Delay in filing appeal based on COVID-19 reasons: ITAT imposes penalty of Rs. 25,000

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The Chennai Bench of the Income Tax Appellate Tribunal (ITAT) headed by Mahavir Singh (Vice President) and Manoj Kumar Aggarwal (Accountant Member) has imposed a penalty of Rs. 25,000 on the assessee for the delay of 1217 days in filing the appeal due to COVID-19.

The appellant/assessee has challenged the order of CIT (A) in the matter of assessment framed by AO under section 143(3) of the Income Tax Act. The sole issue in the appeal was disallowance under section 14A. In an assessment framed under section 143 (3), the AO computed disallowance under section 14A for Rs. 364.49 lakhs, which was interest disallowance for Rs. 179.60 lakhs and indirect expense disallowance for Rs. 184.88 lakhs.

The Registry has noted an inordinate delay of 1217 days in the appeal. The condonation was sought by the assessee on the strength of an affidavit of Shri K.Sundar for the assessee company. It has been submitted that delays have occurred due to frequent COVID surges or lockdowns on account of the pandemic situation. It has also been stated that the delay was neither willful nor intentional.

The department opposed the condonation of delay.

The ITAT, while considering the contents of the petition and in view of the prevailing COVID-19 Pandemic, decided to condone the delay at a cost.

The Tribunal directed the assessee to pay a cost of Rs.25,000 to the Tamil Nadu State Legal Services Authority at the High Court of Madras within a period of 15 days.

Case Title: M/s. Kal Airways Private Limited Versus DCIT

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