YUSUF R TANWAR, NAVI MUMBAI V. ITO 22(3)(4), MUMBAI

ITA 126/MUM/2015

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 2416 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 6 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-07-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: I
• Assessment Year: 2007-2008
• Appeal Filed On: 07-01-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: A K KARDA M
• Keywords: Opportunity of being heard
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH I, MUMBAI BEFORE SHRI G.S.PANNU, ACCOUNTANT MEMBER& SHRI AMARJIT SINGH, JUDICIAL MEMBER. ITA NO. 126 /MUM/2015 (ASSESSMENT YEAR : 2007-08) YUSUF R. TANWAR, PROP M/S. YR TANWAR & BROS, ROW HOUSE NO.68, TANWAR COURT, SECTOR 15, KOPERKHAIRANE, NAVI MUMBAI - 400409 ... APP ELLANT PAN: ABMPT 7433R VS. THE ITO 22(3)(4), MUMBAI. .... RESPONDENT APPELLANT BY : SHRI PRAKASH PANDIT RESPONDENT BY : SHRI A.K.KARDAM DATE OF HEARING : 19/07/2016 DATE OF PRONOUNCEMENT : 22/07/2016 ORDER PER G.S.PANNU, J.M: THE CAPTIONED APPEAL FILED BY THE ASSESSEE PERTAIN ING TO ASSESSMENT YEAR 2007-08 IS DIRECTED AGAINST AN ORD ER PASSED BY CIT(A)- 33, MUMBAI DATED 30/10/2014 WHICH IN TURN ARISES OU T OF AN ORDER PASSED BY THE ASSESSING OFFICER UNDER SECTION 143(3 ) OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT) DATED 30/12/2013. 2. IN THIS APPEAL THE ASSESSEE HAS RAISED THE FO LLOWING GROUNDS OF APPEAL:- 2 ITA NO. 126 /MUM/2015 (ASSESSMENT YEAR : 2007-08) 1 IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LEARNED CIT(A) ERRED IN PASSING AN EX-PARTE ORDER WITHOUT P ROPER SERVICE OF NOTICE ON THE APPELLANT. 2 REASONS GIVEN BY LEARNED CIT(A) ERRED IN PASSING AN EX-PARTE ORDER WITHOUT PROPER SERVICE OF NOTICE ON THE APPELLANT, ARE WRONG, INSUFFICIENT AND CONTRARY TO THE FACTS AND EVIDENCE ON RECORD. 3 THE LEARNED CIT(A) OUGHT TO HAVE GIVEN THE APPELL ANT PROPER OPPORTUNITY OF BEING HEARD. 4 IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW THE LEARNED CIT(A) ERRED IN CONFIRMING ADDITION OF RS. 48,89,02 5/- ON ACCOUNT OF CESSATION OF LIABILITY U/S 41 (1) OF THE IT ACT. 5 REASONS GIVEN BY LEARNED CIT(A) FOR CONFIRMING AD DITION OF RS. 48,89,025/- ON ACCOUNT OF CESSATION OF LIABILITY U/ S 41(1) OF THE IT ACT, ARE WRONG, INSUFFICIENT AND CONTRARY TO THE FA CTS AND EVIDENCE ON RECORD. 6 THE LEARNED CIT(A) OUGHT TO HAVE FOLLOWED DIRECT ION OF THE ITAT IN DECIDING THE SAID ISSUE ON ACCOUNT OF CESSATION OF LIABILITY OF RS. 48, 89,025/- U/S 41(1) OF THE IT ACT. 3. IN BRIEF, THE RELEVANT FACTS ARE THAT ASSESSEE I S AN INDIVIDUAL, ENGAGED IN THE BUSINESS OF CIVIL CONTRACTING. FOR ASSESSMENT YEAR 2007- 08, HE FILED RETURN OF INCOME DECLARING TOTAL INCOM E OF RS.2,10,060/-, WHICH WAS SUBJECT TO SCRUTINY ASSESSMENT UNDER SEC TION 143(3) DATED 27/11/2009, DETERMINING TOTAL INCOME AT RS.51,54,25 0/-, AFTER MAKING CERTAIN ADDITIONS/DISALLOWANCES. ONE OF THE ADDITI ONS MADE IN ASSESSMENT IS OF A SUM OF RS.48,89,025/-, REPRESENT ING CESSATION OF LIABILITY UNDER SECTION 41(1) OF THE ACT. THIS ASP ECT OF THE ADDITION TRAVELLED UPTO THE TRIBUNAL AND VIDE ITS ORDER IN I TA NO. 8408/MUM/2010 DATED 28/02/2013 , THE TRIBUNAL SET- ASIDE THE ISSUE OF CESSATION OF LIABILITY BACK TO THE FILE OF THE ASSE SSING OFFICER FOR A FRESH ASSESSMENT. IN AN ORDER PASSED UNDER SECTION 143(3 ) R.W.S. 254 OF DATED 30/12/2013, IN COMPLIANCE WITH THE DIRECTION OF THE TRIBUNAL, THE 3 ITA NO. 126 /MUM/2015 (ASSESSMENT YEAR : 2007-08) ASSESSING OFFICER RETAINED THE SAME ADDITION UNDER SECTION 40(1) OF THE ACT AMOUNTING TO RS.48,89,025/-. THE SAID ADDITION WAS CARRIED IN APPEAL BEFORE THE CIT(A), WHO HAD DISMISSED THE APP EAL OF THE ASSESSEE. AGAINST SUCH AN ORDER OF THE CIT(A), THE ASSESSEE I S IN FURTHER APPEAL BEFORE THE TRIBUNAL. 4. BEFORE US, ASSESSEE HAS RAISED MULTIPLE GROUNDS OF APPEAL, AS ABOVE. HOWEVER, AT THE TIME OF HEARING, LD. REPRES ENTATIVE FOR THE ASSESSEE HAS RAISED A PRELIMINARY GROUND THAT THE C IT(A) HAS PASSED AN EX-PARTE ORDER WITHOUT ENSURING PROPER SERVICE OF NOTICE OF HEARING. IT HAS BEEN POINTED OUT THAT THE NOTICE OF HEARING WAS ISSUED ONCE BY THE CIT(A) AND THAT TOO AT THE OLD ADDRESS, THOUGH SUCH ADDRESS WAS STATED IN FORM NO.35 BEFORE THE CIT(A). THE LD. REPRESENT ATIVE FOR THE ASSESSEE POINTED OUT THAT THE ASSESSMENT ORDER CONT AINED THE CORRECT ADDRESS OF THE ASSESSEE AND, IN FACT, THE IMPUGNE D EX-PARTE ORDER PASSED BY THE CIT(A) HAS SINCE BEEN DELIVERED TO HI M AT THE ADDRESS MENTIONED IN THE ASSESSMENT ORDER, WHICH IS THE CO RRECT ADDRESS. BECAUSE THE NOTICE OF HEARING WAS NOT SENT AT THE A DDRESS MENTIONED IN THE ASSESSMENT ORDER, IT REMAINED TO BE SERVED AND CONSEQUENTLY, ASSESSEE COULD NOT PUT-IN AN APPEARANCE BEFORE TH E CIT(A). IT WAS THUS, CONTENDED THAT THE ASSESSEE WOULD BE SATISFIE D, IF THE MATTER IS REMANDED BACK TO THE FILE OF CIT(A) IN ORDER TO ENA BLE HIM TO PUT-FORTH HIS SUBMISSIONS ON THE MERITS OF THE ADDITION. 5. THE LD. DEPARTMENTAL REPRESENTATIVE HAS NOT OPPO SED THE PLEA OF THE ASSESSEE FOR REMANDING THE MATTER BACK TO TH E FILE OF THE CIT(A) FOR ADJUDICATION AFRESH ON MERITS. 4 ITA NO. 126 /MUM/2015 (ASSESSMENT YEAR : 2007-08) 6. AFTER HEARING THE RIVAL PARTIES, IN OUR VIEW, HA VING REGARD TO THE PECULIAR FACTS AND CIRCUMSTANCES EXPLAINED BY THE L D. REPRESENTATIVE FOR THE ASSESSEE, IT WOULD BE IN THE FITNESS OF THINGS THAT THE APPEAL OF THE ASSESSEE IS REMANDED BACK TO THE FILE OF CIT(A), WH O SHALL RE-ADJUDICATE THE DISPUTE ON MERITS AFTER ALLOWING REASONABLE OPP ORTUNITY OF BEING HEARD TO THE ASSESSEE, AS PER LAW. THUS, WITHOUT GOING INTO THE MERITS OF THE ADDITION, THE MATER IS RESTORED BACK TO THE FILE OF CIT(A), AS ABOVE. 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALLOWED, AS ABOVE. ORDER PRONOUNCED IN THE OPEN COURT ON 22/07/2016 SD/- SD/- (AMARJIT SINGH) (G.S. PANNU) JUDICIAL MEMBER ACCOU NTANT MEMBER MUMBAI, DATED 22/07/2016 VM , SR. PS 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// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI