High Court Will Not Disturb Concurrent Condonation Rejection

High Court Will Not Disturb Concurrent Condonation Rejection Unless Findings Are Shown Perverse

Issue

Whether the High Court under Section 260A can re-appreciate factual findings and interfere with concurrent orders of the CIT(A) and the ITAT rejecting the condonation of a 441-day delay in filing a first appeal.

Facts

Delay in Appeal: For Assessment Year 2014-15, the assessee filed a first appeal before the CIT(A) with a delay of 441 days.
Dismissal by CIT(A): The CIT(A) found that the assessee failed to demonstrate sufficient cause explaining the 441-day delay and refused to condone it.
Upheld by Tribunal: On further appeal, the ITAT appreciated the material on record and upheld the CIT(A)’s finding, holding that no sufficient cause was shown for the delay.
High Court Appeal: The assessee filed an appeal before the High Court under Section 260A, seeking re-appreciation of the facts to condone the delay.

Decision

Sufficient Cause is a Fact-Finding Exercise: In favour of Revenue. Evaluating the sufficiency of cause shown for condoning a delay is a exercise of factual appreciation, primarily within the domain of the initial fact-finding authorities. [Para 14]
Scope of High Court Interference: In favour of Revenue. When two lower authorities concurrently hold that sufficient cause was not shown, the High Court will not re-appreciate evidence or substitute its view under Section 260A unless the finding is proven perverse, based on no material, or arrived at by ignoring relevant facts. [Para 15]
No Substantial Question of Law: In favour of Revenue. Since both the CIT(A) and Tribunal applied settled legal principles to evaluate the 441-day delay, the concurrent finding of fact called for no interference under Section 260A. [Para 16]

Key Takeaways

Concurrent Findings on Delay Stand: The High Court will not re-evaluate facts to overturn concurrent orders of the CIT(A) and ITAT rejecting condonation of delay unless perversity is clearly demonstrated.
High Threshold for Section 260A Review: Condonation of delay involves discretionary factual appreciation; mere disagreement with lower authorities’ discretion does not give rise to a substantial question of law.
Litigants Must Prove Reasonable Cause: Substantial delays (such as 441 days) require clear, verifiable, and compelling justifications at the first-instance appeal stage to prevent final dismissal.

HIGH COURT OF PUNJAB & HARYANA

Rijwan

Income-tax Officer

Deepak Sibal and Sunish Bindlish, JJ.

IT Appeal No. 3 of 2020 ^†

SEPTEMBER 23, 2026

Rishabh Singla and Anirudh Garg, Advs. for the Appellant. Ranvijay Singh, Sr. Standing Counsel and Vidul Kapoor, Jr. Standing Counsel for the Respondent.

ORDER

1. The present appeal has been preferred by the appellant/assessee under Section 260-A of the Income Tax Act, 1961 (for brevity, “the Act”), against the order dated 01.05.2019 (Annexure A-6), passed by the Income Tax Appellate Tribunal, Delhi Bench “SMC”, Delhi (hereinafter referred to as “the Tribunal”) in Rizwan v. ITO [IT Appeal No. 7807 (Del.) of 2018, dated 1-5-2019], relating to the Assessment Year 2014-15, whereby the Tribunal affirmed the order dated 17.09.2018 (Annexure A-4) passed by the Commissioner of Income Tax (Appeals)-1, Gurgaon [“CIT(A)”], declining to condone a delay of 441 days in filing the first appeal and consequently, dismissing the appeal preferred by the assessee, as being barred by limitation.

2. The facts necessary for determining the present appeal lie in a narrow compass. The appellant, proprietor of M/s Malik Dairy & Ice, engaged in the business of dairy products, filed his return for the Assessment Year 2014-15 declaring income of Rs. 3,73,618/-. The case was selected for scrutiny. Statutory notices under Sections 143(2) and 142(1) of the Act were sent, however, the same remained uncomplied with and were returned as unserved with the endorsement “Refused to take”. Despite sufficient opportunity, the appellant did not produce his books of account or any material in support of the return. The Assessing Officer, invoking Section 145(3) read with Section 144 of the Act, rejected the books of account and framed a best-judgment assessment dated 07.12.2016, estimating net profit at the rate of 3% of the declared gross receipts of Rs.12,28,16,022/-, thereby computing income at Rs. 36,84,481/- and making an addition of Rs. 33,10,863/-.

3. Aggrieved against the aforesaid assessment order dated 07.12.2016, the appellant preferred an appeal before the CIT(A), but only on 22.02.2018 i.e., 441 days after service of the assessment order on 09.12.2016. Along with the appeal, an application for condonation of delay was filed. The explanation offered was that the appellant’s tax consultant, Mr. Vineet Shukla, Advocate, was unable to act on account of his mother’s hospitalisation and her subsequent demise on 26.01.2017. Owing to bereavement, the counsel returned to his office only on 15.03.2017 and thereafter suffered from liver and heart ailments, on account whereof the appeal could not be filed from 16.03.2017 until 31.01.2018 and that he resumed the work on 01.02.2018 and filed the appeal on 22.02.2018.

4. The CIT(A), vide order dated 17.09.2018, found that no reasonable cause was established for the delay and dismissed the appeal as time-barred, without going into the merits.

5. The appellant carried the matter to the Tribunal, reiterating the very same explanation. The Tribunal, vide impugned order dated 01.05.2019, concurred with the CIT(A) and dismissed the appeal, principally for the following reasons:

(i)

After the death of his mother, counsel for the assessee resumed his office on 15-03-2017 and since then no appeal was filed before CIT(A) till 22-02-2018. During this period of approximately one year, the assessee did not do anything in the matter.

(ii)

The plea regarding the counsel’s liver and heart ailment during this period was a general assertion and not proved to the satisfaction of the CIT(A).

(iii)

the assessee did not cooperate before the AO and did not produce anything to support the return. He refused to accept the statutory notices or file a reply and did not produce books of account and other documents to the satisfaction of AO.

(iv)

the Tribunal on appreciation of facts held that the assessee and his counsel were wholly negligent and did not take any steps in the matter of filing of appeal before CIT(A) within limitation.

6. The Tribunal relied upon Vedabai alias Vaijayanatabai Baburao Patil v. Shantaram Baburao Patil 253 ITR 798 (SC), and CIT v. Ram Mohan Kabra [2002] 257 ITR 773 (Punjab & Haryana), to hold that the assessee had failed to demonstrate sufficient cause for the delay.

7. In this appeal, the following question has been proposed as a substantial question of law:

“Whether on the facts and circumstances of the case, the Ld. ITAT is justified in ignoring the fact that the appellant had shown sufficient cause for condonation of delay?”

8. Learned counsel for the appellant contended that the delay was neither intentional nor attributable to the appellant as the matter had already been entrusted to a professional and that a litigant ought not to be deprived of adjudication on merits for circumstances arising in the office of his counsel. Reliance was also placed upon the liberal principles governing “sufficient cause”, as propounded in the judgments of the Hon’ble Apex Court in the cases of Collector, Land Acquisition v. Mst. Katiji (SC)/(1987) 2 SCC 107 and N. Balakrishnan v. M. Krishnamurthy (1998) 7 SCC 123.

9. Per contra, learned counsel for the respondent supported the orders of the authorities below and submitted that the explanation was general in nature and that the alleged prolonged illness of the former counsel was never supported by satisfactory material. Moreover, there is no explanation of any diligence exercised by the appellant himself for nearly a year and that concurrent factual findings regarding absence of sufficient cause do not give rise to a substantial question of law under Section 260-A of the Act.

10. We have heard learned counsel for the parties and have examined the record.

11. Section 249(2) of the Act prescribes the period of 30 days within which an appeal is required to be presented before the CIT(A), while sub-section (3) empowers the Commissioner (Appeals) to admit an appeal after expiry of the prescribed period, if satisfied that the appellant had sufficient cause for not presenting it within such period. Thus, while the power to condone is undoubtedly available, the existence of “sufficient cause” is the statutory condition for its exercise.

12. There can be no quarrel with the proposition that the expression “sufficient cause” is not to be construed pedantically. In Mst. Katiji’s case(supra), the Hon’ble Supreme Court advocated a “justice-oriented approach” to applications for condonation of delay so as to advance substantial justice. Likewise, in N. Balakrishnan (supra), the Hon’ble Supreme Court upheld the principles of liberal construction to advance substantial justice and emphasized that the length of delay by itself is not decisive. It was, however, held that the acceptability of the explanation is the only criterion. Reference may also be made to the decision of the Hon’ble Supreme Court in Basawaraj v. Special Land Acquisition Officer (2013) 14 SCC 81, where the Hon’ble Supreme court has held that the law on the issue can be summarised to the effect that where a case has been presented in the court beyond limitation, the applicant has to explain the court as to what was the “sufficient cause” which means an adequate and enough reason which prevented him to approach the court within limitation. In case a party is found to be negligent, or for want of bona fide on his part in the facts and circumstances of the case or found to have not acted diligently or remained inactive, there cannot be a justified ground to condone the delay.

13. The Hon’ble Apex Court in Esha Bhattacharjee v. Managing Committee of Raghunathpur Nafar Academy (2013) 12 SCC 649, while cautioning against a pedantic and hyper-technical approach, equally emphasised that inaction, negligence or lack of bona fides would be the relevant factors that have to be taken into consideration and cannot be given a go-by. A distinction between a short delay and an inordinate delay is also relevant considerations. The concept of liberal approach has to encapsulate the conception of reasonableness and it cannot be allowed totally unfettered free play.

As held in P.K. Ramachandran v. State of Kerala (1997) 7 SCC 556, the law of limitation may harshly affect a particular party, but it has to be applied with all its rigour when the statute so prescribes, and the courts have no jurisdiction to extend the period of limitation on equitable grounds where the delay has not been satisfactorily explained.

14. It is also well settled that this Court, in exercise of its appellate jurisdiction, can interfere only where a “substantial question of law” arises, i.e. a question which is not merely of academic interest but which substantially affects the rights of the parties, and which has not already been settled by a binding precedent. Reference in this regard be made to the decision rendered in the case of Santosh Hazari v. Purushottam Tiwari (2001) 3 SCC 179.

Further, the sufficiency, or otherwise, of the cause shown for condonation of delay is, in the first instance, a finding arrived at on an appreciation of facts placed before the fact-finding authority. Where two authorities (here, the CIT(A) and the Tribunal), have concurrently found, on proper appreciation of facts and material available on record, that no sufficient cause was made out, this Court would not re-appreciate that material and substitute its own view unless the finding is shown to be perverse, based on no material or arrived at by ignoring relevant material or taking into account irrelevant material. Reference in this regard may be made to the decisions rendered by the Hon’ble Supreme Court in the cases of CIT v. P. Mohanakala 291 ITR 278 (SC) and Vijay Kumar Talwar v. CIT, New Delhi 330 ITR 1 (SC)/(2011)1 SCC 673 . Moreover, in Ram Mohan Kabra’s case (supra), it has been held by this Court that once the concerned authority applies its mind and declines to condone the delay in filing the appeal for good and appropriate reasons, in that event it cannot give rise to a question of law for determination.

15. Tested against afore principles, we find no infirmity, much less any perversity, in the concurrent findings of the CIT(A) and the Tribunal.

Firstly, the explanation set up by the appellant, even taken at face value, accounts at best for the period ending 15.03.2017, the date on which the counsel is stated to have resumed office. It furnishes no explanation whatsoever — beyond a bare, particularized assertion of continuing ill-health for the subsequent period of nearly eleven months, up to 22.02.2018, when the appeal was in fact filed. No medical certificate, prescription, hospital record or other material was placed before the CIT(A) to substantiate the claim of the counsel’s liver and heart ailment during this period. An unsubstantiated and generalised plea of this nature cannot discharge the burden of showing sufficient cause for each segment of the admittedly inordinate delay in the present case.

Secondly, the appellant’s own conduct at the assessment stage is a relevant and telling circumstance. The record shows that statutory notices were declined to be accepted on more than one occasion and that despite adequate opportunity neither any reply was filed nor any books of account or supporting material were produced before the Assessing Officer. This pattern of non-cooperation is not attributable solely to the counsel. It reflects, in the first instance, on the appellant himself.

As discussed above, while length of delay is not the sole criterion, the explanation offered must still satisfy the test of bonafides and reasonableness. Viewed against the appellant’s demonstrated indifference to the proceedings even at the assessment stage, the plea that the delay in filing the first appeal was wholly attributable to the counsel’s personal circumstances does not inspire confidence, and both the CIT(A) and the Tribunal were justified in declining to accept it at its face value.

Thirdly, reliance placed by the appellant on the decision in the case of Rafiq v. Munshi Lal, AIR 1981 SC 1400 to state that a party ought not to suffer for the default of his counsel, would not be attracted in the facts in this case as that was a case where the party engaged a lawyer and appeal had been validly instituted in time, however, the lawyer did not appear on date of hearing leading to ex parte order of dismissal of the appeal for nonappearance of the counsel. Application made by counsel for recalling the order and for permission to participate in the hearing of the appeal, was rejected by the High Court on the ground of unexplained delay in presenting the application to the Court. In appeal, the Hon’ble Supreme Court observed that the party having done everything in his power to effectively participate in the proceedings, could not be expected to act as a watchdog and see that the advocate appears in the matter when listed.

It was held that the party having done everything in his control could not be made to suffer for the default of his counsel. As apposed to the facts involved in the said case, in the present case (as also discussed in detail above), the appellant has failed to offer any reasonable or sufficient explanation for his inaction and negligence in ensuring that the appeal was filed before the CIT(A) within the period of limitation.

16. For the foregoing reasons, we are satisfied that the finding recorded concurrently by the CIT(A) and the Tribunal that the appellant failed to show sufficient cause for the delay of 441 days in filing the first appeal, is a finding of fact/discretion, correctly arrived at upon a proper application of the settled principles of law laid down by the Hon’ble Supreme Court and appreciation of the material available on record and therefore, calls for no interference. No substantial question of law, much less the one proposed by the appellant, arises for consideration in this appeal.

17. The appeal is accordingly dismissed. No order as to costs.

18. Pending application(s), if any, shall stand disposed of.