M/s. POS-Hyundai Steel Mfg. (I) Pvt. Ltd., Kancheepuram V. Addl.CIT, CHENNAI

ITA 2090/CHNY/2010

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 4821 (ITAT-CHENNAI)
• Duration Of Justice: 6 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-06-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 20-06-2011
• Assessment Year: 2006-2007
• Appeal Filed On: 09-12-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P B SEKARAN
• Section: 92C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL BENCH B CHENNAI (BEFORE SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER AND SHRI GEORGE MATHAN, JUDICIAL MEMBER) .. I.T.A. NO. 2090/MDS/2010 ASSESSMENT YEAR : 2006-07 M/S POS-HYUNDAI STEEL MFG. (I) PVT. LTD., F-70, SIPCOT INDUSTRIAL PARK, IRRUNGATTUKOTTAI, NH-4, SRIPERUMBUDUR TALUK, KANCHIPURAM DISTRICT 602 105. PAN : AAACP6484G (APPELLANT) V. THE ADDITIONAL COMMISSIONER OF INCOME TAX, COMPANY RANGE V, CHENNAI 600 034. (RESPONDENT) APPELLANT BY : SHRI VIKRAM VIJAYARAGHAVAN RESPONDENT BY : SHRI P.B. SEKARAN O R D E R PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER : IN THIS APPEAL FILED BY THE ASSESSEE, ITS GRIEVANC E IS THAT DISPUTE RESOLUTION PANEL (DRP) REJECTED THE REQUEST OF THE ASSESSEE FOR RESOLUTION OF ITS OBJECTIONS, IN LIMINE , FOR A REASON THAT ASSESSEE HAD FILED THE APPLICATION IN FORM NO.35 INSTEAD OF FORM NO.35A. THE ASSESSING OFFICER HAD PROPOSED ADDITION OF ` 4,46,139/- BASED ON THE I.T.A. NO. 2090/MDS/10 2 ORDER OF TPO UNDER SECTION 92C OF INCOME-TAX ACT, 1 961 (IN SHORT THE ACT). ASSESSEE HAD ITSELF MADE AN ADJUSTMENT OF ` 6,23,997/- ON ACCOUNT OF ALP DIFFERENCE IN PURCHASE BUT TPO HA D FOUND SUCH ADJUSTMENT TO BE NOT ADEQUATE. HOWEVER, ON THIS AS WELL AS OTHER PROPOSED ADDITIONS, ASSESSEE MOVED BEFORE THE DRP A ND INSTEAD OF FORM NO.35A, ASSESSEE FILED FORM NO.35. AT THE TIM E OF HEARING, ARGUMENT OF THE ASSESSEE WAS THAT IT WAS ONLY A TEC HNICAL ERROR AND ASSESSEE BEING NEW TO THE PROVISIONS RELATING TO DI SPUTE RESOLUTION, WAS UNDER THE IMPRESSION THAT FORM NO.35 HAD TO BE USED FOR FILING AN APPLICATION BEFORE THE DRP. THE DRP, THROUGH A MAJORITY DECISION, REJECTED THE REQUEST OF THE ASSESSEE IN LIMINE FOR A REASON THAT ASSESSEE HAD NOT FILED A FRESH FORM NO.35A AND MISTAKE COMMITTED WAS FATAL. 2. NOW BEFORE US, LEARNED A.R. SUBMITTED THAT AT TH E BEST, THE ERROR OF THE ASSESSEE IN FILING A WRONG FORM COULD HAVE BEEN CONSIDERED AS A DEFECT AND ASSESSEE PUT ON NOTICE F OR RECTIFYING THE DEFECT. AS PER THE LEARNED A.R., NO SUCH DEFECT NO TICE WAS ISSUED BY THE DRP AND THE DRP COMMITTED A GRAVE MISTAKE IN DI SMISSING THE APPLICATION OF THE ASSESSEE IN LIMINE . I.T.A. NO. 2090/MDS/10 3 3. PER CONTRA, LEARNED D.R. SUBMITTED THAT THIS TRI BUNAL COULD NEVER DIRECT A LOWER AUTHORITY TO CONSIDER AN APPLI CATION FILED IN WRONG FORM. ACCORDING TO HIM, DRP HAD NO POWER TO ENTERT AIN AN APPLICATION FILED IN WRONG FORM AND HENCE, IT WAS P ROPER TO DISMISS THE OBJECTIONS OF THE ASSESSEE. 4. WE HAVE PERUSED THE ORDERS AND HEARD THE RIVAL C ONTENTIONS. UNDISPUTEDLY, ASSESSEE HAD FILED FORM NO.35 INSTEAD OF FORM NO.35A BEFORE DRP. ASSESSEE WAS PUT ON NOTICE REGA RDING THIS ONLY AT THE TIME OF HEARING ON 24.8.2010. HOWEVER, NO D EFECT MEMO WAS ISSUED TO THE ASSESSEE BY DRP. AS PER THE DRP, IT WAS NOT A TECHNICAL ERROR AND THE ASSESSEE HAD NOT FILED A FR ESH FORM NO.35A. NO DOUBT, THE DRP COULD NOT HAVE PROCEEDED ON THE B ASIS OF FORM NO.35 FILED BY THE ASSESSEE WHEN THE APPLICATION SH OULD HAVE BEEN IN FORM NO.35A PRESCRIBED UNDER THE RULES. BUT, NE VERTHELESS, IN OUR OPINION, THIS WAS A TECHNICAL ERROR AND A DEFECT ME MO HAD TO BE ISSUED TO THE ASSESSEE FOR RECTIFICATION THEREOF. IN OUR OPINION, ASSESSEE WAS NOT GIVEN SUFFICIENT OPPORTUNITY FOR R ECTIFYING THE MISTAKE, THEREBY DEPRIVING IT OF VALUABLE RIGHT OF RESOLUTION OF ITS DISPUTES, AVAILABLE UNDER THE STATUTE. WE ARE, THE REFORE, OF THE I.T.A. NO. 2090/MDS/10 4 OPINION THAT THE MATTER REQUIRES RE-VISIT BY DRP. WE REMIT THE ISSUE BACK TO DRP WITH A DIRECTION TO ISSUE DEFECT MEMO A ND IF THE ASSESSEE RECTIFIES THE DEFECT REGARDING THE FORM FO R FILING OF APPLICATION, THEN THE DRP SHALL PROCEED IN ACCORDAN CE WITH LAW AND RESOLVE THE QUESTIONS RAISED BY THE ASSESSEE, ON ME RITS. ORDERED ACCORDINGLY. 5. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. THE ORDER WAS PRONOUNCED IN THE COURT ON 24 TH JUNE, 2011. SD/- SD/- (GEORGE MATHAN) (ABRAHAM P. GEORGE) JUDICIAL MEMBER ACCOUNTANT MEMBER CHENNAI, DATED THE 24 TH JUNE, 2011. KRI. COPY TO: (1) APPELLANT (2) RESPONDENT (3) ITO & SECY, DRP, CHENNAI (4) ADDL.CIT, COMPANY RANGE-V, CHENNAI (5) D.R. (6) GUARD FILE