POPATLAL NATHALAL SHAH, MUMBAI V. D.C.I.T. 16(3), MUMBAI

ITA 2297/MUM/2012

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 71345 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 5 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-09-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: K
• Next Hearing Date: 26-09-2013
• Assessment Year: 2007-2008
• Appeal Filed On: 09-04-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: AARTI VISANJI IZRFKHZ DH LS
• Keywords: Transfer pricing
• Section: 143(3)

Judgement Text

M/S POPATLAL NATHALAL SHAH - 1 - VK;DJ VIHYH; VF/KDJ.K DS U;K;IHB EQACBZ ESAA IN THE INCOME TAX APPELLATE TRIBUNAL K BENCH, MUM BAI JH JKTSUNZ FLAG YS[KK LNL; ,OA JH FOT; IKY JKO] U;K F;D LNL; DS LE{K BEFORE SHRI RAJENDRA SINGH ACCOUNTANT MEMBER AND SH RI VIJAY PAL RAO JUDICIAL MEMBER VK;DJ VIHY LA[;K /ITA NO. 2297/MUM/2012 FU/KKZJ.K O'KZ @ ASSESSMENT YEAR: - 2007-08 M/S POPATLAL NATHALAL SHAH. 1801, PANCHRATNA OPERA HOUSE, MUMBAI 400 004. CUKE@ VS. DEPUTY COMMISSIONER OF INCOME TAX 16(3), MATRU MANDIR, TARDEO, MUMBAI. PAN:- AAAFP0468K VIHYKFKHZ @ APPELLANT IZR;FKHZ @ RESPONDENT VIHYKFKHZ DH VKSJ LS @ APPELLANT BY MS. AARTI VISANJI IZR;FKHZ DH VKSJ LS @ RESPONDENT BY SHRI AJEET KUMAR JAIN VKNS'K@ VKNS'K@ VKNS'K@ VKNS'K@ ORDER PER RAJENDRA SINGH, AM THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 4.1.2012 OF CIT(A) FOR THE ASSESSMENT YEAR 2007-08. THE DISPUTE RAISED IN THIS APPEAL RELATES TO TP ADJUSTMENT MADE BY THE AO . IN ADDITION THE ASSESSEE HAS ALSO CHALLENGED THE ORDER OF AO HOLDIN G THAT THE APPEAL WAS NOT MAINTAINABLE. 2. THE FACTS IN BRIEF ARE THAT THE ASSESSEE FOR THE RELEVANT YEAR HAD DECLARED TOTAL INCOME OF RS.1,95,52,104/- WHICH HAD BEEN ACCEPTED U/S 143(1). SUBSEQUENTLY THE CASE WAS TAKEN UP FOR SCRU TINY AND THE AO REFERRED LQUOKBZ DH RKJH[K @ DATE OF HEARING 26-09-2013 ?KKS'K.KK DH RKJH[K @ DATE OF PRONOUNCEMENT 30-09-2013 M/S POPATLAL NATHALAL SHAH - 2 - THE ISSUE OF TRANSFER PRICING ADJUSTMENT TO THE TPO WHO VIDE ORDER DATED 18.10.2010 RECOMMENDED ADJUSTMENT OF RS. 25,53,906/ -. THEREAFTER, THE AO PASSED THE ORDER U/S 143(3) ON 14.12.2010 MAKING ADDITION ON ACCOUNT OF TP ADJUSTMENT IN ADDITION TO OTHER DISALLOWANCE/ ADDITIONS AND DETERMINED THE TOTAL INCOME AT RS. 22,06,010/-. 3. IN APPEAL CIT (A) NOTED THAT THE AO IN ASSESSMEN T ORDER HAD MENTIONED DRAFT ASSESSMENT ORDER WHICH WAS NOT AP PELABLE. CIT(A), THEREFORE, DISMISSED THE APPEAL AS NOT MAINTAINABLE , AGGRIEVED BY WHICH THE ASSESSEE HAS FILED THE PRESENT APPEAL. 4. BEFORE US THE LEARNED AR FOR THE ASSESSEE SUBMIT TED THAT THE ASSESSEE HAD NOT OBJECTED TO THE TP ADJUSTMENT PROPOSED BY T HE TPO IN THE DRAFT ASSESSMENT ORDER DATED 18.10.2010. THEREAFTER, THE AO HAD PASSED THE ASSESSMENT ORDER ON 14.12.2010 AND THE ASSESSEE HAD NOT OBJECTED TO THE DRAFT ASSESSMENT ORDER. IT WAS A REGULAR ASSESSMENT ORDER WHICH WAS FOLLOWED BY DEMAND NOTICE AND CHALLAN AND THE ASSES SEE HAD ALSO PAID TAX. THEREFORE, ONLY BECAUSE OF FACT THAT DRAFT ASSESSM ENT ORDER MENTIONED IN THE ASSESSMENT ORDER, IT COULD NOT BE SAID THAT IT WAS NOT FINAL ORDER BY THE AO. THE LEARNED AR PLACED ON RECORD COPY A COPY OF LETTER NO. DY.CIT- 16(3)/TP/2010-11 DATED 6.12.2010 FORWARDING THEREWITH THE DRAFT ASSESSMENT ORDER. THE LEARNED DR ON THE OTHER HAND SUPPORTED T HE STAND TAKEN BY CIT (A). 5. WE HAVE PERUSED THE RECORDS AND CONSIDERED THE M ATTER CAREFULLY. THE DISPUTE IS REGARDING MAINTAINABILITY OF THE APPEAL. CIT(A) HAS HELD THE APPEAL AS NOT MAINTAINABLE ON THE GROUND THAT NO FINAL ORDER HAD BEEN PASSED BY THE AO AND THAT THE ORDER AGAINST WHICH T HE APPEAL HAS BEEN FILED WAS ONLY DRAFT ASSESSMENT ORDER. THE ASSESSEE DISPU TED THE CLAIM AND SUBMITTED THAT THE ORDER DATED 14.10.20110 PASSED B Y THE AO WAS THE FINAL ORDER THOUGH ON THE SAID ORDER IT WAS WRONGLY MENT IONED AS DRAFT ASSESSMENT ORDER. THE ASSESSEE HAS FILED A COPY OF THE LETTER NO. DY.CIT- 16(3)/TP/2010-11 DATED 6.12.2010 OF THE DCIT FORWAR DING THERE WITH THE M/S POPATLAL NATHALAL SHAH - 3 - DRAFT ASSESSMENT ORDER WHICH SHOWED THAT THE DRAFT ASSESSMENT ORDER WAS DATED 6.12.2010 AND SINCE THE ASSESSEE HAD NOT OBJE CTED TO THE SAME, THE AO HAD PASSED THE FINAL ASSESSMENT ORDER ON 14.12.2 010. IT HAS ALSO BEEN SUBMITTED THAT ALONG WITH THE SAID ORDER THE ASSESS EE HAD ALSO RECEIVED DEMAND NOTICE WHICH HAD BEEN PAID BY THE ASSESSEE. IN VIEW OF THIS POSITION THE ORDER OF CIT(A) HOLDING THAT THE ORDER APPEAL A GAINST WAS ONLY A DRAFT ASSESSMENT ORDER CANNOT BE UPHELD. IN OUR VIEW MATT ERS REQUIRES FRESH VERIFICATION AT THE LEVEL OF CIT(A) BOTH REGARDING MAINTAINABILITY OF THE APPEAL AS WELL AS MERIT OF THE APPEAL. WE, THEREFORE, SET ASIDE THE ORDER OF CIT (A) AND RESTORE THE MATTER BACK TO HIM FOR PASSING A FR ESH ORDER AFTER NECESSARY VERIFICATION AND AFTER ALLOWING OPPORTUNITY OF HEAR ING TO THE ASSESSEE. 6. IN THE RESULT APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED ON 30-9-2013 SD/- SD/- (VIJAY PAL RAO) (RAJENDRA SINGH) JUDICIAL MEMBER ACCOUNTANT MEMBER SKS SR. P.S, MUMBAI DATED 30.9.2013 COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CONCERNED CIT(A) 4. THE CONCERNED CIT 5. THE DR, K BENCH, ITAT, MUMBAI BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCHES, MUMBAI