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Judgment
PER AMITABH SHUKLA, AM
This appeal filed by the assessee is directed against the order of Ld. Commissioner of Income Tax(Appeals)/NFAC, Delhi, dated 18.09.2023 arising out of intimation order dated 24.08.2020 passed under section 154 for the Assessment Year 2018-19. The word ‘Act’ herein this order would mean Income Tax Act, 1961.
At the outset, we have noted that the Registry has identified the delay of 684 days in filing of this appeal before the Tribunal. Explaining the impugned delay the appellant has submitted that in his case, the addition of Rs.1,83,36,205/-was made vide order u/s 143(1) dated 08.02.2020. It was submitted that the impugned disallowance to the Return of Income was on account of late deposit of PF/ESI payments. The appellant, after rejecting of its application u/s 154 of the Act, filed an appeal before the ld. First Appellate Authority, who also dismissed the petition through his order dated 18.09.2023. It is the case of the appellant that its earlier counsel’s ill adviced, the appellant qua the course of action to be taken after order of the ld. CIT(A). The ld. Counsel for the assessee accordingly submitted that as the issue of PF and ESTI payment was highly debatable and the appellant was not getting proper advice, the impugned delay of 684 days occurred. In support of his contentions, the appellant has placed the reliance upon the catena of judgement to justify its delay.
It was thus noted that the appellant has primarily attributed the delay to the ill advice of some professional/counsel and consequent inadequate understanding of the issue. The ld. Counsel for the assessee was requested to provide the details of the said counsel who had reportedly ill advised and which had contributed the impugned delay. The ld. Counsel for the assessee did not furnish the said details.
The ld. DR vehemently opposed the request for condoning the delay. It was argued that there is no merit in the explanation put-forth by the appellant and that the issue of delay is being casually attended. The ld. DR argued that there is no justification in the condonation petition of the appellant/assessee.
We have heard rival submissions in the light of material placed on records. We have noted that even though Hon’ble Courts have observed that as no litigant gains by non-prosecution of its case and therefore the delay petition should be sympathetically addressed. However, we have also noted that the Hon’ble Courts including Hon’ble jurisdictional High Court and the Hon’ble Apex Court have laid down that delay condonation is not a luxury to be enjoyed by the litigant and that condonation should be granted only to the deserving cases. We have noted that while examining the issue, this Tribunal in the case of Peejay Industries Pvt. Ltd. in ITA No.2875/Del/2024 dated 07.08.2026 have observed as under:-
“……Whereas, Hon’ble Apex Court has ruled in the famous decision in the case of Collector, Land Acquisition, Anantnag v. Mst. Katiji ([1987] 2 SCC 107) that delay matters need to be considered liberally. We have however also noted that the Hon’ble Apex Court in its decision in the case of State of Odisha v. Managing Committee of Namatara Girls High School, 2026 SCC OnLine SC 191, dated as 09-02-2026 has held that condonation of delay is not a routine exercise and cannot be taken as granted by the delinquent litigants. Hon’ble Supreme Court held “Condonation of delay cannot be claimed as a matter of right. It is entirely the discretion of the Court whether or not to condone delay.” The Court stated that “sufficient cause” under Section 5 of the Limitation Act, 1963 is elastic and intended to advance substantial justice. The Court undertook an extensive survey of the case law on condonation of delay and observed that there is a shift from the earlier justice-oriented liberal approach to a stricter standard. The Court traced the evolution from the liberal approach adopted in Collector, Land Acquisition, Anantnag v. Mst. Katiji, (1987) 2 SCC 107 and G. Ramegowda v. Land Acquisition Officer, (1988) 2 SCC 142, where it was emphasised that when substantial justice and technical considerations are pitted against each other, the cause of substantial justice deserves to be preferred and that governmental functioning, encumbered by procedural red tape, may justify a certain latitude. It was noted that governmental decision-making is proverbially slow and “a little play at the joints” should be allowed. The Hon’ble Apex Court noted that its later decisions including Postmaster General v. Living Media India Ltd., (2012) 3 SCC 563; University of Delhi v. Union of India, (2020) 13 SCC 745 and Pathapati Subba Reddy v. Collector (LA), (2024) 12 SCC 336, adopted a stricter approach and emphasised that limitation is founded on public policy and that merits are irrelevant at the stage of condonation. The Court further referred to decision in the case of Commissioner of Wealth Tax v. Amateur Riders Club, 1994 Supp (2) SCC 603, where it was lamented that “there is a point beyond which even the courts cannot help a litigant … under the shackles of bureaucratic indifference.” Thus, holding that in the impugned case, the State had been “utterly lethargic, tardy and indolent” the Hon’ble Apex Court declined to condone the delay and dismiss the SLP of the State Govt. For the purposes of clarity, we reproduce the relevant part of this order as under:-
“…11.We now proceed to assign our reasons. 12. No cause, much less sufficient cause, has been shown for exercise of discretion in favour of the State of Odisha. The nature of explanation in the application for condonation of delay is such that with much ado, the proceedings could be closed.
13.However, since there is a long line of decisions of this Court propounding the law that the expression ‘sufficient cause’ employed by the legislature in Section 5 of the Limitation Act, 1963 is adequately elastic to enable the courts to apply the law in a meaningful manner which subserves the ends of justice and in view of the submission of Ms. Sanjana, we have considered it appropriate to consider the matter in some depth.
14.Almost four decades back, in Collector, Land Acquisition, Anantnag v. Mst Katiji9, a coordinate Bench noting that the justifiably liberal approach which this Court has been adopting in matters instituted before it is not being followed by the courts lower in the hierarchy, mandated that a justice oriented approach is indeed called for when a ‘State’ seeks condonation of delay as distinguished from ‘a private party’.
15.Close on the heels of Katiji (supra), Hon’ble Justice M.N. Venkatachaliah speaking for the coordinate Bench in G. Ramegowda v. Land Acquisition Officer10 had referred to Katiji (supra) in paragraph 14 and quoted the following passage therefrom:
“When substantial justice and technical considerations are pitted against each other, cause of substantial justice deserves to be preferred for the other side cannot claim to have vested right in injustice being done because of a non-deliberate delay … It must be grasped that judiciary is respected not on account of its power to legalise injustice on technical grounds but because it is capable of removing injustice and is expected to do so.” Immediately thereafter, in paragraphs 15 to 17, it was held as under:
15.In litigations to which Government is a party there is yet another aspect which, perhaps, cannot be ignored. If appeals brought by Government are lost for such defaults, no person is individually affected; but what, in the ultimate analysis, suffers is public interest. The decisions of Government are collective and institutional decisions and do not share the characteristics of decisions of private individuals.
16.The law of limitation is, no doubt, the same for a private citizen as for governmental authorities. Government, like any other litigant must take responsibility for the acts or omissions of its officers. But a somewhat different complexion is imparted to the matter where Government makes out a case where public interest was shown to have suffered owing to acts of fraud or bad faith on the part of its (1987) 2 SCC 107 (1988) 2 SCC 142 officers or agents and where the officers were clearly at cross-purposes with it.
17.Therefore, in assessing what, in a particular case, constitutes “sufficient cause” for purposes of Section 5, it might, perhaps, be somewhat unrealistic to exclude from the considerations that go into the judicial verdict, these factors which are peculiar to and characteristic of the functioning of the government. Governmental decisions are proverbially slow encumbered, as they are, by a considerable degree of procedural red tape in the process of their making. A certain amount of latitude is, therefore, not impermissible. It is rightly said that those who bear responsibility of Government must have “a little play at the joints”. Due recognition of these limitations on governmental functioning — of course, within reasonable limits — is necessary if the judicial approach is not to be rendered unrealistic. It would, perhaps, be unfair and unrealistic to put government and private parties on the same footing in all respects in such matters. Implicit in the very nature of governmental functioning is procedural delay incidental to the decision-making process. In the opinion of the High Court, the conduct of the law officers of the Government placed the Government in a predicament and that it was one of those cases where the mala fides of the officers should not be imputed to Government. It relied upon and trusted its law officers. …
16.Katiji (supra) and Ramegowda (supra) were consistently followed by this Court until adoption of a different and seemingly strict approach while dealing with applications for condonation of delay during the last decade and a half became discernible starting with the decision in Postmaster General v. Living Media India Limited11, where a delay of 427 days in filing the relevant special leave petition was not condoned. University of Delhi v. Union of India12 is another decision (of a three- Judge Bench of this Court) where delay of 916 days was not condoned. While upholding the decision of the relevant high court under challenge refusing to condone the delay of 5659 days in presentation of an appeal under Section 54 of the Land Acquisition Act, 1894 by the heirs of a (2012) 3 SCC 563 (2020) 13 SCC 745 deceased landowner, a coordinate Bench in Pathapati Subba Reddy v. Collector(LA)13 very recently reiterated that the law of limitation is founded on public policy, the object is that a legal remedy is put to an end so that no litigation remains pending for an indefinite period. It was also held, departing from the earlier view, that the merits of the case cannot be considered at the stage of considering the application for condonation of delay.
17.Indeed, one of us [Dipankar Datta] in Sheo Raj Singh v. Union of India14 authoring the judgment for a coordinate Bench adopted the view taken in Katiji (supra), Ramegowda (supra) and a host of other decisions following the same while not interfering with an order of condonation of delay passed by the relevant high court. However, it was observed that a distinction ought to be drawn between an ‘explanation’ and an ‘excuse’ that is proffered as cause for condonation of delay. It was also emphasized that a different approach has to be adopted while this Court is considering an application for condonation of delay in presentation of an appeal/application and when it sits in appeal over a discretionary order of the high court granting the prayer for condonation of delay. In the case of the former, whether to condone or not would be the only question whereas in the latter, whether there has been proper exercise of discretion in favour of grant of the prayer for condonation has to be examined. (2024) 12 SCC 336 (2023) 10 SCC 531
18.However, what perhaps remained unnoticed in any of the decisions post Katiji (supra) and Ramegowda (supra) adopting a liberal approach is the exasperation and consequent lament expressed by none other than Hon’ble M.N. Venkatachaliah, CJI. in course of authoring a brief order in Commissioner of Wealth Tax, Bombay v. Amateur Riders Club, Bombay15 and admonishing officers of the “revenue” in not acting with promptitude. This order was made within six years of the decision in Ramegowda (supra). We can do no better than quoting the same in its entirety hereunder:
1.We have heard Shri S.C. Manchanda, learned senior counsel for the Revenue.
2.This special leave petition filed on November 16, 1993 is delayed by 264 days. For quite some time in the past, this Court has been making observations as to the grave prejudice caused to public interest by appeals brought on behalf of the Government being lost on the point of limitation. Such observations have been made for over a few years in the past. But there seems to be no conspicuous improvement as is apparent in the present petition which is filed in November 1993. The explanation for the delay, had better be set out in petitioner’s own words:
“(g)The Advocate-on-Record got the special leave petition drafted from the drafting Advocate and sent the same for approval to the Board on June 24, 1993 along with the case file.
(h)The Board returned the case file to the Advocate-on-Record on July 9, 1993 who re-sent the same to the Board on September 20, 1993 requesting that draft SLP was not approved by the Board. The Board after approving the draft SLP sent this file to CAS on October 1, 1993.”
3.This explanation is incapable of furnishing a judicially acceptable ground for condonation of delay. After the earlier observations of this Court made in several cases in the past, we hoped that the matters might improve. There seems to be no visible support for this optimism. There is a point beyond which even the courts cannot help a litigant even if the litigant is Government which is itself under the shackles of bureaucratic indifference. Having regard to the law of limitation which binds everybody, we cannot find any way of granting relief. It is true that Government should not be treated as any other private litigant as, indeed, in the case of the former the decisions to 1994 Supp (2) SCC 603 present and prosecute appeals are not individual but are institutional decisions necessarily bogged down by the proverbial red-tape. But there are limits to this also. Even with all this latitude, the explanation offered for the delay in this case merely serves to aggravate the attitude of indifference of the Revenue in protecting its common interests. The affidavit is again one of the stereotyped affidavits making it susceptible to the criticism that the Revenue does not seem to attach any importance to the need for promptitude even where it affects its own interest.
4.The application for condonation of delay is, accordingly, dismissed. The special leave petition is, therefore, dismissed as barred by time. (emphasis ours)
19.Reading Ramegowda (supra) and Amateur Riders (supra), one after the other, leaves none in doubt that it did not take much time for this Court to lose hope. It is absolutely clear that the law was laid down in Ramegowda (supra), following Katiji (supra), with much optimism that matters would improve. Their Lordships, however, found no visible support for such optimism and the Court’s patience having been tested to the extreme limit, held that there is a point beyond which even the courts cannot help a litigant even if the litigant labouring under the shackles of bureaucratic indifference is the Government.
20.We have found the State of Odisha to be utterly lethargic, tardy and indolent not only before the High Court but also before this Court. Notwithstanding that its appeal was dismissed as time-barred by the High Court, this Court has been approached by the State of Odisha four months after expiry of the period of limitation.
21.Condonation of delay cannot be claimed as a matter of right. It is entirely the discretion of the Court whether or not to condone delay. Despite all the latitude that is shown to a “State”, we are of the clear opinion that the cause sought to be shown here by the State of Odisha is not an explanation but a lame excuse. No case for exercise of discretion has been set up.
22.The applications for condonation of delay in filing the special leave petition and condonation of delay in re-filing the same, thus, stand rejected, with the result that the special leave petition stands dismissed as time-barred.
6.We have noted that in the present case also, there has been a case of total lethargy, tardy and indolent behavior on the part of appellant/revenue to submit a justified explanation for the delay in spite of the fact that a time of more than two years have been allowed to the revenue to cure the defect. In respectful compliance to the decision of Hon’ble Apex Court in the case of State of Odisha v. Managing Committee of Namatara Girls High School (supra), we hold that there is no justified ground with the Revenue for the delay in filing of this appeal. We, therefore, dismiss the appeal of the Revenue in limine…”
Accordingly, in view of the discussion in the preceding paragraphs and in respectful compliance to the orders of the Hon’ble jurisdictional High Court and the Hon’ble Supreme Court, the delay of 684 days in filing of this appeal is not condoned. Accordingly, the appeal of the assessee is therefore dismissed.
In the result, the appeal of the assessee is dismissed.