ITAT Visakhapatnam Refuses to Condone 792-Day Delay: Maa Tara Foundation's Unsupported Medical Plea Fails
Background and Context
The Visakhapatnam Bench of the Income Tax Appellate Tribunal recently delivered a significant ruling in the matter of Maa Tara Foundation Vs ADDL/JCIT (A) (ITAT Visakhapatnam) concerning Assessment Year 2022-23. The case centred entirely on whether an inordinate delay of 792 days in filing an appeal before the Commissioner of Income Tax (Appeals) could be condoned on the basis of a medical explanation that lacked documentary substantiation. The Tribunal's decision reinforces the principle that liberal judicial discretion in condonation of delay is not an unconditional entitlement — sufficient cause must be demonstrably established.
Facts of the Case
The Assessee and Return Filing
Maa Tara Foundation is a charitable trust duly registered under applicable legal provisions. For Assessment Year 2022-23, the trust filed its return of income disclosing:
- Gross receipts: ₹65,04,294
- Application of income: ₹37,55,381
- Exemption claimed: Under
Section 11andSection 12of the Income Tax Act, 1961 - Forms filed: Form 9A and Form 10B
Demand Raised by CPC
When the return was processed by the Centralized Processing Centre, Bengaluru under Section 143(1) of the Income Tax Act, 1961, a demand of ₹1,33,460 was raised vide intimation dated 17.03.2023. The CPC treated ₹8,83,762 as taxable income, reportedly because of an inadvertent clerical error in the reporting of the 15% accumulation permissible under Section 11(1)(a) of the Act.
Rectification Application and Its Rejection
The trust filed a rectification application under Section 154 of the Income Tax Act, 1961 to correct the alleged clerical error. However, the CPC rejected this application on 22.10.2024.
Delay in Filing Appeal
Aggrieved by the rejection of the rectification application, the assessee filed an appeal before the CIT(A). However, this appeal was filed with a delay of 792 days beyond the prescribed limitation period. The explanation offered for the delay was that the authorised signatory of the trust — a senior-citizen trustee — had been suffering from severe medical problems.
The CIT(A), upon examining the explanation, found that sufficient cause had not been established and dismissed the appeal in limine, i.e., at the threshold itself, without entering into the merits.
Grounds of Appeal Before ITAT
Before the Visakhapatnam ITAT, the assessee pressed the following principal contentions: