TMI Blog2007 (5) TMI 297X X X X Extracts X X X X X X X X Extracts X X X X ..... CIT passed under section 264 was an order on merits as against the fact that the application under section 264 was not admitted on the ground of limitation. (3) The learned CIT(A) erred in not condoning the delay in filing the appeal even though the appellant was prevented by a sufficient cause from filing appeal within the prescribed time. (4) The learned CIT(A) erred in not deciding the appeal on merits." 3. The facts of the case, in brief, are as follows. The assessee was a partnership firm having three partners and was engaged in the business of construction/development of immovable properties. A search was conducted at the business premises of the assessee under section 132 of the Act on 25-6-1998. In response to the notice under section 158BC issued on 9-11-1998, the assessee declared undisclosed income of Rs. 97,70,000 for the block period ending 25-6-1998, in the return filed in Form No. 2B. In the assessment order passed under section 158BC(c) of the Act on 30-6-2000 the total undisclosed income was assessed at Rs. 4,34,64,022 as under: ------------------------------------------------------------ Particulars (Rs.) ------ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... paid full taxes due on the undisclosed income declared in the return, filed in response to the notice under section 158BC. He, therefore, held, vide his order dated 5-2-2002, that the appeal filed by the assessee could not be admitted in view of the provisions of section 249(4)(a). The observations made by the CIT(A) in paragraphs 3 and 4 of his order are as under: "3. Mr. V.L. Jain, C.R. and the Authorised Representative of the appellant, who appeared on 5-2-2002 in response to the letter dated 1-2-2002, fairly admitted that tax due on the income returned by the appellant had not been paid and the case of the appellant fell within the provisions of section 249(4)(a) of the Act, as extracted below: '(4) No appeal under this Chapter shall be admitted unless at the time of filing of the appeal- (a) where a return has been filed by the assessee, the assessee has paid tax due on the income returned by him; or (b) where no return has been filed by the assessee, the assessee has paid an amount equal to the amount of advance tax which was payable by him' 4. In view of the facts mentioned above and the specific provisions of section 249(4)(a), appeal cannot be admitted. Accordin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... even on merits. - that the order passed by the Assessing Officer was non-appealable before the CIT(A) on the same matter which was decided by the CIT under section 264 on merits. - that the inordinate delay of more than 3 years and 6 months was not satisfactorily explained and that there was no sufficient cause. - that the appeal was not admitted and was therefore rejected at the threshold. 8. It is the aforesaid order of the CIT(A) dated 31-8-2004 which has been challenged by the assessee in the present appeal. 9. Shri V.L. Jain, the ld. AR reiterated the submissions made on behalf of the assessee before the CIT(A). The submissions made by him are summarized below: - that the first appeal before the CIT(A) was filed in time. - that the CIT(A) was approached the second time after payment of taxes. - that the orders passed by the CIT(A) under section 264 were without jurisdiction. - that even after order passed by the CIT(A) under section 264 alternative remedy was available under section 246A. - that reliance was placed, inter alia, on the decisions in the following cases: (i) J.K. Chaturvedi v. Asstt. CIT [2004] 3 SOT 456 (Ahd.). (ii) Collector, Land Acqui ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as not expired, or, in the case of an appeal [to the Commissioner (Appeals) or] to the Appellate Tribunal, the assessee has not waived his right of appeal; or (b) where the order is pending on an appeal before the [Deputy Commissioner (Appeals)]; or (c) where the order has been made the subject of an appeal, [to the Commissioner (Appeals) or] to the Appellate Tribunal." 13. In the present case, the assessee filed an appeal before the CIT(A) on 31-7-2000 and also a revision petition under section 264 before the CIT on 2-8-2000. Because of the ban imposed by subsection (4) of section 264, the CIT rejected the petition filed under section 264 vide his order dated 2-2-2001, as mentioned in paragraph 4 above. 14. Also, because of the failure on the part of the assessee to comply with the provisions of section 249(4)(a) of the Act, the appeal filed before the CIT(A) was rejected vide order dated 5-2-2002. In our opinion, this order of the CIT(A) was appealable before the Tribunal under section 253 of the Act and consequently, the ban imposed by section 264(4) of the Act continued to operate. This view of ours gets support from the decisions discussed below. 15. In the case of C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation of delay. The CIT(A) refused to codone the delay and dismissed the appeal, vide his order dated 31-8-2004, as mentioned in paragraph 7 above. In our opinion this order of the CIT(A) cannot be sustained because when, substantial justice and technical consideration are pitted against each other, the cause of substantial justice deserves to be preferred. In taking this view we are fortified by the decision of the Supreme Court in the case of Mst. Katiji. 21. In the case of Mst. Katiji the Supreme Court, while holding that liberal approach should be adopted while exercising discretion in matters of condonation of delay in filing of the appeal, observed as under: "(1) Ordinarily, a litigant does not stand to benefit by lodging an appeal late. (2) Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As against this, when delay is condoned, the highest that can happen is that a cause would be decided on merits after hearing the parties. (3) 'Every day's delay must be explained' does not mean that a pedantic approach should be made. Why not every hour's delay, every second's delay? The doctrin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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