HITECH CORPORATION LTD (EARLIER KNOWN AS MIPAK POLYMERS LTD), MUMBAI V. ITO 1 (2)(2), MUMBAI

ITA 119/MUM/2020

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 8298 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 7 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-08-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Assessment Year: 2010-2011
• Appeal Filed On: 03-01-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: GURBINDER SINGH
• Keywords: Opportunity of being heard; Bonafide belief
• Section: 143(3); 234B; 115JB; 143(1); 80IA; 148; 10

Judgement Text

ITA NO. 119/MUM/2020 A.Y. 2010 - 11 HITE C H CORPORATION LTD. VS. ITO - 1(2)(2) 1 IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH H MUMBAI BEFORE SHRI S.RIFAUR RAHMAN (ACCOUNTANT MEMBER) AND SHRI RAVISH SOOD (JUDICIAL MEMBER) ITA NO.119 /MUM/2020 (ASSESSMENT YEAR: 2010 - 11 ) HITE C H CORPORATION LTD. UNIT NO. 203, WELSPUN HOUSE, KAMALA MILLS, SENAPATI BAPAT MARG, LOWER PAREL, MUMBAI 400 013 VS. ITO - 1(2)(2) AAYAKAR BHAVAN, MUMBAI 400 020 PAN NO. AABCM3595L ( ASSESSEE ) ( REVENUE ) ASSESSEE BY : SHRI DALPAT SHAH , A.R REVENUE BY : SHRI GURBINDER SINGH , D.R DATE OF HEARING : 10/08 /2021 DATE OF PRONOUNCEMENT : 12 /08 /2021 ORDER PER RAVISH SOOD, J.M: THE PRESENT APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER PASSED BY THE CIT(A) - 24, MUMBAI, DATED 31.10.2019, WHICH IN TURN ARISES FROM THE ORDER PASSED BY THE A.O U/S 143(3) R.W.S 147 OF THE INCOME TAX ACT, 1961 (FOR SHORT ACT) , DATED 17.03. 2016. T HE ASSESSEE HAS ASSAILED THE IMPUGNED ORDER ON THE FOLLOW ING GROUNDS BEFORE US: 1 . ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE CIT ( APPEALS) 2 4, MUMBAI, ERRED IN PASSING AN EX - PARTE ORDER ON THE GROUND OF NON APPEARANCE FOR THE HEARING, IGNORING THE FACT THAT THE APPELLANT HAD SOUGHT ADJOURNMENTS FOR GENUINE REASONS ON 07.03.2019, 22. 08.2019, 18.09. 2019 AND 30.10.2019 AND THE REPRESENTATIVE OF THE APPELLANT HAD COME WITH WRITTEN SUBMISSIONS AND PAPER COMPILATION ON 07.11.2019 AS PER THE O RAL AD JOURNMENT GRANTED ON 30.10.2019 BUT THE SAID CIT (APPEAL) ADJOURNED THE HEARING AS HE HAD TO ATTEND & STATUTORY ITA NO. 119/MUM/2020 A.Y. 2010 - 11 HITE C H CORPORATION LTD. VS. ITO - 1(2)(2) 2 MEETING AND WILL INFORM THE NEXT DATE OF HEARING VIDE A FRESH NOTICE. THEREFORE, IN THE INTEREST OF JUSTICE, THE APPEAL SHOULD BE RESTORED BACK TO THE FILE OF CIT (APPEALS). GROUNDS OFAPPEALON MERIT 2. DISALLOWANCE OF CLAIM U/S 8 0 - IA(4)(IV) OF RS.14,13,123/ - 2.1. ON THE FACTS AND CIRCUMSTA NCES OF THE CASE, THE SAID C.IT (APPEAL) ERRED IN CONFIRMING THE DISALLOWANCE OF LEGITIMAT E CLAIM U/S 80 - IA(4)(IV) OF RS. 14,13,123/ - IGNORING THE FACT THAT THE APPELLANT RECTIFIED THE TECHNICAL MISTAKE OF CLAIMING INCOME FROM 'WINDMILL' AS EXEMPTED U/SEC 10 INSTEA D OF CLAIMING DEDUCTION U/S 80 - IA(4)(IV) IN THE RETURN FILED U/S 148 . 2. 2. THE SAID C.L.T. ( APPEAL) ERRED IN IGNORING THE FACT THAT THE 'WINDMILL' WAS APPROVED BY THE GEDA (A GUJ ARAT STATE GOVERNMENT BODY) FOR GENERATION AND SAFE OF POWER AND COPY OF APPROVAL CERTIFICATE OF GEDA BEFORE THE AO. 3. BOOK PROFIT U/SEC. 115JB: THE SAID CI T ( APPEAL) ERRED IN NOT ALLOWING DEDUCTION U/SEC 80 IA ( 4)(IV ) OF RS.1 4 , 13,123/ - WHILE COMPUTING BOOK PROFIT U /SEC 115JB IGNORING THE FACT THAT THE NET PROFIT OF THE 80IA( 4)(IV) UNIT OF RS.14,13,123/ - HAS ALREADY BEEN INCLUDED IN THE BOOK PROFIT AND THEREFORE, ANY FURTHER ADDITION WILL AMOUNT TO DOUBLE ADDITION OF THE SAME INCOME. 4. INTEREST U/S 234B AND 2 34C THE SAID C.IT.(APPEAL ) ERRED IN CONFIRMING INTEREST LEVIED U/S 234B OF RS.37,96,590/ - AND U/S 234C OF RS . 1 , 73, 070/ - WHEN NO SUCH INTEREST CAN BE LEVIED. 5. THE APPELLANT CRAVES LEAVE TO AD D, AMEND, AF TER, MODIFY, DELETE AND/OR CHANGE ALL OR ANY OF THE ABOVE GROUNDS ON OR BEFORE THE DATE OF HEARING. 2. BRIEFLY STATED, THE ASSESSEE COMPANY WHICH IS ENGAGED IN THE BUSINESS OF MANUFACTURING OF PLASTIC AND PET CONTAINERS, BOTTLES, CAPS, JARS AND CANS, TRADING IN PRINTING MACHINES AND ACCESSORIES ETC. HAD E - FILED ITS RETURN OF INCOME FOR A.Y. 2010 - 11 ON 29.09.2010, DECLARING A TOTAL INCOME OF RS.1,00,06,210/ - . THE RETURN OF INCOME WAS INITIALLY PR OCESSED AS SUCH U/S 143(1) OF THE ACT. ORIGINAL ASSESSMENT WAS FRAMED BY THE A.O VIDE HIS ORDER PASSED U/S 143(3), DATED 15.03.2013 AT AN INCOME OF RS. 2 ,17,06,540/ - . SUBSEQUENTLY, THE A.O OBSERVING THAT DEDUCTION U/S 80IA (IV) OF RS.16,17,483/ - WAS WRONGLY ALLOWED TO THE ASSESSEE FIRM , THEREFORE, HE REOPENED ITS CASE U/S 147 OF THE ACT. ASSESSMENT ITA NO. 119/MUM/2020 A.Y. 2010 - 11 HITE C H CORPORATION LTD. VS. ITO - 1(2)(2) 3 U/S 143(3) R.W.S 147 OF THE ACT WAS COMPLETED BY THE A.O ON 17.03.2016, DETERMINING THE INCOME OF THE ASSESSEE COMPANY AT RS.2,31,19,660/ - UNDER THE NORMAL PROVISI ONS OF THE ACT AND BOOK PROFIT U/S 115JB AT RS.2,73,71,083/ - . 3. AGGRIEVED, THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE CIT(A). AS IS DISCERNIBLE FROM THE ORDER OF THE CIT(A) , THE ASSESSEE ON VARIOUS DATES HAD SOUGHT ADJOURNMENTS I.E ON 07.08.20 19, 22.08.2019 AND 18.09.2019. AS OBSERVED BY THE CIT(A), THE LD. AUTHORIZED REPRESENTATIVE OF THE ASSESSEE VIZ. M/S MANUBHAI & SHAH LLP, CAS ON LAST OCCASION I.E ON 18.09.2019 HAD REQUESTED FOR AN ADJOURNMENT; PURSUANT WHERETO THE CASE WAS RE - FIXED FOR H EARING ON 30.10.2019, VIDE NOTICE OF HEARING DATED 25.10.2019. HOWEVER, AS OBSERVED BY THE CIT(A), THE ASSESSEE REPRESENTATIVE, VIZ. M/S MANUBHAI & SHAH LLP, CA ON 18.09.2019 FILED ANOTHER LETTER STATING THAT AS THE IR OFFICE WOULD BE CLOSED DUE TO DIWALI AND THEY WOULD BE PREOCCUPIED WITH THE COMPILATION OF THE TAX AUDIT REPORT S AND INCOME TAX RETURNS TILL 31.10.2019, THEREFORE, THE MATTER MAY BE FURTHER ADJOURNED BY 15 DAYS . HOWEVER, THE CIT(A) BEING OF THE VIEW THAT THE ASSESSSE WAS NOT SERIOUS IN PROSE CUTING THE APPEAL, THEREFORE, PROCEEDED WITH AND DISPOSED OF THE SAME ON THE BASIS OF AN EX - PARTE ORDER DATED 31.10.2019 . 4. AGGRIEVED, THE ASSESSEE HAS ASSAILED THE ORDER PASSED BY THE CIT(A), DATED 31.10.2019 BEFORE US. THE LD. AUTHORIZED REPRESENTATIVE (FOR SHORT A.R) FOR THE ASSESSEE AT THE VERY OUTSET SUBMITTED THAT THE ASSESSEE HAD SOUGHT ADJOURNMENTS ON VARIOUS OCCASIONS FOR GENUINE REASONS I.E ON 07.08.2019, 22.08.2019 AND 18.09.2019. IT WAS SUBMITTED BY THE LD. A.R THAT THE ASESSEE COMPANY HA D FO R A GENUINE REASON REQUESTED THE CIT(A) TO ADJOURN THE HEARING OF THE APPEAL THAT WAS FIXED FOR HEARING ON 30.10.2019 FOR A FURTHER PERIOD OF 15 DAYS. IT WAS SUBMITTED BY THE LD. A.R THAT ACCEDING TO THE AFORESAID REQUEST THE CIT(A) HAD ON 30.10.2019 ORALL Y ADJOURNED THE MATTER AND TOLD THE AUTHORIZED REPRESENTATIVE THAT A FRESH NOTICE WOULD BE ISSUED INTIMATING THE NEXT DATE OF HEARING OF THE APPEAL. HOWEVER, IT IS STATED BY THE LD. A.R THAT WHEN AS PER THE ITA NO. 119/MUM/2020 A.Y. 2010 - 11 HITE C H CORPORATION LTD. VS. ITO - 1(2)(2) 4 ASSURANCE GIVEN BY THE CIT(A) HE HAD VISITED HIS OFFICE ON 07.11.2019 WITH WRITTEN SUBMISSIONS, HE WAS INFORMED THAT THE APPEAL HAD ALREADY BEEN DISPOSED OFF VIDE ORDER DATED 31.10.2019. IN THE BACKDROP OF THE AFORESAID FACTS, IT WAS SUBMITTED BY THE LD. A.R THAT THE ASSESSEE WHO AS PER THE ASSURANCE OF THE CIT(A) REMAINED UNDER A BONAFIDE BELIEF THAT THE HEARING OF THE APPEAL WAS ADJOURNED HAD HOWEVER TO HIS UTTER SURPRISE SUFFERED AN EX - PARTE ORDER FOR NO FAULT ON ITS PART. IT WAS , THUS , SUBMITTED BY THE LD. A.R THAT IN THE TOTALITY OF THE AFORESAID FAC TS OF THE CASE THE MATTER BE RESTORED TO THE FILE OF THE CIT(A) WITH A DIRECTION TO REDECIDE THE APPEAL AFRESH AFTER AFFORDING AN OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 5. PER CONTRA, THE LD. DEPARTMENTAL REPRESENTATIVE (FOR SHORT D.R) RELIED ON THE ORDER S OF THE LOWER AUTHORITIES. 6. WE HAVE HEARD THE LD. AUTHORIZED REPRESENTATIVES FOR BOTH THE PARTIES, PERUSED THE ORDERS OF THE LOWER AUTHORITIES AND THE MATERIAL AVAILABLE ON RECORD. AS IS DISCERNIBLE FROM THE ORDER OF THE CIT(A), WE FIND THAT THE A SSESSEE HAD ON VARIOUS OCCASIONS SOUGHT ADJOURNMENT S QUA THE HEARING OF THE APPEAL I.E ON 07.08.2019, 22.08.2019 AND 18.09.2019 . ADMITTEDLY, ON ALL THE OCCASIONS THERE WERE JUSTIFIABLE REASONS ON THE BASIS OF WHICH THE ADJOURNMENTS WERE SOUGHT BY THE ASSESSEE AND THE SAME WERE IN ALL FAIRNESS ALLOWED BY THE CIT(A). CONTROVERSY INVOLVED IN THE PRESENT APPEAL HINGES AROUND THE CLAIM OF THE ASSESSEE THAT IT HAD SOUGHT FOR A SHORT ADJOURNMENT QUA THE HEARING OF THE APPEAL THAT WAS FIXED FOR 30.10.2019, WHICH AS PER HIM WAS ORALLY ALLOWED BY THE CIT(A). ON THE CONTRARY, IT IS THE CLAIM OF THE CIT(A) THAT A S PER THE REQUEST LETTER FILED B Y THE ASSESSEE ON 18.09.2019 THE CASE WAS ADJOURNED TO 30.10.2019, VIDE A NOTICE OF HEARING DATED 25.10.2019. HOWEVER, ON 18.09.2019 THE LD. AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE HAD FILED ANOTHER LETTER STATING THAT AS ITS OFFICE WOULD BE CLOSED DUE TO DIWALI FESTIVAL AND THEY WOULD BE PREOCCUPIED WITH COMPILATION OF TAX AUDIT REPORT S AND THE RETURNS OF INCOME TILL 31.10.2019, ITA NO. 119/MUM/2020 A.Y. 2010 - 11 HITE C H CORPORATION LTD. VS. ITO - 1(2)(2) 5 THEREFORE, THE HEARING OF THE APPEAL MAY BE FURTHER ADJOURNED BY 15 DAYS . BACKED BY THE AFORESAID CONDUCT OF THE ASSESSEE, THE CIT(A) HOLDING A CONVICTION THAT THE ASSESSEE WAS NOT SERIOUS IN PROSECUTING ITS APPEAL, THUS, PROCEEDED WITH AND DISPOSED OF F THE SAME ON THE BASIS OF AN EX - PARTE ORDER. 7. WE HAVE GIVEN A THOUGHTFUL CONSIDERATION TO THE AFORESAID ISSUE, AND FIND, THAT IT IS THE CLAIM OF THE ASSESSEE THAT ON 30.10.2019, ON AN ORAL REQUEST , THE CIT(A) HAD ADJOURNED THE MATTER AND HAD ASSURED THE ASSESEE THAT THE NEXT DATE OF HEARING WOULD BE INTIMATED VIDE A FRESH NOTICE. HOWEVER, AS STATED BY THE LD. A.R, THE CIT(A) HAD THEREAFTER MOST ARBITRARILY DISPOSED OFF THE APPEAL VIDE AN EX - PARTE ORDER DATD 31.10.2019. AFTER DELIBERATING AT LENGTH ON THE AFORESAID FACTS ATTENDING TO THE CASE OF THE PRESENT ASSESSEE BEFORE US, WE MAY HEREIN OBSERVE THAT THOUGH AN ASSESSEE IS ENTITLED FOR SEEKING ADJOURNMENT OF A CASE UNDER EXCEPTIONAL AND COMPELLING CIRCUMSTANCES, HOWEVER, THE SAME BY NO MEANS CAN BE TAKEN AS A MATTER OF RIGHT. AS IS DISCERNIBLE FROM THE RECORDS, THE CIT(A) HAD RIG HTLY OBSERVED THAT THE CONDUCT OF THE ASSESSEE IN THE COURSE OF THE PROCEEDINGS BEFORE HIM DID NOT INSPIRE MUCH OF CONFIDENCE AS REGARDS ITS SERIOUSNESS IN PROSECUTING THE APPEAL BEFORE HIM. AT THE SAME TIME, WE ALSO CANNOT REMAIN OBLIVIO N OF THE FACT THAT THE ASSESSEE HAD REMAINED DIVESTED O F A FAIR OPPORTUNITY IN PUTTING FORTH ITS CASE BEFORE THE CIT(A) DUE TO THE MISCONCEPTION ON THE PART OF ITS AUTHORIZED REPRESENTATIVE THAT ON 30.10.2019 THE MATTER WAS ADJOURNED BY THE CIT(A) AND THE NEXT DATE OF HEARI NG OF THE APPEAL WAS TO BE INTIMATED VIDE A FRESH NOTICE. IN THE BACKDROP OF THE AFORESAID FACTS, WE ARE OF THE CONSIDERED VIEW THAT THE MATTER IN ALL FAIRNESS REQUIRES TO BE RESTORED TO THE FILE OF THE CIT(A) FOR FRESH ADJUDICATION . NEEDLESS TO SAY, THE C IT(A) IN THE COURSE OF THE SET - ASIDE PROCEEDINGS SHALL AFFORD AN OPPORTUNITY OF BEING HEARD TO THE ASSESSEE . 8. AS WE HAVE RESTORED THE APPEAL TO THE FILE OF THE CIT(A) FOR FRESH ADJUDICATION, THEREFORE, WE REFRAIN FROM ADVERTING TO AND THEREIN ADJUDICATIN G THE ITA NO. 119/MUM/2020 A.Y. 2010 - 11 HITE C H CORPORATION LTD. VS. ITO - 1(2)(2) 6 CONTENTIONS RAISED BY THE ASSESSEE QUA THE VALIDITY OF THE ADDITIONS MADE BY THE A.O, WHICH ARE LEFT OPEN. 9. RESULTANTLY, T HE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES . ORDER PR ONOUNCED IN THE OPEN COURT ON 12 .08.2021 SD/ - SD/ - ( S. RIFAUR RAHMAN ) (RAVISH SOOD) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI ; DATED: 12 .08 .2021 PS: ROHIT COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A) - 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. BY ORDER, //TRUE COPY// (SR. PRIVATE SECRETARY) ITAT, MUMBAI