M/s North India Securities Pvt. Ltd., New Delhi V. ACIT, New Delhi

ITA 1075/DEL/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 86498 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 10 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-01-2015
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: E
• Next Hearing Date: 23-12-2014
• Assessment Year: 2009-2010
• Appeal Filed On: 25-02-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: K SAMPATH ADV RAJ KUMAR
• Keywords: Principle of natural justice
• Section: 54

Judgement Text

ITA NO.1075/DEL/2013 ASSTT.YEAR: 2009-10 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES E NEW DELHI BEFORE SHRI S.V. MEHROTRA, ACCOUNTANT MEMBER AND SHRI CHANDRAMOHAN GARG, JUDICIAL MEMBER ITA NO. 1075/DEL/2013 ASSTT.YEAR: 2009-10 NORTH INDIA SECURITIES PVT. LTD., VS A CIT, H-108, IIND FLOOR, CENTRAL CIRC LE-9, NEW ASIATIC BLDG., NEW DELHI. CONNAUGHT PLACE, NEW DELHI. (PAN: AAACN9408N) (APPELLANT) (RESPONDENT) APPELLANT BY: S/SHRI K. SAMPATH ADV., RAJ KUMAR A DV. RESPONDENT BY: SHRI VIVEK KUMAR, SR. DR O R D E R PER CHANDRAMOHAN GARG, J.M. THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF THE CIT(A)-XXXII, NEW DELHI DATED 12.11.2012 IN APPEAL NO. 139/11-12(A)32 DATED 12.11.20-12 FOR AY 2009-10. 2. WE HAVE HEARD ARGUMENTS OF BOTH THE SIDES AND CAREF ULLY PERUSED THE RELEVANT MATERIAL PLACED ON RECORD. LD. COUNSEL OF THE ASSESSEE, AT THE VERY OUTSET, HAS DRAWN OUR ATTENTION TOWARDS OPERATIVE P ARAGRAPH 8 AND 9 OF THE IMPUGNED ORDER AND SUBMITTED THAT THE CIT(A) PASSED EX PARTE ORDER WITHOUT ITA NO.1075/DEL/2013 ASSTT.YEAR: 2009-10 2 AFFORDING DUE OPPORTUNITY OF HEARING FOR THE ASSESS EE AND PLACING RELIANCE ON THE DECISION OF HONBLE HIGH COURT OF MADHYA PRADESH I N THE CASE OF ESTATE OF LATE TUKOJIRAO HOLKAR VS CWT 223 ITR 480(MP). LD. COUNSEL FURTHER CONTENDED THAT AS PER SERVICE OF NOTICE AS NOTED BY THE CIT(A) IN PARA 4.1, A NOTICE DATED 15.10.12 WAS ISSUED TO THE ASSESSEE FI XING THE DATE OF HEARING ON 6.11.2012 AND CIT(A) IN THE REMARKS COLUMN MENTIONE D THAT NONE ATTENDED NOR ANY SUBMISSIONS FILED NOR ANY REQUEST FOR ADJOU RNMENT MADE AND PLACING RELIANCE ON THE DECISION OF HONBLE HIGH COURT OF M ADHYA PRADESH (SUPRA), THE CIT(A) DISMISSED THE APPEAL OF THE ASSESSEE BY PASS ING AN EX PARTE ORDER. LD. COUNSEL FURTHER CONTENDED THAT EVEN IF THE ASSESSEE DOES NOT APPEAR BEFORE THE CIT(A) DESPITE DUE SERVICE OF NOTICE, THEN ALSO THE CIT(A) IS DUTY BOUND TO ADJUDICATE ALL THE GROUNDS RAISED BY THE ASSESSEE B EFORE HIM ON MERITS. LD. COUNSEL VEHEMENTLY CONTENDED THAT AS PER FORM 35, T HE ASSESSEE RAISED SIX GROUNDS BEFORE THE CIT(A) WHICH WERE NOT ADJUDICATE D AS PER REQUIREMENT OF PROVISIONS OF THE ACT, THEREFORE, THE CASE MAY KIND LY BE REMITTED TO THE FILE OF CIT(A) FOR FRESH ADJUDICATION. 3. REPLYING TO THE ABOVE, LD. CIT(A) CONTENDED THAT IF DESPITE DUE SERVICE OF NOTICE, NEITHER THE ASSESSEE NOR ITS REPRESENTATIVE APPEAR BEFORE THE FIRST APPELLATE AUTHORITY I.E. CIT(A), THEN THERE IS NO A LTERNATIVE BUT TO DECIDE THE APPEAL EX PARTE. HOWEVER, LD. DR FAIRLY ACCEPTED T HAT IF IT IS FOUND JUST AND ITA NO.1075/DEL/2013 ASSTT.YEAR: 2009-10 3 PROPER, THEN THE DEPARTMENT HAS NO SERIOUS OBJECTIO N IN RESTORING ENTIRE FIRST APPEAL TO THE FILE OF CIT(A) FOR FRESH ADJUDICATION ON MERITS. 4. ON CAREFUL CONSIDERATION OF ABOVE SUBMISSIONS OF BOTH THE SIDES, FROM FORM NO. 35, WE OBSERVE THAT THE ASSESSEE RAISED SI X GROUNDS BEFORE THE CIT(A). FROM THE DETAILS OF NOTICES AND DATE OF HE ARING AS EMANATED FROM PARA 4.5 OF THE IMPUGNED ORDER, WE OBSERVE THAT ON 6.9.2 012 ON THE WRITTEN REQUEST OF THE ASSESSEES REPRESENTATIVE, THE CASE WAS ADJOURN ED SINE DIE AND SUBSEQUENTLY ANOTHER NOTICE WAS ISSUED ON 15.10.12 FIXING THE DA TE OF HEARING ON 6.11.12 AND CIT(A) OBSERVED THAT NONE ATTENDED NOR ANY SUBMISSI ON FILED NOR ANY REQUEST FOR ADJOURNMENT WAS MADE AND THE CIT(A) DECIDED THE APPEAL EX PARTE WITH FOLLOWING BRIEF, CRYPTIC AND SLIPSHOD OBSERVATIONS AND CONCLUSION:- 8. FROM THE ABOVE, IT CAN BE SEEN THAT THE ADDITIONS/DISALLOWANCES MADE BY THE LD. AO ARE WELL REASONED OUT AND ARE ON SOUND FOOTING. IT IS FURTHER SEEN TH AT THE APPELLANT WAS DULY CONFRONTED BY THE LD. AO DURING THE ASSESSMENT PROCEEDINGS ON THE ISSUES UNDER CONSIDER ATION AND ITS FAILURE TO FURNISH THE INFORMATION/EVIDENCES CA LLED FOR LED TO THE ADDITIONS WHICH HAVE BEEN MADE IN ACCORDANCE WI TH THE LAW. I, THEREFORE, DO NOT FIND ANY INFIRMITY IN THE ACTION OF THE AO IN MAKING SUCH ADDITIONS/DISALLOWANCES. 9. UNDER THESE CIRCUMSTANCES, THE FACT THAT THE APP ELLANT IS NOT INTERESTED IN PURSUING THE APPEAL IS A CLEAR INDICA TOR THAT THE APPELLANT DOES NOT HAVE ANY MATERIAL EVIDENCE IN IT S POSSESSION TO CHALLENGE THE DECISION OF THE AO AS P ER THE IMPUGNED ORDER. THERE IS NOTHING ON RECORD TO SUBST ANTIATE THE GROUNDS OF APPEAL AND AS HELD SUPRA, THE ADDITIONS MADE BY THE LD. AO ARE AS PER LAW. THEREFORE, THE APPEAL FI LED BY THE APPELLANT AGAINST THE IMPUGNED ASSESSMENT ORDER IS LIABLE TO BE REJECTED IN VIEW OF THE REASONS RECORDED IN THE PRECEDING PARAS AND THE ADDITIONS MADE UNDER VARIOUS HEADS BY THE AO ITA NO.1075/DEL/2013 ASSTT.YEAR: 2009-10 4 ARE ACCORDINGLY CONFIRMED. THE GROUND NOS. 2 TO 5 OF THE APPELLANT ARE ACCORDINGLY REJECTED. 5. LD. COUNSEL OF THE ASSESSEE DURING THE ARGUMENT BEFORE US SUBMITTED COPIES OF THE DECISION OF ITAT, AHMADABAD BENCH C IN THE CASE OF GUJARAT THEMIS BIOSYN LTD. VS JCIT 74 ITD 339 (AHMEDABAD) W HEREIN COORDINATE BENCH OF THIS TRIBUNAL ON THE SIMILAR ISSUE HAS HEL D AS UNDER:- 3. WE HAVE CAREFULLY CONSIDERED THE FACTS AND CIRCUMSTANCES OF THE CASE AS WELL AS SUBMISSIONS MA DE BEFORE US. THE IMPUGNED ORDER PASSED BY THE CIT(A) IS CLEA RLY VIOLATIVE OF THE EXPRESS PROVISIONS OF SECTION 250( 6), WHICH PROVIDES THAT THE APPELLATE ORDERS OF THE CIT(A) AR E TO STATE THE POINTS ARISING IN THE APPEAL, THE DECISION OF T HE AUTHORITY THEREON AND THE REASONS FOR SUCH DECISION. THE UNDE RLYING RATIONALE OF THE PROVISION IS THAT SUCH ORDERS ARE SUBJECT TO FURTHER APPEAL TO THE APPELLATE TRIBUNAL. SPEAKING ORDER WOULD OBVIOUSLY ENABLE A PARTY TO KNOW PRECISE POINTS DEC IDED IN HIS FAVOUR OR AGAINST HIM. ABSENCE OF THE FORMULATION O F THE POINT FOR DECISION FOR WANT OF CLARITY IN A DECISION UNDO UBTEDLY PUTS A PARTY IN QUANDARY. SECTION 250(6) EXPRESSLY EMBOD IES THE PRINCIPLES OF NATURAL JUSTICE AND SUCH A PROVISION IS CLEARLY MANDATORY IN NATURE. THE IMPUGNED ORDER PASSED BY T HE COMMISSIONER (APPEALS) IN VIOLATION OF THE PROVISIO NS OF SECTION 250(6) CANNOT, THEREFORE, BE SUSTAINED. REG ARDING THE DECISIONS OF THE DELHI BENCH OF THE TRIBUNAL IN MUL TIPLAN INDIA (P.) LTD.'S CASE (SUPRA) CITED BY THE LD. CIT(A), W E FIND THAT THE SAID DECISION IS CLEARLY DISTINGUISHABLE. SECTION 2 54 REFERRING TO THE ORDERS OF THE TRIBUNAL CONFERS PLENARY JURIS DICTION ON THE TRIBUNAL IN THE MATTER OF PASSING ORDERS UNDER SECTION 254(1). THERE IS NO SUCH EXPRESS STIPULATION IN SE CTION 254 AS CONTAINED UNDER THE PROVISIONS OF SECTION 250(6) RE LATING TO THE ORDERS OF FIRST APPELLATE AUTHORITY. THEREFORE, RELIANCE PLACED BY THE CIT(A) ON MULTIPLAN INDIA (P.) LTD.'S CASE (SUPRA) IS ENTIRELY MISPLACED. SIMILARLY, THE CASE OF ESTATE OF LATE TUKOJIRAO HOLKAR (SUPRA) CITED BY THE LD. CIT( A) IS DISTINGUISHABLE AND DOES NOT SUPPORT THE VIEW TAKEN BY THE CIT(A). ITA NO.1075/DEL/2013 ASSTT.YEAR: 2009-10 5 4. FOR THE REASONS INDICATED ABOVE, WE HEREBY SET A SIDE THE IMPUGNED ORDER OF THE CIT(A) AND DIRECT THE CIT(A) TO DISPOSE OF THE APPEAL OF THE ASSESSEE AFRESH AFTER ALLOWING PROPER OPPORTUNITY IN ACCORDANCE WITH LAW. 6. IN THE LIGHT OF FACTS AND CIRCUMSTANCES OF THE P RESENT CASE, WE OBSERVE THAT IN A SIMILAR SITUATION, IT WAS HELD THAT RELIANCE P LACED BY THE CIT(A) ON MULITPLAN INDIA PVT. LTD. 38 ITD 320 (DEL) IS ENTIR ELY MISPLACED AND THE CASE OF THE CASE OF ESTATE OF LATE TUKOJIRAO HOLKAR (SUPRA) CITED BY THE LD. CIT(A) IS DISTINGUISHABLE AND DOES NOT SUPPORT THE VIEW TAKEN BY THE CIT(A). IN THE PRESENT CASE, WE ARE UNABLE TO SEE ANY OBSERVATION OR CONCLUSION OF THE CIT(A) THAT THE NOTICE ISSUED TO THE ASSESSEE ON 15.10.201 2 FOR THE DATE OF HEARING ON 6.11.2012 WAS DULY SERVED UPON THE ASSESSEE AND DES PITE DUE SERVICE, NEITHER THE ASSESSEE NOR HIS REPRESENTATIVE ATTENDED THE PR OCEEDINGS NOR ANY REQUEST FOR ADJOURNMENT WAS MADE ON BEHALF OF THE ASSESSEE. IN THIS SITUATION, IT CAN SAFELY BE PRESUMED THAT THE CIT(A) IGNORED TO APPRECIATE T HIS FACT WHETHER THE LAST NOTICE DATED 15.10.12 WAS REALLY SERVED UPON THE AS SESSEE OR NOT. IN THIS SITUATION, EX PARTE ORDER PASSED BY THE CIT(A) IS CLEARLY VIOLATIVE OF PRINCIPLES OF NATURAL JUSTICE. WE FURTHER HOLD THAT THE RELIA NCE PLACED BY THE CIT(A) ON THE CASE OF ESTATE OF LATE TUKOJIRAO HOLKAR (SUPRA) DOE S NOT SUPPORT THE VIEW TAKEN BY THE CIT(A). THE PRESENT CASE IS SQUARELY COVERE D IN FAVOUR OF THE ASSESSEE BY THE ORDER OF THE ITAT AHMEDABAD BENCH C IN THE CASE OF GUJARAT THEMIS BIOSYN LTD. VS JCIT (SUPRA), HENCE, APPEAL OF THE ASSESSEE ON THIS LEGAL ISSUE IS ALLOWED AND THUS, WE HEREBY SET ASIDE THE I MPUGNED ORDER OF THE ITA NO.1075/DEL/2013 ASSTT.YEAR: 2009-10 6 CIT(A) AND DIRECT THE CIT(A) TO DISPOSE OF THE APPE AL OF THE ASSESSEE AFRESH AFTER ALLOWING PROPER OPPORTUNITY OF HEARING IN ACC ORDANCE WITH LAW. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DEE MED TO BE ALLOWED FOR STATISTICAL PURPOSES RESTORING THE FIRST APPEAL TO THE FILE OF CIT(A) IN THE MANNER AS INDICATE ABOVE. ORDER PRONOUNCED IN THE OPEN COURT ON 14.1.15. SD/- SD/- (S.V. MEHROTRA) (CHANDRAMOHAN GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER DT. 14TH JANUARY 2015 GS COPY FORWARDED TO:- 1. APPELLANT 2. RESPONDENT 3. C.I.T.(A) 4. C.I.T. 5. DR BY ORDER AS STT. REGISTRAR