/S.AVATHAR JEWELLERSALWA TOWERS, EDAPPAL, MALAPPURAM REPRESENTED BY ITS MANAGING PARTNER, MR.U.ABDULLABY ADVS.ANIL D. NAIRSRI.SREEJITH R.NAIRSRI.ACHYUT K PADMARAJSMT. ARYA ANILSMT. NILOOFAR O. NIZAMSHRI.GOKULRAJ L. RESPONDENT/S: THE DEPUTY COMMISSIONER OF INCOME TAX,CENTRAL CIRCLE, THRISSUR-680 001BY ADVS.SRI.P.K.RAVINDRANATHA MENON (SR.)JOSE JOSEPH, SC, FOR INCOME TAX THIS INCOME TAX APPEAL HAVING COME UP FOR ADMISSION ON01.04.2022, ALONG WITH ITA.45/2019 AND CONNECTED CASES, THECOURT ON THE SAME DAY DELIVERED THE FOLLOWING: -3- IN THE HIGH COURT OF KERALA AT ERNAKULAMPRESENT THE HONOURABLE MR.JUSTICE S.V.BHATTI & THE HONOURABLE MR.JUSTICE BASANT BALAJI FRIDAY, THE 1 DAY OF APRIL 2022 / 11TH CHAITHRA, 1944ITA NO. 47 OF 2019 ITA 582/2017 OF I.T.A.TRIBUNAL,COCHIN BENCH APPELLANT/S: M/S.AVATHAR JEWELLERSALWA TOWERS,EDAPPAL,MALAPPURAM,REPRESENTED BY ITS MANAGING PARTNER. M.U.ABDULLA.BY ADVS.ANIL D. NAIRSRI.SREEJITH R.NAIRSRI.ACHYUT K PADMARAJSMT. ARYA ANILSMT. NILOOFAR O. NIZAM RESPONDENT/S: THE DEPUTY COMMISSIONER OF INCOME TAXCENTRAL CIRCLE,THRISSUR-680001.BY ADVS.SRI.P.K.RAVINDRANATHA MENON (SR.)JOSE JOSEPH, SC, FOR INCOME TAX THIS INCOME TAX APPEAL HAVING COME UP FOR ADMISSION ON01.04.2022, ALONG WITH ITA.45/2019 AND CONNECTED CASES, THECOURT ON THE SAME DAY DELIVERED THE FOLLOWING: -4- IN THE HIGH COURT OF KERALA AT ERNAKULAMPRESENT THE HONOURABLE MR.JUSTICE S.V.BHATTI & THE HONOURABLE MR.JUSTICE BASANT BALAJI FRIDAY, THE 1 DAY OF APRIL 2022 / 11TH CHAITHRA, 1944 ITA NO. 50 OF 2019 ITA 583/2017 OF I.T.A.TRIBUNAL,COCHIN BENCH APPELLANT/S: AVATHAR JEWELLERS ALWA TOWERS,ALWA TOWERS, EDAPPAL, MALAPPURAM, REPRESENTED BY ITS MANAGING PARTNER MR U. ABDULLABY ADVS.ANIL D. NAIRSREEJITH R.NAIRACHYUT K PADMARAJARYA ANILNILOOFARGOKULRAJ L. RESPONDENT/S: THE DEPUTY COMMISSIONER OF INCOME TAX,CENTRAL CIRCLE, THRISSUR - 680001BY ADVS.SRI.P.K.RAVINDRANATHA MENON (SR.)JOSE JOSEPH, SC, FOR INCOME TAX THIS INCOME TAX APPEAL HAVING COME UP FOR ADMISSION ON01.04.2022, ALONG WITH ITA.45/2019 AND CONNECTED CASES, THECOURT ON THE SAME DAY DELIVERED THE FOLLOWING: -5- S.V.BHATTI& BASANT BALAJI, JJ. [ITA Nos.45/2019,51, 47 AND 50/2019] JUDGMENT (Dated this the 1[st] day of April 2022) Basant BalajiJ., I.T.A.Nos.45, 47, 50 and 51 of 2019 are filed by theassessee, a partnership firm engaged in jewellery business,against the orders of the Income Tax Appellate Tribunal,Cochin Bench, Cochin in I.T.A. Nos.580/Coch/2017,582/Coch/2017,583/Coch/2017 and 582/Coch/2017respectively. 2. The appellant’s business premises was searched THE DEPUTY COMMISSIONER OF INCOME TAX,CENTRAL CIRCLE, THRISSUR - 680001BY ADVS.SRI.P.K.RAVINDRANATHA MENON (SR.)JOSE JOSEPH, SC, FOR INCOME TAX THIS INCOME TAX APPEAL HAVING COME UP FOR ADMISSION ON01.04.2022, ALONG WITH ITA.45/2019 AND CONNECTED CASES, THECOURT ON THE SAME DAY DELIVERED THE FOLLOWING: -5- S.V.BHATTI& BASANT BALAJI, JJ. [ITA Nos.45/2019,51, 47 AND 50/2019] JUDGMENT (Dated this the 1[st] day of April 2022) Basant BalajiJ., I.T.A.Nos.45, 47, 50 and 51 of 2019 are filed by theassessee, a partnership firm engaged in jewellery business,against the orders of the Income Tax Appellate Tribunal,Cochin Bench, Cochin in I.T.A. Nos.580/Coch/2017,582/Coch/2017,583/Coch/2017 and 582/Coch/2017respectively. 2. The appellant’s business premises was searched and in the search certain documents were recovered and theassessment was completed under Section 143(3) read withSection 153C of the Income Tax Act as per the Assessmentorder dated 31.3.2014. Aggrieved by the said assessment -6- order, the appellant filed statutory appeal before theCommissioner of Income Tax (Appeals) and the appellateauthority, by order dated 27.12.2016 dismissed the appeal.The appellant filed second appeal before the Income TaxAppellate Tribunal, Cochin Bench as I.T.A. Nos.580 to583/Coch/2017. The appeals filed by the appellant werenot in time and hence, the application to condone the delayof 217 days in filing the appeal was also filed along withthe appeal memorandum. Annexure – D, petition tocondone the delay, was filed through the power of attorneyholder of the Managing Partner. The Tribunal, by theimpugned order, dismissed the delay petition holding thatthe appellant failed to give proper explanation forcondoning the delay. Aggrieved by the said order, theseappeals are filed. 3. Annexure-D is the petition to condone the delay in filing the appeal, which was filed along with the appealsbefore the Appellate Tribunal. In the said application, the -7- appellant has specifically stated that he was in policecustody for few months and only after releasing from thecustody, he could sign the requisite documents and hence,the delay occurred in filing the appeal. 4. Heard Shri.Anil D.Nair, learned counsel for theappellant and Shri.Jose Joseph, learned counsel for therespondent. 5. It is a fact that that the appeal was filed with a delay of 217 days, which was sought to be condoned byfiling Annexure – D application. The reasons stated in thepetition to condone the delay was that he was notphysically present to sign the requisite documents to filethe appeal as he was in police custody. The person, who isphysically not able to sign the documents for filing theappeal because he was in police custody, is a genuine andbonafide reason for condoning the delay. Laches cannot beattributed against him. Moreover, the finding of theTribunal that there is no proper explanation for condoning -8- the delay, according to us, is not correct. 6. The learned counsel for the appellant relied on the decision of the honourable Supreme Court reported in EshaBhattacharjee v. Managing Committee ofRaghunathpur Nafar Academy and others [(2013) 12SCC 649], to contend that in dealing with delay petitions,the court should take liberal approach. The Apex Courtheld in the said decision that:- “(i) there should be a liberal, pragmatic, justice –oriented, non-pedantic approach while dealingwith an application for condonation of delay, forthe courts are not supposed to legalise injusticebut are obliged to remove injustice. (ii) The terms “sufficient cause” should beunderstood in their proper spirit, philosophy andpurpose regard being had to the fact that theseterms basically elastic and are to be applied inproper perspective to be obtaining fact –situation. (iii) Substantial justice being paramount and -9- pivotal the technical consideration should not begiven undue and uncalled for emphasis.” “(i) there should be a liberal, pragmatic, justice –oriented, non-pedantic approach while dealingwith an application for condonation of delay, forthe courts are not supposed to legalise injusticebut are obliged to remove injustice. (ii) The terms “sufficient cause” should beunderstood in their proper spirit, philosophy andpurpose regard being had to the fact that theseterms basically elastic and are to be applied inproper perspective to be obtaining fact –situation. (iii) Substantial justice being paramount and -9- pivotal the technical consideration should not begiven undue and uncalled for emphasis.” 7. The Honourable Apex Court in a catena of decisions held that in dealing with delay petitions, a liberalview has to be taken and lis has to be decided on the basisof its merits rather its technicalities. According to us, sincethe physical movement of the appellant was curtailed, sincehe was in the police custody, we are of the consideredopinion that the Tribunal ought to have condoned the delay,and an opportunity to the assessee/appellant to contest thecase on merits is afforded. In view of the matter, we set aside the order of the Income Tax Appellate Tribunal in I.T.A. Nos.580 to583/Coch/2017. Taking note of the circumstances of thecase and the explanation offered by the appellant tocondone the delay in filing the appeal as well as the dictumlaid down by the honourable Apex Court in the decisioncited Esha Bhattacharjee (supra), we condone the delay -10- of 217 days in filing the appeal before the Tribunal. TheTribunal is directed to pass final orders in the appeals filedby the appellant on merits within a period of three monthsfrom the date of receipt of a copy of this judgment. In the result, Income Tax Appeals are allowed asabove. SD S.V.BHATTI, JUDGE dl/ SD BASANT BALAJI, JUDGE -11- APPENDIX OF ITA 51/2019 PETITIONER ANNEXURESANNEXURE-ATRUE COPY OF THE ASSESSMENT ORDER DATED31.03.2014 FOR THE A.Y.2010-11ANNEXURE-BTRUE COPY OF THE APPELLATE ORDER DATED 28.1.2016 OF THE COMMISSIONER OF INCOMETAX (APPEALS)ANNEXURE-CTRUE COPY OF THE APPEAL MEMORANDUM BEFORE INCOME TAX APPELLATE TRIBUNALANNEXURE-DTRUE COPY OF THE PETITION FOR DELAY CONDONATION BEFORE TRIBUNAL ANNEXURE-E TRUE COPY OF THE ORDER OF THE INCOME TAX TRIBUNAL DATED 27/09/2018 -12- APPENDIX OF ITA 47/2019 PETITIONER ANNEXURESANNEXURE -A TRUE COPY OF THE ASSESSMENT ORDER DATED 31.03.2014. ANNEXURE -B TRUE COPY OF THE APPELLATE ORDER DATED 29.12.2016.TRUE COPY OF THE APPEAL MEMORANDUM BEFORE TRIBUNAL.TRUE COPY OF THE PETITION FOR DELAY CONDONATION BEFORE TRIBUNAL. ANNEXURE -C ANNEXURE -D ANNEXURE -E TRUE COPY OF THE ORDER OF THE INCOME TAXTRIBUNAL DATED 27.09.2018. -13- APPENDIX OF ITA 50/2019 PETITIONER ANNEXURESANNEXURE A ANNEXURE ATRUE COPY OF THE ASSESSMENT ORDER DATED 31.03.2014ANNEXURE BTRUE COPY OF THE APPELLATE ORDER DATED 29.12.2016ANNEXURE CTRUE COPY OF THE APPEAL MEMORANDUM BEFORE TRIBUNALANNEXURE D TRUE COPY OF THE PETITION FOR DELAY CONDONATION BEFORE TRIBUNAL ANNEXURE E TRUE COPY OF THE ORDER OF THE INCOME TAXTRIBUNAL DATED 27.09.2018 -14- APPENDIX OF ITA 45/2019 PETITIONER ANNEXURESANNEXURE -AANNEXURE -B TRUE COPY OF THE ASSESSMENT ORDER DATED 31.3.2014 FOR THE a.y. 2009-10.TRUE COPY OF THE APPELLATE ORDER DATED 27.12.16 OF THE COMMISSIONERE OF INCOME TAX (APPEALS).TRUE COPY OF THE APPEAL MEMORANDUM BEFORE INCOME TAX APPELLATE TRIBUNALTRUE COPY OF THE PETITION FOR DELAY CONDONATION BEFORE TRIBUNAL.TRUE COPY OF THE ORDER OF THE INCOME TAXTRIBUNAL DATED 27.9.2018. ANNEXURE -C ANNEXURE -DANNEXURE -E