The ITO, Ward-2(4), Surat V. Shri Manish Garg, Surat

ITA 1006/AHD/2011

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 89484 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 year(s) 1 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-05-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 18-05-2015
• Assessment Year: 2005-2006
• Appeal Filed On: 06-04-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MK SINGH
• Assessee Lawyers: SUNIL KEDIA
• Keywords: Opportunity of being heard; Additional evidence; Non compliance
• Section: 144

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, AHMEDABAD BEFORE SHRI G.D. AGRAWAL, VICE PRESIDENT AND SHRI S. S. GODARA, JUDICIAL MEMBER ITA NO.1006/AHD/2011 / ASSESSMENT YEAR: 2005-06 ITO, WARD-2(4), SURAT SHRI MANISH GARG, PROP. OF M/S. PATLIPUTRA STEELS & ASHISH STEELS, PLOT NO.103, ROAD NO.2, GIDC, SACHIN, SURAT PAN : ADMPG 8252 D / // / (APPELLANT) / // / (RESPONDENT) REVENUE BY : SHRI M.K. SINGH, SR. DR. ASSESSEE(S) BY : SHRI SUNIL KEDIA, AR ! '#$ ! '#$ ! '#$ ! '#$ / DATE OF HEARING : 18/05/2015 %& ! '#$ / // / DATE OF PRONOUNCEMENT: 22/05/2015 '( '( '( '(/ // / O R D E R PER G.D. AGRAWAL, VICE PRESIDENT: THIS IS AN APPEAL FILED BY THE REVENUE AND IS DIREC TED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS)-II, PATNA DATE D 24.01.2011, PERTAINING TO THE ASSESSMENT YEAR 2005- 06. 2. IN THIS APPEAL BY THE REVENUE, FOLLOWING GROUNDS WERE RAISED:- 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN L AW, THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITIONS MADE BY THE A.O. IN SPITE OF THE FACT THAT THE ASSESSEE HAD FURNISHED DIFFERENT BOGUS ADDRESSE S THEREBY FAILING TO COMPLY WITH THE DIRECTIONS ISSUED IN NOTICES U/S 14 2(1) AND COMPELLING THE A.O. TO FINALIZE ASSESSMENT ORDER U/S 144 OF TH E IT ACT, 1961. 2. ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LA W, THE LD. CIT(A) HAS ERRED BY NOT GIVING OPPORTUNITY TO PRESENT ASSESSIN G OFFICER FOR SUBMISSION OF REMAND REPORT. ITA NO.1006/AHD/2011 ITO VS SHRI MANISH GARG AY: 2005-06 2 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) OUGHT TO HAVE UPHELD THE ORDER OF THE ASSESSING OFF ICER. 4. IT IS, THEREFORE, PRAYED THAT THE ORDER OF THE CIT( A) MAY BE SET ASIDE AND THAT OF ASSESSING OFFICER MAY BE RESTORED TO THE AB OVE EXTENT. 3. AT THE TIME OF HEARING BEFORE US, IT WAS SUBMITT ED BY THE LD. DEPARTMENTAL REPRESENTATIVE THAT THE ASSESSEE DID N OT APPEAR BEFORE THE ASSESSING OFFICER DESPITE ISSUANCE OF VARIOUS NOTIC ES. THE LD. DEPARTMENTAL REPRESENTATIVE WAS FAIR ENOUGH TO ACCEPT THAT THE N OTICE WAS ACTUALLY NOT SERVED UPON THE ASSESSEE BUT ALL THE NOTICES WERE R ETURNED BACK, BECAUSE THE ASSESSEE WAS NOT AVAILABLE AT THE ADDRESS GIVEN BY HIM IN THE RETURN OF INCOME OR IN THE AUDIT REPORT. THE ASSESSEE HAS NOT INFORMED THE CHANGE OF ADDRESS. DESPITE THESE FACTS, THE CIT(A) ADMITTED T HE ADDITIONAL EVIDENCE AND WITHOUT ALLOWING OPPORTUNITY TO THE ASSESSING O FFICER OF SURAT TO WHOM THE CASE RECORDS HAVE BEEN TRANSFERRED, HE PAS SED THE APPELLATE ORDER DELETING ALL THE ADDITIONS. HE, THEREFORE, SUBMITTE D THAT THE ORDER OF THE CIT(A) SHOULD BE SET ASIDE AND HE SHOULD BE DIRECTE D TO RE-ADJUDICATE THE ISSUE, AFTER ALLOWING OPPORTUNITY TO THE ITO-SURAT TO WHOM THE FILES OF THE ASSESSEE HAVE BEEN TRANSFERRED. 4. THE LD. COUNSEL FOR THE ASSESSEE, ON THE OTHER H AND, POINTED OUT THAT ORIGINALLY THE ASSESSEE WAS RESIDING AT PATNA, THEN HE SHIFTED TO VARANASI AND AGAIN SHIFTED TO SURAT. THAT THE ASSESSEE SHIFT ED FROM ONE PLACE TO ANOTHER IN SEARCH OF BETTER BUSINESS OPPORTUNITIES AND ULTIMATELY SETTLED AT SURAT AND HIS CASE RECORDS HAVE ALSO BEEN SUBSEQUEN TLY TRANSFERRED TO SURAT. HE FURTHER SUBMITTED THAT NONE OF THE NOTICE COULD BE SERVED UPON THE ASSESSEE AND HE WAS NOT AWARE ABOUT ANY ASSESSMENT PROCEEDINGS BEING TAKEN BY THE ASSESSING OFFICER. IT WAS ALSO POINTED OUT BY THE LD. COUNSEL THAT THE CIT(A) CALLED FOR THE REMAND REPORT FROM T HE ASSESSING OFFICER OF ITA NO.1006/AHD/2011 ITO VS SHRI MANISH GARG AY: 2005-06 3 PATNA, BECAUSE AT THE RELEVANT TIME THE CASE RECORD WAS AVAILABLE WITH THE ITO-PATNA AND HAS NOT BEEN TRANSFERRED TO ITO-SURAT . HE ALSO SUBMITTED THAT EVEN AFTER THE TRANSFER OF CASE RECORDS, IF TH E CIT(A) CALLED FOR THE REMAND REPORT FROM THE ITO-PATNA, HE COULD HAVE FOR WARDED THE MATTER TO ITO-SURAT. THEREFORE, MERELY BECAUSE THE CIT(A) DID NOT ALLOW OPPORTUNITY TO THE ITO-SURAT, THE MATTER NEED NOT BE SET ASIDE. HE FURTHER SUBMITTED THAT THE CIT(A) CONSIDERED EACH AND EVERY FACTS IN DETAI LS AND ALLOWED THE RELIEF AFTER CONSIDERING THE FINDINGS IN THE ASSESSMENT OR DER AS WELL AS ASSESSEES WRITTEN SUBMISSION AND THE EVIDENCE FURNISHED BEFOR E HIM. MOREOVER, THE REVENUE HAS NOT TAKEN UP ANY SPECIFIC GROUND AGAINS T THE DELETION OF VARIOUS ADDITIONS BY THE CIT(A). HE, THEREFORE, SUB MITTED THAT THE ORDER OF THE CIT(A) SHOULD BE SUSTAINED. 6. IN REJOINDER, WE ASKED THE LD. DEPARTMENTAL REPR ESENTATIVE WHETHER THE DATE OF TRANSFER OF THE FILE FROM ITO-PATNA TO ITO-SURAT IS AVAILABLE ON RECORD? THE LD. DEPARTMENTAL REPRESENTATIVE INFORM ED THAT AS PER HIS RECORDS, FILE WAS TRANSFERRED FROM ITO-PATNA TO ITO -SURAT ON 02.07.2010. 7. WE HAVE CAREFULLY CONSIDERED THE ARGUMENTS OF BO TH THE SIDES AND PERUSED THE MATERIAL PLACED BEFORE US. FROM THE GR OUNDS OF APPEAL AS WELL AS THE ARGUMENTS OF LD. DEPARTMENTAL REPRESENTATIVE AT THE TIME OF HEARING BEFORE US, IT IS CLEAR THAT THE MAIN GRIEVANCE OF T HE REVENUE IS THE ACCEPTANCE OF ADDITIONAL EVIDENCE BY THE CIT(A) WITHOUT ALLOWI NG OPPORTUNITY TO THE ITO-SURAT. WE FIND THAT THE CIT(A) DISCUSSED THIS I SSUE IN PARAGRAPH 3 OF HIS ORDER AND WE REPRODUCE THE SAME BELOW FOR READY REF ERENCE:- 3. THE A/R FILED A PETITION FOR ADMISSION OF EVIDE NCE DURING APPELLATE PROCEEDINGS IN TERMS OF RULE 46A OF THE INCOME TAX RULES 1962, IN WHICH IT WAS SUBMITTED THAT THE NON COMPLIANCE TO THE NOTICE S BY THE APPELLANT WAS DUE TO THE FACT THAT HE HAD BEEN FORCED TO MOVE OUT OF PATNA IN VIEW OF THE ITA NO.1006/AHD/2011 ITO VS SHRI MANISH GARG AY: 2005-06 4 EXTRAORDINARY CIRCUMSTANCES PREVAILING IN BIHAR AT THAT POINT OF TIME, AND THEREAFTER WAS, FURTHER FORCED TO MOVE TO SURAT FRO M VARANASI FOR BUSINESS VIABILITY. IT WAS PLEADED THAT THE APPELLANT WAS A LAW ABIDING CITIZEN, AND THE DEFAULT WHICH OCCURRED DURING ASS ESSMENT PROCEEDINGS WAS OCCASIONED BY CIRCUMSTANCES BEYOND HIS CONT ROL. PERMISSION WAS SOUGHT FOR INTRODUCING EVIDENCE WHICH COULD NOT BE FILED B EFORE THE AO. AFTER CONSIDERING THE APPELLANT'S SUBMISSIONS, THE PLEA T HAT THE APPELLANT HAD BEEN PREVENTED BY SUFFICIENT CAUSE FROM PRODUCING THE EV IDENCES, WHICH HE WAS CALLED UPON TO PRODUCE BY THE AO, WAS ACCEPTED. ACC ORDINGLY, A COPY OF THE PAPER BOOK FILED BY THE A/R WAS FORWARDED TO THE AO , AND HE WAS ASKED TO EXAMINE THE EVIDENCES ADDUCED ON BEHALF OF THE APPE LLANT IN SUPPORT OF THE GROUNDS OF APPEAL, AND, AFTER MAKING NECESSARY ENQU IRIES AND AFFORDING REASONABLE OPPORTUNITY OF BEING HEARD TO THE APPELL ANT, FURNISH A FACTUAL REPORT WITHIN THREE WEEKS OF RECEIPT OF THE LETTER. THIS LETTER WAS DATED 12.5.2009. WHEN NO RESPONSE WAS RECEIVED FROM THE A O, A REMINDER WAS ISSUED ON 21.8.2009, REQUIRING HIM TO ENSURE SUBMIS SION OF HIS REPORT BY 31.8.2009. SUBSEQUENTLY, ANOTHER REMINDER WAS ISSUE D ON 15.2.2010, REQUESTING THE AO TO SENT THE REMAND REPORT BY 26.2 .2010, FAILING WHICH IT WOULD BE CONSIDERED THAT HE HAD NOTHING TO SAY IN T HE MATTER. DESPITE ISSUE OF TWO REMINDERS, NO RESPONSE HAS BEEN RECEIVED FRO M THE AO TILL DATE. NO REQUEST FOR EXTENSION OF TIME HAS BEEN RECEIVED EIT HER. THE POSITION WHICH EMERGES IS THAT THE APPELLANT'S SUBMISSIONS HAD B EEN FORWARDED TO THE AO ON 12.5.2009, AND THE APPELLATE ORDER IS BEING PASS ED IN JANUARY 2011, AND TWO REMINDERS HAD BEEN ISSUED IN THE INTERREGNUM, B UT THE AO HAS NOT MADE ANY RESPONSE. IT IS, ACCORDINGLY, CONCLUDED THAT TH E AO HAS NO CONTRARY MATERIAL AGAINST THE SUBMISSIONS MADE BY THE A/R DU RING APPELLATE PROCEEDINGS. THE GROUNDS OF APPEAL ARE BEING DISPOS ED IN THIS CONTEXT. 8. FROM THE ABOVE, IT IS EVIDENT THAT THE CIT(A) HA S GIVEN ADEQUATE REASON FOR ADMITTING THE ADDITIONAL EVIDENCE. THE REASON GIVEN BY THE CIT(A) HAS NOT BEEN CONTROVERTED BY THE REVENUE. WE , THEREFORE, HOLD THAT THE CIT(A) WAS JUSTIFIED IN ADMITTING THE ADDITIONA L EVIDENCE. NOW THE QUESTION REMAINS WHETHER THE OPPORTUNITY ALLOWED TO THE ASSESSING OFFICER FOR SUBMITTING THE REMAND REPORT ON THE ADDITIONAL EVIDENCE WAS IN ACCORDANCE WITH LAW OR NOT. FROM THE ORDER OF THE C IT(A), IT IS EVIDENT THAT VIDE LETTER DATED 12.05.2009, HE FORWARDED THE ADDI TIONAL EVIDENCE TO THE ASSESSING OFFICER AND SOUGHT FOR A REMAND REPORT WI THIN THREE WEEKS OF THE RECEIPT OF THE LETTER. THIS LETTER WAS ADMITTEDLY S ENT TO ITO-PATNA. SINCE NO ITA NO.1006/AHD/2011 ITO VS SHRI MANISH GARG AY: 2005-06 5 RESPONSE WAS RECEIVED, A REMINDER WAS ISSUED ON 21. 08.2009 AND SUBSEQUENTLY, ANOTHER REMINDER WAS ISSUED ON 15.02. 2010. DESPITE THREE LETTERS, THE ASSESSING OFFICER DID NOT SUBMIT ANY R EMAND REPORT. FROM THESE DATES, IT IS EVIDENT THAT THE LETTERS FOR THE REMAN D PROCEEDINGS AND REMINDERS WERE ISSUED BETWEEN 12.05.2009 AND 26.02. 2010. ADMITTEDLY, DURING THIS PERIOD, FILES WERE WITH THE ASSESSING O FFICER AT PATNA AND THE FILES WERE TRANSFERRED TO THE ASSESSING OFFICER AT SURAT ONLY IN JULY 2010. THEREFORE, THE GRIEVANCE OF THE REVENUE THAT THE OP PORTUNITY TO THE SUBSEQUENT ASSESSING OFFICER WAS NOT GIVEN FOR SUBM ISSION OF REMAND REPORT IS CONTRARY TO THE FACTS ON RECORDS. IN VIEW OF ABOVE FACTS, WE DO NOT FIND ANY JUSTIFICATION TO INTERFERE WITH THE ORDER OF THE CIT(A) WHICH IS SUSTAINED AND THE REVENUES APPEAL IS DISMISSED. 9. IN THE RESULT, THE REVENUES APPEAL IS DISMISSED . ORDER PRONOUNCED IN THE COURT ON 22 ND MAY, 2015 AT AHMEDABAD. SD/- SD/- (S. S. GODARA) JUDICIAL MEMBER (G.D. AGRAWAL) VICE-PRESIDENT AHMEDABAD; DATED 22/05/2015 BIJU T., PS '( ! ') *')' '( ! ') *')' '( ! ') *')' '( ! ') *')'/ COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ++ ' , / CONCERNED CIT 4. , ( ) / THE CIT(A) 5. )/0 ' , , / DR, ITAT, AHMEDABAD 6. 02 3 / GUARD FILE . '( '( '( '( / BY ORDER, TRUE COPY 4 44 4/ // / +5 +5 +5 +5 ( DY./ASSTT.REGISTRAR) , , , , / ITAT, AHMEDABAD