1. The present appeal under Section 260A of the Income-tax Act, 1961 (hereinafter referred to as 'the Act'), is directed against the order of the Tribunal dated November 29, 2004, in I. T. A. No. 44/Agra of 1998 for the assessment year 1992-93.
2. The appellant is a partnership firm consisting of two partners, namely, Sri Udit Kohli and Smt. Sudarshan Kohli. Against the order of the Commissioner of Income-tax (Appeals) dated July 16, 1997, the appellant filed appeal before the Tribunal beyond a period of 160 days along with an application for condonation of delay. The Tribunal by the impugned order rejected the application for condonation of delay.
3. Heard Sri D. K. Singh, learned Counsel for the appellant, and Sri A. N. Mahajan, learned standing counsel appearing on behalf of the Revenue. With the consent of counsel for both the parties, the present appeal is being decided at the admission stage itself.
4. We have perused the order of the Tribunal. In our opinion while considering the application for condonation of delay, the Tribunal has taken a pedantic view. In the application under Section 5 of the Limitation Act, it was explained by Sri Udit Kohli, one of the partners of the firm that another partner was his mother, Smt. Sudarshan Kohli, aged about 68 years, the business was closed since May, 1993, and he was the only male partner and was suffering from jaundice and later on from hypertension and other complications from July to December, 1997, and due to illness, the appeal could not be filed within time. The Tribunal while rejecting the application has taken a very serious note of the fact that at one stage it was stated by the appellant that the order of the Commissioner of Income-tax (Appeals) has not been served while it was served in the month of December, 1997; Sri Udit Kohli was suffering from jaundice and later on from hypertension and other complications and the other partner, Smt. Sudarshan Kohli being familiar with the income-tax matters and having filed the appeal before the Commissioner of Income-tax (Appeals) and illness was not of such a nature which could render Sri Udit Kohli incompetent to such a level where he could not be in a position to even complete his signature on various papers.
5. We are of the opinion that the approach of the Tribunal is pedantic, while in matters of condonation of delay it should be pragmatic and liberal. Admittedly, Smt. Sudarshan Kohli, who was the partner of the firm was aged about 68 years and Sri Udit Kohli was the only male partner. There may be reasons for signing the appeal, filed before the Commissioner of Income-tax (Appeals), which might be long back. The appellant was carrying on business at Jhansi and the appeal was to be filed at Agra and for filing of appeal so many formalities have to be carried on which require effective involvement and in case a person is ill, it is not expected from him to get the appeal prepared and filed. The illness of Udit Kohli has not been disputed. In the circumstances, we are of the view that the reasons given by the appellant for the delay in filing the appeal were sufficient and liable to be condoned. In the various cases the apex court held that in the matters of condonation of delay a pragmatic view should be taken and there should be a liberal approach.
6. The law of limitation is enshrined in the maxim interest reipublica ut sit finis litium (it is for the general welfare that a period be put to litigation).Rules of limitation are not meant to destroy the rights of the parties, rather the idea is that every legal remedy must be kept alive for a legislatively fixed period of time.
7. In the case of Collector, Land Acquisition v. Mst. Katiji reported in : (1987)ILLJ500SC , the hon'ble Supreme Court held as follows (page 472) :
'The Legislature has conferred the power to condone delay by enacting Section 5 of the Limitation Act of 1963 in order to enable the courts to do substantial justice to parties by disposing of matters on 'merits'. The expression 'sufficient cause' employed by the Legislature is adequately elastic to enable the courts to apply the law in a meaningful manner which subserves the ends of justice--that being the life-purpose of the existence of the institution of courts. It is common knowledge that this Court has been making a justifiably liberal approach in matters instituted in this Court. But the message does not appear to have percolated down to all the other courts in the hierarchy.
And such a liberal approach is adopted on principle as it is realized that :
1. Ordinarily, a litigant does not stand to benefit by lodging an appeal late.
2. Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As against this; when delay is condoned, the highest that can happen is that a cause would be decided on merits after hearing the parties.
3. 'Every day's delay must be explained' does not mean that a pedantic approach should be made. Why not every hour's delay, every second's delay The doctrine must be applied in a rational, common sense and pragmatic manner.
4. When substantial justice and technical considerations are pitted against each other, the 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.
5. There is no presumption that delay is occasioned deliberately, or on account of culpable negligence, or on account of mala fides. A litigant does not stand to benefit by resorting to delay. In fact, he runs a serious risk.
6. It must be grasped that the judiciary is respected not on account of its power to legalize injustice on technical grounds but because it is capable of removing injustice and is expected to do so.'
8. In N. Balakrishnan v. M. Krishnamurthy reported in : 2008(228)ELT162(SC) , the apex court explained the scope of limitation and condonation of delay, observing as under (headnote):
'the primary function of a court is to adjudicate the dispute between the parties and to advance substantial justice. The time-limit fixed for approaching the court in different situations is not because on the expiry of such time a bad cause would transform into a good cause. Rules of limitation are not meant to destroy the rights of parties. They are meant to see that parties do not resort to dilatory tactics, but seek their remedy ... for the redress of the legal injury so suffered, the law of limitation is thus founded on public policy.'
9. In Shankanao v. Chandmsenkunwar reported in : AIR1987SC962 , the Supreme Court took the view that the court should not adopt an injustice-oriented approach in rejecting the application for condonation of delay.
10. In Vedabai alias Vaijayanatabai Baburao Patil v. Shantaram Baburao Patil reported in : 2001(132)ELT15(SC) the apex court made a distinction in delay and inordinate delay observing as under (page 799) :
'In exercising discretion under Section 5 of the Limitation Act, the courts should adopt a pragmatic approach. A distinction must be made between a case where the delay is inordinate and a case where the delay is of a few days. Whereas in the former case the consideration of prejudice to the other side will be a relevant factor so the case calls for a more cautious approach ....'
11. In New India Insurance Co. Ltd. v. Smt. Shanti Misra reported in, : [1976]2SCR266 , the hon'ble Supreme Court held that discretion given by Section 5 should not be defined or crystallised so as to convert a discretionary matter into a rigid rule of law. The expression 'sufficient cause' should receive a liberal construction.
12. In Brij Inder Singh v. Kanshi Ram reported in AIR 1917 PC 156 it was observed that true guide for a court to exercise the discretion under Section 5 is whether the appellant acted with reasonable diligence in prosecuting the appeal.
13. In Shakuntala Devi Jain v. Kuntal Kumari reported in : [1969]1SCR1006 , the hon'ble Supreme Court held that unless want of bona fides of such inaction or negligence as would deprive a party of the protection of Section 5 is proved, the application must not be thrown out or any delay cannot be refused to be condoned.
14. In O. P, Kathpalia v. Lakhmir Singh reported in : AIR1984SC1744 , the hon'ble Supreme Court held that if the refusal to condone the delay results in grave miscarriage of justice, it would be a ground to condone the delay.
15. In State of Haryana v. Chandra Mani reported in : 2002(143)ELT249(SC) , the hon'ble Supreme Court considered a large number of its earlier judgments including Binod Bihari Singh v. Union of India reported in : AIR1993SC1245 ; Shakambari and Co. v. Union of India reported in : AIR1992SC2090 ; Warlu v. Gangotribai reported in : AIR1994SC466 ; Ramlal v. Rewa Coalfields Ltd. reported in : [1962]2SCR762 ; Concord of India Insurance Co. Ltd. v. Nirmala Devi reported in : [1979]118ITR507(SC) ; Mata Din v. A. Narayanan reported in : [1970]2SCR90 , and held that the expression 'each day's delay must be explained', does not mean that a pedantic approach should be made and it must be applied in a rational common sense pragmatic manner.
16. In the result, the appeal is allowed. The order of the Tribunal dated November 29, 2004, is set aside. Delay in filing the appeal is condoned. The Tribunal is directed to decide the I. T. A. No. 44/Agra of 1998 for the assessment year 1992-93 on the merits after giving opportunity of hearing to both the parties.