Affidavit statement has to be taken as correct unless controverted by material filed by other party to counter the statement made therein – ITAT
ABCAUS Case Law Citation:
ABCAUS 1177 (2017) (03) ITAT
This assessee was aggrieved by the order passed by the CIT(A) upholding the reopening of the assessment section 147 r.w.s.148 of the Income Tax Act, 1961 (‘the Act’)
Assessment Year : 2008-09
Date/Month of Pronouncement: March, 2017
Brief Facts of the Case:
The appellant assessee had filed the present appeal before the Tribunal (‘ITAT’) with a delay of 218 days. The order of the CIT(A) was passed on 13.11.2013 whereas the same was claimed to have been communicated to the assessee on 10.01.2014 but the appeal was ultimately filed on 15.10.2015 resulting in a delay of 218 days.
The assessee-company filed an affidavit seeking condonation of delay, duly signed by the Whole-time Director of the Company, and also a petition was filed under section 253(5) of the Act.
The case of the assessee was that it took two months to receive the order of the CIT(A) but the said order was served upon one person in the name of an employee of another company who did not know about the assessee-company since it had become dormant for many years.
In the affidavit it was stated that the assessee-company was incorporated in the Financial Year 2005-06 and Assessment Year 2008-09 is the first year of business wherein the assessee incurred heavy losses and virtually the assessee-company had gone out of business thereafter. Under these circumstances, there was nobody to look into the day-to-day affairs of the assessee-company and whole-time Director had abandoned the affairs of the company. In other words, the business of the assessee-company had gone into hibernation.
In the affidavit, It was further stated that the said employee of other company mechanically received the impugned order of the CIT(A) and he did not inform anyone about the said order. Ultimately when the tax audit and statutory audit of the assessee-company was taken-up towards the end of September, 2014 the factum of receipt of appellate order was noticed and thereafter, the in-house Manager approached the Counsel for drafting and filing of appeal before the Hon’ble Tribunal. Ultimately the appeal was filed on 15.04.2014 which resulted in a delay of 218 days.
Contentions of the Appellant assessee:
It was contended before us that when the technical issue of delay is pitted against the merits of the case, the merits should prevail and in the instant case, the assessee has a strong case on merits inasmuch as the A.O. has issued a notice under section 148 without even recording reasons and therefore, the re-assessment proceedings deserve to be annulled as void abinitio.
Observations made by the Tribunal:
The Tribunal observed that since the affidavit was based on certain facts which could not be cross-verified by the Bench, it was the duty of the Revenue to file an appropriate reply.
With regard to the clarifications sought for by the ITAT, the Revenue submitted that it was not verifiable from the records as to who had received the order of the CIT(A), therefore, the details could not be verified
The Tribunal observed that It is well settled that a statement made in an affidavit has to be taken as correct unless some material is filed by other party to counter the statement made therein whereas, in the instant case, no material was furnished. In fact, no counter affidavit or even letter was filed by the AO till date.
Held that there was a reasonable cause for not filing the appeal in time and therefore the appeal was admitted.