Hind Airlink Pvt. Ltd., New Delhi V. DCIT, New Delhi

ITA 1498/DEL/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 6546 (ITAT-DELHI)
• Duration Of Justice: 8 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-12-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC 2
• Next Hearing Date: 02-11-2016
• Assessment Year: 2012-2013
• Appeal Filed On: 21-03-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Opportunity of being heard
• Section: 142(1)

Judgement Text

I.T.A .NO.-1498/DEL/2016 HIND AIRLINK PVT.LTD. VS DCIT IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: SMC-II NEW DELHI BEFORE SMT DIVA SINGH, JUDICIAL MEMBER I.T.A .NO.-1498/DEL/2016 (ASSESSMENT YEAR-2012-13) HIND AIRLINK PVT.LTD., A-1, OKHLA INDUSTRIAL AREA, PHASE-I, NEW DELHI-110020. PAN-AABCH0809G ( APPELLANT) VS DCIT, CIRCLE-12(1), NEW DELHI (RESPONDENT) ASSESSEE BY SH.M.P.RASTOGI, ADV. REVENUE BY NONE DATE OF HEARING 02 . 11 .2016 DATE OF PRONOUNCEMENT 19 .1 2 .2016 ORDER THE PRESENT APPEAL HAS BEEN FILED BY THE ASSESSEE A SSAILING THE CORRECTNESS OF THE ORDER DATED 19.01.2016 OF CIT(A)-4, NEW DELHI PERTA INING TO 201213 ASSESSMENT YEAR ON THE FOLLOWING GROUNDS:- 1. THAT THE CIT(APPEALS) OUGHT TO HAVE DECIDED THE APPEAL ON MERITS INSTEAD OF DISMISSING THE APPEAL ON ACCOUNT OF NON-PROSECUT ION. 2. THAT THE DISALLOWANCE OF RS.15,00,000/- BEING TH E 50% OF THE SALARY PAID TO MRS.KIRAN QURESHI, DIRECTOR U/S40A(2)(B) OF THE IT ACT (WRONGLY MENTIONED SECTION 40(2)(B) BY AO) AS MADE BY THE AO IS ARBITR ARY, UNJUST AND AT ANY RATE VERY EXCESSIVE. 2. AT THE TIME OF HEARING, AN ADJOURNMENT WAS MOVED ON BEHALF OF THE REVENUE. HOWEVER, NO ONE WAS PRESENT IN SUPPORT OF THE SAME. THE STATED REASON FOR ADJOURNMENT WAS THAT THE LD. SR. DR COULD NOT REACH DELHI. TH E ADJOURNMENT REQUEST WAS OPPOSED BY THE LD.AR STATING THAT THE POINT AT ISSUE IS FULLY COVE RED IN HIS FAVOUR BY VIRTUE OF THE ORDER OF THE ITAT IN ASSESSEES OWN CASE. CONSIDERING THE MATER IAL AVAILABLE ON RECORD, THE ADJOURNMENT REQUEST WAS REJECTED AND IT WAS CONSIDERED APPROPRI ATE TO PROCEED EX-PARTE QUA THE REVENUE RESPONDENT ON MERIT. 3. THE RELEVANT FACTS OF THE CASE ARE THAT THE ASSE SSEE IN THE YEAR UNDER CONSIDERATION HAD RETURNED AN INCOME OF RS19,58,750/-. THE SAID RETURN WAS SELECTED FOR SCRUTINY UNDER CASS. THE AO AFTER ISSUANCE OF NOTICE U/S 143(2) & 142(1) ETC. REQUIRED THE ASSESSEE TO EXPLAIN THE PAYMENT OF RS.30 LACS PAID TO SMT. KIRA N QURESHI. THE ASSESSEE IN THE FACTS OF PAGE 2 OF 3 I.T.A .NO.-1498/DEL/2016 HIND AIRLINK PVT.LTD. VS DCIT THE PRESENT CASE, IS ENGAGED IN THE BUSINESS OF THE GENERAL SALES AGENT. THE ASSESSEE SUBMITTED THAT SMT. QURESHI WAS A HIGHLY QUALIFIED PERSON AND WAS A PROMOTER-DIRECTOR OF THE COMPANY THUS THE PAYMENT WAS CLAIMED TO COMMENSURAT E WITH HER QUALIFICATIONS. HOWEVER, THE AO BEING OF THE VIEW THAT SINCE THE ASSESSEE CO ULD NOT PROVE DAY TO DAY INVOLVEMENT WITH THE BUSINESS CONCERNS OF THE ASSESSEE BY WAY OF ANY DOCUMENTED EVIDENCE, THE REASONABLENESS OF THE PAYMENT WAS HELD TO BE NOT PR OVED. ACCORDINGLY 50% OF THE SAME WAS DISALLOWED U/S 40A(2)(B) OF THE I.T.ACT, 1961. THE ISSUE TRAVELLED IN APPEAL BEFORE THE CIT(A) WHO AFTER FIXING THE CASE ON 08.09.2015 & 12.01.201 6 DISMISSED THE APPEAL HOLDING THAT THE ASSESSEE IS NOT SERIOUS IN PURSUING THE APPEAL FILE D. 4. LD.AR AT THE TIME OF HEARING SUBMITTED THAT THE POINT AT ISSUE IS FULLY COVERED IN FAVOUR OF THE ASSESSEE VIDE ORDER DATED 10.08.2016 IN ITA NO.2634/DEL/2015 PERTAINING TO 2011-12 AY IN THE CASE OF THE ASSESSEE ITSELF. ACCORDINGLY , RELYING UPON THE SAME, IT WAS HIS SUBMISSION THAT THE ISSUE HAS BEEN DECIDED IN FAVOU R OF THE ASSESSEE AND HE WOULD HAVE NO OBJECTION IF THE ISSUE IS RESTORED TO THE CIT(A) FO R EXAMINING THE CLAIM OF THE ASSESSEE. HOWEVER, THE GRANT OF ADJOURNMENT WAS OBJECTED TO. CONSIDERING THE FACT THAT THE IMPUGNED ORDER IS AN EX-PARTE ORDER WHEREIN THE RELEVANT FAC TS ADDRESSING HOW THE NOTICES WERE SENT TO THE ASSESSEE IS NOT BROUGHT OUT, IT IS CONSIDERED A PPROPRIATE TO SET ASIDE THE IMPUGNED ORDER AND RESTORE THE ISSUE BACK TO THE CIT(A) WITH THE D IRECTION TO TAKE INTO CONSIDERATION THE ORDER PASSED BY THE CO-ORDINATE BENCH STATED TO BE ON SIM ILAR FACTS AND CIRCUMSTANCES AND PASS A SPEAKING ORDER IN ACCORDANCE WITH LAW AFTER GIVING THE ASSESSEE A REASONABLE OPPORTUNITY OF BEING HEARD. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 19 TH OF DECEMBER, 2016. SD/- (DIVA SINGH) JUDICIAL MEMBER *AMIT KUMAR* PAGE 3 OF 3 I.T.A .NO.-1498/DEL/2016 HIND AIRLINK PVT.LTD. VS DCIT COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI