M/s Nandana Education Trust , Shimoga V. The Deputy Commissioner of IncomeTax Circle-1 , Shimoga

ITA 1552/BANG/2018

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 8376 (ITAT-BANGALORE)
• Duration Of Justice: 1 year(s) 2 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-07-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 08-07-2019
• Assessment Year: 2010-2011
• Appeal Filed On: 11-05-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: A R VIVEK DR P V PRADEEP
• Keywords: Opportunity of being heard; Capital expenditure; Set aside
• Section: 10; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH : BANGALORE BEFORE SHRI ARUN KUMAR GARODIA, ACCOUNTANT MEMBER AND SHRI PAVAN KUMAR GADALE, JUDICIAL MEMBER I TA NO S . 1552 & 1553 /BANG/201 8 ASSESSMENT YEAR S : 20 10 - 11 & 201 1 - 12 M/S. NANDANA EDUCATION TRUST, BYPASS ROAD, BEHIND SAHYADRI COLLEGE, SHIMOGGA. PAN: AABTN1659H VS. THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE 1, SHIMOGGA. APPELLANT RESPONDENT ASSESSEE BY : SHRI A.R. VIVEK, ADVOCATE REVENUE BY : DR. P.V. PRADEEP KUMAR, ADDL. CIT (DR) DATE OF HEARING : 0 8 .0 7 .2019 DATE OF PRONOUNCEMENT : 12 .0 7 .2019 O R D E R PER SHRI A.K. GARODIA, ACCOUNTANT MEMBER BOTH THESE APPEALS ARE FILED BY THE ASSESSEE WHICH ARE DIRECTED AGAINST TWO SEPARATE ORDERS OF LD. CIT(A), DAVANGERE BOTH DATED 01.03.2018 FOR ASSESSMENT YEARS 2010-11 AND 2011-12. BOTH THESE APPEALS WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY WAY OF THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. 2. THE GROUNDS RAISED BY THE ASSESSEE FOR ASSESSMENT YEAR 2010-11 IN ITA NO. 1552/BANG/2018 ARE AS UNDER. 1. THE ORDER OF FIRST APPELLATE AUTHORITY IS BAD IN LAW, CONTRARY TO THE FACTS AND CIRCUMSTANCES OF THE CASE AND HAS BEEN DISMISSED WITHOUT RECORDING ANY FINDING IN RELATION TO THE GROUND OF APPEAL AS URGED BY THE APPELLANT. 2. WITHOUT PREJUDICE TO THE ABOVE CONTENTION THE APPELLANT DENIES ITSELF LIABLE TO BE ASSESSED AT RS.50,07,709/ AS AGAINST THE RETURNED LOSS OF 85,81,500/- ON THE FACT AND CIRCUMSTANCE OF THE CASE. 3. THE CIT(A) FAILED TO APPRECIATE THAT A SUM OF RS.25,71,039/- WAS A DONATION MADE TO THE CORPUS OF THE TRUST AND SAME WAS NOT TAXABLE ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND CONFIRMING THE SAID ADDITION WAS BAD IN LAW AND CONTRARY TO THE FACTS AND CIRCUMSTANCES OF THE CASE. 4. THE LEARNED CIT(A) ERRED IN CONFIRMING THE IMPOSING OF INTEREST UNDER SECTION 234A AND B OF THE ACT ON THE FACT AND CIRCUMSTANCES OF ITA NOS. 1552 & 1553/BANG/2018 PAGE 2 OF 3 THE CASE. 3. SIMILARLY THE GROUNDS RAISED BY THE ASSESSEE FOR ASSESSMENT YEAR 2011-12 IN ITA NO. 1553/BANG/2018 ARE AS UNDER. 1. THE APPELLANT DENIES ITSELF LIABLE TO. BE ASSESSED AT RS.26,39,810/- ON THE FACTS AND CIRCUMSTANCES OF THE CASE. 2. THE CIT(A) OUGHT TO HAVE PASSED A ORDER ASSIGNING REASONS AS MANDATED UNDER LAW AND DISMISSING THE APPEAL WITHOUT ASSIGNING THE REASONS FOR THE GROUNDS URGED IS CONTRARY TO THE PROVISION OF THE ACT. 3. THE CIT(A) AND THE ASSESSING OFFICER FAILED TO ASSIGN PROPER REASONS FOR THE ADDITIONS MADE IN THE ORDER OF ASSESSMENT ON THE FACTS AND CIRCUMSTANCES OF THE CASE. 4. THE LEARNED CIT(A) AND THE ASSESSING OFFICER ERRED IN NOT EXTENDING THE BENEFIT OF SECTION 10(23)(C) OF THE ACT TO THE INCOME ACCRUING TO THE APPELLANT BEING A EDUCATION INSTITUTION ON THE FACTS AND CIRCUMSTANCE OF THE CASE. 5. THE LEARNING CIT(A) ERRED IN NOT ALLOWING RS.69,44,240/- AS APPLICATION OF INCOME U/S.11(1)(A) OF THE ACT, WITHOUT GIVING ANY REASONS IN RESPECT OF CAPITAL EXPENDITURE. 6. THE LEARNED CIT(A) ERRED IN NOT ALLOWING THE CLAIM OF DEPRECATION ON THE FACTS AND CIRCUMSTANCES OF THE CASE. 4. AT THE VERY OUTSET, IT WAS POINTED OUT BY THE BENCH THAT BOTH THESE ORDERS PASSED BY LD. CIT(A) ARE EX-PARTE QUA THE ASSESSEE. THE BENCH WANTED TO KNOW ABOUT THE REASONS DUE TO WHICH NONE APPEARED ON BEHALF OF THE ASSESSEE BEFORE LD. CIT(A). IN REPLY, IT WAS SUBMITTED BY LD. AR OF ASSESSEE THAT ALTHOUGH THE ASSESSEE DID NOT APPEAL BEFORE LD. CIT(A) BUT EVEN THEN LD. CIT(A) SHOULD HAVE DECIDED THE APPEALS ON MERIT INSTEAD OF DISMISSING THE APPEALS IN LIMINE BY FOLLOWING THE TRIBUNAL ORDER RENDERED IN THE CASE OF MULTIPLAN (INDIA) LTD. AS REPORTED IN 38 ITD 320 (DEL) AND OF HONBLE HIGH COURT OF MADHYA PRADESH RENDERED IN THE CASE OF ESTATE OF LATE TUKOJIRAO HOLKAR VS. CWT AS REPORTED IN 223 ITR 480. THE LD. DR OF REVENUE SUPPORTED THE ORDER OF LD. CIT(A). 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FIND THAT IT IS NOTED BY LD. CIT(A) IN BOTH THE ORDERS THAT INSPITE OF SEVERAL OPPORTUNITIES PROVIDED BY HIM, NO PROPER COMPLIANCE WAS MADE BY THE ASSESSEE AND THEREFORE, LD. CIT(A) ITA NOS. 1552 & 1553/BANG/2018 PAGE 3 OF 3 CAME TO THE CONCLUSION THAT ASSESSEE HAS NO INTENTION IN PROSECUTING THE APPEALS AND HE DISMISSED BOTH THE APPEALS FOR WANT OF PROSECUTION WITHOUT DECIDING THE APPEALS ON MERIT. IT IS BY NOW SETTLED POSITION OF LAW THAT EVEN IN CASE OF NON-APPEARANCE BY THE APPELLANT, THE APPEAL SHOULD BE DECIDED ON MERIT AND SINCE, THIS WAS NOT DONE BY LD. CIT(A) IN THE PRESENT CASES, WE FEEL IT PROPER TO SET ASIDE BOTH THE ORDERS OF LD. CIT(A) AND RESTORE THE MATTER BACK TO HIS FILE FOR DECISION ON MERIT AFTER PROVIDING REASONABLE OPPORTUNITY OF BEING HEARD TO BOTH SIDES. WE WANT TO MAKE IT CLEAR THAT EVEN IF IN THE PRESENT PROCEEDINGS, NONE APPEARES ON BEHALF OF THE ASSESSEE INSPITE OF GRANTING OF REASONABLE OPPORTUNITY, THE LD. CIT(A) CAN DECIDE THE APPEALS EX-PARTE QUA THE ASSESSEE BUT HIS DECISION SHOULD BE ON MERITS OF THE APPEALS BY WAY OF A SPEAKING AND REASONED ORDER. 6. IN THE RESULT, BOTH THE APPEALS FILED BY THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THE DATE MENTIONED ON THE CAPTION PAGE. SD/- SD/- (PAVAN KUMAR GADALE) (ARUN KUMAR GARODIA) JUDICIAL MEMBER ACCOUNTANT MEMBER BANGALORE, DATED, THE 12 TH JULY, 2019. /MS/ COPY TO: 1. APPELLANT 4. CIT(A) 2. RESPONDENT 5. DR, ITAT, BANGALORE 3. CIT 6. GUARD FILE BY ORDER ASSISTANT REGISTRAR, INCOME TAX APPELLATE TRIBUNAL, BANGALORE.