Shri Krishan Kumar Vishnoi, JODHPUR V. ITO, JODHPUR

CO 17/JODH/2010

• Counselvise Citation: [2010] 122 COUNSELVISE.COM (IT) 5411 (ITAT-JODHPUR)
• Duration Of Justice: 1 month(s) 18 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 04-10-2010
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 01-10-2010
• Assessment Year: 2005-2006
• Appeal Filed On: 16-08-2010
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: T C GUPTA
• Keywords: Opportunity of being heard; Principle of natural justice; Condonation of delay
• Section: 10B; 54

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL JODHPUR BENCH, JODHPUR BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI K.G. BANSAL, ACCOUNTANT MEMBER ITA NO. 385/JU/2010 ASSTT. YEAR : 2005-06 INCOME-TAX OFFICER, , WARD 1(2), JODHPUR APPELLANT VERSUS SHRI KRISHAN KUMAR VISHNOI, PROP. M/S. VISHNU ART & CRAFTS, 32, VIDHYA PARK, JODHPUR. ...RESPONDENT C.O. NO.17/JU/2010 (ARISING OUT OF ITA NO. 385/JU/2010) ASSTT. YEAR : 2005-06 SHRI KISHAN KUMAR VISHNOI, PROP. M/S. VISHNU ART & CRAFTS, 32, VIDHYA PARK, JODHPUR. CROSS OBJEC TOR VERSUS INCOME-TAX OFFICER, WARD 1(2), JODHPUR .RESPONDENT REVENUE BY : SHRI T.C. GUPTA, D.R. ASSESSEE BY : SHRI RAJENDRA JAIN, ADVOCATE ORDER PER JOGINDER SINGH, J.M.: THE REVENUE IS IN APPEAL AND THE ASSESSEE HAS PREF ERRED CROSS OBJECTIONS AGAINST THE ORDER OF THE LD. CIT (A) DAT ED 31.05.2009. FIRST WE 2 SHALL TAKE UP THE APPEAL OF THE REVENUE WHEREIN IN ITS FIRST GROUND THE CONDONATION OF DELAY OF ABOUT 22 MONTHS IN FILING T HE APPEAL BEFORE THE LEARNED FIRST APPELLATE AUTHORITY HAS BEEN CHALLENG ED BY ACCEPTING THE VERSION OF THE ASSESSEE. 2. DURING HEARING OF THIS APPEAL, THE LEARNED DR SH RI T.C. GUPTA ADVANCED HIS ARGUMENT WHICH IS IDENTICAL TO THE GRO UND RAISED, BY FURTHER SUBMITTING THAT THE LEARNED FIRST APPELLATE AUTHORI TY HAS NO POWER TO CONDONE THE DELAY OF 22 MONTHS THAT TOO WITHOUT ASSIGNING A NY REASON, AS THERE WAS NO SUFFICIENT CAUSE TO CONDONE THE DELAY AND SECOND LY, UNDER THE EXCISE ACT THE LEARNED FIRST APPELLATE AUTHORITY CAN CONDONE T HE DELAY ONLY OF ONE MONTH. THEREFORE, IT WAS PRAYED THAT THE ORDER OF T HE LEARNED FIRST APPELLATE AUTHORITY MAY BE SET ASIDE. ON THE OTHER HAND, THE LD. COUNSEL FOR THE ASSESSEE SHRI RAJENDRA JAIN SUBMITTED THAT FIRSTLY, THE DELAY WAS NOT AT THE BEHEST OF THE ASSESSEE, AS THE NECESSARY DOCUMENTS FOR FILING THE APPEAL WERE HANDED OVER TO HIS COUNSEL IN TIME AND SECONDLY, AS PER SECTION 249 OF THE ACT, THE LD. CIT(A) IS FULLY EMPOWERED TO CONDONE T HE DELAY. 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PER USED THE MATERIAL AVAILABLE ON THE FILE. AS PER THE RECORD, THE ASSES SMENT ORDER DATED 28.12.2007 WAS RECEIVED BY THE AUTHORIZED REPRESENT ATIVE OF THE ASSESSEE ON 31.12.2007 (AS MENTIONED IN FORM NO. 35) AND THE AP PEAL WAS FILED ON 04.11.2009. ADMITTEDLY, THERE IS A SUBSTANTIAL DELA Y IN FILING THE APPEAL. HOWEVER, BEFORE THE LEARNED FIRST APPELLATE AUTHORI TY THE AFFIDAVITS OF THE COUNSEL AS WELL AS OF THE ASSESSEE WERE FILED BY CL AIMING THAT THE NECESSARY INSTRUCTION TO THE COUNSEL WAS GIVEN WITHIN TIME BY THE ASSESSEE AS ALSO THE NECESSARY DOCUMENTS. A CONDONATION PETITION FOR CON DONING THE DELAY DATED 3 04.11.2009 WAS ALSO FILED. IN THE CONDONATION PETIT ION THE ASSESSEE EXPLAINED THE CIRCUMSTANCES WHICH CAUSED THE DELAY. THE MAJOR REASON WAS THAT INADVERTENTLY, THE COUNSEL FOR THE ASSESSEE WAS UND ER A REASONABLE BELIEF THAT APPEAL HAS BEEN FILED BUT BY CHANCE THE PAPERS REMA INED IN THE FILE OF THE COUNSEL AND DUE TO UNINTENDED MISTAKE OF THE COUNSE L, THE APPEAL COULD NOT BE FILED IN TIME. THERE ARE VARIOUS JUDICIAL PRONOU NCEMENTS THAT NO LITIGANT SHOULD SUFFER FOR THE MISTAKE OF THE COUNSEL FOR WH ICH RELIANCE CAN BE PLACED UPON THE DECISION IN MANOJ AHUJA (MINOR) & ORS. VS. IAC, 150 ITR 696 AND BHILAI ENGINEERING CORPN. VS. DCIT, 81 ITD 282 (NAG.)(SB). IN THE IMPUGNED ORDER, THE LEARNED FIRST APPELLATE AUTHORI TY HAS CONSIDERED THE CIRCUMSTANCES WHICH LED TO THE DELAY ALONGWITH JUDI CIAL PRONOUNCEMENTS. THE ASSERTION OF THE ASSESSEE IS ALSO SUPPORTED BY THE AFFIDAVITS WHICH WERE NOT CONTRADICTED BY THE REVENUE. EVEN OTHERWISE, ON THE PRINCIPLE OF NATURAL JUSTICE, NO LITIGANT SHOULD SUFFER BECAUSE WHAT MAY BE THE RESULT AT LEAST THE EITHER PARTY SHOULD BE HEARD. IN VIEW OF THESE FACT S AND JUDICIAL PRONOUNCEMENTS, WE ARE IN AGREEMENT WITH THE STAND OF LEARNED CIT(A) IN CONDONING THE DELAY. AS FAR AS THE ARGUMENT OF THE LD. DR THAT THE LEAR NED FIRST APPELLATE AUTHORITY IS NOT AUTHORIZED TO CONDONE THE HUGE DEL AY, WE ARE NO IN AGREEMENT WITH THIS ASSERTION BECAUSE AS PER SECTIO N 249(3) THE LEARNED COMMISSIONER (APPEALS) MAY ADMIT AN APPEAL AFTER TH E EXPIRATION OF PERIOD IF HE IS OTHERWISE SATISFIED THAT THE APPELLANT HAS SUFFICIENT CAUSE FOR NOT PRESENTING THE APPEAL WITHIN THE PRESCRIBED LIMIT. THE RELEVANT PORTION OF THE PROVISION OF THE ACT IS REPRODUCED HEREUNDER : 249 (3)--------THE COMMISSIONER (APPEALS) MAY ADM IT AN APPEAL AFTER THE EXPIRATION OF THE SAID PERIOD I F HE IS SATISFIED 4 THAT THE APPELLANT HAD SUFFICIENT CAUSE FOR NOT PRE SENTING IT WITHIN THAT PERIOD. ----------PROVIDED THAT IN A CASE FALLING UNDER CL AUSE (B) AND ON AN APPLICATION MADE BY THE APPELLANT IN THIS BEHALF, THE COMMISSIONER (APPEALS) MAY, FOR ANY GOOD AND SUFFIC IENT REASON TO BE RECORDED IN WRITING EXEMPT HIM FROM TH E OPERATION OF THE PROVISIONS OF THAT CLAUSE. ON ANALYSIS OF AFORESAID PROVISION, WE FIND THAT IF THE LEARNED FIRST APPELLATE AUTHORITY FOR ANY GOOD AND SUFFICIENT REASON IS SAT ISFIED WITH THE CAUSES OF DELAY THEN HE IS FULLY EMPOWERED TO CONDONE THE DEL AY. EVEN OTHERWISE NO PERIOD HAS BEEN SPECIFICALLY MENTIONED UNDER THE AC T. THE LEARNED FIRST APPELLATE AUTHORITY OBJECTIVELY ANALYZED THE REASON S OF DELAY AND WAS SUBJECTIVELY SATISFIED WITH SUCH REASONS WHICH WERE SUPPORTED BY AN AFFIDAVIT FROM ASSESSEE AS WELL AS THE CONCERNED CO UNSEL. CONSEQUENTLY, FROM THIS ANGLE ALSO THERE IS NO INFIRMITY IN THE S TAND OF THE LEARNED CIT(A). EVEN OTHERWISE, WHEN ANY APPLICATION FOR CONDONATIO N OF DELAY IS FILED, THE APPELLATE AUTHORITY IS STATUTORILY OBLIGED TO CONSI DER WHETHER SUFFICIENT CAUSE WAS THERE. THIS VIEW IS SUPPORTED BY THE DECISION F ROM HONBLE BOMBAY HIGH COURT IN SMT. GOVIND RAO NARAIN RAO GHORPADE V S. CIT, 48 ITR 54 (BOM.) AND ALSO THE RATIO LAID DOWN IN CIT VS. SOTH IA MINING AND MANUFACTURING CORPORATION LTD. 46 TAXMAN 195 (CAL.) . AS FAR AS THE CONTENTION OF THE LEARNED DR THAT IT WAS AN AFTERTH OUGHT OF THE ASSESSEE FOR GETTING RELIEF BY CLAIMING THE SAME AS MISTAKE OF T HE COUNSEL, IT CAN BE SAID FIRSTLY, IT IS THE SATISFACTION OF THE JUDICIAL AUT HORITY AND SECONDLY IF ANY RELIEF CAN BE GRANTED OR CLAIMED WITHIN LEGAL CIRCUMFERENC E THAT CANNOT BE DENIED IF EITHER PARTY IS ENTITLED FOR THE SAME. THEREFORE , FROM ALL ANGLE THERE IS NO 5 INFIRMITY IN THE STAND OF THE LEARNED CIT(A). THERE FORE, ON THIS COUNT WE ARE IN AGREEMENT WITH THE DECISION OF THE LEARNED FIRST APPELLATE AUTHORITY. 4. THE NEXT GROUND PERTAINS TO DIRECTION TO THE LEA RNED ASSESSING OFFICER TO VERIFY THE FACTS REGARDING MANUFACTURING PROCESS UNDERTAKEN BY THE ASSESSEE AND TO ALLOW DEDUCTION U/S. 10B IF IT IS I DENTICAL TO ASSESSMENT YEAR 2006-07. THE SUBMISSION ON BEHALF OF THE REVENUE IS THAT THIS DIRECTION TANTAMOUNT TO SETTING ASIDE THE ISSUE BACK TO THE A SSESSING OFFICER WHICH IS NOT PERMISSIBLE AS PER THE PROVISIONS OF THE ACT. O N THE OTHER HAND, THE LD. COUNSEL FOR THE ASSESSEE TOOK US TO PARAS-2 (PAGES 7 & 8) OF THE IMPUGNED ORDER. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PER USED THE MATERIAL AVAILABLE ON THE FILE. IT IS SEEN THAT FOR ASSESSME NT YEAR 2006-07, THE LEARNED FIRST APPELLATE AUTHORITY RELIED UPON VARIOUS JUDIC IAL PRONOUNCEMENTS AND HELD THAT THE ASSESSEE WAS A MANUFACTURER AND NOT A TRADER AND THE FACTS OF THE PRESENT ASSESSMENT YEAR ALSO ARE IDENTICAL TO A SSESSMENT YEAR 2006-07 WHEREIN IT WAS HELD THAT THE ASSESSEE WAS ELIGIBLE FOR DEDUCTION U/S. 10B OF THE ACT. THE LEARNED CIT(A) IN SUCH A SITUATION DIR ECTED THE LEARNED AO TO VERIFY THE FACTS REGARDING MANUFACTURING PROCESS UN DERTAKEN BY THE APPELLANT AND ALSO TO VERIFY WHETHER THE FACTS AND THE PROCES S IS IDENTICAL TO THE ASSESSMENT YEAR 2006-07. IN SUCH A SITUATION WITHOU T GOING INTO THE MERITS OF THE CASE AND THE POWERS OF THE LEARNED CIT(A), TO M EET THE ENDS OF JUSTICE, WE DIRECT THE LEARNED AO TO EXAMINE THE CLAIM OF TH E ASSESSEE, PROCESS INVOLVED IN MANUFACTURING, IF ANY, AND OTHER RELEVA NT FACTS AND TO DECIDE AFRESH AS PER THE PROVISIONS OF THE ACT FOR WHICH D UE OPPORTUNITY OF BEING HEARD BE PROVIDED TO THE ASSESSEE. THE ASSESSEE IS ALSO AT LIBERTY TO FURNISH 6 EVIDENCE, IF ANY, TO SUBSTANTIATE ITS CLAIM. WE ARE MAKING IT CLEAR HERE THAT SINCE THE ASSESSMENT YEAR 2006-07 IS NOT IN APPEAL BEFORE US, THEREFORE, WE ARE REFRAINING OURSELVES TO MAKE ANY COMMENT IN ANY MANNER FOR ASSESSMENT YEAR 2006-07. EVEN OTHERWISE, SINCE THE ISSUE HAS NOT BEEN DECIDED ON MERIT, THE REVENUE IS NOT AGGRIEVED IN ANY MANNER A S THE LEARNED ASSESSING OFFICER HAS BEEN DIRECTED TO VERIFY THE FACTS. THER EFORE, IN PRINCIPLE, WE ARE IN AGREEMENT WITH THE STAND OF THE LEARNED CIT(A). 6. AS FAR AS THE CROSS OBJECTION OF THE ASSESSEE IS CONCERNED, IT IS BROADLY IN SUPPORT OF THE ORDER OF THE LEARNED CIT(A) AND S INCE THE IMPUGNED ORDER IN PRINCIPLE HAS BEEN AFFIRMED, THEREFORE, THIS CRO SS OBJECTION OF THE ASSESSEE HAS BECOME INFRUCTUOUS, CONSEQUENTLY, DISMISSED. FINALLY, THE APPEAL OF THE REVENUE IS DISMISSED WH EREAS THE CROSS OBJECTIONS OF THE ASSESSEE ARE DISMISSED AS INFRUCT UOUS. ORDER PRONOUNCED IN THE OPEN COURT ON 4 TH OCTOBER, 2010. SD/- SD/- (K.G. BANSAL) (JOGINDER SINGH) ACCOUNTANT MEMBER JUDICIAL MEMB ER DATED: 4 TH OCTOBER, 2010 *AKS/- COPY FORWARDED TO:- 1. APPELLANT, 2. RESPONDENT, 3. INCOME-TAX OFFICER, 4. CIT, 5. D/R 6. GUARD FILE