Agriculture Produce Market Committee, Sabarkantha V. The Income tax Officer,Ward-4, Modasa

ITA 1427/AHD/2012

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 94332 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 2 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-09-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 28-08-2015
• Assessment Year: 2006-2007
• Appeal Filed On: 29-06-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NARENDRA SINGH
• Assessee Lawyers: S N DIVATIA
• Keywords: Depreciation; Principle of natural justice
• Section: 143(3); 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH , AHMEDABAD (BEFORE SHRI ANIL CHATURVEDI, A.M. & SHRI KUL BHARA T, J.M.) I.T. A. N O.1427/AHD/2012 (ASSESSMENT YEAR: 2006-07) AGRICULTURE PRODUCE MARKET COMMITTEE AT & PO BAYAD DIST. SABARKANTHA V/S THE I.T.O., WARD -4, MODASA (APPELLANT) (RESPONDENT) PAN: AAAJT0492K APPELLANT BY : SHRI S.N. DIVATIA, A.R. RESPONDENT BY : SHRI NARENDRA SINGH, SR.D.R. ( )/ ORDER DATE OF HEARING : 28-8-2015 DATE OF PRONOUNCEMENT : 04-09-2015 PER ANIL CHATURVEDI, ACCOUNTANT MEMBER 1. THIS APPEAL FILED BY THE ASSESSEE IS AGAINST THE OR DER OF CIT(A)-VIII, AHMEDABAD DATED 26.04.2012 FOR A.Y. 2006-07. 2. THE RELEVANT FACTS AS CULLED OUT FROM THE MATERIAL ON RECORD ARE AS UNDER. 3. ASSESSEE IS A STATED TO BE AGRICULTURE PRODUCE MARK ET COMMITTEE ESTABLISHED UNDER APMC ACT. IT FILED ITS RETURN OF INCOME FOR A.Y. 2006-07 ITA NO 1427/ AHD/2012 . A.Y. 2006-0 7 2 ON 27.12.2006 DECLARING TOTAL INCOME AT RS. NIL. TH E CASE WAS SELECTED FOR SCRUTINY AND THEREAFTER THE ASSESSMENT WAS FRAMED U NDER SECTION 143(3) VIDE ORDER DATED 07.10.2008 AND THE TOTAL INCOME WAS ASS ESSED AT RS. NIL. SUBSEQUENTLY NOTICE U/S. 148 OF THE ACT WAS ISSUED ON 02.10.2009 AND THE ASSESSMENT WAS REOPENED AND THEREAFTER AN ORDER WAS PASSED U/S. 143(3) R.W.S. 147 VIDE ORDER DATED 27.12.2010 AND THE TOTA L INCOME WAS DETERMINED AT RS. 15,28,933/-. AGGRIEVED BY THE ORDER OF A.O., ASSESSEE CARRIED THE MATTER BEFORE LD. CIT(A) WHO VIDE ORDER DATED 26.04 .2012 DISMISSED THE APPEAL OF THE ASSESSEE. AGGRIEVED BY THE AFORESAID ORDER OF LD. CIT(A), ASSESSEE IS NOW IN APPEAL BEFORE US AND HAS RAISED THE FOLLOWING GROUNDS:- 1.1 THE ORDER PASSED U/S.250 ON 26.04.2012 FOR A.Y. 2006-07 BY CIT(A)-VIII, ABAD UPHOLDING THE REASSESSMENT AND WITHDRAWAL OF EXEMPT ION U/S. 10(20) AS WELL AS RENTAL INCOME AS PROPERTY INCOME, IS WHOLLY ILLEGAL, UNLAW FUL AND AGAINST THE PRINCIPLES OF NATURAL JUSTICE 2.1 THE ID. CIT(A) HAS GRIEVOUSLY ERRED IN UPHOLDIN G THE VALIDITY OF REOPENING U/S. 147 , THOUGH THE NOTICE U/S 148 WAS ISSUED FOR CHANGE IN OPINION SO THAT IT WAS BAD IN LAW. 3.1 THE LD.CIT(A) HAS GRIEVOUSLY ERRED IN LAW AND O N FACTS IN CONFIRMING THAT THE APPELLANT WAS NOT ' LOCAL AUTHORITY 'U/S.2(31) SO T HAT ITS INCOME WAS NOT IN EXEMPT U/S. 10(20) OF THE ACT. 3.2 THAT IN THE FACTS AND CIRCUMSTANCES OF THE CASE AS WELL AS IN LAW, THE LD.CIT(A) OUGHT NOT TO HAVE UPHELD THAT THE APPELLANT WAS NOT LOCAL AUTHORITY U/S. 2(31) AND INCOME WAS NOT EXEMPT U/S 10(20). 4.1 THE LD.CIT(A) HAS ERRED IN UPHOLDING THAT THE R ENTAL INCOME TOTALING TO RS.12,09,933 WAS ASSESSABLE UNDER THE HEAD 'PROPERTY INCOME' SO THAT DEPRECIATION TOTALING TO RS.3,31,064 WAS NOT ADMISSIBLE. 4.2 THAT IN THE FACTS AND CIRCUMSTANCES OF THE CASE OUGHT NOT TO HAVE UPHELD THAT THE RENTAL INCOME TOTALING TO RS.12,09,933 WAS ASSESSAB LE UNDER THE HEAD 'PROPERTY INCOME' SO THAT DEPRECIATION TOTALING TO RS.3,31,064 WAS NO T ADMISSIBLE. ITA NO 1427/ AHD/2012 . A.Y. 2006-0 7 3 4. AT THE OUTSET, LD. A.R SUBMITTED THAT LD. CIT(A) HA S PASSED AN EX-PARTE ORDER AND ASSESSEE WAS NOT PROVIDED PROPER OPPORTUNITY OF HEARING BEFORE PASSING THE EX-PARTE ORDER. HE THEREFORE SUBMITTED THAT THE MATTER MAY BE REMITTED BACK TO LD. CIT(A) FOR DECIDING THE ISSUE ON MERITS AND FURTHER SUBMITTED THAT ASSESSEE WOULD CO-OPERATE BEFORE LD. CIT(A). T HE LD. D.R. ON THE OTHER HAND OBJECTED TO THE REQUEST MADE BY LD. A.R. TO RE MIT THE ISSUE BACK TO THE FILE OF LD. CIT(A). 5. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. WE FIND THAT IN THE PRESENT CASE WHILE DISMISSING THE APPEAL, LD. CIT(A) HAS NOTED THAT THE HEARING OF THE CASE WAS ADJOURNED TW ICE AND THAT ASSESSEE DID NOT ATTEND PERSONALLY NOR APPLIED FOR ADJOURNMENT A ND HE THEREFORE CONCLUDED THAT ASSESSEE DID NOT WANT TO PURSUE THE APPEAL AND THEREFORE DISMISSED THE APPEAL. BEFORE US, ALSO LD. A.R. HAS NOT PLACED ANY MATERIAL ON RECORD TO JUSTIFY THE ASSESSEES ACTION OF NOT APPE ARING BEFORE LD. CIT(A). IN VIEW OF THESE FACTS, WE ARE OF THE VIEW THAT THE AP ATHY OF THE ASSESSEE TOWARDS THE PROCEEDINGS BEFORE THE LOWER AUTHORITIE S SHOULD NOT BE ENCOURAGED. AT THE SAME TIME, WE FIND THAT LD. CIT( A) HAS DISMISSED THE APPEAL OF THE ASSESSEE ON ACCOUNT OF NON PROSECUTIO N OF THE APPEAL. IT IS A SETTLED LAW THAT LD. CIT(A) HAS NO JURISDICTION TO DISMISS THE APPEAL OF THE ASSESSEE WITHOUT GOING INTO THE MERITS OF THE ISSUE BEFORE HIM. EVEN IN AN EX PARTE ORDER, THE LD. CIT(A) SHOULD HAVE DECIDED THE GROUNDS OF APPEAL OF THE ASSESSEE ON MERITS THEREOF. CONSIDERING THE AFORESA ID FACTS AND IN VIEW OF SUBMISSION OF LD. A.R. THAT ASSESSEE WILL APPEAR BE FORE LD. CIT(A), WE ARE OF THE VIEW THAT IN THE INTEREST OF JUSTICE AND IN FAIRNESS, THE ASSESSEE BE GIVEN ONE MORE OPPORTUNITY TO PRESENT ITS CASE BEFO RE LD. CIT(A) BUT ONLY AFTER PAYMENT OF COST OF RS. 1000/- WHICH IT SHALL DEPOSIT TOWARDS LEGAL AID ITA NO 1427/ AHD/2012 . A.Y. 2006-0 7 4 AND THE PROOF OF WHICH IS TO BE PRESENTED BEFORE LD . CIT(A). THEREAFTER LD. CIT(A) IS DIRECTED TO DECIDE THE ISSUE ON MERITS AN D IN ACCORDANCE WITH LAW AND AFTER PROVIDING ADEQUATE OPPORTUNITY OF HEARING TO BOTH THE PARTIES. IN VIEW OF OUR DECISION TO RESTORE THE ISSUE TO LD. CI T(A), WE ARE NOT ADJUDICATING ON MERITS THE OTHER GROUNDS RAISED BY ASSESSEE. 6. IN THE RESULT, THE APPEAL OF ASSESSEE IS ALLOWED FO R STATISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON 04 - 09 - 2015 . SD/- SD/- (KUL BHARAT) (ANIL CHATURVEDI) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD. TRUE COPY 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