Dr.S.Bikkamchand , Bangalore V. Assistant Commissioner of Income Tax Circle-2(3)(1), Bangalore

ITA 2122/BANG/2018

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 0717 (ITAT-BANGALORE)
• Duration Of Justice: 4 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-11-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2012-2013
• Appeal Filed On: 03-07-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: ROHIT GOUTAMCHAND
• Keywords: Opportunity of being heard; Principle of natural justice
• Section: 12; 2; 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH : BANGALORE BEFORE SHRI ARUN KUMAR GARODIA, ACCOUNTANT MEMBER A ND SHRI LALIET KUMAR, JUDICIAL MEMBER ITA NO. 2122 /BANG/201 8 ASSESSMENT YEAR : 20 1 2 - 1 3 DR. S. BIKKAMCHAND, NO. 6/1, PROMENADE ROAD, NEAR COLES PARK, FRAZER TOWN, BANGALORE 560 005. PAN: ABDPB4767D VS. THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 2 (3) (1), BANGALORE. APPELLANT RESPONDENT APPELLANT BY : SHRI ROHIT GOUTAMCHAND, CA RESPONDENT BY : SHRI R.N. SIDDAPPAJI, ADDL. CIT (DR) DATE OF HEARING : 20 . 11 .2018 DATE OF PRONOUNCEMENT : 29 . 11 .2018 O R D E R PER SHRI A.K. GARODIA, ACCOUNTANT MEMBER THIS APPEAL IS FILED BY THE ASSESSEE AND THE SAME I S DIRECTED AGAINST THE ORDER OF LD. CIT(A)-1, BANGALORE DATED02.04.2018 FO R ASSESSMENT YEAR 2012-13. 2. THE GROUNDS RAISED BY THE ASSESSEE ARE AS UNDER. 1. THE LEARNED ASSESSING OFFICER WAS WRONG IN DENYI NG THE APPELLANT A RELIEF WHICH THE APPELLANT WAS ELIGIBLE AT THE TIME OF ASSESSMENT CARRIED OUT U/S 143(3) OF THE ACT, 1961 IN RESPECT OF TAXATION OF PROFESSIONAL GOODWILL OF RS, 42,50,000/ - RECEIVED BY THE APPELLANT IN THE FINANCIAL YEAR 2011-2012 AGAIN ST A TAKE OVER AGREEMENT OF ONLY THE LABORATORY SERVICES OF T HE APPELLANT'S DIAGNOSTIC CENTRE AS AGAINST THE ENTIRE DIAGNOSTIC CENTRE AS UNDERSTOOD BY THE LEARNED AO. 2. THE LEARNED AO, DISREGARDED THE EXPLANATIONS AND SUBMISSIONS OFFERED BY THE AR OF THE APPELLANT AS ALSO THE COVE RED DECISION OF THE HONORABLE CHENNAI TRIBUNAL, IN THE CASE OF 'DR. K. PREMRAJ VS. DEPUTY CIT'-[2014] 41 TAXMANN.COM 81 (CHENNAI- TRIB.)' , WHERE DR. K PREMRAJ TRANSFERRED THE ASSETS TO M/S V ASAN EYE CARE HOSPITAL AND THE SAME WAS EXEMPTED FROM CAPITA L GAINS TAX SINCE THE RECEIPT WAS IN THE NATURE OF PROFESSIONAL GOODWILL. 3. THE LEARNED AO'S CONTENTION THAT THE APPELLANT N OT BEING A LAB TECHNICIAN / RADIOLOGIST TO RELATE THE RECEIPT OF S UCH SUM AS ITA NO. 2122/BANG/2018 PAGE 2 OF 3 PROFESSIONAL GOODWILL HAS BEEN CONSTRUED IN A NARRO W SENSE, SINCE THE VERY AGREEMENT OF TAKE OVER HAS SPECIFICA LLY ENUMERATED THE PAYMENT BEING MADE IN EXCESS OF THE ASSETS TOWARDS PROFESSIONAL GOODWILL OF APPELLANT AND IN T HE PRESENCE OF THE PRINCIPAL DOCUMENT OF TAKE OVER, THE LEARNED AO WOULD BE GROSSLY ERRING BY RIDING BEYOND THE INTENT OF THE T RANSACTION TO TAX SUCH SUM AS BUSINESS GOODWILL. AS HELD, BY THE HON'BLE APEX COURT IN THE CASE OF ' G.K. CHOKSI & CO. VS CIT- GUJARAT [2007] 165 TAXMAN 299 (SC) 'ON THE SIMILAR ISSUE DIFFERENTIATING THE TERMS BUSINESS AN D PROFESSION. 4. THE LEARNED COMMISSIONER (APPEALS) HAS DEPRIVED THE APPELLANT OF THE PRINCIPLES OF NATURAL JUSTICE BY N OT AWARDING AN OPPORTUNITY OF FILING SUBMISSIONS AND ADDITIONAL EV IDENCES TO SHOW CAUSE AND PLACE OUR OBJECTION AND EXPLANATIONS. FUR THERMORE, THE APPELLANT WAS NOT INFORMED ABOUT THE CHANGE IN INCU MBENT OF THE OFFICER AS OPPOSED TO THE PROVISIONS OF THE INCOME TAX ACT, 1961. 5. THE LEARNED COMMISSIONER (APPEALS) AS MENTIONED FOUR HEARING DATES IN THE APPEAL ORDER, BUT ONLY ONE NOT ICE WAS RECEIVED FOR AY 2009-2010, BY THE APPELLANT DATED 1 5.11.2016 AND OTHER THREE NOTICES MENTIONED IN THE APPEAL ORDER N EITHER RECEIVED BY APPELLANT NOR BY AR TO PUT-FORTH THEIR SUBMISSIO NS AND EVIDENCES. 6. THE APPELLANT CRAVES LEAVE TO ADD, ALTER, DELETE OR SUBSTITUTE ANY OF THE GROUNDS URGED ABOVE. 3. AT THE VERY OUTSET, IT WAS SUBMITTED BY LD. AR O F ASSESSEE THAT THE ORDER OF CIT(A) IS EX-PART QUA THE ASSESSEE. HE SUBMITTED T HAT IT IS NOTED BY CIT(A) IN HIS ORDER THAT HE HAS ISSUED FOUR NOTICES OF HEA RING FIXING THE DATE OF HEARING ON 15.11.2016, 19.12.2016, 22.02.2017 AND 2 6.02.2018. HE SUBMITTED THAT OUT OF THESE FOUR NOTICES, THE ASSES SEE HAS RECEIVED ONLY ONE NOTICE DATED 11.11.2016 AS PER WHICH THE DATE OF HE ARING FIXED IS 15.11.2016. HE SUBMITTED A COPY OF THIS NOTICE AND POINTED OUT THAT IN THIS NOTICE, IT IS STATED THAT THE ASSESSMENT YEAR INVOL VED IS ASSESSMENT YEAR 2009-10 WHEREAS THE IMPUGNED ORDER OF CIT(A) IS FOR ASSESSMENT YEAR 2012-13. HE FURTHER SUBMITTED THAT OTHER THREE NOT ICES SAID TO BE SENT BY CIT(A) WERE NOT RECEIVED BY ASSESSEE AT ALL. HE SU BMITTED THAT UNDER THESE FACTS, THE ORDER OF CIT(A) SHOULD BE SET ASIDE AND THE MATTER SHOULD BE RESTORED BACK TO HIM FOR FRESH DECISION AFTER PROVI DING ADEQUATE OPPORTUNITY OF BEING HEARD TO ASSESSEE. THE LD. DR OF REVENUE SUPPORTED THE ORDER OF CIT(A). ITA NO. 2122/BANG/2018 PAGE 3 OF 3 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND IN VIEW OF THIS FACT THAT AS PER THE IMPUGNED ORDER OF CIT(A), THERE IS NO DECIS ION ON MERIT ON THE GROUNDS RAISED BY THE ASSESSEE AND ALSO, IN VIEW OF THIS FACT THAT IN THE NOTICE DATED 11.11.2016 ISSUED BY CIT(A) FIXING THE DATE OF HEARING ON 15.11.2016, THE ASSESSMENT YEAR MENTIONED IS ASSESS MENT YEAR 2009-10 AND NOT ASSESSMENT YEAR 2012-13 TO WHICH ACTUALLY T HE APPEAL RELATES. THIS IS ALSO THE SUBMISSION OF THE ASSESSEE THAT TH E REMAINING THREE NOTICES WERE NEVER SERVED ON THE ASSESSEE. AS PER THE ORDE R OF CIT(A) ALSO, IT IS STATED THAT THE NOTICES OF HEARING WERE ISSUED AND THERE IS NO MENTION AS TO WHETHER THE NOTICES WERE SERVED ON THE ASSESSEE OR NOT. CONSIDERING ALL THESE FACTS, WE FEEL IT PROPER TO SET ASIDE THIS EX -PARTE ORDER OF CIT(A) AND RESTORE BACK THE ENTIRE MATTER TO HIS FILE FOR FRES H DECISION AFTER PROVIDING ADEQUATE OPPORTUNITY OF BEING HEARD TO BOTH SIDES. IN VIEW OF THIS DECISION, NO ADJUDICATION IS CALLED FOR AT PRESENT IN RESPECT OF VARIOUS GROUNDS RAISED BY ASSESSEE IN THIS APPEAL. 5. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE STANDS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THE DATE MENT IONED ON THE CAPTION PAGE. SD/- SD/- (LALIET KUMAR) (ARUN KUMAR GARODIA) JUDICIAL MEMBER ACCOUNTANT MEMBER BANGALORE, DATED, THE 29 TH NOVEMBER, 2018. /MS/ COPY TO: 1. APPELLANT 4. CIT(A) 2. RESPONDENT 5. DR, ITAT, BANGALORE 3. CIT 6. GUARD FILE BY ORDER ASSISTANT REGISTRAR, INCOME TAX APPELLATE TRIBUNAL, BANGALORE.