KKS Share Brokers Ltd., Kolkata V. ITO, WD-4(4), KOLKATA, Kolkata

ITA 1177/KOL/2016

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 6500 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 10 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-04-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2012-2013
• Appeal Filed On: 26-05-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A BHATTACHERJEE
• Assessee Lawyers: M D SHAH
• Keywords: Opportunity of being heard; Principle of natural justice; Additional evidence
• Section: 143(3); 14A; 68

Judgement Text

, D , IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH D KOLKATA BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER AND SHRI S.S.VISWANETHRA RAVI, JUDICIAL MEMBER ITA NO.1177/KOL/2016 ASSESSMENT YEAR:2012-13 KKS SHARE BROKERS LTD. C/P D. J. SHAH & CO. KALYAN BHAVAN, 2 ELGIN ROAD, KOLKATA-20 [ PAN NO.AABCK 1398 R ] / V/S . INCOME TAX OFFICER, WARD-4(4), AAYAKAR BHAWAN, P-7, CHOWRINGHEE SQUARE, KOLKATA-69 /APPELLANT .. /RESPONDENT /BY APPELLANT SHRI M.D. SHAH, AR /BY RESPONDENT SHRI A. BHATTACHERJEE, ADDL. CIT-DR /DATE OF HEARING 03-04-2018 /DATE OF PRONOUNCEMENT 25-04-2018 /O R D E R PER WASEEM AHMED, ACCOUNTANT MEMBER:- THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)-2, KOLKATA DATED 10.02.2016. A SSESSMENT WAS FRAMED BY ITO WARD-4(4), KOLKATA U/S 143(3) OF THE INCOME TAX ACT , 1961 (HEREINAFTER REFERRED TO AS THE ACT) VIDE HIS ORDER DATED 18.03.2015 FOR ASSE SSMENT YEAR 2012-13. THE GROUNDS RAISED BY THE ASSESSEE PER ITS APPEAL ARE AS UNDER: - FOR THAT IN THE FACTS AND CIRCUMSTANCES OF THE CASE THE APPELLATE ORDER PASSED WAS IN VIOLATION OF PRINCIPALS OF NATURAL JUSTICE HENCE IS BAD IN LAW AND BE QUASHED. 2. FOR THAT IN THE FACTS AND CIRCUMSTANCES THE LD. COMMISSIONER OF INCOME TAX APPEALS ERRED IN UPHOLDING THE ADDITION OF RS.1,46, 50,000/- ON ACCOUNT OF UNEXPLAINED INCOME U/S. 68 OF THE IT ACT 1961. THE ADDITION IS NOT CALLED FOR AND HENCE THE SAME BE DELETED. ITA NO.1177/KOL/2016 A.Y. 20 12-13 KKS SHARE BROKERS LTD. VS. ITO WD-4(4) KOL PAGE 2 3. FOR THAT IN THE FACTS AND CIRCUMSTANCES THE LD. COMMISSIONER OF INCOME TAX APPEALS ERRED IN UPHOLDING THE DISALLOWANCE OF RS.1 ,79,955/- ON ACCOUNT OF EXPENSES U/S. 14A OF THE IT ACT, 1961. THE DISALLOWANCE IS N OT CALLED FOR AND HENCE THE SAME BE REVERSED. 4. THE APPELLANT CRAVES LEAVE TO PRODUCE ADDITIONAL EVIDENCE IN TERMS OF RULE 29 OF THE INCOME TAX (APPELLATE TRIBUNAL) RULES, 1963. 5. FOR THAT THE LD. COMMISSIONER OF INCOME TAX APPE ALS DID NOT PERMIT THE ASSESSEE TO PRODUCE RELEVANT DOCUMENTS / EVIDENCES IN THE CO URSE OF THE HEARING. HENCE THE APPELLATE ORDER AS BAD IN LAW FOR WANT OF OPPORTUNI TY AND PROPER HEARING AND THUS BE QUASHED. 6. FOR THAT THE INTEREST COMPUTED U/S. 234A/B/C/D O F THE IT ACT 1961 IS OVER CHARGED AND WRONGLY CALCULATED AND OR IS NOT APPLICABLE TO THE ASSESSEE CASE IT BE DIRECTED TO RE-COMPUTE THE INTEREST AS PER LAW. 7. THE APPELLANT CRAVES LEAVE TO PRESS NEW, ADDITIO NAL GROUNDS OF APPEAL OR MODIFY, WITHDRAW ANY OF THE ABOVE GROUNDS AT THE TIME OF HE ARING OF THE APPEAL. SHRI M.D. SHAH, LD. AUTHORIZED REPRESENTATIVE APPEA RED ON BEHALF OF ASSESSEE AND SHRI A. BHATTACHERJEE, LD. DEPARTMENTAL REPRESENTA TIVE APPEARED ON BEHALF OF REVENUE. 2. AT THE TIME OF HEARING, LD DR HAS FILED ADJOURNM ENT PETITION ON THE GROUND THAT IT REQUIRES MORE TIME FOR THE PREPARATION OF THE CA SE. ON THE CONTRARY, LD. AR FOR THE ASSESSEE SUBMITTED THAT THE LD CIT(A) HAS PASSED EX PARTE ORDER. IT WAS ALSO BROUGHT TO OUR NOTICED THAT PROPER SUBMISSIONS WERE ALSO NO T MADE EVEN DURING THE ASSESSMENT PROCEEDINGS BEFORE THE AO. ACCORDINGLY IT WAS PRAYE D TO RESTORE THE MATTER TO THE FILE OF AO FOR FRESH ADJUDICATION. 3. AFTER CONSIDERING THE SUBMISSIONS OF BOTH THE PA RTIES WE DECIDED TO HEAR THE APPEAL AND THEREFORE ADJOURNMENT PETITION FILED BY THE LEARNED DR WAS REJECTED. 4. AT THE OUTSET, IT WAS SEEN THAT ORDER OF LD. CIT (A) IS EX PARTE WITHOUT HEARING THE ASSESSEE. THE ISSUE ARISES WHETHER LD. CIT(A) C AN PASS EX PARTE ORDER. WE ARE OF THE VIEW THAT SECTION 250(2) OF THE INCOME TAX ACT, 1961 GRANTS THE ASSESSEE AS WELL AS THE ASSESSING OFFICER CONCERNED A RIGHT OF BEING HEARD BY THE FIRST APPELLATE AUTHORITY. THE APPELLATE AUTHORITY HAS LEGAL DUTY T O DISPOSE OF THE APPEAL AFTER HEARING. EVEN NO DISMISSAL OF APPEAL FOR DEFAULT OF ASSESSEE CAN BE MADE. THUS, THE APPEAL IS TO BE DECIDED ON MERITS. WHERE AN APPEAL IS DISPOSED OF, EVEN THOUGH ON MERITS AFTER TAKING RELEVANT FACTS INTO CONSIDERATI ON BUT WITHOUT GIVING SUFFICIENT ITA NO.1177/KOL/2016 A.Y. 20 12-13 KKS SHARE BROKERS LTD. VS. ITO WD-4(4) KOL PAGE 3 OPPORTUNITY OF BEING HEARD TO THE ASSESSEE, AN APPL ICATION OF SETTING ASIDE OF EX PARTE ORDER IS MAINTAINABLE. 4.1 IT WAS ALSO OBSERVED THAT THE LD. CIT(A) HAS PA SSED THE ORDER AT THE ADDRESS GIVEN BELOW : 71, CANNING STREET 5 TH FLOOR, KOLKATA-700001 AS PER THE ASSESSMENT ORDER, THE AO HAS RECORDED TH E FOLLOWING ADDRESS : 71, CANNING STREET 5 TH FLOOR, ROOM NO. 510, BLOCK-B KOLKATA-700001 IN VIEW OF THE ABOVE, WE ARE OF THE VIEW THAT THE N OTICES SENT BY THE LD. CIT(A) WERE NOT SERVED UPON THE ASSESSEE. THEREFORE THE ASSESSE E FAILED TO APPEAR BEFORE THE LD. CIT(A). 4.2 WE ALSO NOTE THAT THE ASSESSEE HAS ALSO NOT FIL ED ANY DOCUMENTARY EVIDENCES IN SUPPORT OF THE SHARE PREMIUM RAISED BY IT DURING TH E YEAR. IT WAS BROUGHT TO OUR NOTICE BY THE LD. AR THAT THE ASSESSEE IS NOT A PAPER COMP ANY BUT ACTUALLY HOLDING THE SHARE BROKER LICENSE. IN VIEW OF ABOVE, WE ARE OF THE CONSIDERED VIEW THA T THIS ORDER NEEDS TO BE SET ASIDE AND REMANDED BACK TO THE FILE OF AO FOR FRESH ADJUD ICATION AFTER PROVIDING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. ON SPEC IFIC QUERY FROM THE BENCH FOR RESTORING THE MATTER TO THE FILE AO FOR FRESH ADJUD ICATION AS PER THE PROVISIONS OF THE LAW, THE LD. DR RAISED NO OBJECTION. NEVERTHELESS, IT IS NECESSARY TO MENTION THAT THE ASSESSEE WILL COOPERATE IN THE ASSESSMENT PROCEEDIN GS. THE ASSESSEE WILL FILE NECESSARY EVIDENCES ON WHICH HE WANTS TO RELY UPON. IN VIEW O F ABOVE, WE ARE INCLINED TO RESTORE THE ISSUE TO THE FILE OF AO FOR FRESH ADJUDICATION AS PER THE PROVISIONS OF LAW. HENCE, THIS GROUND OF ASSESSEES APPEAL STANDS ALLOWED FOR STATISTICAL PURPOSE. 5 . IN THE RESULT, FOR STATISTICAL PURPOSE, APPEAL OF A SSESSEE IS TREATED AS ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON 25/04/2018 SD/- SD/- ( % ') ( ') (S.S.VISWANETHRA RAVI) (WASEEM AHMED) JUDICIAL MEMBER ACCOUNTANT MEMBER *DKP, SR.P.S ) - 25/04/2018 / KOLKATA ITA NO.1177/KOL/2016 A.Y. 20 12-13 KKS SHARE BROKERS LTD. VS. ITO WD-4(4) KOL PAGE 4 / COPY OF ORDER FORWARDED TO:- 1. /APPELLANT-KKS SHARE BROKERS LTD. C/O D.J. SHAH & C O. KALYAN BHAWAN 2 ELGIN ROAD , KOLKATA-20 2. /RESPONDENT-ITO, WARD-4(4), AAYAKAR BHAWAN, P-7,CHO WIRNGHEE SQ.KOL-69 3. , - / CONCERNED CIT 4. - - / CIT (A) 5. . %%, , , / DR, ITAT, KOLKATA 6. 2 / GUARD FILE. BY ORDER/ , /TRUE COPY/ SR. PRIVATE SECRETARY HEAD OF OFFICE/DDO ,,