Smt Hemavathi , Bangalore V. Deputy Commissioner of Income Tax Central Circle-1(4), Bangalore

ITA 2297/BANG/2018

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 2319 (ITAT-BANGALORE)
• Duration Of Justice: 1 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-09-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2007-2008
• Appeal Filed On: 01-08-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Invalid notice; Opportunity of being heard; Principle of natural justice
• Section: 234B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC-B BENCH : BANGALORE BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER ITA NO S . 229 7 AND 229 6 /BANG/2018 ASSESSMENT YEAR S : 20 0 7 - 08, 2013 - 14 SMT. HEMAVATHI, NO. 25, MANCHAMMAMAHAL, DOLLARS COLONY, NANDINI LAYOUT, BENGALURU 560 022. PAN : ABIPH 5181 J VS. DEPUTY COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE 1(4), BENGALURU. APPELLANT RESPONDENT ASSESSEE BY : SHRI. RAVISHANKAR, ADVOCATE REVENUE BY : SHRI. PRIYADARSHI MISHRA, JCIT, SPECIAL RANGE - III DATE OF HEARING : 14 .0 8 .2018 DATE OF PRONOUNCEMENT : 07 .0 9 .2018 O R D E R PER SUNIL KUMAR YADAV, JUDICIAL MEMBER THESE APPEALS ARE PREFERRED BY THE ASSESSEE AGAINST THE ORDER OF THE CIT(A), INTER ALIA, ON FOLLOWING GROUNDS: GROUNDS OF APPEAL IN ITA NO. 2296/BANG/2018 1. THE ORDER OF THE LEARNED COMMISSIONER OF INCOME-TAX PASSED UNDER SECTION 250 OF THE ACT IN SO FAR AS IT IS AGAINST THE APPELLANT IS OPPOSED TO LAW, WEIGHT OF EVIDENCE, PROBABILITIES, FACTS AND CIRCUMSTANCES OF THE APPELLANT'S CASE. 2. THE APPELLANT DENIES ITSELF LIABLE TO BE ASSESSED ON A TOTAL INCOME OF RS. 16,44,100/- AS AGAINST THE INCOME REPORTED OF RS. 3,23,100/- BY THE APPELLANT UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE. ITA NOS.2296 AND 2297/BANG/2018 PAGE 2 OF 5 3. THE LEARNED CIT [A] ERRED IN CONFIRMING THE ADDITION MADE BY THE LEARNED ASSESSING OFFICER IN TREATING THE ENTIRE SUM OF RS. 12,26,000/- CLAIMED BY THE APPELLANT AS AGRICULTURAL INCOME AS INCOME FROM OTHER SOURCES UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE. 4. WITHOUT PREJUDICE, THE CIT [A] OUGHT TO HAVE ALLOWED CERTAIN AMOUNT OF AGRICULTURAL INCOME CONSIDERING THE LAND HOLDINGS OF THE APPELLANT AND THE CROPS GROWN BY HER UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE. 5. WITHOUT PREJUDICE THE EX-PARTE ORDER PASSED BY THE LEARNED CIT[A] WITHOUT AFFORDING A REASONABLE OPPORTUNITY OF HEARING IS IN VIOLATION OF PRINCIPLES OF NATURAL JUSTICE ON THE FACTS AND CIRCUMSTANCES OF THE CASE. 6. WITHOUT PREJUDICE TO THE RIGHT TO SEEK WAIVER AS PER THE PARITY OF REASONING OF THE DECISION OF THE HON'BLE APEX COURT IN THE CASE OF KARANVIR SINGH' 349 ITR 692, THE APPELLANT DENIES ITSELF LIABLE TO BE CHARGED TO INTEREST UNDER SECTION 234 B OF THE INCOME TAX ACT UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE. 7. WITHOUT PREJUDICE THE LEVY OF INTEREST UNDER SECTION 234 B OF THE ACT IS ALSO BAD IN LAW AS THE PERIOD, RATE, QUANTUM AND METHOD OF CALCULATION ADOPTED ON WHICH INTEREST IS LEVIED ARE ALL NOT DISCERNIBLE AND ARE WRONG ON THE FACTS OF THE CASE. 8. THE APPELLANT CRAVES LEAVE TO ADD, ALTER, SUBSTITUTE AND DELETE ANY OR ALL OF THE GROUNDS OF APPEAL URGED ABOVE. 9. FOR THE ABOVE AND OTHER GROUNDS TO BE URGED DURING THE HEARING OF THE APPEAL THE APPELLANT PRAYS THAT THE APPEAL BE ALLOWED IN THE INTEREST OF EQUITY AND JUSTICE. GROUNDS OF APPEAL IN ITA NO. 2297/BANG/2018 1. THE ORDER OF THE LEARNED COMMISSIONER OF INCOME-TAX PASSED UNDER SECTION 250 OF THE ACT IN SO FAR AS IT IS AGAINST THE APPELLANT IS OPPOSED TO LAW, WEIGHT OF EVIDENCE, PROBABILITIES, FACTS AND CIRCUMSTANCES OF THE APPELLANT'S CASE. 2. THE APPELLANT DENIES HERSELF LIABLE TO BE ASSESSED ON A TOTAL INCOME OF RS. 14,10,943/- AS AGAINST THE INCOME REPORTED OF RS.2,09,040/- BY THE APPELLANT UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE. 3. THE LEARNED CIT [A] ERRED IN CONFIRMING THE ORDER U/S. 153C R.W.S. 143 [3] OF THE LEARNED ASSESSING OFFICER WITHOUT PROPERLY APPRECIATING THE CONTENTIONS TAKEN BY THE APPELLANT AND MECHANICALLY DISPOSED THE ITA NOS.2296 AND 2297/BANG/2018 PAGE 3 OF 5 OBJECTIONS RAISED BY THE APPELLANT ON THE ISSUE OF ASSUMPTION OF JURISDICTION UNDER SECTION 153C OF THE ACT WITHOUT EVEN CALLING EXAMINING THE RECORDS, ON THE FACTS AND CIRCUMSTANCES OF THE CASE. 4. THE CIT [A] ERRED IN HOLDING THAT THE LEARNED ASSESSING OFFICER WAS WITHIN HIS JURISDICTION TO INITIATE PROCEEDINGS U/S 153C OF THE ACT IN THE CASE OF THE APPELLANT ON THE FACTS AND CIRCUMSTANCES OF THE CASE. 5. THE LEARNED CIT [A] FAILED TO APPRECIATE THAT THE NOTICE ISSUED UNDER SECTION 153C OF THE ACT IS BAD IN LAW, FOR WANT OF REQUISITE JURISDICTION ESPECIALLY THE MANDATORY REQUIREMENTS TO ASSUME JURISDICTION UNDER SECTION 153C OF THE ACT HAVE NOT BEEN COMPLIED WITH AND CONSEQUENTLY THE ASSESSMENT LIABLE TO BE CANCELLED ON THE FACTS AND CIRCUMSTANCES OF THE CASE. 6. THE LEARNED CIT [A] FAILED TO APPRECIATE THAT THE ASSESSMENT IS FURTHER BAD IN LAW AS REASONS FOR ISSUE OF NOTICE UNDER SECTION 153 C OF THE ACT HAVE NOT BEEN GIVEN AND THE APPELLANT HAS REASONS TO BELIEVE THAT THE SAME HAS NOT BEEN RECORDED AND CONSEQUENTLY THE ASSESSMENT IS BAD IN LAW. THE APPELLANT SUBMITS THAT MANDATORY CONDITIONS TO ASSUME JURISDICTION IS TO RECORD REASONS AND IN THE ABSENCE OF THE SAME THE ASSESSMENT IS BAD IN LAW AND LIABLE TO BE CANCELLED. 7. THE LEARNED CIT [A] FAILED TO APPRECIATE THAT THE NOTICE ISSUED UNDER SECTION 153C OF THE ACT IS FURTHER BAD IN LAW WHEN LEARNED ASSESSING OFFICER MENTIONED IN THE NOTICE THAT HE PROPOSES TO ASSESS/REASSESS THE INCOME (HIGHLIGHTED PORTION 'ASSESS/REASSESS YOUR INCOME), LEARNED ASSESSING OFFICER ISSUED A NOTICE WITHOUT SPECIFICALLY SPECIFYING BY WHAT HE IS PROPOSING WHETHER HE IS PROPOSE TO ASSESS OR REASSESS AND THERE IS NO SPECIFIC WHAT HE IS PROPOSING IN THE NOTICE AND CONSEQUENTLY THE ENTIRE PROCEEDINGS INITIATED BY THE SAID INVALID NOTICE THE ASSESSMENT ORDER PASSED IS NOT VALID AND VOID-AB-INITIO. 8. THE LEARNED CIT [A] ERRED IN CONFIRMING THE ADDITION MADE BY THE LEARNED ASSESSING OFFICER ON ACCOUNT OF ALLEGED UNEXPLAINED LIABILITY OF RS. 7,01,903/- ON THE FACTS AND CIRCUMSTANCES OF THE CASE. 9. THE LEARNED CIT[A] ERRED IN NOT APPRECIATING THAT PART OF THE UNEXPLAINED LIABILITY STANDING TO THE CREDIT OF SRI. MARIASWAMY OF RS.3,11,600/- AND THAT OF SRI. SURAJ MORE OF RS. 2,08,590/- ARE OPENING BALANCES OF THE PREVIOUS YEAR AND THE SAME COULD NOT BE BOUGHT TO TAX BY THE LEARNED ASSESSING OFFICER IN THE IMPUGNED ASSESSMENT YEAR UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE. 10. THE LEARNED CIT [A] ERRED IN NOT APPRECIATING THAT THE ADDITION OF UNEXPLAINED LIABILITY OF RS. 7,01,903/- IS NOT ARISING OUT OF THE SEIZED MATERIAL IN THE SEARCH AND , CONSEQUENTLY NEEDS TO BE DELETED ON THE FACTS AND CIRCUMSTANCES OF THE CASE. ITA NOS.2296 AND 2297/BANG/2018 PAGE 4 OF 5 11. WITHOUT PREJUDICE THE EX-PARTE ORDER PASSED BY THE LEARNED CIT[A] WITHOUT AFFORDING A REASONABLE OPPORTUNITY OF HEARING IS IN VIOLATION OF PRINCIPLES OF NATURAL JUSTICE ON THE FACTS AND CIRCUMSTANCES OF THE CASE. 12. WITHOUT PREJUDICE TO THE RIGHT TO SEEK WAIVER AS PER THE PARITY OF REASONING OF THE DECISION OF THE HON'BLE APEX COURT IN THE CASE OF KARANVIR SINGH 349 ITR 692, THE APPELLANT DENIES ITSELF LIABLE TO BE CHARGED TO INTEREST UNDER SECTION 234 B OF THE INCOME TAX ACT UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE. 13. THE CALCULATION OF INTEREST BY THE LEARNED ASSESSING OFFICER UNDER SECTION 234 B OF THE ACT IS NOT CORRECT. AS THIS IS AN ASSESSMENT MADE UNDER SECTION 153C OF THE ACT FOR THE IMPUGNED ASSESSMENT YEAR 2007-08 BY ISSUANCE OF A NOTICE UNDER SECTION 153C OF THE ACT, THE INTEREST UNDER SECTION 234 B HAS TO BE CALCULATED AS PER THE PROVISIONS OF SUB-SECTION [3] OF SECTION 234B OF THE ACT. 14. WITHOUT PREJUDICE THE LEVY OF INTEREST UNDER SECTION 234 A, 234 B AND 234 C OF THE ACT IS ALSO BAD IN LAW AS THE PERIOD, RATE, QUANTUM AND METHOD OF CALCULATION ADOPTED ON WHICH INTEREST IS LEVIED ARE ALL NOT DISCERNIBLE AND ARE WRONG ON THE FACTS OF THE CASE. 15. THE APPELLANT CRAVES LEAVE TO ADD, ALTER, SUBSTITUTE AND DELETE ANY OR ALL OF THE GROUNDS OF APPEAL URGED ABOVE. 16. FOR THE ABOVE AND OTHER GROUNDS TO BE URGED DURING THE HEARING OF THE APPEAL THE APPELLANT PRAYS THAT THE APPEAL BE ALLOWED IN THE INTEREST OF EQUITY AND JUSTICE. 2. DURING THE COURSE OF HEARING, THE LEARNED COUNSEL FOR THE ASSESSEE HAS INVITED OUR ATTENTION THAT CIT(A) HAS DISMISSED THE APPEAL EX-PARTE WITHOUT AFFORDING PROPER OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. DESPITE REQUEST OF THE ASSESSEE, THE CIT(A) HAS NOT AFFORDED OPPORTUNITY AND DISPOSED OFF THE APPEAL EX-PARTE THAT TOO NOT ON MERIT. 3. THE LEARNED DR ON THE OTHER HAND PLACED RELIANCE UPON THE ORDER OF CIT(A). 4. HAVING CAREFULLY EXAMINED THE ORDERS OF LOWER AUTHORITIES IN THE LIGHT OF RIVAL SUBMISSIONS, WE FIND THAT CIT(A) HAS DISPOSED OFF THE ITA NOS.2296 AND 2297/BANG/2018 PAGE 5 OF 5 APPEAL EX-PARTE WITHOUT AFFORDING PROPER OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. WE, THEREFORE, SET ASIDE THE ORDER OF THE CIT(A) AND RESTORE THE MATTER TO HIS FILE WITH A DIRECTION TO READJUDICATE THE GROUNDS RAISED BEFORE HIM ON MERIT, AFTER AFFORDING OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 5. IN THE RESULT, APPEALS OF THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON THIS 7 TH DAY OF SEPTEMBER, 2018. SD/- SD/- (A. K. GARODIA) (SUNIL KUMAR YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBER BANGALORE. DATE: 7 TH SEPTEMBER, 2018. /NS/ COPY TO: 1. APPELLANTS 2. RESPONDENTS 3. CIT 4. CIT(A) 5. DR 6. GUARD FILE BY ORDER SENIOR PRIVATE SECRETARY ITAT, BANGALORE