Yagnesh K. Patel, Ahmedabad V. The Dy.Commissioner of Income Tax, Central Circle-1(2), Ahmedabad

ITA 1276/AHD/2016

• Counselvise Citation: [2018] 118 COUNSELVISE.COM (IT) 6818 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 7 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-12-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2011-2012
• Appeal Filed On: 16-05-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: APARNA A GARWAL
• Assessee Lawyers: K C THAKKAR
• Keywords: Opportunity of being heard
• Section: 143(3); 153A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD A BENCH (BEFORE SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER & SHRI MAHAVIR PRASAD, JUDICIAL MEMBER) ITA. NO: 1276/AHD/2016 (ASSESSMENT YEAR: 20011-12) SHRI YAGNESHBHAI K. PATEL HARIBAG, 29, SANTOSA PARK, BOPAL ROAD, AHMEDABAD V/S DCIT, CENTRAL CIRCLE-1(2), AHMEDABAD (APPELLANT) (RESPONDENT) PAN: ABCPP4867B APPELLANT BY : SHRI K.C. THAKKAR, AR RESPONDENT BY : SMT. APARNA AGARWAL, CIT/ D. R. ( )/ ORDER DATE OF HEARING : 10 -12-201 8 DATE OF PRONOUNCEMENT : 31 -12-2018 PER MAHAVIR PRASAD, JUDICIAL MEMBER 1. THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LD. CIT(A)-I1, AHMEDABAD DATED 13.01.2016 PERTAINING TO A.Y. 2011- 12 AND FOLLOWING GROUNDS HAVE BEEN TAKEN: ITA NO. 1276 /AHD/2016 . A.Y. 2011-1 2 2 1. THE LEARNED CIT (A) HAS ERRED IN LAW AND ON FA CTS IN CONFIRMING THE DISALLOWANCE MADE BY THE AO OF RS.3,38,270/- OUT OF THE INTEREST CLAIM. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE AND IN LAW, THE LEARNED CIT (A) OUGHT TO HAVE DELETED THE DISALLOWANCE OF RS.3, 38,270/-. 3. IT IS THEREFORE PRAYED THAT THE DISALLOWANCE OF RS.3,38,270/- MAY BE DELETED. 4. YOUR APPELLANT CRAVES TO ADD, ALTER OR AMEND A NY GROUND OF APPEAL AT THE TIME OF HEARING. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE HAD FILED ORIGINAL RETURN OF INCOME ON 30-09-2011 DECLARING TOTAL INCOME RS. 2,69,21,140/-. 3. IN THE EASE OF THE APPELLANT SEARCH U/S. .132 OF TH E ACT WAS CARRIED OUT ON 27- 04-2011. AS A COROLLARY PROCEEDINGS U/S.L53A OF THE ACT .WERE INITIATED BY ISSUE OF NOTICE U/S. 153A OF THE ACT ON 23-09-2011. THE A PPELLANT COMPLIED WITH NOTICE BY FILING RETURN OF INCOME ON 30-09-2011 DEC LARING TOTAL INCOME OF RS.2,69,21,1 40/-. 4. IN THE COURSE OF ASSESSMENT PROCEEDINGS THE LEARNED AC) RAISED INC. ISSUE OF LOSS UNDER THE HEAD INCOME FROM OTHER SOURCES AND D ISALLOWED INTEREST CLAIMED AT RS.3,38,270/-. THE LEARNED AC) HAS NOT APPRECIAT ED THE FACT THAT THE BORROWED FUNDS WERE UTILIZED FOR INCOME, GENERATING ACTIVITIES AND THERE WAS ONLY A MARGINAL SHORT-FAIL WHICH OUGHT TO HAVE BEEN ALLOWED. 5. IN THE COURSE OF ASSESSMENT PROCEEDINGS THE LEARNED AC) ALSO RAISED THE ISSUE OF RENTAL INCOME FROM PROPERTY. THE APPELLANT EXPLA INED THAT THE PROPERTY IN QUESTION WAS PURCHASED ONLY ON 01-01-2008, AND WAS VACANT DURING THE YEAR. THE LEARNED AO HAS HOWEVER SOUGHT TO ASSESS RS.25,2 00/- AS NOTIONAL RENTAL INCOME. ITA NO. 1276 /AHD/2016 . A.Y. 2011-1 2 3 6. AT THE OUTSET, LD. A.R. STATED THAT HE HAS NOT BEEN GIVEN PROPER OPPORTUNITY BY THE A.O. AS WELL AS BY THE LD. CIT(A). AS WE CAN SE E, IN ASSESSMENT ORDER AND LD. A.O. SOUGHT CERTAIN DETAILS FROM THE ASSESSEE B UT THOSE DETAILS COULD NOT BE SUBMITTED BEFORE THE ASSESSING OFFICER. 7. IN APPEAL, ASSESSEE ALSO RAISED THE GROUND THAT LD. A.O. HAS DISALLOWED THE INTEREST INCOME WITHOUT ANY VALID REASON AND HE WAS NOT GIVEN PROPER HEARING. BUT TO NO AVAIL AND LD. CIT(A) CONFIRM THE ORDER OF LD.A.O. 8. NOW ASSESSEE IS BEFORE US, AS WE CAN SEE FROM IMPUG NED ORDER ASSESSEE WAS PREVENTED FROM PROPER HEARING AND ON ACCOUNT OF THE SAME ASSESSEE COULD NOT FILE THE DETAILS BEFORE THE LD.CIT(A). THEREFORE, I MPUGNED ORDER U/S. 143(3) R.W.S. 153A OF INCOME TAX ACT IS BAD IN LAW, AS NO OPPORTUNITY HAS BEEN GIVEN AS PER DECISION OF IN THE CASE OF TIN BOX CO. VS. C IT [2001] 166 CTR 509 (SC) WHEREIN IT HAS BEEN HELD BY THE HONBLE SUPREME COU RT THAT WE .AGREE WITH THE ASSESSEE'S SUBMISSION THAT THE INCOME TAX OFFICER H AD NOT GIVEN TO THE ASSESSEE PROPER OPPORTUNITY OF BEING HEARD. THAT THE ASSESSEE COULD HAVE PLACED EVIDENCE BEFORE THE FIRST APPELLATE AUTHORITY OR BEFORE THE TRIBUNAL IS REALL Y OF NO CONSEQUENCE FOR IT IS ASSESSMENT ORDER THAT COUNTS, THAT ORDER MUST BE MADE AFTER THE ASSE SSEE HAS BEEN GIVEN A REASONABLE OPPORTUNITY OF SETTING OUT HIS CASE, WE, THEREFORE, DO NOT AGREE WITH THE TRIBUNAL AND THE HIGH COURT THAT IT WAS NOT NECESSARY TO SET ASIDE THE OR DER OF ASSESSMENT AND REMAND THE MATTER TO THE ASSESSING AUTHORITY FOR FRESH ASSESSMENT AFTER GIVING TO THE ASSESSEE A PROPER OPPORTUNITY OF BEING HEARD.2. TWO QUESTIONS WERE PLACED BEFORE THE HIGH COURT, OF WHICH SECOND QUESTION IS NOT PRESSED, THE FIRST QUESTION.....'. 9. THUS, WE SET ASIDE THE ORDER OF LD. CIT(A) AND REMA ND THIS MATTER BACK TO THE FILE OF LD. A.O. TO DECIDE A FRESH AFTER GIVING PRO PER OPPORTUNITY OF BEING HEARD ITA NO. 1276 /AHD/2016 . A.Y. 2011-1 2 4 TO THE ASSESSEE AND WILL DECIDE THE MATTER WITHIN T HREE MONTHS FROM THE DATE OF THE RECEIPT OF THIS ORDER. 10. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS ALLO WED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON 31- 12- 2018 SD/- SD/- (PRADIP KUMAR KEDIA) (MAHAVIR PRASAD) ACCOUNTANT MEMBER TRUE COPY JUDICIAL MEMBER AHMEDABAD: DATED 31/12/2018 RAJESH COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT,AHME DABAD