M/s AAF India Private Limited , Bangalore V. Deputy Commissioner of Income Tax CIrcle-11(1), Bangalore

ITA 2023/BANG/2018

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 6970 (ITAT-BANGALORE)
• Duration Of Justice: 10 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-04-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2008-2009
• Appeal Filed On: 14-06-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R N SIDDAPPAJI IT AT BENGALURU
• Keywords: Principle of natural justice; Condonation of delay; Set aside

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL BENGALURU BENCH 'B', BANGALORE BEFORE SHRI. A. K. GARODIA, ACCOUNTANT MEMBER AND SHRI. LALIET KUMAR, JUDICIAL MEMBER I.T.A NO.2023/BANG/2018 ASSESSMENT YEAR : 2008-09 AAF INDIA PRIVATE LIMITED NO.117 & 118, BOMMASANDRA, JIGANI LINK ROAD, KIADB, ANEKAL TALUK, BENGALURU 560 105. .. APPELLA NT PAN : AAFCA 4502R V. THE DEPUTY COMMISSIONER OF INCOME TAX, [FORMERLY CIRCLE-(11)(1)], BENGALURU - 560 095. ASSESSEE BY : SHRI NARENDRA SHARMA, ADVOCATE REVENUE BY : SHRI. R. N. SIDDAPPAJI, ADDL. CIT(DR ), ITAT, BENGALURU. DATE OF HEARING : 30.4.2019 DATE OF PRONOUNCEMENT : 30.4.2019 O R D E R PER LALIET KUMAR, JUDICIAL MEMBER : THE PRESENT APPEAL IS FILED BY THE REVENUE AGAINST THE ORDER OF THE CIT (A)-1, BENGALURU, DATED NIL, FOR THE ASSESSMENT YEAR 2008-09 ON THE FOLLOWING EFFECTIVE GROUND NO 3 :- 3. THE EX PARTE ORDER PASSED BY THE LEARNED COMM ISSIONER OF INCOME TAX (APPEALS) BANGALORE IS BAD IN LAW AS THE APPELLANT WAS ITA NO.2023/BANG/2018 PAGE 2 OF 5 NOT AFFORDED A REASONABLE OPPORTUNITY OF HEARING, W HICH IS IN GRAVE VIOLATION OF PRINCIPLE OF NATURAL JUSTICE, ON THE F ACTS AND CIRCUMSTANCES OF THE CASE. 2. THE ASSESSEE COMPANY, A PRIVATE COMPANY FILED RE TURN OF INCOME FOR THE ASSESSMENT YEAR 2008-09 DECLARING A LOSS OF RUP EES 2,37,65,062/-. RETURN WAS SELECTED FOR SCRUTINY AND THE AO COMPLET ED THE ASSESSMENT UNDER SECTION 143 (3) OF THE INCOME-TAX ACT, 1961 [ THE ACT] BY MAKING CERTAIN ADDITIONS. 3. FEELING AGGRIEVED BY THE ORDER PASSED BY THE AO , THE ASSESSEE FILED AN APPEAL BEFORE THE CIT(A). THE APPEAL WAS I NSTITUTED ON 14 TH FEBRUARY 2014, HOWEVER THE SAME WAS REQUIRED TO BE PREFERRED ON OR BEFORE 5 TH JANUARY 2014. AS THERE WAS DELAY IN FILING THE APPE AL, THE MATTER WAS POSTED ON 29/01/2015. HOWEVER, ON THE SAID DAT E THE LD. AR OF THE ASSESSEE HAD FILED AN APPLICATION FOR ADJOURNMENT A ND THE MATTER WAS ADJOURNED TO 16/02/2015. AGAIN ON 16/02/2015, THE LD. AR FOR THE ASSESSEE HAD SOUGHT AN ADJOURNMENT AND THE MATTER W AS ADJOURNED TO 16/03/2015. AS NONE APPEARED ON BEHALF OF THE ASSES SEE, THE CIT(A) HAD DECIDED THE MATTER BASED ON THE MATERIAL AVAILABLE ON RECORD BY PROCEEDING EX PARTE AGAINST THE ASSESSEE. 4. THE ASSESSEE CONTENDS THAT THE CIT(A) WAS NOT JU STIFIED IN DISPOSING OF THE APPEAL OF THE ASSESSEE WITHOUT CONDONING THE DELAY IN FILING THE APPEAL ON THE TECHNICAL GROUNDS. IT WAS CONTENDED BEFORE US THAT THE ASSESSEE HAD UNDERTAKEN THE SERVICES OF A GOOD PROF ESSIONAL IN APPEAL AGAINST THE ASSESSMENT ORDER AND ALL ACTIONS ARE RE QUIRED TO BE TAKEN BY THE CHARTERED ACCOUNTANT. 5. THE LEARNED AR WAS HEARD, WHO REITERATED THE SUB MISSIONS AS PUT FORTH IN THE STATEMENT OF FACTS FORMING PART OF THE APPEAL. IT IS FURTHER ITA NO.2023/BANG/2018 PAGE 3 OF 5 SUBMITTED THAT THE ULTIMATE OBJECT OF ASSESSMENT BE ING THAT THE CORRECT INCOME OF THE ASSESSEE BE BROUGHT TO TAX, IN THIS C ONTEXT IT IS PRAYED BY THE LEARNED AR THAT THE IMPUGNED ORDER OF THE CIT(A) BE SET ASIDE AND MATTER RESTORED TO FILE OF CIT(A) FOR HEARING AND ADJUDICA TION ON MERITS. 6. PER CONTRA, THE LEARNED DR FOR REVENUE SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. 7. WE HAVE HEARD AND CAREFULLY CONSIDERED THE RIVAL SUBMISSIONS PUT FORTH BY BOTH LEARNED DR FOR REVENUE AND THE LEARNE D AR OF THE ASSESSEE. A PERUSAL OF THE IMPUGNED ORDER CONFIRMS THE FACT T HAT THE CIT(A) DISMISSED THE ASSESSEES APPEAL FOR DELAY IN FILIN G THE APPEAL BEFORE THE HIM. IT IS SEEN THAT THE APPEAL WAS FILED BEFORE C IT(A)-I, BANGALORE AND THE ASSESSEE DID ATTEND THE HEARINGS ON VARIOUS OCCASIO NS, THOUGH IT HAD SOUGHT ADJOURNMENTS. THE ASSESSEE HAD SHOWN THE RE ASONABLE CAUSE FOR NOT FILING THE APPEAL BEFORE THE COMMISSIONER WITHI N THE STATUTORY PERIOD AS PROVIDED BY ACT AND THEREFORE THE ORDER OF THE COMM ISSIONER DISMISSING THE CONDONATION OF DELAY APPLICATION IS WITHOUT ANY MERIT. IN FACT IT WAS INCUMBENT UPON THE COMMISSIONER TO EXAMINE THE FACT S BROUGHT ON BY THE ASSESSEE IN SUPPORT OF NOT FURNISHING THE APPEAL WI THIN THE STATUTORY PERIOD AND PASS REASONED ORDER IN THIS REGARD. THE COMMISS IONER WITHOUT DOING THE NEEDFUL HAD DISMISSED THE APPEAL AS PREFERRED B Y THE ASSESSEE MERELY RELYING UPON SOME JUDICIAL PRONOUNCEMENT BY THE HON BLE SUPREME COURT AND ALSO ON THE BASIS OF GENERAL OBSERVATIONS. IT I S A SETTLED PROPOSITION OF LAW THAT THE JUDGMENTS OF THE HONBLE SUPREME COURT IN VARIOUS PRONOUNCEMENT IS REQUIRED TO BE FOLLOWED ON THE BAS IS OF THE RATIO LAID DOWN IN THE SAID JUDGEMENTS IN THE FACTS OF THOSE C ASES DECIDED BY THE COURT AND SHOULD NOT BE FOLLOWED AS A STATUTE WITHO UT LOOKING INTO THE FACTS OF THE CASE. TAKING INTO ACCOUNT THE FACTS OF THE MATTER AND IN THE INTEREST OF SUBSTANTIAL JUSTICE, WE ARE INCLINED TO CONCUR W ITH THIS PLEA OF ASSESSEE, ITA NO.2023/BANG/2018 PAGE 4 OF 5 AS IT IS HIGHLY UNLIKELY THAT THE ASSESSEE WOULD IN TENTIONALLY OR DELIBERATELY NOT PREFER THE APPEAL BEFORE THE CIT(A); AS THIS WO ULD CAUSE IMMENSE HARM TO HIS OWN INTERESTS. ADMITTEDLY, THE ASSESSEES AP PEAL HAS NOT BEEN DISPOSED OF BY ADJUDICATION OF THE ISSUES ON MERITS RAISED BEFORE THE CIT(A). SINCE THE ULTIMATE AIM OF THE ASSESSMENT I S THAT ONLY THE CORRECT TAXES DUE BY THE ASSESSEE BE COLLECTED BY REVENUE, IN OUR VIEW, IT IS IMPERATIVE THAT THE ASSESSEES APPEAL BEFORE THE C IT(A) BE HEARD AND DISPOSED OF ON MERITS. 8. IN THIS VIEW OF THE MATTER, WE ARE OF THE CONSID ERED OPINION THAT THE INTEREST OF SUBSTANTIAL JUSTICE WILL BE WELL SERVED IF THE IMPUGNED ORDER OF THE CIT(A) DATED 26.4. 2018 FOR ASSESSMENT YEAR 2008-20 09 BE SET ASIDE AND DELAY IN FILING THE APPEAL BEFORE THE COMMISSIONER IS CONDONED. WE, THEREFORE, SET ASIDE THE AFORESAID IMPUGNED ORDER O F THE CIT(A) AND RESTORE THE MATTER TO HIS FILE FOR FRESH HEARING, EXAMINATI ON AND ADJUDICATION OF THE ISSUES RAISED BY THE ASSESSEE IN THE APPEAL BEFORE HIM. NEEDLESS TO ADD, THE CIT(A) SHALL AFFORD THE ASSESSEE ADEQUATE OPPOR TUNITY OF BEING HEARD AND TO FILE DETAILS/SUBMISSIONS REQUIRED, WHICH SHA LL BE DULY CONSIDERED BEFORE DECIDING THE ISSUES. THE ASSESSEE IS ALSO D IRECTED TO COMPLY WITH AND ATTEND THE HEARINGS BEFORE THE CIT(A). WE HOLD AND DIRECT ACCORDINGLY. CONSEQUENTLY, GROUND NO. 3 IS ALLOWED. 9. AS WE ARE REMANDING BACK THE ENTIRE MATTER TO TH E FILE OF THE COMMISSIONER FOR A FRESH ADJUDICATION, AFTER CONDON ING THE DELAY IN FILLING THE APPEAL, HENCE NO OTHER GROUNDS RAISED IN THE PRESENT APPEAL HAS BEEN ADJUDICATED BY THE TRIBUNAL. ITA NO.2023/BANG/2018 PAGE 5 OF 5 10. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWE D FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON THIS 30 TH DAY OF APRIL, 2019. SD/- SD/- (A. K. GARODIA) (LALIET KUMAR) ACCOUNTANT MEMBER JUDICIAL MEMBE R BENGALURU, DATED, THE 30 TH APRIL, 2019. COPY TO: 1. THE ASSESSEE 2. THE ASSESSING OFFICER 3. THE COMMISSIONER OF INCOME-TAX 4. COMMISSIONER OF INCOME-TAX(A) 5. DR BY ORDER ASSISTANT REGISTRAR, INCOME TAX APPELLATE TRIBUNAL, BANGALORE.