Pursuing rectification u/s 154 is reasonable cause for condonation of delay in filing appeal

Pursuing remedy through rectification application u/s 154 within time, is a reasonable cause for condonation of delay in filing of appeal before CIT(A).

In a recent judgment, ITAT Lucknow has accepted the plea that pursuing remedy through application u/s 154 of Income Tax Act within time, should be accepted as a reasonable cause for condonation of delay in filing of appeal in the office of the CIT(A).

ABCAUS Case Law Citation:
4985 (2026) (01) abcaus.in ITAT

In the instant case, the assessee had challenged the order passed by the CIT(A) in not accepting the application of Condonation of Delay filed by the appellant along with Form-35.

In this case, assessee’s return was processed under Section 143(1) of the Income Tax Act, 1961 (the Act) whereby adjustment was made, making addition to the returned income.

The assessee’s appeal was dismissed by the CIT(A) vide impugned appellate order whereby the assessee’s appeal was not admitted on limitation ground. The assessee’s appeal was dismissed without going into the merits of the case, as the delay in filing of the appeal was not condoned u/s 249(3) of the Act by the CIT(A).

Before the Tribunal, the assessee submitted that the assessee had adduced reasonable grounds for delay in filing of the appeal in the office of CIT(A). It was further clarified that the delay arose because the assessee had pursued remedy through application u/s 154 of the Act. However, realizing that the more appropriate remedy was to file appeal before the CIT(A), the assessee had separately filed appeal before CIT(A) also.

It was also submitted that the application for rectification u/s 154 of the Act was filed by the assessee within prescribed time limit without any delay, which established that the assessee was not negligent, and that the assessee had no mala fide intention.

It was contended that the act of the assessee in pursuing remedy through application u/s 154 of the Act within good time, should be accepted as a reasonable cause for delay in condonation of filing of appeal in the office of the CIT(A).

The assessee prayed that the CIT(A) should be directed to decide assessee’s appeal on merits after condoning delay in filing of appeal.  The assessee relied on several judicial precedents in support of his case.

The Tribunal expressed satisfaction that, in the facts and circumstances of the case, having regard to the submissions made by the assessee, and having due regard to materials on record, this was a fit case for condonation of delay by the CIT(A). 

Accordingly, the ITAT set aside the impugned appellate order of the CIT(A) and restored the disputed matter regarding addition made u/s. 143(1) of the Act, back to the file of the CIT(A) with the direction to condone the delay in filing of the appeal, and to decide the appeal on merits.

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