SURENDRAKUMAR GARG, MUMBAI V. ITO WD 16(1)(3), MUMBAI

ITA 136/MUM/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 92742 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 5 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-06-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Assessment Year: 1985-1986
• Appeal Filed On: 06-01-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: GOLI SRINIVAS RAO
• Assessee Lawyers: SUNIL HIRAWAT
• Keywords: Reasonable cause
• Section: 131; 144; 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH E, MUMBAI BEFORE SHRI R. C. SHARMA, ACCOUNTANT MEMBER AND MS. SUSHMA CHOWLA, JUDICIAL MEMBER ITA NOS. 132 TO 136/MUM/2014 ASSESSMENT YEARS: 1981-82 TO 1985-86 SHRI SURENDRAKUMAR GARG C/O. KARNAVAT & CO. 2A KITAB MAHAL, 1 ST FLOOR 192 DR. D.N. ROAD MUMBAI 400 001 PAN:AAFPG 5586 Q ` .(APPELLANT) VS. THE INCOME-TAX OFFICER WARD-16(1)(3) MATRU MANDIR, TARDEO ROAD MUMBAI 400 007 (RESPONDENT) APPELLANT BY : SHRI SUNIL HIRAWAT RESPONDENT BY : SHRI GOLI SRINIV AS RAO DATE OF HEARING : 11.06.2015 DATE OF PRONOUNCEMENT : 11.06.2015 O R D E R PER SUSHMA CHOWLA, JM: THIS BUNCH OF FIVE APPEALS FILED BY THE ASSESSEE I S AGAINST THE CONSOLIDATED ORDER OF THE CIT(A) -28, MUMBAI DATED 25.10.2013 RELATING TO ASSESSMENT YEARS 1981-82 TO 1985-86 AGAINST ORDER P ASSED UNDER SECTION 143(3) OF THE I.T. ACT. ITA NOS. 132 TO 136/MUM/2014 ASSESSMENT YEARS: 1981-82 TO 1985-86 2 2. THE ASSESSEE HAS RAISED SEVERAL GROUNDS OF APPEA L BUT THE PRELIMINARY ISSUE RAISED BY THE ASSESSEE IS VIDE GROUND OF APPE AL NO. 1 WHICH READS AS UNDER:- 1. (I) ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE, THE IMPUGNED EX PARTE ORDER OF THE LEARNED COMMISSIONER OF INCOM E-TAX (APPEALS) [HEREINAFTER REFERRED TO AS LD. CIT (A) IS BASED ON INCORRECT APPRECIATION OF FACTS, PASSED IN UNDUE HASTE WITHOU T AFFORDING ADEQUATE AND PROPER OPPORTUNITY OF HEARING. (II) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE THE LD. CIT(A) HAS ERRED IN LAW AND ACTED AGAINST THE PRINCIPLES OF NA TURAL JUSTICE IN DISMISSING THE APPEAL IN LIMINE WITHOUT CONSIDERING THE MERITS OF THE CASE BASED ON THE FACTS AND GROUNDS OF APPEAL OF TH E APPELLANT. (III) THE APPELLANT PRAYS THAT THE ORDER OF THE LD. CIT(A) BE SET ASIDE AND THAT THE DETERMINATION OF INCOME AS MADE BY THE LEARNED ASSESSING OFFICER [HEREINAFTER REFERRED TO AS 'LD. AO'] BE DE LETED/MODIFIED IN ACCORDANCE WITH LAW HAVING REGARD TO THE FACTS AND GROUNDS OF APPEAL BEFORE THE LD. CIT(A). 3. THE ISSUE RAISED IN THE BUNCH OF APPEALS IS IDEN TICAL AND WE PROCEED TO DECIDE THE SAME BY THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE. HOWEVER, REFERENCE IS BEING MADE TO THE FACTS IN IT A NO. 132/MUM/2014 TO ADJUDICATE THE ISSUE. 4. BRIEFLY IN THE FACTS OF THE PRESENT CASE, SEARCH UNDER SECTION 132(1) OF THE ACT WAS CONDUCTED AT THE OFFICE CUM RESIDENTIAL PRE MISES OF THE ASSESSEE ON 05.12.1985. STATEMENT OF THE ASSESSEE WAS RECORDED UNDER SECTION 131 OF THE I.T. ACT ON 26.03.1985 AND 23.04.1985, IN WHICH HE ADMITTED THAT HE WAS CARRYING ON THE BUSINESS ACTIVITY IN THE NAME OF 14 CONCERNS. THE ORIGINAL ASSESSMENT WAS COMPLETED UNDER SECTION 144 OF THE A CT VIDE ORDER DATED 19.12.1986. THE CIT(A) VIDE ORDER DATED 22.11.1987 SET ASIDE THE ASSESSMENT TO THE AO WITH DIRECTIONS. IN PURSUANT THERETO AGAIN F RESH ASSESSMENT WAS MADE AGAINST WHICH THE ASSESSEE AGAIN PREFERRED AN APPEA L WHICH IS PARTLY ALLOWED BY THE CIT(A). THE TRIBUNAL VIDE CONSOLIDATED ORDER DA TED 01.01.1996 SET ASIDE THE ASSESSMENT BACK TO THE FILE OF THE AO WITH DIRECTIO NS. IN THE MEANWHILE THE ITA NOS. 132 TO 136/MUM/2014 ASSESSMENT YEARS: 1981-82 TO 1985-86 3 ASSESSEE FILED A PETITION BEFORE THE SETTLEMENT COM MISSION FOR ASSESSMENT YEARS 1982-84 TO 84-85 HOWEVER, THE ASSESSEE FAILED TO FURNISH THE INFORMATION AND DETAILS AS REQUIRED BY THE SETTLEMENT COMMISSIO N, THEREFORE THE MATTER WAS SET ASIDE TO THE AO FOR DISPOSAL AS PER THE I.T. AC T. THE ASSESSING OFFICER ISSUED SUMMONS TO DIFFERENT PARTIES, WHO DENIED THAT THEY HAD ANY DEALINGS WITH THE ASSESSEE. CONSEQUENT THERETO AGAIN ASSESSMENT WAS C OMPLETED AND MATTER WAS AGAIN SET ASIDE TO THE FILE OF THE AO. ANOTHER GROU ND OF PROCEEDINGS BEFORE THE AO AND CIT(A) TOOK PLACE AND THE MATTER WAS BEFORE THE TRIBUNAL, WHICH VIDE ORDER DATED 26.03.2010 PASSED ELABORATE ORDER WITH DIRECTIONS. THE SAID DIRECTION OF THE TRIBUNAL ARE REPRODUCED, UNDER PAR A 10 AT PAGES 7 TO 9 OF THE ASSESSMENT ORDER. IN THE SET ASIDE PROCEEDING THERE WAS SOME COMPLIANCE TO THE NOTICES BUT COMPLETE DETAILS WERE NOT FILED BY THE ASSESSEE AND CONSEQUENT THERETO THE ASSESSMENT WAS COMPLETED IN THE HANDS O F THE ASSESSEE BY MAKING ADDITIONS FROM YEAR TO YEARS. BEFORE THE CIT(A) THE RE WAS NON-COMPLIANCE CONSEQUENT TO WHICH THE APPEAL WAS DECIDED BY THE C IT(A) AFTER UPHOLDING THE ORDER OF THE AO. 5. THE ASSESSEE IS IN APPEAL AGAINST THE SAID ORDER OF THE CIT(A). THE LD. AR FOR THE ASSESSEE POINTED OUT THAT IT WAS PREVENT ED BY A REASONABLE CAUSE FOR NON APPEARANCE BEFORE THE CIT(A). IT WAS ALSO POINT ED BY THE LD. AR FOR THE ASSESSEE HAD THAT THERE WAS CHANGE IN THE OFFICES O F THE CIT(A)AND COMPLETE PROCEEDINGS DID NOT TAKE PLACE BEFORE ONE OFFICER A ND THE CONSEQUENT ORDER PASSED BY THE CIT(A) WAS WITHOUT CONSIDERING THE CO MPLETE EVIDENCE . 6. THE LD. D.R. FOR THE REVENUE HOWEVER PLACED RELI ANCE ON THE ORDERS OF THE AUTHORITIES BELOW. 7. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE RECORD. ADMITTEDLY THE ASSESSEE HAD FAILED TO PUT IN COMPLETE REPRESENTATI ON BEFORE THE AUTHORITIES BELOW, WHICH HAS RESULTED IN THE IMPUGNED ORDERS BE ING PASSED BY RESPECTIVE AUTHORITIES. THE LD. AR FOR THE ASSESSEE BEFORE US AS FILED AN AFFIDAVIT ITA NOS. 132 TO 136/MUM/2014 ASSESSMENT YEARS: 1981-82 TO 1985-86 4 EXPLAINING THE REASONS FOR NON-APPEARANCE BEFORE TH E CIT(A) ON THE LAST DATE OF HEARING AND HAS ALSO EXPLAINED THE VARIOUS PROCEEDI NGS BEFORE THE DIFFERENT CIT(A). THE AFFIDAVIT FILED BY THE ASSESSEE READ AS UNDER:- AFFIDAVIT I, SUNIL HIRAWAT, INDIAN INHABITANT. S/O. LATE SHRI MEHTABCHAND HIRAWAT. AGED ABOUT 57 YEARS, PRESENTLY RESIDING AT FLAT NO. 401, JOLLY BHAVAN, 16TH CROSS ROAD, KHAR (WEST), MUMBAI 400052 , DO HEREBY STATE AND DECLARE ON SOLEMN AFFIRMATION AS UNDER:- 1. THAT I AM APPEARING IN THE ASSESSMENT AND APPELL ATE PROCEEDINGS OF SHRI SURENDRA GARG RELATING TO THE ASSTT. YEARS 198 1-82 TO 1985-86 SINCE LONG. 2. THAT I HAVE APPEARED BEFORE THE ASSESSING OFFICE R IN THE PROCEEDINGS U/S.143(3) OF THE INCOME TAX ACT (WHICH HAS ARISEN FROM THE HON'BLE ITAT'S ORDER DATED 20.03.2010 DURING THE MONTHS OF JULY 2011 TO DECEMBER 2011. 3. THAT ORDERS U/S.143(3) R.W.S. 254 WERE PASSED BY SHRI D. KIRAN KUMAR, ITO WARD-16(1)(3). 4. THAT APPEALS AGAINST THE ORDERS OF ASSESSING OFF ICER WERE FILED BEFORE THE COMMISSIONER OF INCOME-TAX (APPEALS) ON 30.01.2 012. 5. THAT THE PROCEEDINGS WERE INITIATED IN THE LATER PART OF YEAR 2012 BEFORE THE LEARNED COMMISSIONER OF INCOME-TAX (APPE ALS)-27 (SHRI Y. RAJENDRA). ON 21.09.2012, I HAVE APPEARED BEFORE TH E LEARNED CIT(A) AND SUBMITTED COPIES OF SOME EARLIER ORDERS AND THE MATTER WAS DISCUSSED. 6. THAT THE APPELLATE PROCEEDINGS WERE FIXED ON 08. 04.2013 BEFORE THE LEARNED CIT(A)- 28 (SHRI PRATAP SINGH). SINCE THE N OTICE DATED 04.04.2013 WAS RECEIVED BY THE UNDERSIGNED ON 06.04 .2013 FIXING THE HEARING ON 08.04.2013 AND ACCORDINGLY, ADJOURNMENT WAS ASKED FOR DUE TO SHORT TIME BETWEEN THE RECEIPT OF NOTICE AND DAT E OF HEARING. 7. THAT IN THE MONTH OF JULY 2013, THE HEARING IN T HE APPEALS WAS INSTALLED BY THE LEARNED CIT(A)-28 (SHRI SHISHIR AG ARWAL) AND THE MATTER WAS ADJOURNED ON 4 OCCASIONS DUE TO THE REAS ON THAT SOME NEW FACTS WERE BROUGHT IN THE ASSESSMENT ORDER BY THE A SSESSING OFFICER AND SHRI SURENDRA GARG WANTED TO DISCUSS THE MATTER WIT H OTHER CONSULTANTS. ON 17.10.2013 WHEN THE CASE OF SHRI SU RENDRA GARG WAS ITA NOS. 132 TO 136/MUM/2014 ASSESSMENT YEARS: 1981-82 TO 1985-86 5 AGAIN FIXED FOR HEARING, I WAS IN BANGALORE FOR PRO FESSIONAL WORK, ACCORDINGLY, SHRI SHASHIKANT GUPTA, PARTNER OF M/S. KARNAVAT & CO. WRITTEN LETTER NO.SG/IT/9949 DATED 17.10.2013 AND R EQUESTED FOR ADJOURNMENT STATING AS UNDER:- 'THE AFORESAID APPEALS HAVE BEEN FIXED FOR HEARING TODAY I.E. ON 17.10.2013 AT 2.30 P.M. IN THIS CONNECTION, WE WOUL D LIKE TO BRING TO YOUR HONOUR'S KIND NOTICE THAT OUR SHRI SUNIL HIRAW AT, WHO LOOKS AFTER THE MATTER, IS OUT OF STATION AND WOULD LIKE TO COM E BACK IN THE NEXT WEEK. UNDER THE CIRCUMSTANCES, WE REQUEST YOUR HONO UR TO KINDLY ADJOURN THE HEARING FOR A FORTNIGHT OR SO AND OBLIG E. WE REGRET THE INCONVENIENCE CAUSED'. 8. THAT THE LEARNED CIT(A) HAS REFUSED THE ADJOURNM ENT AND PASSED THE ORDER ON 25.10.2013. 8. IN THE TOTALITY OF THE ABOVE SAID FACTS AND CIRC UMSTANCES WE HOLD THAT THE ASSESSEE WAS PREVENTED BY SUFFICIENT CAUSE FROM NON -APPEARANCE BEFORE THE CIT(A). IN VIEW THEREOF WE RESTORE THE MATTER BACK TO THE CIT(A) TO DECIDE THE ISSUE AFTER AFFORDING AN OPPORTUNITY OF HEARING TO THE ASSESSEE. HOWEVER, IT IS MADE CLEAR THAT THE ASSESSEE SHALL APPEAR BEFORE TH E CIT(A) WITHIN ONE MONTH FROM THE DATE OF RECEIPT OF THE ORDER PASSED BY THE TRIBUNAL. IN VIEW THEREOF THE GROUND OF APPEAL NO. 1 RAISED BY THE ASSESSEE IS AL LOWED FOR STATISTICAL PURPOSES. AS WE ARE SENDING THE MATTER BACK TO THE FILE OF TH E CIT(A), WE ARE NOT ADJUDICATING THE GROUND OF APPEAL RAISED ON MERITS OF THE ADDITION. THE GROUND OF APPEAL RAISED BY ASSESSEE ARE PARTLY ALLOWED. TH E FACTS AND ISSUE IN ITA NO. 133 TO 136 ARE IDENTICAL TO THE FACTS AND ISSUE IN ITA NO. 132/MUM/2014 AND OUR DECISION IN ITA NO. 132/MUM/2014 SHALL APPLY MU TATIS MUTANDIS TO ITA NOS. 133 TO 136/MUM/2014. ITA NOS. 132 TO 136/MUM/2014 ASSESSMENT YEARS: 1981-82 TO 1985-86 6 9. IN THE RESULT ALL THE APPEALS FILED BY THE ASSES SEE ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 11 TH DAY OF JUNE, 2015. SD/- SD/- (R. C. SHARMA) (SUSHMA CHOWLA) ACCOUNTANT MEMBER J UDICIAL MEMBER MUMBAI, DATED: 11.06.2015 *SRIVASTAVA COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT(A) CONCERNED, MUMBAI THE DR E BENCH //TRUE COPY// BY ORDER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.