RUNWALL MULTIHOUSING PVT. LTD, Pune V. ACIT RANGE 6, PUNE, Pune

ITA 170/PUN/2010

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 56488 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 7 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-09-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 16-09-2011
• Assessment Year: 2006-2007
• Appeal Filed On: 28-01-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K AMBASTHA
• Assessee Lawyers: SUNIL PATHAK
• Keywords: Opportunity of being heard
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A, PUNE BEFORE SHRI SHAILENDRA KUMAR YADAV, JUDICIAL MEMBER AND SHRI D.KARUNAKAR RAO, ACCOUNTANT MEMBER I.T.A. NO. 170 /PN/2010 : A.Y. 2006-07 RUNWAL MULTIHOUSING PVT LTD., ... APPELLANT 41/12, KARVE ROAD, PUNE-411 003 PA NO.AAACR 8222 Q VS. ADDL. CIT, RANGE-6 ... . RESPONDENT PUNE APPELLANT BY: SUNIL PATHAK RESPONDENT BY: SHRI S.K.AMBASTHA DATE OF HEARING: -16- 9-2011 DATE OF PRONOUNCEMENT: 23 -9-2011 ORDER PER SHAILENDRA KUMAR YADAV, JM THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE CIT(A)III PUNE DATED 7-10-2009, IN THE MATTER OF ASSESSMENT UNDER SECTION 143(3) OF THE IN COME TAX ACT, 1961, FOR A.Y. 2006-07. 2 I.T.A. NO. 170 /PN/2010 : A.Y. 2006-07 2. THE APPEAL WAS DISMISSED BY THE CIT(A) BY INVOKI NG PROVISIONS OF SECTION 249(4) OF THE INCOME TAX ACT, 1961 BECAUSE AS THE RELEVANT POINT OF TIME, THE ASSESSEE HAD NOT PAID TAXES ON THE RETURNED INCOME. 3. BEFORE US, LEARNED COUNSEL FOR THE ASSESSEE, INTER ALIA, REITERATED THE FACTS, DEPOSED IN THE AFFIDAVIT, A S UNDER: THAT RUNWAL MULTI HOUSING PVT LTD(THE COMPANY) HAS GONE THROUGH A VERY BAD LIQUIDITY CRUNCH FOR TH E LAST 4 TO 5 YEARS. THE COMPANY HAD TAKEN LOAN FROM DEUTSCHE BANK WHICH WAS DISBURSED FROM JAN 2007 TO SEPT 2007. THE TOTAL AMOUNT OF LOAN SANCTIONED WAS RS.450 CRORES. OUT OF WHICH AN AMOUNT OF RS.322 CROSS (APPROX) WAS DISBURSED UPTO SEPT.2007. FOR OBTAINING THE LOANS FROM THE BANK, THE COMPANY HAD MORTGAGED ALL ITS OWN IMMOVABLE PROPERTIES AS WELL AS THE PROPERTIES OF THE GROUP COMPANIES. DUE TO CERTAIN UNAVOIDABLE LEGAL DISPUTES IN RESPEC T OF IMMOVABLE PROPERTIES, THE BANK HAD FROZEN THE BANK ACCOUNTS AND ALSO THE BANKING OPERATIONS IN NOV.2007. THE VARIOUS IMMOVABLE PROPERTIES OWNED BY THE COMPANY WERE ALREADY MORTGAGED TO THE BANK. THE ABOVE PROBLEM RESULTED IN A SEVERE LIQUI9DITY CRUNCH FOR THE COMPANY AS THE ASSETS COULD NOT BE SOLD AND THE BANK ACCOUNTS COULD NOT BE OPERATED. ALL THE BUSINESS OPERATIONS OF THE COMPANY COMPLETELY HALTED FROM NOV 2007 AND THE COMPANY HAD NO OTHER SOURCE OF INCOME. THE I.T.DEPT. HAD ALSO ATTACHED OUR BANK ACCOUNTS BUT COULD NOT RECOVER ANY TAXES FROM THE COMPANY. THUS, THE COMPANY HAD NO MEANS TO PAY THE TAXES FOR THE VARIOUS YEARS INCLUDING THE SELF ASSESSMENT TAX FOR A.Y. 2006-07. 3 I.T.A. NO. 170 /PN/2010 : A.Y. 2006-07 THEREAFTER, THE COMPANY APPROACHED RBI IN OCT 2008 FOR PERMISSION TO SELL ITS PROPERTIES AND UTIL ISE THE SALE PROCEEDS FOR THE PURPOSES OF MEETING THE LIABILITIES. ACCORDINGLY, FROM MARCH, 2010 WE COUL D GET SOME ADVANCES FROM THE CUSTOMERS AGAINST SALE OF THE PROPERTIES AND WE STARTED PAYING THE TAXES. WE PAID THE SELF ASST. TAX FOR A.Y. 2006-07 IN MARC H TO JULY, 2010. THE ABOVE FACTS CLEARLY INDICATE TH AT THE COMPANYS BAD FINANCIAL CONDITION WAS THE REASON FOR NOT PAYING THE SELF ASSESSMENT TAX FOR A.Y. 2006-07 AND OTHER TAXES.... LEARNED COUNSEL FILED PROOF OF TAX PAID WHICH ARE ATTACHED AT PAGES 3 TO 7 OF PAPER BOOK. IT WAS SUB MITTED THAT AS THE ASSESSEE HAD NOW PAID THE TAXES AS MENTIONED IN THE PAPER BOOK, THE APPEAL BE RESTORED BACK TO THE FILE OF THE CIT(A) WITH A DIRECTION TO DECIDE THE SAME ON THE BASIS OF FACTS AND LAW. 4. HAVING HEARD THE RIVAL CONTENTIONS AND HAVING PERUSED THE MATERIAL ON RECORD, WE FIND THAT THE AS SESSEE HAS CLAIMED TO HAVE PAID THE TAXES AS MENTIONED IN THE PAPER BOOK (SUPRA). IN VIEW OF THIS, WE RESTORE BA CK THE APPEAL TO THE FILE OF THE CIT(A) WITH THE DIRECTION TO VERIFY THE PAYMENT OF TAX AS PER PROVISIONS OF SECTION 249 (4) OF THE I.T.ACT, 1961 AND HAVING SATISFIED ON THE ISSUE , HE IS DIRECTED TO DECIDE THE APPEAL ON FACTS AND LAW AFTE R PROVIDING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. WE ORDER ACCORDINGLY. 4 I.T.A. NO. 170 /PN/2010 : A.Y. 2006-07 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS TRE ATED AS ALLOWED FOR STATISTICAL PURPOSES. DECISION PRONOUNCED IN THE OPEN COURT ON 23 RD SEPTEMBER 2011. SD/- SD/- (D.KARUNAKAR RAO) (SHAILENDRA KUMAR YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBER PUNE DATED THE 23 RD SEPTEMBER 2011 PARIDA COPY OF THE ORDER IS FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) PUNE 4. THE CIT PUNE 5. THE D.R, ITAT PUNE BENCH, PUNE 6. GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL 5 I.T.A. NO. 170 /PN/2010 : A.Y. 2006-07