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Devendra Kumar Verma, 8/187, Subh Vihar, Kashipur. VS ITO-1, Kashipur
November, 20th 2014
                   DELHI BENCHES : "B" NEW DELHI

                     SHRI J.SUDHAKAR REDDY, J.M
                   AND SHRI GEORGE GEORGE K, JM

                             ITA No: 614/Del/2013
                                 AY : - 2007-08

Devendra Kumar Verma,                    ITO-1,
8/187, Subh Vihar,                       Kashipur
(Appellant)                              (Respondent)

                     Appellant by    :Shri S.K. Chaturvedi, CA
                     Respondent      :Smt. Parwinder Kaur, SR. DR



     This is an appeal filed by the assessee directed against the order of the

Commissioner of Income Tax (Appeals) II, Dehradun dated 19.11.2012 for

the assessment year 2007-08 on the following grounds :-

     1. " That the Hon'ble CIT(A) ­ 2, Dehradun, erred in law and on the
        facts and in the circumstances of the case in not condoning genuine
        and bonafide delay of 2 year and 7 months in filing an appeal
        against an impugned order dated 26.12.20008 passed u/s
        143(3)/148 of Income Tax Act, 1961 without appreciating the
        vehement and detailed arguments and pleadings placed on record.
        In view of the bonafide, honest, truthful belief and trust on the part
        of your appellant on his representatives without and intention to
        cover any ulterior purpose and the circumstances being beyond the
        control of your appellant, which has caused the unintended and
        inadvertent delay, the Hon'ble CIT(A)-2, Dehradun, ought to have
        condoned the delay. The Hon'ble CIT(A)-2, Dehradun be directed to
        condone the delay."

2.       After hearing rival contentions, we hold as follows :-
                                                                  ITA 614/Del/2013
                                                                       AY 2007-08
                                                  Shri Devendra Kumar Verma vs. ITO

      Both the parties agreed that the issue in hand is no more res Integra

as under similar circumstances the appeal filed the employees of the bank

with a delay of 2 year 7months were condoned by the ITAT.

3.    The Delhi A Bench of the ITAT in ITA No. 363/D/2013 in the case of

Anil Kumar Verma vs. ITO order dated 29.11.2013 condoned the delay by

observing as follows :-

            "6.2 We have considered the submissions of both sides and have
            perused the record of the case.

            6.3 The condonation of delay depends upon the sufficiency of
            reasons seeking condonation. In the present case, the assessee
            in its condonation petition had pointed out that it was on account
            of legal advice that he did not pursue the matter, any further,
            after the assessment order was passed. Subsequently on the
            basis of legal advice, the assessee filed a petition u/s 154. Again
            he got a legal advice that the appeal is to be preferred and,
            therefore, he filed the appeal.

            7. In our opinion, the assessee cannot be treated as a litigant
            who was not interested in pursuing the legal remedy against the
            assessment order. It was only on account of wrong legal advice
            that the assessee did not pursue the appeal. Filing of petition u/s
            154 and thereafter appeal before Ld. CIT(A) clearly vindicates the
            assessee's claim that he was acting on legal advice. The
            assessee was a bank employee and not a legal expert to know
            the niceties of his legal rights. The Hon'ble Supreme Court in the
            case of Mst. Kattiji & Othrs. (supra) has held as under :-

            "The Legislature has conferred power to condone delay by
            enacting section 5 of the Limitation Act, 196 , in order to enable
            the courts to do substantial justice to parties by disposing of
            matters on merits. The expression "sufficient cause" in section 5
            is adequately elastic to enable the courts to apply the law in a
            meaningful manner, which subserves the ends of justice ­ that
            being the life-purpose of the existence of the institution of courts.
            A justifiably liberal approach has to be adopted on principle.

            "Every day's delay must be explained" does not imply a pedantic
            approach. The doctrine must be applied in a rational, common
            sense and pragmatic manner.

            The doctrine of equality before law demands that all litigants,
            including the State as a litigant, are accorded the same treatment

                                                      ITA 614/Del/2013
                                                           AY 2007-08
                                      Shri Devendra Kumar Verma vs. ITO

and the law is administered in an evenhanded manner. There is
no warrant for according a step motherly treatment when the
State is the applicant praying for condonation of delay.

" When substantial justice and technical considerations are pitted
against each other, the cause of substantial justice deserves to be
preferred, for the other side cannot claim to have a vested right in
injustice being done because of a non-deliberate delay."

7.1 In our opinion, this decision is squarely applicable in the
present set of facts and the delay in filing the appeal before Ld.
CIT(A) should have been condoned.

8. Ld. DR has relied on various decisions which are discussed
hereunder :

   ·   Madhu Dadha vs. Asstt. CIT, Chennai. In this case there
       was a delay of 558 days in filing the appeal. Tribunal
       rejected the appeal holding that assessee was not given
       sufficient reasons for delay. In para 8 & 9 the Hon'ble
       Madras high Court has observed as under :-

       8. "From a reading of the above, it is clear that the
       appellant has not explained the cause of delay in filing the
       appeal, especially when authorized representative viz.
       Representative who was given charge to file the appeal
       had died exactly one year after the last date of filing of the
       appeal. When that be so, it is pertinent to point out that
       actually the filing of the appeal was not done and even
       after the death of Ashok Kumbat, the assessee had taken
       more than six months in filing the present appeal. The
       assessee had neither given any particular or details in the
       affidavit as on which date the papers were handed over to
       the counsel for preparing the appeal and on what occasion
       the assessee enquired about the progress in preparing the
       appeal and filing the same."

Thus, under such circumstances, the Hon'ble High Court held
that there was no sufficient reason or cause to interfere with the
order of the Tribunal. This decision is not at all applicable in the
present set off facts.

   ·   Shree Balaji Woollen Mills vs. Asstt. CIT. In this case there
       was a delay of 902 days.

2. "These appeals earlier disposed of vide order dated 2.6.2011,
were recalled vide order dated 28.9.2012 in MA Nos. 273 &
274/D/2011. The quantum appeal filed by the assessee in ITA
No. 1238/D/2011 is delayed by 902 days. Though the assessee
mentioned in ground No. 3 in the appeal that there was
reasonable cause for delay in filing the appeal, not even a

                                                     ITA 614/Del/2013
                                                          AY 2007-08
                                     Shri Devendra Kumar Verma vs. ITO

whisper has been made in the documents annexed with the
appeal as to what was the reasonable cause nor any application
for condonation of delay of 902 days in filing the appeal has been
submitted ever since appeal was filed on 10.3.2011.None
appeared before us on behalf of the assessee even when date of
hearing was specifically informed to the Ld. AR on behalf of the
assessee when he appeared on 22.11.2012. A is evident from the
aforesaid facts, quantum appeal filed by the assessee when he
appeared on 22.11.2012. As is evident from the aforesaid facts,
quantum appeal filed by the assessee is delayed by 902 days
while no request has been made by the assessee for condonation
of delay in filing the appeal. In these circumstances, there being
no sufficient cause for delay in filing the appeal, the appeal
cannot be admitted. Regarding `sufficient cause', in the case of
Gopal Films vs. CIT (1999) 237 ITR 655 / 105 Taxman 364 (kar.)
it was held by the Hon'ble Court that

             "Whenever a party wants delay to be condoned, he
             should show sufficient cause. If no cause is shown at
             all, the only conclusion that can be reached is that
             the delay cannot be condoned, particularly when
             lack of bona fides is evident."

Since assessee did not give any reasonable cause nor any
application for condonation of delay, therefore, Tribunal did not
condone the delay. This decision is also not applicable to the
facts of the case in-as-much as assessee itself had taken a
ground before Ld. CIT(A) for condonation of delay and had filed
the petition for condonation of delay

   ·   Agricultural Market Committee vs. ADIT (Exemptions-1),
       Hyderabad. In this case there was a delay of 1500 days in
       filing appeals. The Tribunal while refusing to condone the
       delay, inter-alia, observed as under :-

       "The delay cannot be condoned simply because the
       assessee's case is hard and calls for sympathy or merely
       out of benevolence to the party seeking relief. In granting
       the indulgence and condoning the delay, it must be proved
       beyond the shadow of doubt that the assessee was diligent
       and was not guilty of negligence whatsoever. The sufficient
       cause within the contemplation of the limitation provision
       must be a cause which is beyond the control of the party
       invoking the aid of the provisions. The Supreme Court in
       the case of Ramlal vs. Rewa Coalfields Ltd. AIR 1962 SC
       361 has held that the cause for the delay in filing the
       appeal which by due care and attention could have been
       avoided, cannot be a sufficient cause within the meaning of
       the limitation provision. Where no negligence, nor inaction,
       or want of bonafides can be imputed to the assessee a

                                                                  ITA 614/Del/2013
                                                                       AY 2007-08
                                                  Shri Devendra Kumar Verma vs. ITO

                   liberal construction of the provisions has to be made in
                   order to advance substantial justice. Seekers of justice
                   must come with clean hands. In the present case, the
                   reasons advanced by the assessee do not show any good
                   and sufficient reason to condone the delays. The delays
                   are not properly explained by the assessee. There is no
                   reason for condoning such delays for the assessment years
                   under consideration. The delay is nothing but negligence
                   and inaction of the assesseee which could have been very
                   well avoided by the exercise of due care and attention.
                   There exists no sufficient or good reason for condoning
                   inordinate delays of more than 1500 days for the years
                   under consideration (para 6)".

            This decision also is of no assistance to revenue because here
            also the assessee was found to be negligent and failed to prove
            that he was diligent and was not guilty of negligence
            whatsoever. In the present case, however, as noted earlier,
            assessee had pointed out that on account of wrong legal advice
            it did not file appeal before Ld. CIT(A). The assessee's action of
            filing 154 petitions before AO indicates assessee's plea that he
            was not negligent.

            9. In view of above discussion, we condone the delay in filing
            the appeal before Ld. CIT(A) and restore the matter to his file for
            deciding the appeal denovo on merits."

4.   Similar view has been taken by the G Bench of the ITA No.

364/Del/2013 order dated 19.12.2013. Consistent with the view taken

therein we condone the delay in filing the first appeal before the Ld. CIT(A).

5.   Normally in such cases the appeal is restored to the file of CIT(A) for

fresh adjudication. But, as the issue as to whether the asessee is entitled

for exemption u/s 10(10C) is no more res Integra in view of number of

decisions on the matter, we feel it would be an empty formality to set aside

the matter. Thus we dispose off the case on merits.

6.      Hon'ble Calcutta High Court in the case of Sail DSP VR Employees

Association 1998 v. Union of India held that the maximum exemption under

                                                                        ITA 614/Del/2013
                                                                             AY 2007-08
                                                        Shri Devendra Kumar Verma vs. ITO

section 10(10C) of Rs. 5 lakhs is allowable as all the conditions of Section

10(10C) read with rule 2BA are fulfilled. If the sum is received in excess of

Rs. 5 lakhs, the same was held eligible for relief under section 89 (1) of the

Act in view of the decision of Hon'ble Madras High Court in the case of CIT

vs. G.V. Venugopal. The sums in question are clearly the part of salary in

the form of profits in lieu of salary as defined in Section 17(3) of the Act.

These are amount of compensation received by, the employee from the

employer in connections with the terms of employment and, therefore, the

assesees in question are clearly entitled for relief under section 89(1) in

accordance with law in respect of the payments that are included in the

total income. This view has been expressed in the decision of the Hon'ble

Madras High Court in the case of CIT v. Venugopal 273 ITR 307 (Mad) and

the decision of the Hon'ble Karnataka High Court in CIT v. P. Surendra

Prabhu 279 ITR 402 (Karn), CIT vs. Nagesh Devidas Kulkarni (2007) 291 ITR

407 (Bom) and others.

7.   Respectfully following the same we allow this appeal of the assessee.

8.   In the result appeal of the assessee is allowed.

     Order pronounced in the Open Court on 19th November, 2014.

                     sd/-                                                  sd/-

         (GEORGE GEORGE K)                               (J.SUDHAKAR REDDY)
         JUDICIAL MEMBER                                ACCOUNTANT MEMBER

Dated: the 19th November, 2014

Copy of the Order forwarded to:

1.       Appellant

                                  ITA 614/Del/2013
                                       AY 2007-08
                  Shri Devendra Kumar Verma vs. ITO

2.   Respondent
3.   CIT
4.   CIT(A)
5.   DR
6.   Guard File

                          By Order

                       Deputy Registrar

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