Anupam Kumar Didwania, New Delhi V. DCIT, CHENNAI

ITA 2138/CHNY/2006

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 68788 (ITAT-CHENNAI)
• Duration Of Justice: 6 year(s) 11 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-10-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 1995-1996
• Appeal Filed On: 26-10-2006
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N MADHAVAN IRS
• Assessee Lawyers: N DEVANATHAN
• Keywords: Opportunity of being heard; Principle of natural justice; Condonation of delay
• Section: 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, CHENNAI BEFORE DR. O.K.NARAYANAN, VICE-PRESIDENTAND SHRI VIKAS AWASTHY, JUDICIAL MEMBER ITA NO. 2138(MDS)/2006 ASSESSMENT YEAR : 1995-96 SHRI ANUPAM KUMAR DIDWANIA, A-199, NEW FRIENDS COLONY, NEW DELHI 110 065. PAN : AFVPK 0457 K V. THE DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE I(3), CHENNAI - 600 034. (NOW JURISDICTION WITH DCIT, CENTRAL CIRCLE 25, NEW DELHI.) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI N. DEVA NATHAN, ADVOCATE RESPONDENT BY : SHRI N. MADHAVA N, IRS, JCIT DATE OF HEARING : 15 TH OCTOBER, 2013 DATE OF PRONOUNCEMENT : 23 RD OCTOBER, 2013 O R D E R PER DR.O.K.NARAYANAN, VICE-PRESIDENT THIS APPEAL FILED BY THE ASSESSEE RELATES TO ASSE SSMENT YEAR 1995-96. THIS APPEAL IS DIRECTED AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)-II AT CHENNAI, DATED 23.3.2 000. THE APPEAL ARISES OUT OF THE ASSESSMENT COMPLETED UNDER SECTION 144 OF THE INCOME-TAX ACT, 1961. 2 I.T.A. NO. 2138/MDS/06 2. THE GROUNDS RAISED BY THE ASSESSEE IN THE PRESEN T APPEAL READ AS BELOW:- (1) THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN LAW AND ON THE PRINCIPLES OF NATURAL JUSTICE IN NOT CONDONING THE DELAY OF JUST 20 DAYS IN FILING THE APPEAL BEFORE THE LD. CIT(A) AND DISMISSING THE PETITION FOR CONDONATION OF DELAY INSPITE OF THE REASONS OF DELAY BEING GENUINE AS STATED IN THE PETITION AND WITHOUT AFFORDING OPPORTUNITY OF BEING HEARD AND WITHOUT TAKING COGNIZANCE OF THE QUANTUM INVOLVED IN THE APPEAL. (2) THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN LAW AND ACTED AGAINST THE PRINCIPLES OF NATURAL JUSTICE IN DISMISSING THE APPEAL IN LIMINE WITHOUT CONSIDERING THE MERITS OF THE CASE BASED ON THE FACTS AND GROUNDS OF APPEAL OF THE APPELLANT ANNEXED HEREWITH AS ANNEXURE A. (3) THAT THE APPELLANT PRAYS THAT THE ORDER OF THE LD. CIT(A) BE SET ASIDE AND THAT THE DETERMINATION OF INCOME AS MADE BY THE ASSESSING OFFICER BE DELETED/MODIFIED IN ACCORDANCE WITH LAW HAVING REGARD TO THE FACTS AND GROUNDS OF APPEAL BEFORE THE LD. CIT(A) THE ASSESSMENT IN THE PRESENT CASE WAS COMPLETED UN DER SECTION 144 ON 25.2.1999. 3. THERE WAS A DELAY OF 20 DAYS IN FILING THE FIRST APPEAL BEFORE THE COMMISSIONER OF INCOME TAX (APPEALS). INSPITE OF SEVERAL NOTICES ISSUED BY THE COMMISSIONER OF INCOME TAX (A PPEALS) FOR 3 I.T.A. NO. 2138/MDS/06 THE APPEARANCE OF THE ASSESSEE TO DISPOSE OF THE AP PEAL, NOBODY WAS PRESENT. AS NOBODY WAS PRESENT FOR THE ASSESSE E, THE COMMISSIONER OF INCOME TAX (APPEALS) PASSED AN EX PARTE ORDER. IN THE SAID EX PARTE ORDER, THE COMMISSIONER OF INCOME TAX (APPEALS) NOTICED THAT THE REASONS STATED FOR THE D ELAY OF 20 DAYS CAUSED IN FILING THE APPEAL MIGHT NOT BE GENUINE AS THE ASSESSEE HAS NOT APPEARED BEFORE HIM INSPITE OF SEVERAL NOTI CES TO PROSECUTE THE APPEAL AND TO EXPLAIN HIS POSITION. AS THE ASS ESSEE DID NOT APPEAR BEFORE THE COMMISSIONER OF INCOME TAX (APPEA LS), HE CONCLUDED THAT REASONS FOR THE DELAY ALSO WOULD BE UNFOUNDED. ON THAT SHORT GROUND, HE DISMISSED THE APPEAL IN LIMIN E ON THE GROUND OF LIMITATION. 4. WE HEARD SHRI N. DEVANATHAN, THE LEARNED COUNSEL FOR THE ASSESSEE AND SHRI N. MADHAVAN, THE LEARNED JOINT CO MMISSIONER OF INCOME TAX, APPEARING FOR THE REVENUE. 5. IT IS TRUE THAT THE NOTICES ISSUED BY THE COMMIS SIONER OF INCOME TAX (APPEALS) WERE NOT RESPONDED BY THE ASSE SSEE AND THE ASSESSEE DID NOT APPEAR BEFORE HIM TO PROSECUTE THE APPEAL. WHEN THE ASSESSEE IS NOT APPEARING OR CAUSING TO APPEAR BEFORE THE CONCERNED AUTHORITY, IT IS WITHIN THE COMPETENCE OF THE CONCERNED 4 I.T.A. NO. 2138/MDS/06 AUTHORITY TO PROCEED EX PARTE . BUT, EVEN SUCH AN EX PARTE ORDER MUST BE AN ORDER PASSED AFTER CONSIDERING THE MERIT S OF THE CASE. 6. IN THE PRESENT CASE, THE DELAY OCCURRED IN FILIN G THE FIRST APPEAL WAS 20 DAYS. IT IS NOT AN INORDINATE DELAY. IT IS NOT ANY UNREASONABLE DELAY. THE PRE-OCCUPATIONS OF THE ASS ESSEE AND TIME CAUSED TO CONSULT THE CONCERNED LEGAL ADVISER COULD BE REASONABLE GROUNDS TO JUSTIFY THE DELAY. THE ASSESSEE IS NOT BENEFITTING HIMSELF BY NOT FILING THE APPEAL WITHIN THE TIME. THE DELA Y OF 20 DAYS CAN BE CONSIDERED ON THE GROUND OF REASONABLE EXPLANATION OFFERED BY AN ASSESSEE. THERE IS NO NEED OF ANY BUNDLE OF EVIDEN CES TO ESTABLISH THE REASONS BEHIND THE DELAY. THESE ARE MATTERS OF FAIR AND GOOD JUDGMENT. THINGS BEING SO, THE COMMISSIONER OF INC OME TAX (APPEALS) OUGHT HAVE CONSIDERED TO CONDONE THE DELA Y INDEPENDENT OF SITUATION WHERE THE ASSESSEE DID NOT APPEAR BEFO RE HIM INSPITE OF NOTICES. THE DELAY CAUSED IN FILING THE APPEAL BEF ORE THE COMMISSIONER OF INCOME TAX (APPEALS) AND THE NON-AP PEARANCE BEFORE THE COMMISSIONER OF INCOME TAX (APPEALS) FOR THE PROSECUTION OF THE APPEAL, BOTH ARE INDEPENDENT EVE NTS EVEN THOUGH HIGHLY INTERCONNECTED. UTMOST IT COULD BE A N ARGUMENT THAT THE ASSESSEE DID NOT EXPLAIN THE DELAY BEFORE THE C OMMISSIONER OF INCOME TAX (APPEALS). AT THE SAME TIME, IT IS TO B E SEEN THAT THE 5 I.T.A. NO. 2138/MDS/06 ASSESSEE HAS FILED A CONDONATION PETITION EXPLAININ G THE CIRCUMSTANCES IN WHICH THE DELAY WAS CAUSED. THERE FORE, IN OUR HUMBLE VIEW THE COMMISSIONER OF INCOME TAX (APPEALS ) SHOULD HAVE CONSIDERED THE ISSUE OF DELAY INDEPENDENTLY AN D THE SAID PROCESS OF ADJUDICATION CONCERNING THE DELAY, SHOUL D NOT HAVE BEEN INFLUENCED BY THE FACT THAT THE ASSESSEE DID NOT AP PEAR BEFORE HIM INSPITE OF NOTICES. THEREFORE, WE FIND THAT IT IS NECESSARY IN THE INTEREST OF JUSTICE THAT THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) MUST BE SET ASIDE. 7. NOW, COMING TO THE ISSUE OF DELAY, AS ALREADY ME NTIONED IN PARAGRAPHS ABOVE, THE REASONS EXPLAINED BY THE ASSE SSEE ARE PLAUSIBLE. THERE IS NO GROUND TO DISBELIEVE THOSE EXPLANATIONS ESPECIALLY IN THE LIGHT OF THE FACT THAT THE DELAY IS JUST NOMINAL FOR 20 DAYS. IN THE FACTS AND CIRCUMSTANCES OF THE CASE, WE CONDONE THE DELAY CAUSED IN FILING THE FIRST APPEAL BEFORE THE COMMISSIONER OF INCOME TAX (APPEALS). 8. AS ALREADY STATED, THE FIRST APPEAL IS NOT DISPO SED OF ON MERITS. THEREFORE, NOW THE QUESTION IS WHETHER THE FILE SHOULD BE REMITTED BACK TO THE COMMISSIONER OF INCOME TAX (AP PEALS) OR IT SHOULD GO BACK TO THE ASSESSING OFFICER. THE ASSES SMENT ITSELF HAS BEEN COMPLETED UNDER SECTION 144. EVEN IN CASE OF ASSESSMENT 6 I.T.A. NO. 2138/MDS/06 UNDER SECTION 144, IT IS INCUMBENT UPON THE ASSESSI NG OFFICER TO CONVEY THE ASSESSEE THE PROPOSAL ON THE BASIS OF WH ICH, HE IS CONTEMPLATING TO COMPLETE THE ASSESSMENT. AN ASSES SMENT UNDER SECTION 144 DOES NOT MEAN AN ASSESSMENT BEHIND THE BACK OF THE ASSESSEE. EVEN IN SUCH A CASE, IT IS NECESSARY ON THE PART OF ASSESSING OFFICER TO ISSUE A PRE-ASSESSMENT NOTICE TO THE ASSESSEE EXPLAINING THE PARAMETERS ON WHICH THE ASSESSING OF FICER IS PROPOSING TO COMPLETE THE ASSESSMENT UNDER SECTION 144. IN THE PRESENT CASE, NO SUCH COMMUNICATION IS SEEN ON RECO RD. THIS IS ALSO AGAINST THE PRINCIPLE OF NATURAL JUSTICE. 9. THEREFORE, WE FIND THAT IT IS MORE APPROPRIATE T O REMIT BACK THE FILE TO THE ASSESSING OFFICER TO REDO THE ASSES SMENT AFRESH AFTER HEARING THE ASSESSEE AND EXAMINING THE EVIDENCES AN D EXPLANATIONS PLACED BY THE ASSESSEE BEFORE THE ASSE SSING AUTHORITY. THE ASSESSEE SHALL CO-OPERATE WITH THE ASSESSING OFFICER TO COMPLETE THE ASSESSMENT AT THE EARLIEST. THE AS SESSING OFFICER CAN SERIOUSLY VIEW THE DELAY TACTICS, IF ANY, ADOPT ED BY THE ASSESSEE. 10. IN THE RESULT, THE FILE IS REMITTED BACK TO THE ASSESSING OFFICER AND THE APPEAL IS TREATED AS ALLOWED FOR STATISTICA L PURPOSES. 7 I.T.A. NO. 2138/MDS/06 ORDER PRONOUNCED ON WEDNESDAY, THE 23 RD OCTOBER, 2013 AT CHENNAI. SD/- SD/- (VIKAS AWASTHY) (DR. O .K.NARAYANAN) JUDICIAL MEMBER VICE-PRESIDENT CHENNAI, DATED, THE 23 RD OCTOBER, 2013. KRI. COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT (CENTR AL)-I, CHENNAI 4. CIT(A)-II, CHENNAI-34 5. DR 6. GF.