TMI Blog2013 (4) TMI 886X X X X Extracts X X X X X X X X Extracts X X X X ..... the case, the Ld. CIT(A) was not justified in confirming the addition made by the AO of an amount of ₹ 9,80,015/- on account of loans allegedly taken from Finishing Touch during the year, u/s. 68 of the Income-tax Act, 1961. 5. On the facts and in the circumstances of the case, the Ld. CIT(A) was not justified in not disposing of the ground No.3 before him pertaining to addition of ₹ 34,249 out of labour charges. 6. On the facts and in the circumstances of the case, the Ld. CIT(A) was not justified in not disposing of the ground No.4 before him pertaining to addition of ₹ 3,858 out of telephone charges. 2. The brief facts of the case are that the assessee, a dealer in paper and paper products, filed his return of income declaring total income of ₹ 1,63,255. The return was processed u/s. 143(1) of the Income Tax Act. The AO found that the assessee had introduced capital of ₹ 8,94,550 during the relevant year. The assessee was asked to file the details of capital so introduced. However, the assessee despite opportunities given to him failed to provide the necessary details. The AO thus in the absence of explanation of the source of capital, tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee vide his letter dated 15/2/2010 had endorsed the letter of the representative filed with form No.35) 1. That we were the Authorised Representative in respect of matter concerning Mr. Kunal Surana before the Assessing Officer for the Assessment Year 2006-07 2. That the Assessing Officer had passed order under section 143(3) dated 16th December, 2008 and was duly served on 6th January, 2009. 3. That due to my visit to outside Mumbai on some urgent person work the preparation and submission of appeal was given to my Asssistant Mr. Anand Kanse. 4. However, he had kept these papers in his drawer and failed to take necessary action in the matter. 5. On my resumption of office, he had not informed me about the pendency of submission of appeal due to fear of reprimanded. 6. On receiving the penalty under section 271(1)(c) dated 27th May 2009 (received by our client on 30th May, 2009) it came to my notice about non submission of above appeal. 7. On further inquiry the papers were found in his drawer and left without any action. 8. That as stated above, it was due to oversight and unintentional mistake that the necessary appeal could not be submitted in time. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... On perusal of assessment order, it immensely transpires that inspite of sufficient opportunities, the assessee had not cared to explain the issues/points raised by the AO, which entailed additions. For ease of reference, relevant extract of assessment order of AO as contained in page 1 and 2 is reproduced as under. Page 1 Capital introduction treated as cash credit u/s. 68 : It is seen from the assessee s proprietary capital account that assessee has introduced capital during the year of ₹ 8,94,550/-. The assessee vide questionnaire were asked to file the details of capital introduction with sources of the same alongwith documentary evidences. The assessee did not produce the details and sources of capital introduced during the year. A reminder letter dt. 17.10.2008 was issued and served on the assessee asking to file these details. There was no compliance from the assessee s side to this reminder letter. A final opportunity letter was given to the assessee vide letter dated 21.11.2008 and case was fixed for hearing on 27.11.2008 to file the details called for. No details filed on this date. In response to this letter the assessee filed letter dt. 02.12.2008 of adjour ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in such a manner. He submitted that until and unless the application for condonation of delay is not allowed by a speaking order with the application of mind, it cannot be said that the delay was condoned automatically on entertaining the application for additional evidence by the learned CIT(A). 6. We have considered the submissions of the learned representatives of the parties. In our view there is no merit in the contention of the learned AR that on entertaining the application for additional evidence, the delay in preferring the appeal was deemed to be condoned. When a case is barred by limitation, it creates a substantive right in favour of the other party. It cannot be curtailed or taken away by such type of interpretation; rather, an application for condonation of delay is required to be heard on merits and is required to be allowed or disallowed taking into consideration the relevant facts as to whether or not the appellant/applicant was prevented by sufficient cause for not preferring the appeal in time, per a speaking order and cannot be a matter of presumption. However, if during the pendency of the appeal as well application for condonation of delay, the assessee or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , UCO Bank . 2007 (4) Bom CR 321, (2007) IIILLJ 106 Bom. 7. We may further observe that a duty was cast upon the representative of the assessee to bring into the knowledge of the first appellate authority that the appeal preferred by the assessee was time barred and before an application of additional evidence was filed, he should have pressed before the learned CIT(A) for adjudication on the application for condonation of delay. The contention of the learned AR that a right for hearing of the appeal on merits has automatically accrued to the assessee because of the fact that he has succeeded in getting entertained the application for additional evidence by keeping the learned authorities in dark about the pendency of limitation application cannot be appreciated. No one can be allowed to take benefit of his own wrong. Moreover, as observed above, in view of the settled position of law that even entertaining the application for additional evidence pending adjudication on application for condonation of delay does not give any automatic right of condonation of delay. Rather, the said order passed on any application without disposal of application for condonation of delay can be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ents of Order XIX Rule 3 of the Code of Civil Procedure. The relevant extract of the judgment is reproduced below: 12. The provision of Order XIX of Code of Civil Procedure, deals with affidavit. Rule 3 (1) of Order XIX which deals with matters to which the affidavit shall be confined provides as follows: Matters to which affidavits shall be confined. - (1) affidavits shall be confined to such facts as the deponent is able of his own knowledge to prove, except on interlocutory applications, on which statements of his belief may be admitted; provided that the grounds thereof are stated. 13. Order XI of the Supreme Court Rules 1966 deals with affidavits. Rule 5 of Order XI is a virtual replica of Order XIX Rule 3 (1). Order XI Rule 5 of the Supreme Court Rules is therefore set out: Affidavits shall be confined to such facts as the deponent is able of his own knowledge to prove, except on interlocutory applications, on which statements of his belief may be admitted, provided that the grounds thereof are stated. 14. In this connection Rule 13 of Order XI of the aforesaid Rules are also relevant and is set out below: 13. In this Order, `affidavit' includes a pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt upheld the same principle: The question then is: What were the materials placed by the appellants in support of this case which the respondents had to answer? According to Paragraph 27 of the petition, the proximate cause for the issuance of the order was the discussion that the two friends of the 2nd respondent had with him, the petition which they filed at his instance and the direction which the 2nd respondent gave to respondent No. 7. But these allegations are not grounded on any knowledge but only on reasons to believe. Even for their reasons to believe, the appellants do not disclose any information on which they were founded. No particulars as to the alleged discussion with the 2nd respondent, or of the petition which the said two friends were said to have made, such as its contents, its time or to which authority it was made are forthcoming. It is true that in a case of this kind it would be difficult for a petitioner to have personal knowledge in regard to an averment of mala fides, but then were such knowledge is wanting he has to disclose his source of information so that the other side gets a fair chance to verify it and make an effective answer. In such a situat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d interception of his telephone. The absence of such disclosure in the affidavit, which was filed along with the petition, raises a prima facie impression that the writ petition was based on unreliable facts. 20. In case of M/s Sukhwinder Pal Bipan Kumar and others v. State of Punjab and others, [(1982) 1 SCC 31], a three Judge Bench of this Court in dealing with petitions under Article 32 of the Constitution held that under Order XIX Rule 3 of the Code it was incumbent upon the deponent to disclose the nature and source of his knowledge with sufficient particulars. In a case where allegations in the petition are not affirmed, as aforesaid, it cannot be treated as supported by an affidavit as required by law. (See para 12 page 38) 21. The purpose of Rules 5 and 13 of the Supreme Court Rules, set out above, has been explained by this Court in the case of Smt. Savitramma v. Cicil Naronha and another, AIR 1988 SCC 1987. This Court held, in para 2 at page 1988, as follows: ...In the case of statements based on information the deponent shall disclose the source of his information. Similar provisions are contained in Order 19, Rule 3 of the Code of Civil Procedure. Affidavit is a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Bench judgments of this Court in Purushottam Jog Naik (supra), Barium Chemicals Ltd. (supra) and A.K.K. Nambiar (supra) and in several other judgments pointed out the importance of filing affidavits following the discipline of the provision in the Code and the said rules. 67. These rules, reiterated by this Court time and again, are aimed at protecting the Court against frivolous litigation must not be diluted or ignored. However, in practice they are frequently flouted by the litigants and often ignored by the Registry of this Court. The instant petition is an illustration of the same. If the rules for affirming affidavit according to Supreme Court were followed, it would have been difficult for the petitioner to file this petition and so much of judicial time would have been saved. This case is not isolated instance. There are innumerable cases which have been filed with affidavits affirmed in a slipshod manner. 68. This Court, therefore, directs that the Registry must henceforth strictly scrutinize all the affidavits, all petitions and applications and will reject or note as defective all those which are not consistent with the mandate of Order XIX Rule 3 of the CPC and Or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... administration of oath is also required to be mentioned. The procedure to administer the oath and making of endorsement has been described in Chapter XXVII of Maharashtra Civil Court Manual. Rule 510 511 of the said manual are relevant, which for the sake of convenience are reproduced here under: 510. The Officer, authorised to administer oaths shall before certifying the affidavit, him personally or identified before him by a person whom he personally knows, or whose identity is duly established to the satisfaction of the Officer by any of the following documents, namely Passport, Driving License, Voters identity Card, PAN Card, or photo Identity Card issued by State/Central Government. The manner in which the identification is so made shall be certified by the Officer administering the oath Every Officer administering an oath in such a case shall add the following words after the words, Solemnly affirmed before me, namely, by ... who is identified before me by or whom I personally know. 511. (1) Every affidavit to be used in a Court shall be entitled In the Court of .. (2) Every affidavit shall bear the number of the proceeding in which it is pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he has administered the oath or affirmation in the event of the same being administered elsewhere than in the Court House. 200. Affidavit not to be filed unless properly endorsed.- No affidavit shall be filed in the several offices of the Court unless properly endorsed, giving the names of the deponents, the date on which it is sworn, and stating by whom or whose behalf it is filed. Rule 9 10 of Chapter III Part II- Procedure and Practice Bombay High Court Rules are also relevant, which for the sake of convenience are reproduced as under: 9. Oath to be administered under Oaths Act . - Oaths and affirmations to be made by a witness or interpreter under section 4 of the Oaths Act, 1969 (Act XLIV of 1969), shall, as required by section 6(2) of that Act, be administered as per Rule 9 of Chapter II of the Bombay High Court Appellate Side Rules. I960. The following forms of oaths and affirmation are prescribed under section 6 of the Oaths Act, 1969 :~ Form No. 1 (Witnesses): I do swear in the name of God/solemnly affirm that what I shall state, shall be the truth, the whole truth and nothing but the truth. Form No. 3 (Interpreter) : I do swear in the name of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the case of Dr. (Smt.) Shipra Etc. Etc. vs. Shanti Lal Khoiwal Etc. Etc has observed as under: Verification by a Notary or any other prescribed authority is a vital act which assures that the election petitioner had affirmed before the notary etc. that the statement containing imputation of corrupt practices was duly and solemnly verified to be correct statement to the best of his knowledge or information as specified in the election petition and the affidavit filed in support thereof; that reinforces the assertions. Thus affirmation before the prescribed authority in the affidavit and supply of its try copy should also contain such affirmation so that the returned candidate would not be misled in his understanding that imputation of corrupt practices was solemnly affirmed or duly verified before the prescribed authority. Reliance may also be placed on the authority of The Hon ble Karnataka High Court in the case of V.R.Kamath vs. Divisional Controller AIR 1997 Kant 275, ILR 1997 KAR 1856. It may be observed that despite giving sufficient opportunity to the assessee to cure the defects in his affidavit, he has failed to do so. Even the Notary has affixed his seal on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l from his assistant. There is no mention as to whether the assessee ever enquired from his representative about the filing or non-filing, pendency or date of hearing of appeal. Neither any affidavit of the assessee nor any affidavit of the learned representative was produced before the learned CIT(A). The case is of gross negligence and inaction on the part of the assessee as well as his representative. The learned CIT(A) has rightly observed that the said letter is dated 27.06.2008, which was filed along with form no.35 on 05.06.2009, however, the assessment order is dated 16.12.2008 and the appeal has been filed on 05.06.2009 and the said letter which is prior to the assessment order cannot be related to the appeal against the said assessment order. All these facts show sheer negligence, carelessness and non-application of mind on the part of the learned representative of the assessee. No doubt, courts adopt liberal view while condoning delay on the principle that technicalities when pitied against the cause of justice, the latter should prevail. However, it can be observed that it does not mean that the litigants should take the courts for granted to ignore the gross negligence ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... usal of the assessment order as well as the order of the CIT(A) reveals that the assessee and his representative always remained careless and negligent in pursuing their case. The explanation put forward is vague and evasive and does not constitute any sufficient cause for condonation of delay. Faced with somewhat similar situation, Hon ble Punjab Harayana High court in the case of Krishan Dev Dhiman vs. Mahesh Bhatia and others [RSA No.3142 of 2006 decided on 08.04.2008] has observed as under: Even otherwise, the only ground for condonation of delay is contained in paragraph 3 of the application wherein it is stated that the brief was misplaced by the clerk of the counsel who has now left the service and on finding the file, the same has been filed now. Even otherwise, no details are given as to when the Clerk of the counsel has misplaced the file, when he had left the service of the counsel for the applicant-appellant and when the file has been found. Learned counsel appearing for the applicant-appellant has stated that it was due to the fault of the Clerk that delay has been caused. I am not impressed by this argument. It is the duty of the party also to follow his/h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The order condoning the delay cannot be sustained. This appeal, therefore, succeeds and the impugned order is set aside. Consequently, the application for condonation of delay filed in the High Court would stand rejected and the miscellaneous first appeal shall stand dismissed as barred by time. In the case of Municipal Corporation of Delhi and others Vs. International Security and Intelligence Agency Ltd. (2004) 3 Supreme Court Cases, 250 the Hon ble Supreme Court has held as follows:- 21 . It has to be remembered that law of limitation operates with all its rigour and equitable considerations are out of place in applying the law of limitation. The cross-objector ought to have filed appeal within the prescribed period of limitation calculated from the date of the order if he wished to do so. Having allowed that opportunity to lapse he gets another extended period of limitation commencing from the date of service of the notice of the appeal enabling him putting in issue for consideration of the appellate court the same grounds which he could have otherwise done by way of filing an appeal. This extended period of limitation commences from the date of service of the noti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oner was not guilty of negligence bearing in mind the definition of 'good faith' given in the Limitation Act. 12. So in view of the law laid down by the Higher Courts, there is no merit in the case of the assessee for condonation of delay. It is a case of gross negligence, inaction and laches not only on the part of the appellant but also on the part of his representative. Neither the appellant nor his representative have acted with reasonable diligence in prosecuting the appeal before the CIT(A) and as observed above, even they remained reluctant to attend or answer the reasonable queries in the assessment proceedings before the AO. The appellant has to suffer for not filing appeal within the period of limitation when he was not prevented from any sufficient cause as the courts of law cannot be taken for granted. In our view, the learned CIT(A) has rightly dismissed the application for condonation of delay and thereby appeal of the assessee being barred by limitation. The finding of the learned CIT(A) in respect of the matter is hereby upheld. Since we have upheld the order of the CIT(A) on limitation point, it is not necessary to adjudicate on other issues on merit ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
