M/s. Gupta Global Exim Pvt. Ltd., GANDHIDHAM V. The Assistant Commissioner of Income Tax, Gandhidham Circle, GANDHIDHAM

ITA 214/RJT/2015

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 0965 (ITAT-RAJKOT)
• Duration Of Justice: 5 year(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-06-2020
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Assessment Year: 2001-2002
• Appeal Filed On: 18-05-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SUHAS MISTRY
• Keywords: Set aside
• Section: 271(1)(c); 143(3); 133A; 274; 147

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH, RAJKOT BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER & SMT. MADHUMITA ROY, JUDICIAL MEMBER ./ I.T.A. NO. 214/RJT/2015, 254 & 255/RJT/2014 ( / ASSESSMENT YEARS: 2001-02, 1999-2000 & 2005-06 ) M/S. GUPTA GLOBAL EXIM PVT. LTD. PLOT NO. 244/1, N. H. 8A, GANDHIDHAM, KUTCH & KALPESH S. DOSHI & CO CHARTERED ACCOUNTANTS 411, COSMO COMPLEX, MAHILA COLLEGE CIRCLE, RAJKOT 360001 / VS. ACIT GANDHIDHAM CIRCLE, GANDHIDHAM ./ ./ PAN/GIR NO. : AAACG7805L ( / APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY : SHRI CHETAN AGARWAL, A.R. / RESPONDENT BY : SHRI SUHAS MISTRY, SR. D.R. / DATE OF HEARING 28/02/2020 !'# / DATE OF PRONOUNCEMENT 01/06/2020 $% /O R D E R PER BENCH: ALL THREE CAPTIONED APPEAL HAVE BEEN FILED AT THE I NSTANCE OF THE ASSESSEE AGAINST THE ORDERS OF THE COMMISSIONER OF INCOME TAX ITA NOS. 215/RJT/15, 254 & 255/RJT/14[M/S. GUPTA GL OBAL EXIM PVT. LTD. VS. ACIT] A.YS. 2001-02, 1999-2000 & 2005-06 - 2 - (APPEALS)-3, RAJKOT (CIT(A) IN SHORT) DATED 28/04/2 015 RELEVANT TO ASSESSMENT YEAR (AY) 2001-02 & CIT(A)-II, RAJKOT DA TED 20/02/2014 FOR THE RELEVANT ASSESSMENT YEARS 1999-2 000 & 2005- 06 . ITA NO. 214/RJT/2015 A.Y. 2001-02 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: 1. THAT, THE LEARNED CIT(A) HAS ERRED IN IMPOSING PENALTY U/S. 271(1)(C) OF RS.6,71,930/- IS NOT JUSTIFIED AND SHOULD BE CANCEL LED. 3. THE ONLY ISSUE RAISED BY THE ASSESSEE IS THAT TH E LEARNED CIT (A) ERRED IN IMPOSING THE PENALTY OF RS. 6,71,930/- UNDER THE PR OVISIONS OF SECTION 271(1)(C) OF THE ACT. 4. THE FACTS IN BRIEF ARE THAT THE ASSESSEE IN THE PRESENT CASE IS A PRIVATE LIMITED COMPANY AND ENGAGED IN THE BUSINESS OF TIMB ER TRADING. THERE WAS THE SURVEY OPERATION CARRIED OUT AT THE PREMISES OF THE ASSESSEE UNDER SECTION 133A OF THE ACT. AS A RESULT OF SURVEY, CERTAIN DOC UMENTS OF INCRIMINATING NATURE WERE FOUND. ACCORDINGLY THE INCOME OF THE AS SESSEE WAS ESTIMATED AT THE RATE OF 7% BASED ON SUCH INCRIMINATING DOCUMENT S WHICH RESULTED IN THE ADDITION OF RS. 16,98,943/- TO THE TOTAL INCOME OF THE ASSESSEE. THUS THE ASSESSMENT WAS FRAMED UNDER SECTION 143(3) READ WIT H SECTION 147 OF THE ACT, VIDE ORDER DATED 29-12-2008 AFTER MAKING THE IMPUGN ED ADDITION TO THE TOTAL INCOME OF THE ASSESSEE. THE AO SIMULTANEOUSLY ISSUE D NOTICE UNDER SECTION 274 READ WITH SECTION 271(1)(C) OF THE ACT, FOR INITIAT ING THE PENALTY WHICH WAS CONFIRMED AT RS. 6,71,930/- BEING 100% OF THE AMOUN T OF TAX SOUGHT TO BE EVADED. 5. AGGRIEVED ASSESSEE PREFERRED AN APPEAL TO THE LE ARNED CIT (A) WHO ALSO CONFIRMED THE ORDER OF THE AO. ITA NOS. 215/RJT/15, 254 & 255/RJT/14[M/S. GUPTA GL OBAL EXIM PVT. LTD. VS. ACIT] A.YS. 2001-02, 1999-2000 & 2005-06 - 3 - 6. BEING AGGRIEVED BY THE ORDER OF THE LEARNED CIT (A), THE ASSESSEE IS IN APPEAL BEFORE US. 7. THE LEARNED AR BEFORE US SUBMITTED THAT THE ADDI TION HAS BEEN MADE ON ESTIMATED BASIS. THEREFORE THERE CANNOT BE ANY PENA LTY UNDER SECTION 271(1)(C) OF THE ACT. THE LEARNED AR ALSO CONTENDED THAT THE AO IN THE PE NALTY ORDER HAS NOT MENTIONED ANY SPECIFIC CHARGE WHETHER IT WAS FOR TH E CONCEALMENT OF INCOME OR FURNISHING OF INACCURATE PARTICULAR OF INCOME. THUS THE PENALTY ORDER IS NOT SUSTAINABLE. 8. ON THE OTHER, THE LEARNED DR VEHEMENTLY SUPPORTE D THE ORDER OF THE AUTHORITIES BELOW. 9. WE HAVE HEARD THE LD. DR AND PERUSED THE MATERIA LS AVAILABLE ON RECORD. AT THE OUTSET, WE NOTE THAT THE PENALTY HAS BEEN IM POSED BY THE AO U/S 271 (1)(C) WITHOUT MENTIONING THE SPECIFIC CHARGE IN IT S PENALTY ORDER DATED 23/10/2013, WHETHER, IT WAS LEVIED ON ACCOUNT OF CO NCEALMENT OF INCOME OR FURNISHING INACCURATE PARTICULARS OF INCOME. THE RE LEVANT EXTRACT OF THE PENALTY ORDER IS REPRODUCED AS UNDER: IT IS ESTABLISHED THAT THE ASSESSEE HAS CONCEALED BUT GROSS OF INCOME/ FURNISHED INACCURATE PARTICULARS OF INCOME AND THIS IS, THEREFORE, A FIT CASE FOR LEVY OF PENALTY U/S. 271(1)(C) OF THE ACT ON PERUSAL OF ABOVE, IT IS CLEAR THAT THE AO HAS NO T LEVIED THE PENALTY ON THE SPECIFIC CHARGE AS MANDATED U/S 271(1)(C) OF THE AC T. IN SUCH FACTS AND CIRCUMSTANCE THE HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF SNITA TRANSPORT PVT. LTD. VS. ASSISTANT COMMISSIONER OF INCOME TAX REPORTED IN 42 TAXMANN.COM 54 HAS HELD THAT PENALTY CANNOT BE IMPO SED WITHOUT MENTIONING THE SPECIFIC CHARGE. THE RELEVANT EXTRACT OF THE OR DER IS REPRODUCED BELOW: ITA NOS. 215/RJT/15, 254 & 255/RJT/14[M/S. GUPTA GL OBAL EXIM PVT. LTD. VS. ACIT] A.YS. 2001-02, 1999-2000 & 2005-06 - 4 - 9. REGARDING THE CONTENTION THAT THE ASSESSING OFFICE R WAS AMBIVALENT REGARDING UNDER WHICH HEAD THE PENALTY WAS BEING IMPOSED NAME LY FOR CONCEALING THE PARTICULARS OF INCOME OR FURNISHING INACCURATE PARTICULARS, WE MAY RECORD THAT THOUGH IN THE ASSESSMENT ORDER THE ASSESSING OFFICER DID ORDER IN ITIATION OF PENALTY ON BOTH COUNTS, IN THE ULTIMATE ORDER OF PENALTY THAT HE PASSED, HE CL EARLY HELD THAT LEVY OF PENALTY IS SUSTAINED IN VIEW OF THE FACT THAT THE ASSESSEE HAD CONCEALED THE PARTICULARS OF INCOME. THUS INSOFAR AS FINAL ORDER OF PENALTY WAS CONCERNE D, THE ASSESSING OFFICER WAS CLEAR AND PENALTYWAS IMPOSED FOR CONCEALING PARTICULARS O F INCOME. IN LIGHT OF THIS, WE MAY PERUSE THE DECISION OF THIS COURT IN CASE OF MANU E NGINEERING WORKS (SUPRA). IN THE SAID DECISION, THE DIVISION BENCH CAME TO THE CONCL USION THAT LANGUAGE OF 'AND/OR' MAY BE PROPER IN ISSUING A NOTICE FOR PENALTY, BUT IT W AS INCUMBENT UPON THE ASSESSING AUTHORITY TO COME TO A POSITIVE FINDING AS TO WHETH ER THERE WAS CONCEALMENT OF INCOME BY THE ASSESSEE OR WHETHER ANY INACCURATE PARTICULA RS OF SUCH INCOME HAD BEEN FURNISHED BY THEM. IF NO SUCH CLEAR CUT FINDING IS REACHED BY THE AUTHORITY, PENALTY CANNOT BE LEVIED. IT WAS A CASE IN WHICH IN FINAL C ONCLUSION THE AUTHORITY HAD RECORDED THAT 'I AM OF THE OPINION THAT IT WILL HAVE TO BE S AID THAT THE ASSESSEE HAD CONCEALED ITS INCOME AND/OR THAT IT HAD FURNISHED INACCURATE PART ICULARS OF SUCH INCOME.' IT WAS IN THIS RESPECT THE BENCH OBSERVED THAT 'NOW THE LANGU AGE OF 'AND/OR' MAY BE PROPER IN ISSUING A NOTICE AS TO PENALTY ORDER OR FRAMING OF CHARGE IN A CRIMINAL CASE OR A QUASI- CRIMINAL CASE, BUT IT WAS INCUMBENT UPON THE IAC TO COME TO A POSITIVE FINDING AS TO WHETHER THERE WAS CONCEALMENT OF INCOME BY THE ASSE SSEE OR WHETHER ANY INACCURATE PARTICULARS OF SUCH INCOME HAD BEEN FURNISHED BY TH E ASSESSEE.NO SUCH CLEAR CUT FINDING WAS REACHED BY THE IAC AND, ON THAT GROUND ALONE, THE ORDER OF PENALTY PASSED BY THE IAC WAS LIABLE TO BE STRUCK DOWN.' THE PRINCIPLES LAID DOWN BY THE HONBLE JURISDICTIO NAL HIGH COURT IN THE ABOVE CASE ARE SQUARELY APPLICABLE TO THE FACTS OF THE CA SE ON HAND. THE AO HAS NOT MENTIONED THE SPECIFIC CHARGE IN ITS PENALTY ORDER WHETHER IT WAS LEVIED FOR CONCEALMENT OF INCOME OR FOR FURNISHING INACCURATE PARTICULARS OF INCOME. THEREFORE, IN OUR CONSIDERED VIEW, THE PENALTY LEVI ED BY THE AO AND CONFIRMED BY THE LEARNED CIT (A) IS NOT SUSTAINABLE. AS WE HAVE DELETED THE PENALTY IMPOSED BY THE AO & CONFIRMED BY THE LD. CIT- A ON THE TECHNICAL GROUND, I.E. NO SPECIFIC CHARGE HAS BEEN INVOKED AS DISCUSSED ABOVE. THEREFORE, WE ARE INCLINED TO REFR AIN OURSELVES FROM ADJUDICATING THE GROUNDS OF APPEAL OF ASSESSEE RAIS ED ON MERITS. 10. IN THE RESULT THE APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED. 11. COMING TO THE ITA NO. 254/AHD/2014 FOR THE AY 1 999-00 WHERE THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL : 1. THAT, THE LEARNED CIT(A) HAS WRONG CONFIRMED TH E PENALTY U/S. 271(1)(C) OF THE I.T. ACT OF RS.17,07,205/-. ITA NOS. 215/RJT/15, 254 & 255/RJT/14[M/S. GUPTA GL OBAL EXIM PVT. LTD. VS. ACIT] A.YS. 2001-02, 1999-2000 & 2005-06 - 5 - 12. AT THE OUTSET WE NOTE THAT WE HAVE DECIDED THE IDENTICAL ISSUE IN THE OWN CASE OF THE ASSESSEE IN ITA NO. 214/RJT/2015 IN ITS FAVOUR VIDE PARAGRAPH NUMBER 9 OF THIS ORDER. FOR THE DETAILED DISCUSSION , PLEASE REFER THE RELEVANT PARAGRAPH. RESPECTFULLY FOLLOWING THE SAME, WE SET ASIDE THE FINDING OF THE LEARNED CIT (A) AND DIRECT THE AO TO DELETE THE PEN ALTY IMPOSED BY HIM. HENCE THE GROUND OF APPEAL OF THE ASSESSEE IS PARTLY ALLO WED. 13. IN THE COMBINED RESULT, BOTH THE APPEALS OF THE ASSESSEE ARE PARTLY ALLOWED. 14. COMING TO THE ITA NO. 255/AHD/2014 FOR THE AY 2 005-06 WHERE THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL : 1. THAT, THE LEARNED CIT(A) HAS WRONG CONFIRMED TH E PENALTY U/S. 271(1)(C) OF THE I.T. ACT OF RS.40,90,779/-. 15. THE ONLY ISSUE RAISED BY THE ASSESSEE IS THAT T HE LEARNED CIT (A) ERRED IN IMPOSING THE PENALTY OF RS. 40,90,779.00 UNDER THE PROVISIONS OF SECTION 271(1)(C) OF THE ACT. 16. THE ASSESSEE IN THE YEAR UNDER CONSIDERATION HA S DECLARED THE LOSS OF I 1,51,39,300 IN THE RETURN FILED BY IT. HOWEVER, THE AO MADE THE DISALLOWANCES OF INTEREST EXPENSES AMOUNTING TO I 1,80,000 AND DE TERMINED THE GROSS PROFIT AT THE RATE OF 3% IN THE ASSESSMENT FRAMED UNDER SE CTION 143(3) OF THE ACT. HOWEVER, THE ITAT RESTRICTED THE ADDITION OF THE GP TO THE EXTENT OF 2% OF THE TURNOVER AMOUNTING TO I 1,11,79,287.00 AND DELETED THE ADDITION MADE BY THE AO ON ACCOUNT OF INTEREST EXPENSES VIDE ORDER DATED 6 JANUARY 2012 IN ITA NO. 1127/RJT/2010. THE AO SUBSEQUENTLY ISSUED A NOTICE UNDER SECTION 271(1)(C)/274 OF THE ACT PROPOSING THE PENALTY ON T HE AMOUNT OF THE ADDITION CONFIRMED BY THE ITAT. THE ASSESSEE IN RESPONSE TO SUCH NOTICE REPLIED THAT THE ADDITION HAS BEEN MADE ON ESTIMATED BASIS, THEREFOR E THERE CANNOT BE ANY PENALTY. HOWEVER, THE AO DISREGARDED THE CONTENTION OF THE ASSESSEE AND ITA NOS. 215/RJT/15, 254 & 255/RJT/14[M/S. GUPTA GL OBAL EXIM PVT. LTD. VS. ACIT] A.YS. 2001-02, 1999-2000 & 2005-06 - 6 - LEVIED THE PENALTY OF RS. 40,90,779.00 BEING 100% O F THE AMOUNT OF TAX SOUGHT TO BE EVADED. 17. AGGRIEVED ASSESSEE PREFERRED AN APPEAL TO THE L EARNED CIT (A) WHO CONFIRMED THE ORDER OF THE AO. 18. BEING AGGRIEVED BY THE ORDER OF THE LEARNED CIT (A) THE ASSESSEE IS IN APPEAL BEFORE US. 19. THE LEARNED AR BEFORE US CONTENDED THAT THERE C ANNOT BE ANY PENALTY FOR THE CONCEALMENT OF INCOME ON THE ADDITION MADE ON ESTIMATED BASIS. 20. ON THE OTHER HAND THE LEARNED DR VEHEMENTLY SUP PORTED THE ORDER OF THE AUTHORITIES BELOW. 21. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND PERUSED THE MATERIALS AVAILABLE ON RECORD. ADMITTEDLY, THE ADDI TION WAS MADE ON ESTIMATED BASIS. THEREFORE IN OUR CONSIDERED VIEW THERE CANNO T BE ANY PENALTY QUA TO THE ADDITION MADE ON ESTIMATED BASIS. IN HOLDING SO WE DRAW SUPPORT AND GUIDANCE FROM THE JUDGMENT OF HONBLE GUJARAT HIGH COURT IN THE CASE OF ITO VS. BOMBAY WALA READYMADE STORES REPORTED IN 55 TAXMANN .COM 258 WHEREIN IT WAS HELD AS UNDER: 6. THE PENALTIES WERE UPHELD AS IT WAS ONLY ESTIMATED VALUE ON WHICH ESTIMATES OF INCOME TAX WAS MADE AND THE BOOKS OF ACCOUNTS WERE REJECTED. THERE WAS NO SCOPE TO LEVY THE PENALTY UNDER SECTION 271(1)(C), THE APPEL LANT HAD BEEN ASSESSED BY THE INCOME TAX. THE TRIBUNAL HAS VERY RIGHTLY CONSIDERE D THAT BOTH THE ADDITIONS ARE ON A ESTIMATED BASIS. THEREFORE, JUST BECAUSE ESTIMATES ARE MADE, PENALTY CANNOT BE LEVIED UNDER SECTION 271(C). RESPECTFULLY FOLLOWING THE PRINCIPLES LAID DOWN BY THE HONBLE GUJARAT HIGH COURT IN THE CASE ABOVE, WE SET ASIDE THE FINDING O F THE LEARNED CIT-A AND DIRECT THE AO TO DELETE THE ADDITION MADE BY HIM. H ENCE THE GROUND OF APPEAL OF THE ASSESSEE IS ALLOWED. ITA NOS. 215/RJT/15, 254 & 255/RJT/14[M/S. GUPTA GL OBAL EXIM PVT. LTD. VS. ACIT] A.YS. 2001-02, 1999-2000 & 2005-06 - 7 - 22. BEFORE WE PART WITH THE ISSUE/APPEAL AS DISCUSS ED ABOVE, IT IS PERTINENT TO NOTE THAT THE CLAUSE (C) OF RULE 34 OF THE APPEL LATE TRIBUNAL RULES 1963 REQUIRES THE BENCH TO MAKE ENDEAVOUR TO PRONOUNCE T HE ORDER WITHIN 60 DAYS FROM THE CONCLUSION OF THE HEARING. HOWEVER THE PER IOD OF 60 DAYS CAN BE EXTENDED UNDER EXCEPTIONAL CIRCUMSTANCES BUT THE SA ME SHOULD NOT ORDINARILY BE FURTHER EXTENDED BEYOND ANOTHER 30 DAYS. IN SIMP LE WORDS THE TOTAL TIME AVAILABLE TO THE BENCH IS OF 90 DAYS UPON THE CONCL USION OF THE HEARING. HOWEVER, DURING THE PREVAILING CIRCUMSTANCES WHERE THE ENTIRE WORLD IS FACING THE UNPRECEDENTED CHALLENGE OF COVID 2019 OUTBREAK, RESULTING THE LOCKDOWN IN THE COUNTRY, THE ORDERS THOUGH SUBSTANTIALLY PREPAR ED BUT COULD NOT BE PRONOUNCED FOR THE UNAVOIDABLE REASONS WITHIN THE M AXIMUM PERIOD OF 90 DAYS. IN SUCH CIRCUMSTANCES WE FIND THAT THE HONBLE MUMB AI TRIBUNAL IN THE CASE OF JSW LIMITED VS DEPUTY COMMISSIONER OF INCOME TAX IN ITA NO. 6103/MUM/2018 VIDE ORDER DATED 14-5-2020 EXTENDED THE TIME FOR PRONOUNCING THE ORDER WITHIN 90 DAYS OF TIME BY OBS ERVING AS UNDER: 9. LET US IN THIS LIGHT REVERT TO THE PREVAILING SI TUATION IN THE COUNTRY. ON 24TH MARCH, 2020, HONBLE PRIME MINISTER OF INDIA TOOK THE BOLD STEP OF IMPOSING A NATIONWIDE LOCKDOWN, FOR 21 DAYS, TO PREVENT THE SPREAD OF COV ID 19 EPIDEMIC, AND THIS LOCKDOWN WAS EXTENDED FROM TIME TO TIME. AS A MATTER OF FACT , EVEN BEFORE THIS FORMAL NATIONWIDE LOCKDOWN, THE FUNCTIONING OF THE INCOME TAX APPELLATE TRIBUNAL AT MUMBAI WAS SEVERELY RESTRICTED ON ACCOUNT OF LOCKDOWN BY T HE MAHARASHTRA GOVERNMENT, AND ON ACCOUNT OF STRICT ENFORCEMENT OF HEALTH ADVISORI ES WITH A VIEW OF CHECKING SPREAD OF COVID 19. THE EPIDEMIC SITUATION IN MUMBAI BEING GR AVE, THERE WAS NOT MUCH OF A RELAXATION IN SUBSEQUENT LOCKDOWNS ALSO. IN ANY CAS E, THERE WAS UNPRECEDENTED DISRUPTION OF JUDICIAL WOK ALL OVER THE COUNTRY. AS A MATTER OF FACT, IT HAS BEEN SUCH AN UNPRECEDENTED SITUATION, CAUSING DISRUPTION IN THE FUNCTIONING OF JUDICIAL MACHINERY, THAT HONBLE SUPREME COURT OF INDIA, IN AN UNPRECED ENTED ORDER IN THE HISTORY OF INDIA AND VIDE ORDER DATED 6.5.2020 READ WITH ORDER DATED 23.3.2020, EXTENDED THE LIMITATION TO EXCLUDE NOT ONLY THIS LOCKDOWN PERIOD BUT ALSO A FEW MORE DAYS PRIOR TO, AND AFTER, THE LOCKDOWN BY OBSERVING THAT IN CASE THE LIMITATION HAS EXPIRED AFTER 15.03.2020 THEN THE PERIOD FROM 15.03.2020 TILL THE DATE ON WHICH THE LOCKDOWN IS LIFTED IN THE JURISDICTIONAL AREA WHERE THE DISPUTE LIES OR WHERE THE CAUSE OF ACTION ARISES SHALL BE EXTENDED FOR A PERIOD OF 15 DAYS AFTER THE LIFTING OF LOCKDOWN . HONBLE BOMBAY HIGH COURT, IN AN ORDER DATED 15T H APRIL 2020, HAS, BESIDES EXTENDING THE VALIDITY OF ALL INTERIM ORDERS, HAS ALSO OBSERVED THAT, IT IS ALSO CLARIFIED THAT WHILE CALCULATING TIME FOR DISP OSAL OF MATTERS MADE TIME- BOUND BY THIS COURT, THE PERIOD FOR WHICH THE ORDER DATED 26TH MARCH 2020 CONTINUES TO OPERATE SHALL BE ADDED AND TIME SHALL STAND EXTENDED ACCORDINGLY , AND ALSO OBSERVED THAT ARRANGEMENT CONTINUED BY AN ORDER DATED 26TH MARCH 2020 TILL 30TH APRIL 2020 SHALL CONTINUE FURTHER TILL 15TH JUNE 2020 . IT HAS BEEN AN UNPRECEDENTED SITUATION NOT ONLY IN INDIA BUT ALL OVER THE WORLD. GOVERNMENT OF INDIA HAS, VIDE NOTIFICATION DATED 19 TH FEBRUARY 2020, TAKEN THE STAND ITA NOS. 215/RJT/15, 254 & 255/RJT/14[M/S. GUPTA GL OBAL EXIM PVT. LTD. VS. ACIT] A.YS. 2001-02, 1999-2000 & 2005-06 - 8 - THAT, THE CORONAVIRUS SHOULD BE CONSIDERED A CASE OF NATURAL CALAMITY AND FMC (I.E. FORCE MAJEURE CLAUSE) MAYBE INVOKED, WHEREVER CONSIDERED APPROPRI ATE, FOLLOWING THE DUE PROCEDURE. THE TERM FORCE MAJEURE HAS BEEN DEFINED IN BLACKS LAW DICTIONARY, AS AN EVENT OR EFFECT THAT CAN BE NEITHER ANTICIPATED NOR CONTROLLED WHEN SUCH IS THE POSITION, AND IT IS OFFICIALLY SO NOTIFIED BY THE GOVERNMENT OF INDIA AND THE COVID-19 EPIDEMIC HAS BEEN NOTIFIED AS A DISAST ER UNDER THE NATIONAL DISASTER MANAGEMENT ACT, 2005, AND ALSO IN THE LIGHT OF THE DISCUSSIONS ABOVE, THE PERIOD DURING WHICH LOCKDOWN WAS IN FORCE CAN BE ANYTHING BUT AN ORDINARY PERIOD. 10. IN THE LIGHT OF THE ABOVE DISCUSSIONS, WE ARE O F THE CONSIDERED VIEW THAT RATHER THAN TAKING A PEDANTIC VIEW OF THE RULE REQUIRING PRONOU NCEMENT OF ORDERS WITHIN 90 DAYS, DISREGARDING THE IMPORTANT FACT THAT THE ENTIRE COU NTRY WAS IN LOCKDOWN, WE SHOULD COMPUTE THE PERIOD OF 90 DAYS BY EXCLUDING AT LEAST THE PERIOD DURING WHICH THE LOCKDOWN WAS IN FORCE. WE MUST FACTOR GROUND REALIT IES IN MIND WHILE INTERPRETING THE TIME LIMIT FOR THE PRONOUNCEMENT OF THE ORDER. LAW IS NOT BROODING OMNIPOTENCE IN THE SKY. IT IS A PRAGMATIC TOOL OF THE SOCIAL ORDER. TH E TENETS OF LAW BEING ENACTED ON THE BASIS OF PRAGMATISM, AND THAT IS HOW THE LAW IS REQ UIRED TO INTERPRETED. THE INTERPRETATION SO ASSIGNED BY US IS NOT ONLY IN CON SONANCE WITH THE LETTER AND SPIRIT OF RULE 34(5) BUT IS ALSO A PRAGMATIC APPROACH AT A TI ME WHEN A DISASTER, NOTIFIED UNDER THE DISASTER MANAGEMENT ACT 2005, IS CAUSING UNPREC EDENTED DISRUPTION IN THE FUNCTIONING OF OUR JUSTICE DELIVERY SYSTEM. UNDOUBT EDLY, IN THE CASE OF OTTERS CLUB VS DIT [(2017) 392 ITR 244 (BOM)] , HONBLE BOMBAY HIGH COURT DID NOT APPROVE AN ORDER BEING PASSED BY THE TRIBUNAL BEYOND A PERIOD OF 90 DAYS, BUT THEN IN THE PRESENT SITUATION HONBLE BOMBAY HIGH COURT ITSELF HAS, VID E JUDGMENT DATED 15TH APRIL 2020, HELD THAT DIRECTED WHILE CALCULATING THE TIME FOR DISPOSAL OF MATTERS MADE TIME-BOUND BY THIS COURT, THE PERIOD FOR WHICH THE ORDER DATED 26TH MARCH 2020 CONTINUES TO OPERATE SHALL BE ADDED AND TIME S HALL STAND EXTENDED ACCORDINGLY . THE EXTRAORDINARY STEPS TAKEN SUO MOTU BY HONBL E JURISDICTIONAL HIGH COURT AND HONBLE SUPREME COURT ALSO INDICATE THAT THIS PERIOD OF LOCKDOWN CANNOT BE TREATED AS AN ORDINARY PERIOD DURING WHICH THE NORM AL TIME LIMITS ARE TO REMAIN IN FORCE. IN OUR CONSIDERED VIEW, EVEN WITHOUT THE WOR DS ORDINARILY, IN THE LIGHT OF THE ABOVE ANALYSIS OF THE LEGAL POSITION, THE PERIOD DU RING WHICH LOCKOUT WAS IN FORCE IS TO EXCLUDED FOR THE PURPOSE OF TIME LIMITS SET OUT IN RULE 34(5) OF THE APPELLATE TRIBUNAL RULES, 1963. VIEWED THUS, THE EXCEPTION, TO 90-DAY TIME-LIMIT FOR PRONOUNCEMENT OF ORDERS, INHERENT IN RULE 34(5)(C), WITH RESPECT TO THE PRONOUNCEMENT OF ORDERS WITHIN NINETY DAYS, CLEARLY COMES INTO PLAY IN THE PRESENT CASE. OF COURSE, THERE IS NO, AND THERE CANNOT BE ANY, BAR ON THE DISCRETION OF THE B ENCHES TO REFIX THE MATTERS FOR CLARIFICATIONS BECAUSE OF CONSIDERABLE TIME LAG BET WEEN THE POINT OF TIME WHEN THE HEARING IS CONCLUDED AND THE POINT OF TIME WHEN THE ORDER THEREON IS BEING FINALIZED, BUT THEN, IN OUR CONSIDERED VIEW, NO SUCH EXERCISE WAS REQUIRED TO BE CARRIED OUT ON THE FACTS OF THIS CASE. 11. TO SUM UP, THE APPEAL OF THE ASSESSEE IS ALLOWE D, AND APPEAL OF THE ASSESSING OFFICER IS DISMISSED. ORDER PRONOUNCED UNDER RULE 3 4(4) OF THE INCOME TAX (APPELLATE TRIBUNAL) RULES, 1962, BY PLACING THE DETAILS ON TH E NOTICE BOARD. CONSIDERING THE ABOVE, WE EXPRESS TO PRONOUNCE THE ORDER BEYOND THE PERIOD OF 90 DAYS. ACCORDINGLY, WE PROCEED TO PRONOUNCE TH E ORDER AS ON DATE. ITA NOS. 215/RJT/15, 254 & 255/RJT/14[M/S. GUPTA GL OBAL EXIM PVT. LTD. VS. ACIT] A.YS. 2001-02, 1999-2000 & 2005-06 - 9 - 23. IN THE COMBINED RESULT, APPEAL OF THE ASSESSEE IN ITA NO.214/RJT/2015 & 254/RJT/14 ARE PARTLY ALLOWED WHE REAS ITA NO.255/RJT/2014 IS ALLOWED. SD/- SD/- (MADHUMITA ROY) (WASEEM AH MED) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD: DATED 01/06/2020 TRUE COPY S. K. SINHA / COPY OF ORDER FORWARDED TO:- 1. / REVENUE 2. $ / ASSESSEE 3. ) *+ , / CONCERNED CIT 4. ,- / CIT (A) 5. 012 33*+, *+#, 56$)$ / DR, ITAT, AHMEDABAD 6. 289 : / GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT, RAJKOT THIS ORDER PRONOUNCED IN OPEN COURT 01/06/2020