G. Sundaravel and Brothers vs Income Tax Appellate Tribunal and Another

K. Raviraja Pandian, J.—This writ petition is filed for the relief of issuance of a writ of certiorarified mandamus calling for the records of the first respondent in I.T.A. No. 1722/MDS/99 and quash the order dated August 16, 2005, and direct the first respondent to condone the delay in filing the appeal and hear the appeal on the merits.

Heard the learned Counsel appearing for the respondent-income tax Department.

The order, which is put in issue, is an order passed by the Appellate Tribunal refusing to condone the delay of 25 days in filing an appeal u/s 254 of the Income Tax Act.

It is interesting to note that the reason given by the assessee has been extracted by the Appellate Tribunal, but ultimately dismissed the application by saying that there found no reasonable cause for the inordinate delay of 25 days and thereby fore-closed the valuable appellate right of the assessee. The reason for the delay as extracted by the Tribunal is as follows:

The order of the Commissioner of Income Tax (Appeals) was received in November, 1999, by the partner Shri Shanmugavel. As there was quarrel between the partners, Shri Shanmugavel did not hand over the order immediately. It was only later on the partners came to know about this order, obtained it from Shri Shanmugavel and prepared the appeal papers and filed before the Tribunal. This resulted in a delay of 25 days. Copy of the reconstitution of the partnership expelling Shri Shanmugavel from the firm with effect from July 5, 2000, is enclosed. As it can be seen from the partnership deed originally it was intended to be effective from February, 2000, but due negotiations with Shri Shanmugavel it could be finalized only on July 5, 2000. It is only because of animosity of Shri Shanmugavel the appellant could not receive the papers on time and file the appeal in time.

In order to support his case in the extracted portion, the assessee has also filed expulsion order of the partner at page No. 24, which reads as follows:

Whereas Shri. G. Shanmugavel, G. Manickkavel, G. Ratnavel and V.S. Guruswamy have been hitherto carrying on business in partnership under the deed of partnership dated August 2, 1994, under the style of the deed of partnership dated August 2, 1994, under the style of M/s. G. Sundaravel and Bros and whereas the said firm has been registered at Coimbatore with the Registrar of Firms, vide Registration No. 42 of 1966 and whereas the said partner Shri G. Shanmugavel has been expelled from the firm in pursuance of a resolution passed in the meeting of the partners on the 5th day of July, 2000, notice is hereby given to all whom it may concern that the said business will henceforth be carried by Sri G. Manickavel, G. Ratnavel, and V.S. Guruswamy alone under the old style, and neither Sri G. Manickkavel, G. Ratnavel, and V.S. Guruswamy nor the firm will be liable for any act done by Sri. G. Shanmugavel or anybody or acting on his behalf after that date, i.e., July 5, 2000.

On going through the abovesaid reason, I am of the view that the "reasonable cause" envisaged u/s 253(5) has been clearly there. This court has considered that there is a sufficient cause for filing the appeal with a delay of 25 days and the delay has to be condoned and accordingly the same is condoned. The Appellate Tribunal is directed to take the appeal on file, if it is otherwise in order, and proceed further in accordance with law.

With this observation, the writ petition is allowed. However, there is no order as to costs.