21st Century Investments and Properties Private Limited , Hyderabad V. ACIT, Central Circle-1, Hyderabad

ITA 222/Hyd/2023

AI Insights

The case involves multiple appeals filed by 21st Century Investments and Properties (P) Ltd against the orders of the CIT (A)-11, Hyderabad, relating to the assessment years 2007-08 to 2009-10. The primary issues in the appeals were the disallowance of sales tax payable and the addition of unexplained expenditure by the Assessing Officer. The CIT (A) had dismissed the appeals in limine due to inordinate delay, which was over 10 years. The Tribunal found that the CIT (A) had not provided a proper opportunity of hearing to the assessee and remanded the case for a fresh decision.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 130993 (ITAT-HYDERABAD)
• Duration Of Justice: 2 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-06-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB-A
• Next Hearing Date: 26-06-2023
• Assessment Year: 2008-2009
• Appeal Filed On: 12-04-2023
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained expenditure; Opportunity of being heard; Condonation of delay
• Section: 271(1)(c); 142(1); 13; 153C

Judgement Text

Page 1 of 8 आयकर अपीलीय अधिकरण, हैदराबाद पीठ IN THE INCOME TAX APPELLATE TRIBUNAL Hyderabad ‘A‘ Bench, Hyderabad Before Shri R.K. Panda, Vice-President AND Shri Laliet Kumar, Judicial Member Appeal in ITA No Appellant Respondent A.Y 218/Hyd/2023 21 st Century Investments and Properties (P) Ltd Hyderabad PAN:AAACZ2590H A.C.I.T. Central Circle-1 Hyderabad. 2007-08 219/Hyd/2023 -do- -do- -do- 220/Hyd/2023 -do- -do- 2008-09 221/Hyd/2023 -do- -do- -do- 222/Hyd/2023 -do- -do- -do- 223/Hyd/2023 -do- -do- 2009-10 224/Hyd/2023 -do- -do- -do- 225/Hyd/2023 -do- -do- -do- Assessee by : Shri P. Murali Mohan Rao, CA Revenue by: Smt. T.H. Vijaya Lakshmi, CIT(DR) Date of hearing: 27/06/2023 Date of pronouncement: 27/06/2023 O R D E R Per Laliet Kumar, J.M These are the connected appeals filed by the assessee directed against the common order dated 13.02.2023 of the learned CIT (A)-11, Hyderabad relating to A.Ys.2007-08 to 2009- 10 respectively. Page 2 of 8 2. As all the captioned appeals are related to one assessee, we take ITA No.218/Hyd/2023 for the A.Y 2007-08 as the lead appeal. 3. Though, the assessee has raised as many as 13 grounds, except the following two grounds, the remaining grounds are technical and general in nature, which requires no adjudication. “1. The learned. CIT(A) ought to have appreciated that the learned Assessing Officer erred in making the disallowance of Rs.2,28,701/- towards sale tax payable, without appreciating the actual facts of the case. 2. The ld.CIT(A) ought to have appreciated that the ld.AO erred in making the addition of Rs.1,08,62,908/- towards unexplained expenditure by taking an estimation on the total expenses made by the assessee during the AY under consideration.” 4. The brief facts of the case are that assessee is a company filed its return of income for A.Y. 2007-08 admitting total income of Rs.78,21,140/- but did not file its return of income for A.Ys. 2008-09 and 2009-10. A search operation was carried out in the case of the Director of the assessee Sri A. Ramakrishna in 17.09.2008 and simultaneous survey operation was conducted in the case of the assessee. Notices u/s 153C were issued to the assessee and the assessee did not file the return of income in response to the said notices. Subsequently, the Assessing Officer had completed the assessment and also passed the penalty orders, the details of which read as under : Page 3 of 8 Assessment orders: Sl.No. AY Order u/s` Date of the order Assessed income in Rs. 1 2007-08 153C r.w.s. 144 30.12.2010 1,89,03,749 2 2008-09 153C r.w.s. 144 30.12.2010. 6,10,56,570 3 2009-10 144 30.12.2010 4,37,21,247 Penalty orders : Sl.No. AY Order u/s` Date of the order Assessed income in Rs. 1 2007-08 271(1)(c) 23.06.2011 63,63,002 2 2008-09 271AAA 23.06.2011 35,07,378 3 2008-09 271(1)(c) 23.06.2011 88,31,547 4 2009-10 271AAA 23.06.2011 5,43,567 5 2009-10 271(1)(c) 23.06.2011 1,31,81,229 5. Feeling aggrieved by the order passed by the assessing officer, assessee filed appeal before the Ld. CIT(A), who dismissed the appeal of assessee in limine on account of inordinate delay by holding as under : “6.......... In the present case, the appellant could have very well avoided the delay by exercising of due care and attention at least after the month of June, 2011 when the penalty orders were received. Therefore, there exist no bonafide reasons and no sufficient and reasonable cause for the delay of an inordinate period of more than 10 years and applying the principle laid down by the Hon’ble Courts in the aforesaid decisions, the delay of more than 10 years in filing the appeal cannot be condoned. Accordingly, all the appeals filed by the appellant are dismissed as barred by limitation.” Page 4 of 8 6. Before us, ld. AR had submitted that the learned CIT (A) decided the appeal without affording an opportunity of hearing to the assessee as no date of hearing was fixed by the learned CIT (A) before deciding the appeals. He drew our attention to the order passed by the learned CIT(A) on 13.2.2023 whereby the learned CIT (A) dismissed the appeal of the assessee for the reasons mentioned at pages 35 to 46 of the order. It was submitted by the learned AR that the assessee is a company on which the notice u/s 153C was issued and served on 12.09.2009 and thereafter, the assessee could not participate in the assessment proceedings, hence, the Assessing Officer had passed the assessment order u/s 144 of the Act on 30.12.2010. It was further submitted that the assessment order was not traceable, therefore, assessee had filed the appeal on the basis of the photocopy of the order, before the learned CIT (A) on 13.6.2022. It was submitted that there was an inordinate delay of 4151 days in filing of the appeal for the A.Y 2007-08 and more 3975 days delay with respect to other appeals. It was submitted that the assessee was not functional and name of the assessee was struck down. It was submitted that the learned CIT (A) should have condoned the delay in prosecuting the appeals and should have decided the matter on merit. 7. On the other hand, the learned DR vehemently submitted that the notice u/s 153C was duly served on 12.09.2009 on the assessee and it was incumbent duty of the assessee to appear in the assessment proceedings and file return of income. However, no plausible reasons were given for non- appearance or non-filing of return of income by the assessee before the Assessing Officer. Further it was submitted that the Page 5 of 8 notice u/s 142(1) was served through affixture as the main Directors of the company were untraceable and the company remained unrepresented despite service of notice u/s 153C. In the above circumstances, the Assessing Officer had completed the assessment u/s 144 of the Act. 8. Further, it was submitted that the learned CIT (A) had elaborately discussed the facts of the case in Para 6 onwards and more particularly at page 40, it was submitted that the assessee is taking contradictory stand as on the one hand assessee is saying that “order was not traceable” whereas on some places, it was mentioned that the notice was not served on the assessee. It was submitted that it is a fit case for dismissing the condonation of delay application and the order of the learned CIT (A) is in accordance with law. It was further submitted that the contention of the assessee that the learned CIT (A) had decided the issue without affording opportunity of being heard and fixed the dates is preposterous. He drew our attention to Col.7 at page 1 of the order wherein against the dates mentioned, it was mentioned that as per the order sheet notings. It was submitted that if the contention of the assessee is found to be wrong, then suitable action be initiated against it. 9. In rebuttal, the learned AR vehemently submitted that no date of hearing was fixed by the learned CIT (A) and therefore, the assessee was not represented in the proceedings, hence, order of ld.CIT(A) is non-est in the eyes of law. Page 6 of 8 10. We have heard the rival arguments and perused the material available on record. Admittedly, the learned CIT (A) in the order mentioned that the date of hearing is “as per the order sheet noting”. However, in 46 pages order, we are not able to lay our own hand any of the date of hearing fixed by the learned CIT (A) for adjudication after serving the notice of haring. Further, we are not able to find out as to when the notice of hearing was issued to assessee and when it was served on the assessee. The date of issuance and service of notice during the appellate proceedings are conspicuously missing and therefore, it is difficult to accept the contention of the assessee or the learned LD. DR. In the light of the above, we are of the opinion that it is necessary for the learned CIT (A) to mention atleast the date of issuance of the notice for appellate proceedings and service thereof in the body of the order. Since nothing has been mentioned in the order, therefore, we are left with no option but to uphold the salutary principle of judicial/quasi judicial adjudication, that no person should be condemned without providing an opportunity of hearing. 11. In the light of the above, we deem it proper to remand back the matter to the file of the learned CIT (A) with a direction to decide the appeal afresh. Since there is a dispute about non- grant of opportunity, we fix the date of hearing as 20.07.2023. It is expected that the learned CIT (A) shall decide the appeal and the grounds raised therein afresh and shall pass a reasoned speaking order. The assessee is also directed to appear on the date fixed on 20.07.2023 and participate in appellate proceedings. Page 7 of 8 Needless to say we have not adjudicated any of the grounds raised by the assessee nor we have condoned the delay in filing the appeals before the learned CIT (A). The learned CIT (A) shall decide the issue afresh after affording opportunity of being heard to the assessee within a reasonable period of six months. Thus, the appeal of the assessee is allowed for statistical purposes. 12. In the result, appeal of assessee in ITA No.218/Hyd/2023 is allowed for statistical purposes. 13. As far as the other appeals i.e., ITA Nos.219 to 225/Hyd/2023 are concerned, in view of the submission of both the parties that the issues raised in A.Y. 2007-08 are identical to the other assessment years, we for the reasons stated hereinabove while deciding the appeal in ITA 218/Hyd/2023 and for similar reasons, allow the other appeals for statistical purposes. 14. In the result, the appeals of assessee in ITA Nos.218 to 225/Hyd/2023 are allowed for statistical purposes. 15. To sum up, all the appeals of assessee are allowed for statistical purposes. A copy of the same may be placed in respective case files. Order pronounced in the Open Court on 27 th June, 2023. Sd/- Sd/- (R.K. PANDA) VICE-PRESIDENT (LALIET KUMAR) JUDICIAL MEMBER Hyderabad, dated 27 th June, 2023. Vinodan/TYNM/SPS Page 8 of 8 Copy to: S.No Addresses 1 M/s. 21 st Century Investments & Properties (P) Ltd C/o P. Murali & Co. C.A 6-3-655/2/3 Somajiguda, Hyderabad 500082 2 ACIT Central Circle-1 Hyderabad 3 Pr. CIT, Central, Hyderabad 4 DR, ITAT Hyderabad Benches 5 Guard File By Order