DHANERA IMPEX ,MUMBAI V. ITO WARD 8(4), MUMBAI

ITA 5841/MUM/2024

AI Insights

The case involves Dhanera Impex, which faced multiple appeals related to quantum assessment proceedings and penalties under section 271(1)(b) of the Income Tax Act for various assessment years from 2014-15 to 2020-21. The assessments were initially completed ex-parte under section 144 due to the non-appearance of the assessee, following a search and seizure operation under section 132. The CIT(A) upheld these assessments and penalties, leading to the current appeals. The Tribunal found procedural inconsistencies, particularly regarding the Permanent Account Number (PAN) used, and noted the absence of the assessee's participation in the earlier proceedings. Consequently, the Tribunal decided to set aside the CIT(A)'s orders and remand the case for a fresh hearing, imposing a cost on the assessee to underscore the seriousness of the proceedings.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 37935 (ITAT-MUMBAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-01-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2019-2020
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANYOGITA NAGPAL
• Assessee Lawyers: MONA SOLANKI
• Keywords: Set aside; Opportunity of being heard; Principle of natural justice; Search and seizure
• Section: 144; 132; 153C

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI “D” BENCH : MUMBAI BEFORE SHRI B.R. BASKARAN, ACCOUNTANT MEMBER AND SHRI SUNIL KUMAR SINGH, JUDICIAL MEMBER ITA No. A.Y. Appellant Respondent 5835/Mum/2024 2014-15 Dhanera Impex, Flat No.201, 2nd Floor, 13, Mehta Court, Girder Lane Opp. Navjivan Society, Mumbai PAN: AAFCD0553P ITO, Ward-8(4), 6th Floor, Aayakar Bhavan, Maharshi Karve Road, Mumbai. 5836/Mum/2024 2015-16 5837/Mum/2024 2016-17 5838/Mum/2024 2017-18 5839/Mum/2024 2018-19 5841/Mum/2024 2019-20 5840/Mum/2024 2020-21 Assessee by : Ms. Mona Solanki Revenue by : Smt. Sanyogita Nagpal, CIT-DR Date of Hearing : 02-01-2025 Date of Pronouncement : 02-01-2025 ORDER PER BENCH: All the appeals have been filed by the assessee and they are directed against the orders passed by Ld CIT(A)-50, Mumbai. Five of these appeals are related to quantum assessment proceedings relating to AYs.2016-17 to 2020-21. Remaining two appeals are related to penalty levied u/s.271(1)(b) of the Act for AYs.2014-15 and 2015-16. 2. The facts relating to the case are stated in brief. The Revenue has carried out search and seizure action u/s 132 of the Act in the case of Shri Rakesh Javerimal Shah and others on 24-04-2019. During the course of sear proceedings, certain materials pertaining to the assessee, which have bearing on the determination of total income of the assessee were found. Accordingly, the AO initiated the assessment proceedings u/s 153C of the Act in respect of assessment years 2014-15 to 2020-21. 2 Dhanera Impex, batch Since the assessee did not appear before the assessing officer, he completed the assessments of the above said years to the best of his judgement u/s 144 of the Act making certain additions in AY 2016-17 to 2020-21.The AO also initiated penalty proceedings u/s 271(1)(b) of the Act for AY 2014-15 and 2015-16 and levied penalty of Rs.20,000/- for each of the two years. 3. The assessee filed appeals before Ld CIT(A) challenging the above said assessment orders and penalty orders, but did not respond to the notices issued by Ld CIT(A). Hence, the Ld CIT(A) confirmed the orders passed by the assessing officer. Aggrieved, the assessee has filed these appeals. 4. We heard the parties and perused the record. On a perusal of the orders passed by Ld CIT(A), there is some confusion with regard to the Permanent Account number. The present orders have been passed under the PAN AAFCD0553P. In the Statement of Facts filed before Ld CIT(A )for AY 2016-17, the assessee has stated as under:- “The Assessee is a proprietorship concern but notices issued in Company PAN no. AAFCD0553P in the name of Dhanera Impex where the Assessee was not aware of said PAN issued to him. However, the said PAN issued in the capacity of Company though the name does not include Private Ltd.” However, in the Grounds of appeal filed before Ld CIT(A) for that year, following ground has been taken:- “On the facts and circumstances of the case and in law, the Ld AO has erred in assessing the making additions of Rs.1,09,95,190/- in PAN No. AAFCD0553P. Inadvertently, the Appellant had two PAN card no., but there were no transactions taken place in the said PAN No. All the business activities are undertaken in proprietorship firm itself, i.e., PAN No. AAKPS6924P. The said addition is not in accordance with the provisions of the Act and bad in law. The said addition may please be deleted.” Thus, apparently, the assessee has furnished two different submissions before Ld CIT(A). 3 Dhanera Impex, batch 5. Be that as it may, the fact would remain that the assessee did not appear before both the tax authorities and hence they were constrained to pass the orders ex-parte, without the presence of the assessee. Accordingly, in the interest of natural justice, we are of the view that the assessee may be provided with one more opportunity to present its case properly before Ld CIT(A). Since the assessee was delinquent, we are of the view that the above said relief should be given at a cost in order to make it understand the seriousness of income tax proceedings. Accordingly, we impose a cost of Rs.10,000/- (Rupees Ten thousand) upon the assessee, which shall be paid to the credit of the Income tax department as other fees within two months from the date of receipt of this order by the assessee. 6. Subject to the payment of above cost, which shall be verified by Ld CIT(A), we set aside the impugned orders passed by Ld CIT(A) in the present appeals and restore all the issues in all the appeals to his file for adjudicating them afresh, after affording adequate opportunity of being heard to the assessee. We also direct the assessee to fully co-operate with the Ld CIT(A) for expeditious disposal of the appeals. After hearing the assessee, the Ld CIT(A) may take appropriate decision in accordance with law. 7. In the result, all the appeals are treated as allowed for statistical purposes. Order pronounced in the open court on 02-01-2025 Sd/- Sd/- [SUNIL KUMAR SINGH] [B.R. BASKARAN] JUDICIAL MEMBER ACCOUNTANT MEMBER Mumbai, Dated: 02-01-2025 TNMM 4 Dhanera Impex, batch Copy to : 1) The Appellant 2) The Respondent 3) The CIT concerned 4) The D.R, “D” Bench, Mumbai 5) Guard file By Order Dy./Asst. Registrar I.T.A.T, Mumbai "