Wp(C)/151/2009 Of M/S.sakthimatha Cashew Company v. The Income Tax Officer, Kollam

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE ANTONY DOMINIC WEDNESDAY, THE 14TH DAY OF MARCH 2012/24TH PHALGUNA 1933 WP(C).No. 151 of 2009 (R) ------------------------- PETITIONER: ------------- M/S.SAKTHIMATHA CASHEW COMPANY NALLILA-P.O, KOLLAM REPRESENTED BY ITS MANAGING PARTNER, SHRI.Y.RAJAN. BY ADVS.SRI.T.M.SREEDHARAN SRI.V.P.NARAYANAN RESPONDENTS: -------------- 1. THE INCOME TAX OFFICER, WARD 3, KOLLAM. 2. THE COMMISSIONER OF INCOME TAX AAYAKKAR BHAVAN, KOWDIAR, THIRUVANANTHAPURAM. 3. INCOME TAX APPELLATE TRIBUNAL, COCHIN BENCH,M IST FLOOR, (BLOCK C-1 & C-II) KENDRIYA BHAVAN, OPP.CSEZ KAKKANAD, COCHIN-682037 REPRESENED BY ITS ASSISTANT REGISTRAR. R1 BY SRI.JOSE JOSEPH, SC, FOR INCOME TAX THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON14-03-2012, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P.(C)No.151/2009 APPENDIX PETITIONER'S EXHIBITS: EXT.P1:COPY OF THE ASSESSMENT ORDER DTD.30/03/2006 PASSED BY THEFIRST RESPONDENT.FIRST RESPONDENT. EXT.P2:COPY OF THE APPELLATE ORDER DTD.30/11/2006 IN ITA No.30-Q/06-07 PASSED BY THE CIT(A), TRIVANDRUM.Q/06-07 PASSED BY THE CIT(A), TRIVANDRUM. EXT.P3:COPY OF THE ORDER GIVING EFFECT TO THE APPELLATE ORDERDTD.15/01/2007 PASSED BY THE 1ST RESPONDENT.DTD.15/01/2007 PASSED BY THE 1ST RESPONDENT. EXT.P4:COPY OF THE MEMORANDUM OF CROSS OBJECTION SUBMITTED BY THEPETITIONER BEFORE THE 3RD RESPONDENT.PETITIONER BEFORE THE 3RD RESPONDENT. EXT.:COPY OF THE AFFIDAVIT AND PETITION FOR CONDONATION OF DELAYP4(a)FILED ALONG WITH C.O. BEFORE THE 3RD RESPONDENT.P4(a)FILED ALONG WITH C.O. BEFORE THE 3RD RESPONDENT. EXT.P5:COPY OF TRADING AND PROFIT AND LOSS ACCOUNT AND BALANCESHEET FOR THE YEAR ENDED 31/3/2002 OF THE FIRM.SHEET FOR THE YEAR ENDED 31/3/2002 OF THE FIRM. EXT.:COPY OF EXPLANATION SUBMITTED BY THE PETITIONER BEFORE THEP5(a)FIRST RESPONDENT.P5(a)FIRST RESPONDENT. EXT.:COPY OF THE CHART SHOWING THE DATES AND EVENTS AS PER THEP5(b)ASST.ORDERP5(b)ASST.ORDER EXT.P6:COPY OF THE ORDER IN ITA No.189/Coch/07 DTD.21/11/2008PASSED BY THE 3RD RESPONDENT.PASSED BY THE 3RD RESPONDENT. EXT.P7:COPY OF THE STATEMENT SHOWING THE PARTICULARS OF ARREARS FORTHE YEAR 1995-96 TO 2002-03 BY THE PETITIONER. THE YEAR 1995-96 TO 2002-03 BY THE PETITIONER. EXT.P8:COPY OF THE NOTICE IN FORM NO.16 DTD.24/8/2005 ISSUED BY THETAHSILDAR (RR), KOLLAM.TAHSILDAR (RR), KOLLAM. EXT.P9:COPY OF THE RELEVANT PORTION OF O.A.No.OF 2005 FILED BY THEFEDERAL BANK BEFORE THE HONOURABLE DEBTS RECOVERY TRIBUNAL,ERNAKULAM.FEDERAL BANK BEFORE THE HONOURABLE DEBTS RECOVERY TRIBUNAL,ERNAKULAM. EXT.P10: COPY OF THE NOTICE NO.KR/16586/RECOVERY/TVM/2004/2006DTD.20/05/2004 ALONG WITH ORDER NO.KR/16586/Enf.II(5)/2006/3797 dtd.21/08/2006 ISSUED BY THE RECOVERY OFFICER,EMPLOYEES PROVIDENT FUND, TRIVANDRUM ISSUED BY THE RECOVERYOFFICER, EMPLOYEES PROVIDENT FUND, TRIVANDRUM.DTD.20/05/2004 ALONG WITH ORDER NO.KR/16586/Enf.II(5)/2006/3797 dtd.21/08/2006 ISSUED BY THE RECOVERY OFFICER,EMPLOYEES PROVIDENT FUND, TRIVANDRUM ISSUED BY THE RECOVERYOFFICER, EMPLOYEES PROVIDENT FUND, TRIVANDRUM. RESPONDENT'S EXHIBITS:NIL. //TRUE COPY// P.A. TO JUDGE ANTONY DOMINIC,J ------------------------------------------ W.P.(C)No.151 of 2009 ------------------------------------- Dated this the 14[th ] day of March, 2012 JUDGMENT Petitioner is an assessee under the Income Tax Act. In respect of the assessment year 2002-2003, assessment wascompleted in March, 2006. On account of various additions thatwere made in spite of returning loss for the year, a demand forRs.48,44,436/- was raised, which included interest. RESPONDENT'S EXHIBITS:NIL. //TRUE COPY// P.A. TO JUDGE ANTONY DOMINIC,J ------------------------------------------ W.P.(C)No.151 of 2009 ------------------------------------- Dated this the 14[th ] day of March, 2012 JUDGMENT Petitioner is an assessee under the Income Tax Act. In respect of the assessment year 2002-2003, assessment wascompleted in March, 2006. On account of various additions thatwere made in spite of returning loss for the year, a demand forRs.48,44,436/- was raised, which included interest. 2. Appeal filed by the petitioner to the AppellateCommissioner was partially allowed and reduction was granted.Petitioner did not file any further appeal to the Tribunal. However,department filed appeal before the Tribunal, which was numberedas ITA No.189/COCH/07. Notice of the appeal was served on thepetitioner during April 2007. In terms of the provisions containedin Section 253(4) of the Act, cross objection if any, should havebeen filed within 30 days. However, the petitioner filed crossobjection. Ext.P4 cross objection in June 2008 together withExt.P4(a) application to condone delay of 347 days in filing thecross-objection. 3. By Ext.P6 order, the petition filed by the Department wasrejected and the cross objection filed by the petitioner was alsorejected, declining to condone delay as sought for by thepetitioner. The reasons stated by the Tribunal for rejecting thecross objection reads thus: “However, we are unable to accept the pleaof the learned counsel for the assessee for thecondonation of the delay. The delay is also veryinordinate and it is time barred by 347 are notsufficient enough to be condoned. Under theabove circumstances, we see no justification inallowing the cross objection. At it is a crossobjection which is time barred by 347 days, wedismiss the Cross Objection filed by the assessee.” 4. It is challenging Ext.P6 to the extent the cross objectionrejected, the writ petition is filed. 5. I heard the counsel appearing for the petitioner and alsothe learned standing counsel appearing for the respondents. 6. According to the learned counsel for the petitioner, inExt.P4(a), convincing reasons have been stated by the petitionersatisfactorily explaining the delay in filing the cross objection andthat in spite of it, the Tribunal wrongly rejected the application. On the other hand, according to the standing counsel, thereasons stated are vague and do not amount to a satisfactoryexplanation of the delay. Therefore, he argued that Ext.P6 doesnot call for any interference. 7. It has been laid down by the Apex Court that in thematter of condonation of delay, the approach to be adopted bythe courts and Tribunal should be liberal or else, parties will bedeprived of an opportunity to get the disputes adjudicated onmerits. Reading of Ext.P4(a) order of application filed by thepetitioner for condonation of delay shows that mainly threereasons are stated. First reason stated is that they were unawareof the right under Section 253(4) to file cross objection. It is truethat this ignorance of the petitioner does not justify the delaycaused. It is stated by the petitioner, that their firm was in lossand financial difficulties and that they did not have themanpower to deal with tax matters. It is also stated that theywere involved in several litigations before various forums andthat such disputes also contributed to the delay. There is nothingon record to doubt the genuineness of these contentions. In such a factual situation, I feel that the Tribunal ought to have accepted the explanation offered by the petitioner and condonethe delay. 8. For these reasons, I cannot uphold Ext.P6 to the extent such a factual situation, I feel that the Tribunal ought to have accepted the explanation offered by the petitioner and condonethe delay. 8. For these reasons, I cannot uphold Ext.P6 to the extent delay in filing cross objection(C.O.No.42/COCH/08) is declined tobe condoned. Therefore, writ petition will stand disposed ofquashing Ext.P6 to the extent, Ext.P4 (a) application forcondonation of delay and C.O.No.42/COCH/08 is dismissed. 9. It is ordered that the delay in filing the cross-objectionwill stand condoned and the Tribunal shall consider the cross-objection (CO No.42/COCH/08) on merits after issuing notice tothe parties and accordance with law. Needless to say that havingregard to the fact that the issue pertains to the assessment year2002-2003, the Tribunal shall consider the matter with thepriority that it deserves. Writ petition is disposed of as above. ANTONY DOMINIC, JUDGE