Kambli v. Kambli4

kambli IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION NOTICE OF MOTION NO.517 OF 2013 IN INCOME TAX APPEAL (L) NO.403 OF 2013 … M/s.Prima Paper & Engineering Pvt.Ltd....Appellant v/s.The Commissioner of Income-tax-V...Respondent … Mrs.Sanjukta Chowdhury i/b PKP Legal for the appellant. Mr.Tejveer Singh for the respondent. ... CORAM:MOHIT S. SHAH, C.J. & M.S.SANKLECHA, J.DATE :9 JULY 2013 P.C. This notice of motion has been taken out by the appellant-assessee for condonation of 515 days delay in filing the income-tax appeal. This appeal relates to assessment year 2004-05. 2.The appellant seeks to raise following question as a substantial question of law:- “Whether on the facts and circumstances of the case and in law the Tribunal was right in disallowing the claim of deduction u/s.80-IA relying upon sub-section 5 thereof.” 3.Learned counsel for the appellant states that Income-tax Appeal No.1417 of 2011 raising the same substantial question for the earlier assessment year 2003-04 has already been admitted by this Court on 8 February 2013. 4.As regards the cause for delay, learned counsel has invited our attention to the affidavit of the Managing Director of the appellant-company in support of the notice of motion stating that upon receiving the impugned order on 3 June 2011, the same was sent to the company's consultant/legal advisor further action. All the taxation matters of the appellant-company were entrusted to the said consultant, however, due to inadvertence of the staff of the said consultant, the impugned order was misplaced. After lapse of considerable time, consultant informed the appellant that the original order of the Tribunal, which had been misplaced, has been traced as the same was found in another client's file. 5.Learned counsel states that it is on account of the aforesaid mistake and/or negligence on the part of the consultant that the appeal could not be filed within the period of limitation and that the appellant has, therefore, now engaged another consultant, who gave necessary instructions to the Firm of Advocates for drafting an appeal from the impugned order and filing the same. kambli 3NM-517-13 6.Learned counsel submits that there was no deliberate delay or inaction on the part of the appellant. Learned counsel has placed reliance upon the decisions of the Supreme Court in Collector Land Acquisition v/s. Mst.Katiji and ors, (1987) 167 ITR 471 (SC)= 1987 SCR (2) 387, N.Balakrishnan vs. Krishnamurthy, (1998) 7 SCC 123 and also State of West Bengal v/s. Administrator, Howrah Municipality & ors, AIR 1972 SC 749, in support of the contention that the expression “sufficient cause” should be interpreted liberally. It is further submitted that since the appellant's appeal raising the same question for the earlier assessment year has already been admitted, this Court may exercise its discretion for condoning the delay. 7.On the other hand, learned counsel for respondent-revenue has opposed the notice of motion. It is submitted that there is gross delay and negligence on the part of the appellant in taking necessary steps within the period of limitation or within reasonable time. 8.In State of West Bengal (supra), the Supreme Court has held that it is not possible to lay down precisely as to what facts constitute “sufficient cause” under section 5 of the Limitation Act. But it may be safely stated that delay in filing an appeal should not have been for reasons which indicate the party's negligence in not taking necessary steps, which he could have or should have taken. Here again, what will be such necessary steps will depend upon the circumstances of the case. Any observation 7.On the other hand, learned counsel for respondent-revenue has opposed the notice of motion. It is submitted that there is gross delay and negligence on the part of the appellant in taking necessary steps within the period of limitation or within reasonable time. 8.In State of West Bengal (supra), the Supreme Court has held that it is not possible to lay down precisely as to what facts constitute “sufficient cause” under section 5 of the Limitation Act. But it may be safely stated that delay in filing an appeal should not have been for reasons which indicate the party's negligence in not taking necessary steps, which he could have or should have taken. Here again, what will be such necessary steps will depend upon the circumstances of the case. Any observation of an illustrative circumstance or fact, will only tend to be a curb on the free exercise of the judicial mind by the Court in determining whether the facts and circumstances of a particular case amount to "sufficient cause" or not. It is needless to emphasise that courts have to use their judicial discretion in the matter soundly in the interest of justice. The words “sufficient cause” should receive a liberal construction so as to advance substantial justice when no negligence or inaction were imputable to the appellant. 9. Having regard to the following facts:- (i)appellant's appeal raising the same question for the earlier assessment year has been admitted.earlier assessment year has been admitted. (ii) the decision of the Special Bench of the Tribunal, which has been followed by the Tribunal in the impugned order, has not been approved by the Madras High Court in Velayudhaswamy Spinning Mills Pvt.Ltd. Vs.Asst.CIT, (2010) 231 CTR (Mad) 368 and which has been followed by the Tribunal in the impugned order, has not been approved by the Madras High Court in Velayudhaswamy Spinning Mills Pvt.Ltd. Vs.Asst.CIT, (2010) 231 CTR (Mad) 368 and (iii) the delay in filing the appeal has been caused on account of what appears to be negligence on the part of the staff of the appellant's consultant,account of what appears to be negligence on the part of the staff of the appellant's consultant, we are of the view that interests of justice would be served if delay in filing the appeal is condoned, subject to the condition that the appellant shall pay costs quantified at Rs.10,000/- to the respondent-, which shall be paid within one month from today. 10.Notice of motion is, accordingly, made absolute in terms of prayer clause (a). Motion stands disposed of. CHIEF JUSTICE (M.S.SANKLECHA, J.)