ITAT Refuses To Condone 9-Year Delay In Filing Appeal Despite Ongoing S. 153C Merits Litigation

The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has dismissed an assessee’s appeal on the ground of limitation, holding that merely contesting an issue on merits before different forums cannot automatically justify condonation of an extraordinary delay in filing a statutory appeal. The bench Yogesh Kumar US (Judicial Member) and Sanjay Awasthi (Accountant Member) observed that the law of limitation is substantive in nature and the power to condone delay must be exercised judiciously. The excessive delay cannot be casually explained by stating that the issue was being pursued in parallel proceedings. The case involved assessee Rishi Aggarwal, who challenged an order passed under Section 154 of the Income Tax Act, 1961. The rectification order had enhanced the assessee’s income by ₹24.04 lakh. However, the appeal before the Commissioner of Income Tax (Appeals) was filed after a delay of nearly nine years. According to the assessee, the rectification order was not properly served and therefore the appeal could not be filed within the prescribed limitation period. The CIT(A), however, dismissed the appeal in limine after observing that even during the rectification proceedings no response had been filed before the Assessing Officer. Before the Tribunal, the assessee argued that the dispute regarding the enhancement under Section 154 had continuously remained alive in different proceedings. The assessee pointed out that the enhancement was subsequently incorporated in an assessment order passed under Sections 143(3)/153C and was also challenged before the ITAT in earlier proceedings. Buy Now: Income Tax Judgments E-Compilation : April 2026 The assessee contended that the issue remained under litigation till December 2023 and therefore there was no deliberate inaction. It was further argued that the rectification itself was patently illegal. The Revenue, on the other hand, argued that although the assessee may have contested the addition on merits before various forums, no satisfactory explanation had been furnished for the extraordinary delay in filing the first appeal. It was pointed out that the submissions before the CIT(A) focused entirely on merits and contained virtually no explanation seeking condonation of delay under Section 249(3) of the Act. Agreeing with the Revenue, the Tribunal observed that the assessee failed to demonstrate “sufficient cause” for condonation of delay. The Bench stated that the submissions created an impression that because the issue was kept alive in other proceedings, the delay at the first appellate stage should automatically stand condoned. The Tribunal termed this argument “fallacious.” The Tribunal extensively discussed the legal principles governing condonation of delay and referred to several Supreme Court decisions including Collector, Land Acquisition v. Mst. Katiji, State of Gujarat v. Sayed Mohd. Baquir El Edross, and Ramlal Motilal v. Rewa Coalfields. The ITAT reiterated that filing an appeal within limitation is the rule, while condonation is an exception; the appellant must explain each day’s delay; sufficient cause must cover the entire period of delay; and even a strong case on merits cannot by itself justify condonation. The Bench further emphasized that discretionary powers to condone delay must be exercised on judicial principles and not in an arbitrary or routine manner. It observed that litigants are expected to act diligently and demonstrate bona fide conduct. Holding that no reasonable cause had been demonstrated for the massive delay, the Tribunal upheld the CIT(A)’s decision dismissing the appeal under Section 249(3) of the Income Tax Act. Consequently, the assessee’s appeal was dismissed. Case Details Case Title: Rishi Aggarwal Versus DCIT Citation: JURISHOUR-1163-ITA-2026(DEL) Case No.: I.T.A No.605/Del/2026 Date: 06.05.2026 Counsel For Appellant: Sudhir Sahgal, CA & Shri Kushal Chopra, CA Counsel For Respondent: Ajay Kumar Arora, Sr. DR Click Here To Read Order Read More: Fly Ash Sale Proceeds Taxable as Business Income, Not Liability Fund: ITAT

ITAT Refuses To Condone 9-Year Delay In Filing Appeal Despite Ongoing S. 153C Merits Litigation

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