Appellant Was Pursuing Review Petition In Good Faith, Delhi High Court Condones Delay In Filing Appeal Against ITAT Order

The Delhi High Court has condoned a 79-day delay in filing an appeal as a review petition was filed before the Income Tax Appellate Tribunal (ITAT).

The bench of Justice Rajiv Shakdher and Justice Girish Kathpalia has observed that the time spent by the applicant while pursuing the review proceedings deserves to be excluded even under principles analogous to Section 14 of the Limitation Act because the applicant, in good faith, was prosecuting the challenge to the impugned order before the Tribunal with due diligence, but the Tribunal was unable to entertain the review on account of a defect of jurisdiction.

The assessee filed the application seeking condonation of a delay of 79 days in filing the appeal against the ITAT order. The delay occurred because no further date was fixed by the ITAT after the conclusion of the final arguments, and the assessee was never informed about the outcome of the case until a written communication seeking the status of the case was sent by the assessee, whereby it was telephonically informed that the case has been decided and the order has been passed.

The department contended that lack of diligence on the part of the appellant in this case would disentitle the applicant to any discretionary relief. The actual delay in filing the appeal is 1471 days and not 79 days, for which the appellant has failed to set up a sufficient cause. It is difficult to believe that to check the status of the case, the appellant would have kept sitting silently for 1070 days after the conclusion of the final arguments before the Tribunal, and even after obtaining the certified copy of the order, the applicant opted to seek review of the order instead of promptly filing the appeal.

“The case set up by the applicant is an “explanation” and not an "excuse." Most importantly, we would prefer in the facts and circumstances of this case to be guided by the cardinal principle of justice that disputes should be decided on merits and not defaults, so the applicant, having brought before us a cause with sufficient explanation concerning the delay, cannot be shown the door,” the court said.

Counsel For Petitioner: Rachna Agrawal

Counsel For Respondent: Aseem Chawla

Case Title: Resorts Consortium India Limited Versus ITAT

Citation: 2023 LiveLaw (Del) 1178

Case No.: ITA 425/2023 & CM APPL. 45878/2023

Click Here To Read The Order