Asst.C.I.T., Hubli V. Shri. Harijivandas J Patadia, Hubli

ITA 1177/BANG/2015

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 8491 (ITAT-BANGALORE)
• Duration Of Justice: 1 year(s) 6 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-03-2017
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 23-02-2017
• Assessment Year: 2008-2009
• Appeal Filed On: 24-08-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SWAPNA DAS
• Keywords: Set aside; Capital Gains
• Section: 32; 147; 131; 68; 246; 69; 145; 27; 148; 54; 37; 6; 56; 263; 63; 132; 12; 28; 144; 10; 90; 154; 2; 11; 15; 271(1)(b); 139; 92

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, BANGALORE BENCH, A, BANGALORE BEFORE SHRI A.K GARODIA, ACCOUNTANT MEMBER SHRI LALIET KUMAR, JUDICIAL MEMBER ITA NOS.1177 & 1178//BANG/2015 (ASST. YEARS 2008-09 & 2010-11) THE ASST. COMMISSIONER OF INCOME-TAX, CIRCLE-1(1), HUBLI. . APPELLANT VS. SHRI HARJIVANDAS J PATADIA, PROP: M/S DIAMOND JEWELLERY MART, BROADWAY, HUBBALLI. . RESPONDENT CO NO.10//BANG/2016 (ASST. YEAR 2010-11) SHRI HARJIVANDAS J PATADIA, PROP: M/S DIAMOND JEWELLERY MART, BROADWAY, HUBBALLI. . APPELLANT VS. THE ASST. COMMISSIONER OF INCOME-TAX, CIRCLE-1(1), HUBLI. . RESPONDENT APPELLANT BY : SMT. SWAPNA DAS, JCIT RESPONDENT BY : SHRI V SRIDHAR, FCA DATE OF HEARING : 23-02-2017 DATE OF PRONOUNCEMENT : 03-03-2017 ITA NO.1177 & 1178 /B/15 CO NO.10/B/16 2 O R D E R PER LALIET KUMAR, JUDICIAL MEMBER THESE TWO APPEALS BY THE REVENUE ARE DIRECTED AGA INST THE ORDER PASSED BY THE COMMISSIONER OF INCOME-TAX (APPEALS), FOR THE ASSESSMENT YEAR 2008-09 AND PENALTY PROCEEDINGS FOR ASSESSMEN T YEAR 2010-11 PENALTY PROCEEDINGS WERE FILED ON 29/9/2015 AND TH E ASSESSEE HAS FILED CROSS OBJECTION IN THE APPEAL FOR THE AY 2008-2009. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESS EE WAS CARRYING ON THE BUSINESS OF TRADING IN GOLD ORNAMENTS, STONE AND BU LLIONS ETC. AND FILED ITS RETURN OF INCOME DECLARING RS.22,58,130/- FOR THE A SSESSMENT YEAR 2008-09. DURING THE SCRUTINY ASSESSMENT NOTICES WERE ISSUED AND LEARNED AR REPRESENTING ON BEHALF OF ASSESSEE APPEARED AND AFT ER DETAILED HEARING, THE AO MADE THE ADDITION OF RS.16,68,425/- FOR UNDER VA LUATION OF STOCK AND RS.54,76,324/- FOR A LONG TERMS CAPITAL GAINS. 3. AGAINST THE SAID ORDER OF THE ASSESSING OFFICER , THE ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT(A). THE LEARNED AR REPRESENTING ON BEHALF OF THE ASSESSEE APPEARED ON VARIOUS OCCASION S INCLUDING ON 11/11/2011, 24/112014, 12/2/2015 AND 18/2/2015. A FTER HEARING THE ITA NO.1177 & 1178 /B/15 CO NO.10/B/16 3 LEARNED AR, THE CIT(A) CANCELED THE ORDER PASSED BY THE ASSESSEE AND GRANTED SUBSTANTIAL RELIEF TO THE ASSESSEE. 4. AGGRIEVED BY THE ORDER OF THE CIT(A), THE REVEN UE IS IN APPEAL BEFORE US. THE LEARNED CIT(A) HAD ALSO DELETED THE PENALTY PRO CEEDINGS INITIATED AGAINST THE ASSESSEE FOR THE ASSESSMENT YEAR 2010-1 1 VIDE ORDER DATED 29/5/2015 AND AGAINST THE DELETION, THE REVENUE IS IN APPEAL BEFORE US. 5. IT MAY ALSO BE POINTED OUT THAT IN THE APPEAL B EFORE THE CIT(A), THE LEARNED AR REPRESENTED THE ASSESSEE ON 3/2/2015 , 12/2/2015, 18/2/2015, 19/5/205 AND 29/5/2015. 6. BEFORE US, THE LEARNED DR VEHEMENTLY REQUESTED FOR ALLOWING BOTH THE APPEALS AND HE HAS DRAWN OUR ATTENTION TO THE O RDER AND ALSO THE GROUNDS RAISED IN THE APPEAL. 7. WE ARE NOT REPRODUCING GROUNDS OF APPEAL FOR T HE REASONS WHICH ARE MENTIONED DURING THE INCLUSION OF THE ORDER. 8. THE LEARNED AR HAS SUBMITTED THAT ON THE LAST D AY OF HEARING, AR WAS ASKED TO GIVE THE DETAILS OF DEATH PARTICULARS AND THE LEGAL HEIRS LEFT BEHIND BY THE ASSESSEE VIZ. HARIJIVANDAS J PATADIA . IN PURSUANCE TO THE ITA NO.1177 & 1178 /B/15 CO NO.10/B/16 4 ORDER, THE LEARNED AR REPRESENTING THE LEGAL HEIRS OF DECEASED ASSESSEE FILED CERTIFICATE OF SURVIVING FAMILY MEMBERS OF TH E DECEASED VIZ. HARIJIVANDAS J PATADIAALONG ALONG WITH AN AFFIDAVIT AND IN THE CERTIFICATE ISSUED BY THE THASILDHAR. IT IS MENTIONED IN THE CERTIFICATE THAT THE ASSESSEE HARIJIVANDAS J PATADIA DIED ON 5/11/2014 AND PARTIC ULARS OF THE LEGAL HEIRS LEFT BEHIND ON HIS DEMISE ARE MENTIONED AS UNDER:- --------------------------------------------------- ------------------------------------------ NAME AGE RELATIONSHIP MARITAL DECEASED STATUS -------------------------------------------------- -------------------------------------------------- MADHUKANTHA, 83 WIFE MARRI ED W/O. HARAJEEVANADASA PATADIYA NAVEENACHANDRA HARAJEEVANADASA 62 SON MAR RIED PATADIYA. BHANUMATI, W/O. MAHESHKUMARA 59 DAUGHTER MARR IED ADESARA RANJANA, W/O. VASANTHAKUMARA SONY 57 DAUGHTER MARRIED JYOTHI, 55 DAUGHTER MARRIED W/O. KISHORAKUMARA SONY USHA, W/O. KANTILALA JAVERI 51 DAUGHTER MARRIED ITA NO.1177 & 1178 /B/15 CO NO.10/B/16 5 MUKESHA, S/O. HARAJEEVANADASA PATADIYA 51 SON MAR RIED RAJU S/O. HARAJEEVANADASA 49 SON MARRIED PATADIYA 9. WE HAVE GONE THROUGH THE RECORD AND PERUSED THE CERTIFICATE AND THE AFFIDAVIT FILED BY THE LEARNED AR. APPEAL BEAR ING NO.1177 WAS PREFERRED BY THE REVENUE AGAINST THE ORDER DATED 29 /5/2015 AND THE LD AR WAS REPRESENTING THE ASSESSEE ON VARIOUS OCCASIONS AND MORE PARTICULARLY ON 18/2/2015. SIMILARLY, THE LEARNED AR IN APPEAL NO.1178 WAS REPRESENTING THE ASSESSEE FROM 19/1/2015 TO 29/5/20 15. AS IT IS CLEAR FROM RECORD THAT THE ASSESSEE HAD DIED ON 5/11/2014 AND EVEN AFTER THE DEATH, THE LD AR/CA HAS BEEN APPEARING ON BEHALF OF THE DECEAS ED PERSONS BEFORE THE CIT(A) AND NO STEPS WERE TAKEN IN THE APPELLATE PRO CEEDING TO BRING ON RECORD THE LRS OF THE DECEASED ASSESSEE. LD AR/CA H AD BEEN REPRESENTING DECEASED IN THE PROCEEDING AND AS SUCH HEARING CONT INUED EVEN AFTER THE DEATH OF ASSESSEE ON 19/1/2015 TO 29/5/2015 IN RESP ECT OF APPEALS. 10. IT IS THE SOLEMN DUTY OF THE LEARNED AR REPRES ENTING THE DECEASED BEFORE THE CIT(A) TO INFORM THE LEARNED CIT(A) ABOU T THE DEATH OF THE ITA NO.1177 & 1178 /B/15 CO NO.10/B/16 6 ASSESSEE AND SHOULD HAVE TAKEN STEPS FOR BRINING LE GAL REPRESENTATIVE/LEGAL HEIRS OF THE DECEASED ON RECORD , DURING THE PENDIN G PROCEEDINGS OF THE APPEAL. THE INITIAL DUTY HAVE NOT BEEN DISCHARGED BY THE LEARNED AR APPEARING FOR THE DECEASED HARIJIVANDAS J PATADIA B EFORE THE CIT AND IN THE ABSENCE OF THE DISCHARGING OF INITIAL DUTY, THE CIT HAD PASSED THE ORDER AGAINST THE REVENUE AND IN FAVOUR OF THE DECEASED A ND THE SAID ORDER IS NOW IN CHALLENGE BEFORE US. 11. IN OUR VIEW, THE DECEASED PERSON CANNOT BE REPR ESENTED BY ANY AR IN THE APPELLATE PROCEEDINGS. LD AR CONTINUED TO RE PRESENT DECEASED PERSON BEFORE THE CIT(A), WITHOUT BRINGING ON RECORD THE L RS OF THE DECEASED, THEREFORE IN OUR VIEW, THE PROCEEDINGS INITIATED AN D CONCLUDED ON BEHALF OF THE DECEASED PERSON , BEFORE THE CIT(A) WERE NON-ES T IN THE EYE OF LAW AND, THEREFORE, REQUIRED TO BE SET ASIDE. ACCORDINGLY T HE ORDER PASSED BY THE CIT(A) IS DIRECTED TO BE SET ASIDE. 12. IN VIEW OF THE ABOVE, WE ALLOW BOTH THE APPEALS FILED BY THE REVENUE FOR STATISTICAL PURPOSES TO THE FILE OF CIT (A) AND WITH THE DIRECTION TO IMPLEAD THE LEGAL HEIRS OF THE DECEASED IN THE ARRAY OF PARTIES IN THE APPELLANT PROCEEDINGS AND THEREAFTER DECIDE THE APP EAL AFTER AFFORDING THE OPPORTUNITY TO NEW IMPLEADED PARTIES IN ACCORDANCE WITH LAW. ITA NO.1177 & 1178 /B/15 CO NO.10/B/16 7 13. IN THE RESULT, THE APPEALS OF THE REVENUE ARE ALLOWED FOR STATISTICAL PURPOSES. CO NO.10/BANG/2016 14. SINCE WE ARE ALLOWING THE REVENUE APPEAL, THE CROSS OBJECTION BECOMES INFRUCTUOUS AND ACCORDINGLY DISMISSED. 15. IN THE RESULT, THE APPEALS FILED BY THE REVENUE ARE ALLOWED FOR STATISTICAL PURPOSES AND THE CROSS-OBJECTION FILED BY THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 3 RD MARCH, 2017 . SD/- SD/- (A.K GARODIA) (LALIET KUMAR) ACCOUNTANT MEMBER JUDICIAL MEM BER BANGALORE DATED : 3/3/2017 VMS COPY TO :1. THE ASSESSEE 2. THE REVENUE 3.THE CIT CONCERNED. 4.THE CIT(A) CONCERNED. 5.DR 6.GF BY ORDER ASST. REGISTR AR, ITAT, BANGALORE.