Incable Net (Andhra) Limited, Hyderabad V. Asst.CIT., Circle-2(1), Hyderabad, Hyderabad

ITA 1812/HYD/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 98839 (ITAT-HYDERABAD)
• Duration Of Justice: 1 year(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-12-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 24-11-2015
• Assessment Year: 2006-2007
• Appeal Filed On: 01-12-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: M SITARAM
• Keywords: Opportunity of being heard; Retrospective amendment
• Section: 143(3); 147

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A, HYDERABAD BEFORE SMT. P.MADHAVI DEVI, ACCOUNTANT MEMBER AND SHRI RIFAUR RAHAMAN, JUDICIAL MEMBER ITA NO. 1812/HYD/2014 ASSESSMENT YEAR: 2006-07 INCABLE NET (ANDHRA) LTD., HYDERABAD. PAN AABCI 2538K VS. THE ASST. COMMISSIONER OF INCOME-TAX, CIRCLE 2(1), HYDERABAD. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI MOHD. AFZAL REVENUE BY : SHRI M. SITARAM DATE OF HEARING : 24-11-2015 DATE OF PRONOUNCEMENT : 18-12-2015 O R D E R PER S. RIFAUR RAHMAN, A.M.: THIS APPEAL IS PREFERRED BY THE ASSESSEE AGAINST T HE ORDER OF CIT(A) III, HYDERABAD DATED 17/10/2014 FOR THE AY 2006-07. 2. BRIEFLY THE FACTS OF THE CASE ARE, ASSESSEE FILE D ITS RETURN OF INCOME ON 29/11/2006 FOR AY 2006-07, DECLARED TOTAL INCOME AT RS. 20,24,239/-. THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY AND THE AO COMPLETED THE ASSESSMENT U/S 143(3) OF THE I NCOME-TAX ACT (IN SHORT ACT) AND DETERMINED THE TOTAL INCOME AT RS. 22,09,243/-. SUBSEQUENTLY, THE CASE WAS REOPENED FOR THE FOLLOWI NG REASONS: M/S INCABLE NET (ANDHRA) LTD., HYDERABAD HAS E-FILE D ITS RETURN OF INCOME FOR THE AY 2006-07 ON 29/11/2006 ADMITTI NG INCOME OF RS. 20,24,239/-. THE RETURN WAS PROCESSED U/S 1 43(1). SUBSEQUENTLY, AN ASSESSMENT U/S 143(3) WAS COMPLET ED ON 26/11/2008. LATER ON, IT IS NOTICED FROM THE DETAI LS FILED THE 2 ITA NO. 1812 /HYD/2014 INCABLE NET (ANDHRA) LTD., HYD. ASSESSEE MADE TDS IN THE FOLLOWING CASES AND NOT R EMITTED OR REMITTED LATE INTO THE GOVT. ACCOUNT: 1. CHANNEL PLUS AP RS. 21,00,000/- 3.11.05 TO 2.06 PAID ON 6.4.06 2. ESPN RS. 5,00,000/- 2.06 PAID ON 6.4.06 3. STAR INDIA (P) LTD. RS. 66,00,000/- 09.05 TO 2. 06 PAID ON 04.06 THE DUE DATE FOR REMITTANCE OF TDS AS PER PROVISIO NS OF SECTION 201 IS WITHIN ONE WEEK AFTER IT WAS DUE IN RESPECT OF PAYMENTS MADE/CREDITED MADE FROM THE MONTH OF APRIL, 2004 T O FEB, 2005 BUT TDS WAS MADE BEFORE 31/03/2005. ANY DEFAULT FR OM THE ABOVE ATTRACTS THE PROVISIONS OF SECTION 40(A)(IA) OF THE IT ACT. HOWEVER, ON ACCOUNT RETROSPECTIVE AMENDMENT BY THE FINANCE ACT, 2008 W.E.F. 01/04/2005, IN RESPECT OF TDS DUE FOR THE MONTHS FROM APRIL, 2004 TO FEB. 2005 SHOULD BE REM ITTED BEFORE THE END OF PREVIOUS YEAR I.E. 31/03/2005 AND IN RE SPECT OF TDS FOR THE MONTH OF MARCH, 2005 IT SHOULD BE BEFORE F ILING OF THE RETURN. FROM THE ABOVE IT IS CLEAR THAT ASSESSEE M ADE PAYMENTS UP TO FEB. 2006 AND DEPOSITED ALL OF THEM IN APRIL , 2006. THE TOTAL AMOUNT PAID IS AMOUNTING TO RS. 92,00,000. T HE SAME IS TO BE DISALLOWED AS PER THE PROVISIONS OF SECTION 40( A)(IA). THE AO FOUND THAT THE ASSESSEE HAD NOT COMPLIED WIT H THE PROVISIONS OF SECTION 201 OF THE ACT AND DISALLOWED RS. 92,00, 000 U/S 40(A)(IA) OF THE ACT AND COMPLETED THE ASSESSMENT U/S 143(3) READ WITH SECTION 147 OF THE ACT. 3. AGGRIEVED WITH THE ABOVE ORDER, ASSESSEE FILED A PPEAL BEFORE THE CIT(A) WITH THE DELAY OF 683 DAYS. ASSESSEE FIL ED THE APPEAL ALONG WITH AN AFFIDAVIT EXPLAINING THE REASON FOR T HE DELAY. THE PLEA OF THE ASSESSEE WAS DISMISSED BY THE CIT(A) WITH THE F OLLOWING OBSERVATIONS: 5. AS PER SECTION 249, THE APPEAL IS TO BE PRESENT ED WITHIN 30 DAYS OF THE DATE OF SERVICE OF THE ASSESSMENT ORDER. IN THIS C ASE, THE APPEAL WAS LATE BY OVER 683 DAYS OR 22 MONTHS. THE APPELLANT IN TH E AFFIDAVIT FILED WITH FORM NO. 35 HAS STATED THAT THE REASON FOR DELAY W AS THE ASSESSMENT ORDER WAS SERVED ON THE EMPLOYEE OF THE COMPANY WH O HAD MIS-PLACED AND NOT HANDED OVER THE SAME TO THE AUTHORISED REP RESENTATIVE AND HENCE, REQUESTED FOR CONDONING THE DELAY. AFTER 683 DAYS, THE APPELLANT'S REQUEST TO CONDONE THE DELAY IS EXTREMELY STRANGE TO SAY T HE LEAST AS CLEARLY THE APPELLANT WAS VERY CASUAL IN PURSUING THE APPEAL. THE REASONS STATED IN AFFIDAVIT ARE NOT EVEN REMOTELY SELF-EXPLANATORY B UT IRRELEVANT AND CONVENIENT AFTERTHOUGHTS. THE REASONING GIVEN IN T HE AFFIDAVIT AND BY THE AR IS COMPLETELY VAGUE AND NOT GERMANE TO THE ISSU E OF DELAYED FILING OF THE APPEAL. AFTER CAREFUL CONSIDERATION OF THE FAC TS OF THE CASE IT IS APPARENT THAT THE REASON OF THE APPELLANT IS DEVOI D OF MERIT AND THE 3 ITA NO. 1812 /HYD/2014 INCABLE NET (ANDHRA) LTD., HYD. APPELLANTS REQUEST FOR CONDONING THE DELAY IN FIL ING APPEAL IS NOT ACCEDED TO. 4. LD. AR SUBMITTED THAT THE ASSESSEE WAS PREVENTED TO FILE THIS APPEAL DUE TO THE FINANCIAL CRISIS AND CRIMINAL PRO CEEDINGS IN THE VARIOUS COURTS DUE TO FAILURE OF THE SPV (IN THE NA ME OF APAKSH BROADBAND LTD.), WHICH WAS CREATED TO CATER TO THE REQUIREMENT OF THE NEW VENTURE IN TRIPLE PLAY SERVICES HOSTED BY THE I NFORMATION TECHNOLOGY AND COMMUNICATION DEPARTMENT OF GOVT. OF ANDHRA PRADESH TO CONNECT ALL THE GOVERNMENT OFFICES IN TH E STATE AND ALSO TO THE CITIZENS OF ANDHRA PRADESH. THE LD. AR SUBMITTE D THAT THE FINANCIAL CONDITION WAS SO BAD, ASSESSEE HAD TO LET GO ITS EMPLOYEES. IN THIS SITUATION, THE EMPLOYEE, WHO RECEIVED THE O RDER FAILED TO REPORT THE SAME. IN THIS CHARGED ENVIRONMENT, ASSESSEE COU LD NOT FILE THE APPEAL ON TIME I.E. WITHIN 30 DAYS. THE LD. CIT(A) FAILED TO APPRECIATE THE REASONS FOR DELAY IN FILING THE APPEAL. 5. LD. DR RELIED ON THE ORDER OF CIT(A) AND SUBMITT ED THAT THE ASSESSEE FAILED TO EXPLAIN THE REASONS FOR DELAY. 6. HAVING CONSIDERED THE SUBMISSIONS OF BOTH THE CO UNSELS AND PERUSED THE MATERIAL FACTS ON RECORD, WE ARE OF THE VIEW THAT THERE IS NO DOUBT ABOUT THE DELAY OF 683 DAYS IN FILING THE APPEAL BEFORE THE LD. CIT(A). LD. CIT(A) COULD HAVE CONSIDERED THE EN VIRONMENT IN WHICH THE ASSESSEE SURVIVED AND ITS FINANCIAL BURDE N ON THE FAILURE OF SPV, WHERE IT HAD A HUGE STAKE. ON TOP OF THAT THE MANAGING DIRECTOR OF THE COMPANY HAD TO ATTEND THE CRIMINAL PROCEEDIN GS FOR ECONOMIC OFFENCE IN VARIOUS COURTS. THE LD. CIT(A) DISMISSE D THE APPEAL ON MERITS ALSO SINCE ASSESSEE DID NOT MAKE WRITTEN SUB MISSIONS AND HELD THAT GROUNDS RAISED BY THE ASSESSEE ARE DEVOID OF M ERIT. HOWEVER, ON CONSIDERATION OF ASSESSEES SUBMISSIONS, WE ARE OF THE OPINION THAT THE DELAY HAS BEEN SATISFACTORILY EXPLAINED BY THE ASSESSEE. THEREFORE, WE CONDONE THE DELAY IN FILING OF THE AP PEAL BEFORE THE CIT(A) AND REMIT THE APPEAL BACK TO THE FILE OF THE CIT(A) WITH A DIRECTION TO RECONSIDER THE ASSESSEES APPEAL ON ME RITS IN THE INTEREST 4 ITA NO. 1812 /HYD/2014 INCABLE NET (ANDHRA) LTD., HYD. OF JUSTICE. NEEDLESS TO SAY THAT ASSESSEE MAY BE GI VEN PROPER OPPORTUNITY OF BEING HEARD IN THE MATTER. 8. IN THE RESULT, ASSESSEES APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON 18 TH DECEMBER, 2015. SD/- SD/- (P. MADHAVI DEVI) (RIFAUR RAHMAN) JUDICIAL MEMBER ACCOUNTA NT MEMBER HYDERABAD, DATED: 18 TH DECEMBER, 2015 KV COPY TO:- 1) INCABLE NET ANDHRA) LTD., C/O MOHD. AFZAL, ADVOC ATE, 11-5-465, SHERSONS RESIDENCY, FLAT NO. 402, CRIMINAL COUR T ROAD, RED HILLS, HYDERABAD 500 004. 2) ACIT, CIRCLE 2(1), HYDERABAD 3) CIT(A)-III, HYDERABAD 4) CIT-II, HYDERABAD 5) THE DEPARTMENTAL REPRESENTATIVE, I.T.A.T., HYDE RABAD.