Spinacom India (P.) Ltd. (SC) Time period for filing an appeal u/s 260A does not get suspended on account of the pendency of an application before the ITAT u/s 254(2).

ISSUE

Whether delay in filing appeal under section 260A can be condoned where the stated reason for delay is the pursuance of an alternate remedy by way of filing an application before the ITAT under section 254(2) for rectification of mistake apparent on record?

FACTS:

1.The appellants have approached the Supreme Court under a special leave petition.

2.There has been a delay of 439 days in filing the appeal u/s 260A for which reason the appellants requested for a condonation of delay under section 14 of Limitation Act, 1963.

3.The appellants submitted that the delay was on account of pursuing an alternate remedy of filing a miscellaneous application before the Income-tax Appellate Tribunal (ITAT) under section 254(2).

PROVISION APPLICABLE

1)Sec.260A provides that an appeal shall lie to the High Court from every order passed in appeal by ITAT if case involves a substantial question of law.

2)Sec.254(2) provides that ITAT with a view to rectifying any mistake apparent from the record, amend any order passed by it

ANALYSIS:

1) SC rejected the question of invoking section 14 of the Limitation Act 1963 which allows condonation of delay on demonstration of sufficient cause.

2) Rectification Application before the ITAT u/s 254(2) not an alternate remedy to filing of the appeal before HC u/s 260A SC refused to accept the submission of the assessee that the application before the ITAT u/s 254(2) was an alternate remedy to filing of the appeal before HC u/s 260A.

3) SC held that application before ITAT u/s 254(2) is for rectifying a ‘mistake apparent from the record’ which is much narrower in scope than appeal before HC u/s 260A. SC held that u/s 260A, an order of the ITAT can be challenged on substantial questions of law.

4) SC stated that the appellant had the option of filing an appeal u/s 260A while also mentioning in the Memorandum of Appeal that its application u/s 254(2) was pending before the ITAT.

5) Therefore, SC held that the time period for filing an appeal u/s 260A does not get suspended on account of the pendency of an application before the ITAT u/s 254(2).

CONCLUSION:

Since no satisfactory reason has been provided by the Appellant for the extraordinary delay of 439 days in filing the appeal, the Supreme Court dismissed the application for condonation of delay.