JUDGMENT
Manmohan Sarin, J.
We had heard arguments in the writ petition on 11-5-1999, and after hearing the parties allowed the writ petition for reasons to be recorded. We now proceed to give reasons for allowing the writ petition.
2. The petitioner has filed this writ petition seeking setting aside of the order dated 28-5-1998, passed by the Commissioner (Appeals), rejecting the petitioner’s application dated 26-3-1998, for extension of time under section 80HHC(2)(a) of the Income Tax Act, 1961.
3. The petitioner-firm, an exporter of readymade garments, had exported goods to Dolbees, London, during the financial year 1995-96. For the exports made in the said financial year, a sum of pounds 40,965 remained outstanding from Dolbees, London. The petitioner-firm had moved an application dated 14-10-1996, seeking extension of time for realisation of the convertible foreign exchange. This request for extension of time was acceded to by the Commissioner (Appeals) vide order dated 18/19-12-1996, and the petitioner was granted time up to 30-6-1997, in terms of section 80HHC(2)(a) of the Income Tax Act, 1961.
The petitioner-firm could realise only part of the amount up to 30-6-1997, and the balance outstanding of sterling pounds 28,965 came to be realised by the petitioner-firm only on 2-12-1997. The petitioner-firm moved an application dated 26-3-1998, for extension of time. In the application itself, the petitioner indicated that the entire outstanding amount had been realised and deposited in the bank and formal extension of time, be granted to the petitioner. The learned Commissioner (Appeals) passed the impugned order, rejecting the application dated 26-3-1998, holding that the assessee did not deserve any further extension as no sufficient cause had been made out for the same,
The main factor which weighed with the Commissioner (Appeals) was that the assessee did not bother to file the application for further extension of time for a period of nearly nine months, i.e., till 26-3-1998, even though the payments were stated to have been received on 2-12-1997. Besides the telephone bills evidencing overseas calls to the importer were ignored on the reasoning that it was not verifiable that calls were made for realising payments before 30-6-1997.
4. We have heard learned counsel for the parties and considered the matter. Learned counsel for the respondent has urged before us that the petitioner had failed to show any justification for the delay in filing the application and the order did not suffer from any error of jurisdiction and the court need not go into the merits of the matter in exercise of the jurisdiction under article 226 of the Constitution of India. Learned counsel for the respondent, in view of the decision of this court in Civil Writ Petn. No. 1689 of 1993, titled Vikram Overseas (P) Ltd. v. CIT (1996) 222 ITR 253 (Del), did not dispute that the Commissioner (Appeals) has the power and jurisdiction to grant extension of time under section 80HHC(2)(a) with retrospective effect.
5. We find from the record and the documents produced before us that the importer, viz., Dolbees, London, was facing financial stringency due to recession in the market and had sought time for making the payment. It has also been brought on record that the partner of the petitioner-firm made regular follow up for realisation of the export proceeds, which included telephone calls and a personal visit to London on 1-9-1997. The petitioner claims that due to earnest endeavours it was able to realise the outstanding payment by 2-12-1997. The petitioner has produced on record copies of the telephone bills as well as of the passport of its partner.
6. Having considered the matter, we are of the view that the petitioner has made out sufficient cause for being granted extension of time. The Commissioner (Appeals) has taken a rather hyper technical view in the matter. Keeping in mind that export proceeds have been realised and the fact that the petitioner has placed on record sufficient material to demonstrate that he was following up the matter regularly, relief to the petitioner should not be denied only on the ground that the petitioner had delayed making the application. The impugned order, rejecting the petitioner’s application for extension of time, deserves to be set aside and is, accordingly set aside. The petitioner’s application before the Commissioner (Appeals) seeking extension of time till 2-12-1997, shall stand allowed.