STAR CRUSIES (INDIA) P.LTD, MUMBAI V. ASST CIT CIR 5(3), MUMBAI

ITA 1420/MUM/2014

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 2603 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 4 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-07-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Assessment Year: 2008-2009
• Appeal Filed On: 28-02-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: SATISH KANODIA
• Keywords: Transfer pricing

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL E BENCH, MUMBAI . . , , ! '#, $ , % BEFORE SHRI B.R.BASKARAN, AM AND SHRI AMARJIT SINGH , JM / I.T.A. NO.1420/MUM/2014 ( $ & '& / ASSESSMENT YEAR: 2008-09) M/S. STAR CRUISES (INDIA) PVT. LTD. C/O. KANODIA CHAUHAN & CO. G-15, EVEREST, TARDEO ROAD, MUMBAI - 400034 / VS. THE ASST. COMMISSIONER OF INCOME TAX CIRCLE 5(3) AAYAKAR BHAVAN, M.K.ROAD, MUMBAI - 400020 ./ ./ PAN/GIR NO. : AAJCS0577L ( / APPELLANT ) .. ( / RESPONDENT ) / DATE OF HEARING: 05.04.2016 !' /DATE OF PRONOUNCEMENT: 13.07.2016 #$ / O R D E R PER AMARJIT SINGH, JM: THE ASSESSEE HAS FILED THE PRESENT APPEAL AGAINST T HE ORDER DATED 16.12.2013 PASSED BY THE COMMISSIONER OF INCOME TAX (APPEAL) 15, MUMBAI [HEREINAFTER REFERRED TO AS THE CIT(A)] R ELEVANT TO THE A.Y.2008-09. ASSESSEE BY: SHRI FIROZE B. ANDHYARUJINA & SATISH KANODIA DEPARTMENT BY: SHRI A.K.NAYAK ITA NO.1420/MUM/14 A.Y.2008-09 2 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS:- 1. ERRED IN COMING TO THE CONCLUSION THAT NO PROP ER REASON WAS SUBMITTED FOR FILING THE APPEAL LATE IN AS MUCH AS HE FAILED TO APPRECIATE THAT INTIMATION OF APPOINTMENT OF LIQUIDATOR WAS FILED WITH THE ASSESSING OFFICER AS PER SECTION 178(1); 2. FAILED TO APPRECIATE THAT ORIGINALLY THE APPEAL WAS FILED IN TIME, HOWEVER THE SAME WAS WITHDRAWN AND FRESH APPE AL FILED AFTER GIVING NOTICE OF THE APPOINTMENT OF LIQ UIDATOR; 3. FAILED TO APPRECIATE THAT THE ORIGINAL APPEAL BE FORE CIT(A) WAS SIGNED BY LIQUIDATOR THOUGH NO INTIMATION WAS G IVEN FORMALLY WHICH WAS SUBSEQUENTLY GIVEN AND WHICH IS ONLY A MATTER OF PROCEDURE; 4. FAILED TO APPRECIATE THAT APPEAL IS A MATTER OF RIGHT AND THE RELIEF ON IMPORTANT LEGAL ISSUES AND HAS NO GONE IN TO MERITS OF THE CASE BUT DISMISSED MERELY ON TECHNICAL AND PROCEDURAL GROUNDS; 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E M/S. STAR CRUISES (INDIA) PVT. LTD. FILED ITS E-RETURN OF INC OME DECLARING INCOME OF RS. NIL ON 30.09.2008. SUBSEQUENTLY THE ASSESSE E FILED THE HARD COPY OF THE E-RETURN OF INCOME ALONG WITH TAX AUDIT REPORT, AUDITED PROFIT AND LOSS ACCOUNT, BALANCE SHEET AND OTHER DE TAILS. THE RETURN WAS PROCESSED U/S.143(1) OF THE INCOME TAX ACT, 196 1 ( IN SHORT THE ACT) ON 12.09.2009. SUBSEQUENTLY, THE CASE WAS TA KEN UP FOR SCRUTINY UNDER CASS AND NOTICE U/S.143(2) OF THE AC T DATED 19.08.2009 WAS ISSUED AND DULY SERVED UPON THE ASSE SSEE. IN THIS CASE, A REFERENCE U/S.92CA(1) OF THE ACT WAS REFERR ED TO THE TRANSFER PRICING OFFICER. SUBSEQUENTLY, A NOTICE U/S.142(1) DATED 16.04.2010 ITA NO.1420/MUM/14 A.Y.2008-09 3 WAS ISSUED AND SERVED UPON THE ASSESSEE. THEREAFTE R, ON THE MATTER OF TRANSFER PRICING ISSUE, THE INCOME OF THE ASSESSEE WAS ASSESSED TO THE TUNE OF RS.1,58,89,470/- BY VIRTUE OF ORDER DATED 2 1.12.2011. SUBSEQUENTLY, ASSESSEE FILED AN APPEAL AGAINST THIS ORDER DATED 20.01.2012 WHICH WAS WITHDRAWN BY THE ASSESSEE BY V IRTUE OF ORDER DATED 22.10.2012. THE ASSESSEE WITHDRAWN THE APPEA L BEFORE THE CIT(A) ON THE GROUND OF THAT THERE IS A TECHNICAL I RREGULARITY IN THE ABOVE APPEAL, THEREFORE, WE WITHDRAW THE APPEAL AND A FRESH APPEAL IS BEING FILED. THEREAFTER THE ASSESSEE FILED AN APPE AL DATED 19.10.2012 WHICH HAS BEEN ORDERED TO BE DISMISSED BY THE ORDER IN QUESTION DATED 16.12.2013. THEREAFTER, THE ASSESSEE FILED THE PRE SENT APPEAL BEFORE US. ISSUE NO. 1, 2 &3:- 4. ALL THESE ISSUES ARE INTERCONNECTED, THEREFORE, ARE BEING TAKEN UP TOGETHER FOR ADJUDICATION. UNDER THESE ISSUES T HE ASSESSEE RAISED THE QUESTION IN CONNECTION WITH THE DISMISSAL OF TH E APPEAL BY THE CIT(A) ON TECHNICAL GROUNDS. THE REPRESENTATIVE OF THE ASSESSEE HAS ARGUED THAT THE CIT(A) DISMISSED THE APPEAL ON GROU ND OF NON- COMPLIANCE OF PROVISION U/S.178(1) AND 140(6) PROVI SO 2 AND 249(1) OF THE ACT. IT IS ALSO ARGUED THAT THE DELAY HAS N OT BEEN CONDONED BY THE CIT(A) IN ACCORDANCE WITH LAW WHICH HAS BEEN DU LY BEEN JUSTIFIED BEFORE HIM. ITA NO.1420/MUM/14 A.Y.2008-09 4 5. ON THE OTHER HAND THE LEARNED REPRESENTATIVE OF THE DEPARTMENT HAS STRONGLY RELIED UPON THE ORDER PASSED BY THE CI T(A) IN QUESTION. BY GIVING THE CAREFUL THOUGHTS TO THE CONTENTION RA ISED BY THE LEARNED REPRESENTATIVE OF THE PARTIES AND PERUSING THE RECO RD CAREFULLY, IT CAME INTO THE NOTICE THAT THE ASSESSING OFFICER HAS PASS ED THE ORDER DATED 21.12.2011 IN VIEW OF THE PROVISION U/S.143(3) R.W. S. 144C(3) OF THE ACT. THIS ORDER HAS BEEN PASSED ON 21.12.2011 AND SUBSEQUENTLY THE ASSESSEE FILED AN APPEAL BEFORE THE CIT(A) ON 20.01 .2012. THE APPEAL HAS BEEN FILED WELL WITHIN THE TIME. THEREAFTER EV EN BEFORE THE EXPIRY OF ONE MONTH THE SAID APPEAL HAS BEEN WITHDRAWN BY VIRTUE OF LETTER DATED 19.10.2012 ON 22.10.2012 PASSED BY THE CIT(A) . THE IMPORTANT CONTENTS WITH REGARD TO FILING THE APPEAL FURTHER H AS ALSO BEEN MENTIONED IN THIS YEAR, FURTHER APPEAL HAS ALSO BEE N FILED ON 19.10.2012. THE SAID APPEAL CONTINUED TILL ITS DIS POSAL UPTO 16.12.2013. WE NOWHERE FIND ANY REASON FOR FILING THE APPEAL DELAYED. IN FACT THERE IS NO DELAY IN FILING THE A PPEAL. THE APPEAL REMAINED IN PROCEEDING TILL ITS FILING WITH EFFECT FROM 20.01.2011. HOWEVER, THE APPEAL HAS BEEN WITHDRAWN ON 22.10.201 2 WITH DUE PERMISSION OF THE CIT(A) AND THE SUBSEQUENT APPEAL HAS BEEN FILED ON 19.10.2012 WITH DUE NOTICE TO THE CIT(A) WHICH CONT INUED TILL ITS DISPOSAL VIDE ORDER DATED 16.12.2013 IN QUESTION. NO DOUBT THE DELAY IS VERY MUCH EXPLANATORY AND THE APPEAL IS NOT LIAB LE TO BE DISMISSED ON THE BASIS OF THE DELAY IN FILING THE APPEAL. ITA NO.1420/MUM/14 A.Y.2008-09 5 6. THE OTHER GROUNDS WHICH HAS BEEN TAKEN BY THE CI T(A) IN HIS ORDER THAT AFTER THE DISSOLUTION OF THE FIRM THE LI QUIDATOR DID NOT INTIMATE THE INFORMATION TO THE ASSESSING OFFICER W ITHIN THE PERIOD OF 30 DAYS U/S.178(1) OF THE ACT AND THE FORM 35 WAS S IGNED BY SHRI.SATISH KANODIA HAVING NO AUTHORITY TO SIGN THE APPEAL AS PER THE PROVISION OF SECTION 140(C) PROVISO 2 OF THE RECORD . ON RECORD IT IS APPARENT THAT ASSESSEE HAS FILED THE RETURN WHICH H AS BEEN DEALT BY THE ASSESSING OFFICER VIDE ORDER DATED 21.12.2011. THE ASSESSING OFFICER DID NOT RAISED THESE POINTS IN HIS ORDER AN D COMPLETE THE ASSESSMENT BY ASSESSING INCOME OF THE ASSESSEE TO T HE TUNE OF RS.1,58,89,470/-. THE COMPANY HAS GONE INTO LIQUID ATION AND SHRI SATISH KANODIA HAS BEEN APPOINTED AS LIQUIDATOR AS GSA WHO HAS FILED THE RETURN AND ALSO FILED THE PRESENT APPEAL BEFORE US. 7. THE TECHNICALITIES RAISED BY THE CIT(A) CAME INT O THE EXISTENCE AFTER THE FINALIZATION OF THE ASSESSMENT ORDER DATE D 21.12.2011 AND IF TECHNICALITIES BE TAKEN INTO CONSIDERATION THEN THE ORDER PASSED BY THE ASSESSING OFFICER ALSO CAME UNDER THE QUESTION. TH E PROVISION U/S.178(1) OF THE ACT SEEMS DIRECTORY IN NATURE AND DEFAULT OF WHICH NOWHERE SEEMS TO CURTAIL RIGHT OF THE PARTIES. IF THE INTIMATION WAS NOT GIVEN UNDER THE SAID PROVISION THE APPEAL MEMO WHIC H HAS BEEN SIGNED BY THE APPELLANT AS HELD BY THE CIT(A) IS NO T IN ACCORDANCE WITH LAW, DOES NOT SEEMS TO BE JUSTIFIABLE. THE OR DER DATED 16.12.2013 IN QUESTION HAS BEEN PASSED MERELY ON TH E TECHNICAL ITA NO.1420/MUM/14 A.Y.2008-09 6 GROUND WHICH NOWHERE IN QUESTION IN THE ORDER PASSE D BY THE ASSESSING OFFICER DATED 21.12.2011. IN VIEW OF THE SAID CIRCUMSTANCES, WE ARE OF THE VIEW THAT THE ORDER PA SSED BY THE CIT(A) IN QUESTION IS WRONG AGAINST LAW AND FACTS AND IS N OT LIABLE TO SUSTAINABLE IN THE EYES OF LAW. THEREFORE, WE SET A SIDE THE ORDER DATED 16.12.2013 AND DIRECT THE CIT(A) TO DECIDE THE MATT ER AFRESH BY GIVING AN OPPORTUNITY TO THE ASSESSEE ON MERITS. 4. IN RESULT THE APPEAL FILED BY THE ASSESSEE IS HEREBY ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT ON 13 TH JULY , 2016. SD/- SD/- (B.R.BASKARAN) (AMARJIT SINGH) # / ACCOUNTANT MEMBER %& # /JUDICIAL MEMBER ' ( MUMBAI; )# DATED : 13 TH JULY, 2016 MP MP MP MP ) * +$!', -,'! / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. * ( ) / THE CIT(A)- 4. * / CIT 5. -./ &&01 , 01' , ' ( / DR, ITAT, MUMBAI 6. /34 5 / GUARD FILE. ) / BY ORDER, - & //TRUE COPY// ./# /(DY./ASSTT. REGISTRAR) , ' ( / ITAT, MUMBAI