Enso Secutrack Ltd., Hyderabad V. Asst.CIT,Circle 2(2), Hyderabad

ITA 1101/HYD/2014

• Counselvise Citation: 110122514 RSA 2014
• Duration Of Justice: 4 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-09-2014
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2008-2009
• Appeal Filed On: 30-05-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: P SOMASEKHAR REDDY
• Assessee Lawyers: Y R A T N A K
• Keywords: Transfer pricing

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A', HYDERABAD BEFORE SHRI P.M.JAGTAP, ACCOUNTANT MEMBER AND SMT. P.MADHAVI DEVI, JUDICIAL MEMBER ITA NO.1 1 0 1 /HYD/2014 (ASSESSMENT YEAR 200 8 - 0 9 ) M/S. E N S O S E C U T R A C T L T D . , HYDERABAD ( PAN - AAA C T 7 5 3 7 J ) V/S. ASST. COMMISSIONER OF INCOME - TAX C I R CLE 2 (2), HYDERABAD (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI Y . R A T N A K A R RESPONDENT BY : SHRI P.SOMA SEKHAR REDDY DATE OF HEARING 29 .0 9 .2014 DATE OF PRONOUNCEMENT 30.09.2014 O R D E R PER P.M.JAGTAP, ACCOUNTANT MEMBER: THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME - TAX(APPEALS) III , HYDERABAD DATED 10 TH M AR C H, 2014, WHEREBY HE DISMISSED THE APP E AL O F THE ASSESSEE IN LIMINE TR E ATIN G THE SAME TO BE NO T MAINTAINABLE. 2. THE ASSESSEE IN THE PRESENT CASE IS A COMPANY WHICH IS ENGAGED IN TH E B U SIN E SS OF MANUFACTURING AND SALE OF CASH COUN T IN G MACHINES AND OTHER AUTOMATION PRODUCTS MOSTLY USED IN BANKS. IT DID NO T FIL E T H E RETURN O F INCOM E FOR THE YE A R UNDER CON S IDE R ATION IN REGULAR COUR SE. A SURVEY UNDER S.133A WAS CARRIED OUT I N TH E CA S E OF TH E ASSESSEE ON 2.9.2009. SUBSEQUENT TO TH E SURVEY, TH E RETURN OF IN C OM E FOR TH E Y E AR UNDER CONSID E RATION WAS FILED BY TH E ASSESSEE ON 2.12.2009, DE C LARING TOTAL IN C OM E OF R S .9,76,77,222. I N TH E ASSESSMENT COMPLETED UNDER S.143( 3 ) VIDE ORD E R DATED I TA NO. 1 1 0 1 /HYD/2014 M/S. ENSO SECUTRACT LTD., HYDERABAD 2 23.12.2010, THE TOTAL INCOME OF TH E ASSESSEE WAS DETERMINED BY THE ASSESSING OFFICER AT R S .40,70,46,211, AF T ER MAKING VARIOUS A DDITIONS/DISALLO W ANCES. 3. AGAIN S T THE O R D E R OF THE ASSESSING OFFICER PASSED UNDER S.143 ( 3), AN APPEAL W AS PREFERRED BY TH E ASSESSEE BEFORE THE LEARNED CIT(A), WHO DISMISSED THE SAME IN LIMINE, AS THE ADMITTED TAX ON THE INCOME DECL A RED IN THE RETURN HAD NO T BEEN PAID BY THE ASSESSEE. ON FURTH E R APPEAL, THE T RIBUNAL UPHELD THE ACTION OF TH E LEARNED CIT(A), KEEPING IN VIEW T HE P R OVI SI ON S OF S.249(4) OF TH E AC T, AND DI SMI SSED THE APPEAL O F THE ASSESSEE, VI D E ITS ORDER DATED 10.10.2012 P A SSED IN ITA NO.366/HYD/2012. 4. MEANWHILE, TH E ASSESSEE WAS MAKING PAYMENT O F THE TAX ON THE INCOME DECLARED IN TH E RETURN IN INSTALMENTS AND LAST S U C H I N STALMENT WAS PAID BY HIM ON 16.10.2012. THEREAFTER, THE ASSESSEE PREFERRED A FRESH APPEAL B E FORE THE LEARNED CIT(A) ON 25.10.,2013, CLAIMING THAT THE TAXES ON THE RETURNED INCOME HAVING BEEN PAID NOW BY IT, THE DELA Y IN FILIN G THE SAID APPEAL BE CONDONED, AND THE APPEAL MAY BE DECI D ED ON MERITS. THE LEARNED CIT(A) DID NO T FIND MERIT IN THIS CLAIM O F TH E ASSESSEE . ACCOR D ING TO HIM, TH E RE WAS NO PROVISION IN LAW ALLO W IN G TH E ASSESSEE TO FILE TWO APPEALS FOR THE SAME ASSESSMENT YEAR BEFORE HIM. HE HELD THAT THE ONLY WAY IN WHICH THE SAME APPEAL IS ADJUDICATED UPON AGAIN IS WHEN TH E T RIBUNAL OR A HIGHER COURT HAS REMANDED THE CA S E BACK TO HIS OFFICE , AND IN THIS CASE, SUCH A THING HAS NOT BEEN DONE EITHER BY THE TRI BUNAL OR BY THE HIGHER C OURT. HE TH E R E FORE, DISMISS ED THE APPEAL OF TH E ASSESSEE IN LI MI NE HOL D IN G TH A T THE SAM E WAS NO T MAIN T AI N ABLE IN LAW. I TA NO. 1 1 0 1 /HYD/2014 M/S. ENSO SECUTRACT LTD., HYDERABAD 3 5. AGGRIEVED BY TH E O R DER OF THE LEARNED CIT(A), THE ASSESSEE HAS PREFERRED THIS APPEAL B E FORE TH IS T R IBUNAL. 6. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AND ALSO PERUSED THE RELEVANT MATERIAL ON RECORD. AS AGREED BY THE LEARNED REPRESENTATIVES OF BOTH THE SIDES, THE ISSUE INVOL V ED IN THI S APPEAL OF TH E ASSESSEE REGARDING THE MAINTAINABILITY OF TH E FRESH APPEAL FILED BY THE ASSESSEE BEFORE THE LEARNED CIT(A) AFTER PAYMENT OF ADMITTED TAX, I S SQU A RELY COVER E D IN FA V OUR OF THE ASSESSEE BY THE DECISION OF THE PUNJAB AND HARYANA HIGH COURT IN THE CASE OF J.R. CHAUHAN V/S. CIT (311 ITR 303) . IN THAT CA SE, THE ASSESSEE WAS AN ASSOCIATION OF THREE PERSONS AND THE ASSESSMENT S FOR THE ASSESSMENT YEAR 1991 - 92 WERE MADE IN D I V I D UALLY FOR THE THREE MEMBERS AND ALSO TH E ASSOCI A T I ON OF PERSONS IN THE HANDS OF THE ASSESSEES AS INDIVIDUAL S . HOWEVER, T HE TAX PAID AS INDIVIDUAL WAS NOT ADJUSTED. THE APPEAL FILED BY TH E ASSESSEE AGAINST THE ASSESSMENT MADE WAS DISMISSED BY THE LEARNED CIT(A) ON THE G R OUND OF NON - COMPLI A NCE WITH THE P R O VI SION S OF S.249(4)(A) OF TH E ACT. THE ASSESSEE TH E R E AFTER, FIL E D A FRESH APPEAL S TATING THAT TAX HAVING BEEN SUBSEQUENTLY ADJUSTED, TH E RE WAS NO DEFAULT OF THE PROVISION S OF S.249(4)(A ) AND TH E APPEAL SHOULD B E DECIDED ON M E RITS. THE LEARNED CIT(A) HO W EVER, DISMISSED THE SAID APPEAL ON G R OUNDS OF DELAY AND WHEN THE ACTION OF THE LEARNED CIT(A) WAS UPHELD BY THE T RIBUNAL, THE HONBLE PUNJAB AND HARYANA HIGH C OU R T, WHILE DEALIN G WITH APPEAL OF THE ASSESSEE , HELD TH A T T HERE WAS NO DISPUTE THAT THE DE FAULT IN COMPLIANCE WITH THE P R O V IS I ON S O F S.249(4)(A) STOOD MET BY THE SUB S EQUE NT ACTION OF ADJUSTING THE TAX AND THE CASE FOR REVIVAL OF APP EA L WAS MADE OUT . THEIR LORDSHIPS OBSERVED T H A T ALTHOUGH FRESH APPEAL FI L ED BY THE ASSESSEE WAS NOT MAI N TAI N ABLE, THE SAME COULD BE TREATED AS AN APPLICATION FOR REVIVA L OF APP E AL E ARLIER DISMIS SED. IT WAS H E LD T H A T INSTEAD OF I TA NO. 1 1 0 1 /HYD/2014 M/S. ENSO SECUTRACT LTD., HYDERABAD 4 CONDEMNING THE ASSESSEE UNHEARD ON THE MERITS OF THE CONTROVERSY, THE APPEAL SHOULD HAVE BEEN HEARD AND DECID ED ON MERITS IN ACCORDAN C E WITH LAW. THE ORDER S OF TH E TRIBUNAL AS WELL AS THE LEARNED CIT(A) THUS WERE SET ASI DE BY THE HON'BLE PUN J AB AND HARYANA HIGH COU R T AND BY TREATING THE FRESH APPEAL FILED BY TH E ASSESSEE AS AN APPLICATION FOR REVIVAL O F THE EARLIER APPEAL DISMISSED ON ACCOUNT OF NON - COMPLI A NCE WITH THE P R OVISION S OF S.249(4) OF TH E ACT, THE LEARNED CIT(A) WAS DIRECTED TO DECID E THE APPEAL OF THE ASSESSEE ON MERITS IN ACCORDANCE WI T H LAW. AS THE ISSUE INVOL V ED IN THE PR E SENT CA SE AS WELL AS ALL THE M A TERIAL FACTS RELE V ANT THERETO ARE SIMILAR TO TH OSE INVOLVED IN THE CASE OF J.R.CHAUHAN (SUPRA), WE RESP E CT F ULLY FOLLOW THE DECISION OF THE HONBLE PUNJAB AND HARYANA HIGH COU R T RENDERED IN TH E CITED CASE, AND RESTORE THE MATTER TO THE FIL E O F THE LEARNED CIT(A), WITH A DIRECTION TO TREAT THE FRESH APPEAL FIL E D BY THE ASSESSEE AS AN APPLI CA TION FOR REVI V AL OF THE EARLIER APPEAL DISMI S SED FOR NON - PAYM E NT OF ADMITTED TAX, AND DECIDE THE SAME ON M E RITS IN ACCORDANCE WITH LAW, AFTER GIVING THE ASSESSEE A PROPER OPPORTUNITY OF BEIN G HEARD. 7. IN THE R E SUL T , APPEAL O F THE ASSESSEE IS ALLOWED FOR STATISTICAL PURP O SES. ` `` ORDER PRONOUNCED IN THE COURT ON 30 TH SEPTEMBER, 2014 SD/ - SD/ - ( P.MADHAVI DEVI) ( P.M.JAGTAP ) JUDICIAL MEMBER ACCOUNTANT MEMBER DT/ - 30 TH SEPTEMBER , 2014 I TA NO. 1 1 0 1 /HYD/2014 M/S. ENSO SECUTRACT LTD., HYDERABAD 5 COPY FORWARDED TO: 1. M/S. ENSO SECUTRACT LTD., FLAT NO.121, AMRUTHA VILLA, OPP. YASHODA HOSPITAL, SOMAJIGUDA, HYDERABAD 500 082 2 . ASST. DIRECTOR OF INCOME - TAX(INTERNATIONAL TAXATION), HYDERABAD 3. DIRECTOR OF INCOME - TAX(INTERNATIONAL TAXATION& TRANSFER PRICING), HYDERABAD 4. DEPARTMENTAL REPRESENTATIVE, ITAT, HYDERABAD. B.V.S