M/s Majestic Metaliks Ltd, Chandigarh V. Income TAx Officer Ward 5(1), Chandigarh

ITA 202/CHANDI/2020

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 8965 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 year(s) 5 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-08-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2005-2006
• Appeal Filed On: 26-02-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ASHOK KHANNA CIT
• Keywords: Opportunity of being heard; Principle of natural justice; Set aside; Audi alteram partem
• Section: 143(2)

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BE NCH B, CHANDIGARH (VIRTUAL COURT) .., ! '# .. , $ %& BEFORE: SHRI. N.K.SAINI, VP & SHRI , R.L. NEGI, JM ITA NO. 202/CHD/2020 ASSESSMENT YEAR : 2005-06 M/S MAJESTIC METALIKS LTD. PLOT NO. 20, FIRST FLOOR INDUSTRIAL AREA, PHASE-1, CHANDIGARH THE ITO WARD 5(1) CHANDIGARH PAN NO: AAACM9800F APPELLANT RESPONDENT !' ASSESSEE BY : NONE #!' REVENUE BY : SHRI ASHOK KHANNA, ADDL. CIT $ %! & DATE OF HEARING : 03/08/2021 '()*! & DATE OF PRONOUNCEMENT : 03/08/2021 %'/ ORDER PER N.K. SAINI, VICE PRESIDENT THIS IS AN APPEAL BY THE ASSESSEE AGAINST THE ORDER DT. 09/09/2019 OF LD. CIT(A)-1, CHANDIGARH. 2. DURING THE COURSE OF HEARING NOBODY WAS PRESENT ON BEHALF OF THE ASSESSEE NEITHER ANY ADJOURNMENT WAS SOUGHT. EARLIE R ALSO WHENEVER THE CASE WAS FIXED FOR HEARING THERE WAS NO REPRESENTATION F ROM THE ASSESSEE SIDE. WE, THEREFORE, HAS NO ALTERNATIVE EXCEPT TO DECIDE THE APPEAL OF THE ASSESSEE EXPARTE, ON MERIT, AFTER HEARING THE LD. SR. DR. 3. FOLLOWING GROUNDS HAVE BEEN RAISED IN THIS APPEA L: 1. THAT THE LD. AUTHORITIES BELOW ARE NOT JUSTIFIED IN NOT PROVIDING PROPER OPPORTUNITY OF HEARING WHICH IS AGAINST THE NATURAL JUSTICE AND HENCE THE ORDER PASSED BY THE LD. CIT (A) BE QUASHED AND ADDITIONS SO CONFIRMED BE DELETED. 2 2. THAT THE LD. CIT (A) IS NOT JUSTIFIED IN CONFIRMING THE ADDITION OF RS. 55,00,000/- ON ACCOUNT OF UNSECURED LOAN RAISED FROM THE MANAGI NG DIRECTOR OF THE COMPANY TREATING THE SAME AS UNEXPLAINED ON ACCOUNT OF CREDITWORTHINESS AND GENUINENESS. 3. THAT THE LD. CIT (A) IS NOT JUSTIFIED IN CONFIRMING THE ADDITION OF RS. 10,00,000/- ON ACCOUNT OF REPAYMENT OF LOAN MADE TO BANK TREATI NG THE SOURCE OF THE SAME AS UNPROVED. 4. THAT THE LD. CIT (A) IS NOT JUSTIFIED IN CONFIRMING THE ADDITION OF RS. 3,73,440/- ON ACCOUNT OF EXPENDITURE FOR EARNING DIVIDEND INCOME WHERE NO DIVIDEND INCOME HAS ACTUALLY BEEN EARNED BY THE APPELLANT DURING TH E YEAR UNDER CONSIDERATION. 5. THAT THE LD. CIT (A) IS NOT JUSTIFIED IN CONFIRMING THE ADDITIONS OF RS. 68,73,440/- IN CASE WHERE THE LD. AO HAS NOT ISSUED ANY SHOW CAU SE NOTICE FOR MAKING SUCH ADDITION. 6. THAT WITHOUT PREJUDICE TO THE ABOVE GROUNDS OF APPE AL, THE APPELLANT DISPUTES THE QUANTUM OF ADDITION OF RS. 68,73,440/- SO CONFIRMED BY THE LD. CIT (A). 7. THAT THE APPELLANT CRAVES LEAVE FOR ANY ADDITION, D ELETION OR AMENDMENT IN THE GROUNDS OF APPEAL ON OR BEFORE THE DISPOSAL OF THE SAME 4. VIDE GROUND NO. 1 THE GRIEVANCE OF THE ASSESSEE RELATES TO THE PROPER OPPORTUNITY OF BEING HEARD NOT PROVIDED BY THE LD. CIT(A). 5. THE FACTS RELATED TO THIS ISSUE IN BRIEF ARE THA T THE ORIGINAL ASSESSMENT IN THIS CASE WAS COMPLETED BY THE A.O. ON 28/12/2007 AND CE RTAIN ADDITIONS WERE MADE. THE ASSESSEE CHALLENGED THOSE ADDITIONS BEFOR E THE LD. CIT(A) WHO SUSTAINED THE ADDITIONS MADE BY THE A.O. ON ACCOUNT OF UNSECURED LOANS ETC. THE ASSESSEE, PREFERRED AN APPEAL AGAINST THE ORDER OF THE LD. CIT(A)TO THE ITAT WHEREIN VIDE ORDER DT. 29/01/2009 THE ISSUES WERE S ET ASIDE TO THE FILE OF THE A.O. ON THE DIRECTION OF THE ITAT, THE A.O. FRAMED THE A SSESSMENT UNDER SECTION 254/143(3) OF THE ACT AND MADE THE ADDITIONS WHICH WERE MADE IN THE ORIGINAL ASSESSMENT BY OBSERVING AS UNDER: AS PER DIRECTIONS OF THE HON'BLE ITAT NECESSARY OPPORTUNITIES WERE AFFORDED TO ASSESSEE VIDE NOTICE 143(2) DATED 30.11.2009 AND TH E ASSESSEES COUNSEL SH. KARAN DEEP SOOD ATTENDED THE OFFICE TIME TO TIME. H E WAS REQUESTED TO GIVE NECESSARY DOCUMENTS REGARDING ADDITIONS MADE ON ACC OUNT OF THE ABOVE 3 MENTIONED ISSUES. ON 29.12.2009 CASE WAS ADJOURNED F OR 31.12.2009 ON THE REQUEST OF THE COUNSEL. ON THE GIVEN DATE I.E. 31.12 .2009 SH. KARAN DEEP SOOD C.A. ATTENDED THE OFFICE AND SHOWN HIS INABILITY TO SUBMIT THE DOCUMENTS IN SUPPORT OF THE ABOVE ADDITIONS MADE AT THE TIME OF ORIGINAL ASSESSMENT. SINCE THE CASE IS GOING TO BE TIME BARRED ON 31.12.2009 RE-AS SESSMENT IS COMPLETED AND ADDITIONS MADE AT THE TIME OF ORIGINAL ASSESSMENT A RE CONFIRMED AS UNDER: INCOME AS PER APPEAL EFFECT U/S 254 RS. (-) 14,88 ,873/- DATED 24.3.2009 ADDITION ON ACCOUNT OF: 1. UNSECURED LOAN RS. 55,00,000/- 2. UNPROVED SOURCE OF REPAYMENT OF BANK:- RS. 10,00,0 00/- 3. ADDITION OF INTEREST:- RS. 3,73,440/- INCOME ASSESSED. RS. 53,84,567/- 6. BEING AGGRIEVED THE ASSESSEE CARRIED THE MATTER TO THE LD. CIT(A) WHO PASSED THE IMPUGNED ORDER EXPARTE AND MENTIONED THA T THE NOTICES ISSUED WERE RECEIVED BACK WITH THE REMARKS NO SUCH FIRM BY THE POSTAL AUTHORITIES AND WHEN NOTICES WERE SENT THROUGH NOTICE SERVER IT WAS REMARKED THAT NO SUCH COMPANY ON THIS ADDRESS. THE LAST NOTICE WAS ISSUED ON 23/07/2019 FOR THE HEARING ON 09/08/2019 WHICH WAS RETURNED BACK WITH THE REMARKS ASSESSEE LEFT. LD. CIT(A) SUSTAINED THE ADDITION MADE BY TH E A.O. 7. NOW THE ASSESSEE IS IN APPEAL. 8. THE LD. DR SUPPORTED THE ORDERS OF THE AUTHORITI ES BELOW AND FURTHER SUBMITTED THAT CONSIDERING THE NON COOPERATIVE ATTI TUDE OF THE ASSESSEE THERE WAS NO ALTERNATIVE EXCEPT TO MAKE THE IMPUGNED ADDI TIONS. 9. WE HAVE CONSIDERED THE SUBMISSIONS OF LD. SR. DR AND PERUSED THE MATERIAL AVAILABLE ON THE RECORD. IN THE PRESENT CA SE IT IS AN ADMITTED FACT THAT THE A.O. AS WELL AS LD. CIT(A) PASSED THEIR RESPECT IVE ORDERS EXPARTE. IT IS WELL SETTLED THAT NOBODY SHOULD BE CONDEMNED, UNHEARD AS PER THE MAXIM, AUDI ALTERAM PARTEM . 4 10. WE THEREFORE KEEPING IN VIEW THE PRINCIPLE OF N ATURAL JUSTICE DEEM IT APPROPRIATE TO SET ASIDE THIS CASE BACK TO THE FILE OF LD. CIT(A) TO BE ADJUDICATED AFRESH IN ACCORDANCE WITH LAW AFTER PRO VIDING DUE AND REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 11. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWE D FOR STATISTICAL PURPOSES. (ORDER PRONOUNCED IN THE OPEN COURT ON 03/08/2021 ) SD/- SD/- .. .., (R.L. NEGI ) ( N.K. SAIN I) $ %&/ JUDICIAL MEMBER ! / VICE PRESIDENT AG DATE: 03/08/2021 (+! ,-.- COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. $ / CIT 4. $ / 01 THE CIT(A) 5. -2 45&456789 DR, ITAT, CHANDIGARH 6. 8:% GUARD FILE (+ $ BY ORDER, ; # ASSISTANT REGISTRAR