POWER FUELS INDIA P.LTD, MUMBAI V. ITO 8(2)(4), MUMBAI

ITA 124/MUM/2014

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 3031 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 5 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-06-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 16-06-2016
• Assessment Year: 2007-2008
• Appeal Filed On: 03-01-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NAVEEN GUPTA
• Assessee Lawyers: NEELAM C JADHAR
• Keywords: Opportunity of being heard; Additional evidence
• Section: 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH , MUMBAI BEFORE SRI MAHAVIR SINGH, J M AND SRI RAMIT KOCHAR , A M ITA NO . 123, 124 & 125 /MUM/2014 (A.Y.:2007 - 08 ) POWER FUELS INDIA PVT. LTD., SHOP NO.2, PLOT NO.216, CENTRAL BLOCK, (OPP. J & K BLOCK), DILSHAD G ARDEN, DELHI - 95 VS. THE INCOME TAX OFFICER, WARD - 8 (2) 4, AAYAKAR BHAVAN, M. K. ROAD, MUMBAI 400 020 AADCP 2583 R APPELLANT .. RESPONDENT APPELLANT BY MS. NEELAM C. JADHAR, AR RESPONDENT BY SHRI NAVEEN GUPTA, DR DATE OF HEARING 16 - 06 - 2016 D ATE OF PRONOUNCEMENT 16 - 06 - 2016 O R D E R PER BENCH : THESE THREE APPEALS BY THE ASSESSEE ARE ARISING OUT OF THE DIFF ERENT ORDERS OF THE CIT (A) - 17, MUMBAI PASSED IN APPEAL NOS .CIT (A) - 17/IT - 226, 225 & 227/11 - 12 VIDE HIS ORDERS OF SAME DATE D 02 - 09 - 201 3. IN THE SE CASES ASSESSMENTS WERE MADE BY THE ITO , WARD 8 (2) - 4 , MUM BAI FOR THE ASSESSMENT YEAR 2007 - 08 VIDE HIS ORDERS DATED 18 - 12 - 2009 PASSED U/S 144 (1) OF THE INCOME TAX ACT, 1961 (H EREINAFTER REFERRED TO AS THE ACT). IN THESE CASES P ENALTY PROCEEDI NGS WERE INITIATED BY THE ITO - 8(2) - 4 MUMBAI U/S 271 (1) (B) OF THE ACT VIDE HIS ORDER DATED 28 - 06 - 2010 AND U/S 271 (1) (C) OF THE ACT VIDE HIS ORDER DATED 29 - 06 - 2010 RESPECTIVELY. 2. FIRST, WE WILL TAKE UP THE QUANTUM APPEAL OF THE ASSESSEE IN ITA NO.12 3/MUM/2014. 3. AT THE OUTSET, THE LEARNED COUNSEL FOR THE ASSESSEE FIRST OF ALL DREW OUR ATTENTION TO THE ASSESSMENT ORDER STATING THAT THE SAME WAS FRAMED EX - PARTE AND FROM THE ASSESSMENT ORDER ITSELF, IT IS CLEAR THAT ONLY THREE OPPORTUNITIES WERE PROVI DED BY THE AO BEFORE FINALIZING THE ASSESSMENT AND FINALLY EX - PARTE ASSESSMENT U/S 144 OF THE ACT WAS ITA NO. 123, 124 & 125 /MUM/20 1 4 2 FRAMED. THE LEARNED COUNSEL FOR THE ASSESSEE ALSO DREW OUR ATTENTION TO THE ORDER OF THE CIT (A) THAT NO OPPORTUNITY OF BEING HEARD WAS PROVIDED BY THE CI T (A) EXCEPT ONE NOTICE OF HEARING. THE LEARNED COUNSEL FOR THE ASSESSEE STATED THAT BOTH THE AUTHORITIES BELOW HAVE PASSED THE EX - PARTE ORDERS AND THE ASSESSEE WAS NOT REPRESENTED IN THE SAME. THEREFORE, IT WAS PRAYED THAT THE ORDERS OF THE LOWER AUTHORIT IES BE SET ASIDE AND THE MATTER MAY BE RESTORED BACK TO THE FILE OF THE AO FOR FRESH ADJUDICATION. THE LEARNED COUNSEL FOR THE ASSESSEE FURTHER STATED THAT BEFORE THE CIT (A) ADDITIONAL EVIDENCES WERE FILED WHICH WERE NOT ENTERTAINED BY HIM FOR THE REASON THAT THE SAME COULD NOT BE PRODUCED BEFORE THE AO AND THAT THE CIT (A) NOTED THAT THE ASSESSEE HAS NOT COMPLIED WITH THE CONDITIONS LAID DOWN UNDER RULE 46A OF THE INCOME TAX RULES, 1962 (HEREINAFTER REFERRED TO AS THE RULES). THE LEARNED COUNSEL FOR THE ASSESSEE STATED THAT THE EVIDENCES PRODUCED BEFOR E THE CIT (A) IN THE SHAPE OF A DDITIONAL EVIDENCES WERE VITAL FOR ADJUDICATION OF THE ISSUES AND THE AO HAS FRAMED THE ASSESSMENT HURRIEDLY WITHOUT PROVIDING ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSES SEE. ON QUERY FROM THE BENCH THE LEARNED CIT DR FAIRLY AGREED THAT THE ISSUES CAN BE REMITTED BACK TO THE FILE OF THE AO FOR ADJUDICATING AFRESH AND THE ASSESSMENT CAN BE REMANDED BACK FOR DE NOVO. IN TERMS OF THE ABOVE FACTS AND CIRCUMSTANCES, WE FEEL THA T THE ASSESSMENT AND APPELLATE ORDER CANNOT SUSTAINED FOR THE REASON THAT THE AO PASSED EX - PARTE ORDER AND WHEN THE ASSESSEE FILED ADDITIONAL EVIDENCES BEFORE THE CIT (A), THE SAME WERE NOT ADMITTED AND THE APPELLATE ORDER WAS ALSO PASSED ALMOST EX - PARTE. ACCORDINGLY, WE SET ASIDE THE ORDERS OF THE LOWER AUTHORITIES AND REMIT ALL THE ISSUES BACK TO THE FILE OF THE AO FOR FRESH ADJUDICATION AFTER ALLOWING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. THIS APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. 4 . NOW, COMING TO THE ASSESSEES APPEAL IN ITA NO.124/MUM/2014 , WE ARE OF THE VIEW THAT THE PENALTY IS ARISING OUT OF THE ABOVE ASSESSMENT, WHICH HAS BEEN SET ASIDE AND REMANDED THE MATTER BACK TO THE FILE OF THE AO FOR FRESH ADJUD ICATION. SINCE, WE ITA NO. 123, 124 & 125 /MUM/20 1 4 3 HAVE REMANDED THE MATTER BACK TO THE FILE OF THE AO AND THE ASSESSMENT IS SET ASIDE, THIS PENALTY WILL NOT SURVIVE. ACCORDINGLY, WE DELETE THE PENALTY. HOWEVER, THE AO DURING THE SET ASIDE PROCEEDINGS, IF, COMES TO A CONCLUSION THAT THER E IS CONCEALMENT OF INCOME OR FURNISHING OF INACCURATE PARTICULARS OF INCOME BY THE ASSESSEE, HE CAN INITIATE FRESH PROCEEDINGS U/S 271 (1) (C) OF THE ACT. THIS APPEAL OF THE ASSESSEE IS ALLOWED. 5. COMING TO THE ASSESSEES APPEAL IN ITA NO.125/MUM/ 2014 , AT THE OUTSET, WE HAVE SEEN THAT THE QUANTUM APPEAL HAS BEEN SET ASIDE AND HERE ALSO THE CIT (A) PASSED EX - PARTE ORDER WITHOUT ALLOWING OPPORTUNITY OF BEING HEARD TO THE ASSESSEE, ACCORDINGLY WE THINK IT FIT TO RESTORE THE MATTER BACK TO THE FILE OF THE CI T (A) FOR FRESH ADJUDICATION AFTER ALLOWING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. ACCORDINGLY, THIS APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. 6. IN THE RESULT , THE ASSESSEE S IN ITA NO.124/MUM/2014 IS ALLOWED AND THE ASS ESSEE S APPEALS IN ITA NOS. 123 & 125/MUM/2014 ARE ALLOWED FOR STATISTICAL PURPOSES. O RDER PRONOUNCED IN THE OPEN COURT ON 16 /06 / 201 6 . SD/ - SD/ - ( RAMIT KOCHAR ) ( MAHAVIR SINGH ) ACCOUN TANT MEMBER JUDICIAL MEMBER MUMBAI , DATED 16 /6 / 201 6 LAKSHMIKANTA DEKA/SR.PS COPY OF THE ORDER FORWARDED TO : BY ORDER, ASSISTANT REGISTRAR ITAT, MUMBAI 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT ( A), MUMBAI. 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. //TRU E COPY// ITA NO. 123, 124 & 125 /MUM/20 1 4 4 DATE INITIAL DICTATION PAD ATTACHED WITH THE DRAFT ORDER YES 1. DRAFT DICTATED ON 17 - 06 - 16 SR.PS 2. DRAF T PLACED BEFORE AUTHOR 2 0 - 06 - 16 SR.PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS SR.PS 6. KEPT FOR PRONOUNCEMENT ON SR.PS 7. FILE SENT TO TH E BENCH CLERK SR.PS 8. DATE ON WHICH FILE GOES TO THE AR 9. DATE ON WHICH FILE GOES TO THE HEAD CLERK. 10. DATE OF DISPATCH OF ORDER.