TMI Blog2009 (4) TMI 331X X X X Extracts X X X X X X X X Extracts X X X X ..... the Interest-tax Act?. Held that- contention regarding maintainability not taken before tribunal but taken for first time before high court cannot be considered. the delay was properly explained by the assessee thus is to be condoned. the assessee was only a financier to help the purchaser were finding of fact. The Tribunal was right in holding that the finance charges and the related interest were not assessable to interest tax. - 220 to 225 of 2009 - - - Dated:- 27-4-2009 - K. RAVIRAJA PANDIAN and M. M. SUNDRESH JJ. Tax Cases (Appeals) Nos. 220 to 225 of 2009 and M. P. Nos. 1 of 2009 in T. C. A. Nos. 221 to 225 of 2009. K. Subramanuim for the appellant. JUDGMENT The judgment of the court was delivered by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... morandum of grounds of appeals are as follows: (i) The assessee is a finance company assessable to interest-tax. For the assessment years 1992-93 to 1997-98, the Assessing Officer while completing the assessment proceedings levied interest-tax. The Assessing Officer brought to tax the finance charges and related interest as chargeable to interest-tax under section 2(7) of the Interest-tax Act, 1974, among other additions/disallowances. (ii) As against that order, the assessee filed an appeal before the Commissioner of Income-tax (Appeals) with a delay of 1,826 days. The Commissioner of Income-tax (Appeals), condoned the delay on being satisfied that there were sufficient cause, and decided the issue on the merits and held that interest- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ordered that petition on October 27, 2006. Hence, at the time of filing of appeal on November 20, 2006, the managing director was competent to file the appeal. However, he very strenuously contended that as the delay is 1,826 days, which is more or less 5½ years, the Tribunal should not have confirmed the order of the Commissioner of income-tax (Appeals) for the sake of passing the order. 7. Here again, we are not able to approve the argument of learned senior counsel. In paragraph 3 of the order, the Tribunal has extracted the averment of the assessee in extenso. The crux of the same is that the order of the interest-tax assessment and notice of demand were not served on the person who was duly authorised by the company to receive the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee was constrained to face so many legal litigations and virtually in the prison for 90 day's and after he came out, he made arrangement for revival of the company and also because of the pendency of the winding-up proceedings, the assessee was not able to file an appeal within the time prescribed. However, the reasoning stated is more than sufficient to condone the delay. 9. It is often said that the primary function of the court is to adjudicate the dispute between the parties and to advance substantive justice. The time- limit has been fixed for approaching the court in different situations is not because on the expiry of such time a bad cause would transform into a good cause. Rules of limitation are not meant to destroy t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the delay was occasioned by the party deliberately to gain time, then the court should lean against acceptance of the explanation. The court knows that refusal to con done the delay would result in foreclosing a suitor from putting forth his cause. There is no presumption that delay in approaching the court is always deliberate. The words "sufficient cause" under section 5 of the Limitation Act should receive a liberal construction so as to advance substantial justice. Once the court accepts the explanation as sufficient, it is the result of positive exercise of discretion and normally the superior court should not disturb such finding, unless the exercise of discretion was on wholly untenable grounds or arbitrary or perverse. But it is a d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eement filed during the appellate stage, revealed that finance charges and interest earned by the assessee were exclusively in connection with hire purchase transactions. The hire purchase finance charges are not to be subjected to "interest-tax" in view of the decisions of the High Court. The Commissioner further recorded a finding that the hirer in the assessee's case is the real purchaser of the asset and that the assessee was only a financier to assist the purchaser. Accordingly, the assessee's case is found to be squarely covered by the decisions of this court in CIT v Harita Finance Ltd. [2006] 283 ITR 370, CIT v. Sri Ram Investment Ltd. [2006] 283 ITR 371 and Vandana Finance Ltd. 12. Though the questions of law have b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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