M/s Super Properties, New Delhi V. ITO, New Delhi

ITA 2361/DEL/2013

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 7380 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 6 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-10-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 29-10-2014
• Assessment Year: 2008-2009
• Appeal Filed On: 22-04-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B R R KUMAR
• Keywords: Opportunity of being heard; Principle of natural justice

Judgement Text

ITA NO. 2361/ DEL/ 2013 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH G , NEW DELHI BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI T.S. KAPOOR, ACCOUNTANT MEMBER I.T.A. N O. 2361/DEL/2013 A.Y. : 2008 - 09 M/S SUPER PROPERTIES, 305 - B, VIPIN GARDEN, MAIN NAJAFGARH ROAD, NEW DELHI 110 058 (PAN: ABHFS2806G) VS. INCOME TAX OFFICER, WARD 23(3), 1209, BLOCK E - 2, 12 TH FLOOR, CIVIC CENTRE, NEW DELHI 110 002 (APPELLANT) (RESPONDENT) ASSESSEE BY : SH. VINEET GARG, ADV. DEPARTMENT BY : SH. BRR KUMAR, SR. DR DATE OF HEARING : 29 - 10 - 2014 DATE OF ORDER : 29 - 10 - 2014 ORDER PER H.S. SIDHU : J M TH IS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS ) - XX III , NEW DELHI DATED 31 . 1 .201 3 P ERTAINING TO ASSESSMENT YEAR 2008 - 09 . 2. THE FOLLOWING GROUNDS HAVE BEEN RAISED BY THE ASSESSEE: - 1. THAT THE LEARNED ASSESSING AND APPELLATE AUTHORITIES HAVE ERRED IN LAW AND ON FACTS IN DISALLOWING RS.26,11,884/ - U/S.40(A)(IA) AND ADDING THE SAID AMOUNT IN THE APPELLANT'S TAXABLE INCOME. ITA NO. 2361/ DEL/ 2013 2 2. THAT IN THE ABSENCE OF SERVICE OF NOTICE U/S.143(2) WITHIN THE STIPULATED PERIOD, THE ORDER IS WITHOUT JURISDICTION AND CONTRARY TO LAW, BEING BARRED BY TIME. 3. THAT THE LEARNED ASSESSING AND APPELLATE AUTHORITY HAVE FAILED TO PROVIDE PROPER AND REASONABLE OPPORTUNITY OF BEING HEARD AND THE ORDER OF LD. CIT A IS AG AINST THE PRINCIPLE OF EQUITY AND JUSTICE. 4. THAT THE LEARNED ASSESSING AND APPELLATE AUTHORITIES HAVE FAILED TO CONSTRUE THE FACTS OF THE APPELLANT'S CASE IN THEIR RIGHT PERSPECTIVE. 5. THAT THE LEARNED ASSESSING AND APPELLATE AUTHORITIES HAVE ERRED IN WRONGLY APPLYING THE PROVISIONS OF LT. ACT, 1961 TO THE APPELLANT'S CASE. 6. THE APPELLANT DENIES HIS LIABILITY TO TAX AS UPHELD BY THE LEARNED CIT(A) AND DETERMINED AND COMPUTED BY THE LEARNED ASSESSING OFFICER AND THE MANNER IN WHICH IT HAS BEEN SO DET ERMINED OR COMPUTED. 3 . WE HAVE HEARD THE BOTH PARTIES AND PERUSED THE ORDERS PASSED BY THE REVENUE AUTHORITIES SPECIALLY THE IMPUGNED ORDER PASSED BY THE LD. FIRST APPELLATE AUTHORITY DATED 31 / 1 /2013 IN WHICH THE LD. FIRST APPELLATE AUTHORITY HAS DISMIS SED THE APPEAL OF THE ASSESSEE FOR NON PROSECUTION. FOR THE SAKE OF CONVENIENCE THE RELEVANT PARAGRAPHS OF THE IMPUGNED ORDER I.E. PARA 2 - 6 ARE REPRODUCED AS UNDER: {2} THE APPEAL WAS FIXED FOR HEARING ON 28.02.2012, VIDE NOTICE U/S 250 DATED 08.02.2012 . NONE ATTENDED ON THAT DATE. VIDE NOTICE DATED 11.05.2012, THE CASE WAS AGAIN FIXED FOR HEARING ON 28.05.2012. NO COMPLIANCE WAS MADE ON THAT DATE ALSO. THE CASE WAS AGAIN FIXED FOR HEARING ON 26.06.2012. ON THIS DATE AN ADJOURNMENT APPLICATION WAS FILED. THE CASE WAS REFIXED FOR 16.07.2012, VIDE ORDER SHEET ENTRY DATED 26.06.2012. ON 16.07.2012, AN ADJOURNMENT APPLICATION WAS FILED. VIDE ITA NO. 2361/ DEL/ 2013 3 NOTICE DATED 08.10.2012, THE CASE WAS AGAIN FIXED FOR HEARING ON 25.10.2012. ON THIS DATE ALSO THE APPELLANT SOUGHT ADJ OURNMENT. ANOTHER NOTICE DATED 21.1.2013, FIXING THE CASE FOR HEARING ON 30.01.2013, WAS ISSUED TO THE APPELLANT. AGAIN AN ADJOURNMENT APPLICATION WAS FILED ON THE DATE OF HEARING I.E. ON 30.01.2013. {3} IN CIT VS B.N.BHATTACHARYA (1977) 118 ITR 461(SC), THE HON'BLE APEX COURT WHILE DEALING WITH THE ISSUE OF PROSECUTION OF APPEAL HAS STATED THAT 'PREFERRING AN APPEAL MEANS MORE THAN FORMALLY FILING IT BUT EFFECTIVELY PURSUING IT' . THE DELHI TRIBUNAL IN CIT VS MULTIPLAN INDIA PVT.LTD. AS REPORTED IN 38 IT D 320 (DELHI) WHEN FACED WITH A SIMILAR SITUATION OF NON PROSECUTION OF APPEAL DISMISSED THE APPEAL OF THE REVENUE. {4} IT IS SEEN THAT THE APPELLANT HAS NOT ATTENDED THE HEARING OF THE APPEAL INSPITE OF NUMBER OF NOTICES ISSUED, AND A NUMBER OF ADJOURNME NTS GRANTED. THEREFORE, IT IS CRYSTAL CLEAR THAT THE APPELLANT IS NOT INTERESTED IN PROSECUTING THE APPEAL. ON THE BASIS OF THE DECISIONS AS DISCUSSED IN THE PRECEDING PARAGRAPH, THE APPEAL OF THE ASSESSEE IS , THEREFORE, LIABLE TO BE DISMISSED FOR NON - PRO SECUTION. {5} EVEN ON MERITS, THE APPELLANT IS NOT ENTITLED TO RELIEF. IT IS ADMITTED THAT THE APPELLANT FIRM EARNED COMMISSION ON BOOKING OF PLOTS IN HOUSING PROJECTS. AGAINST RECEIPT OF COMMISSION OF RS. 32,27,412/ - , THE APPELLANT CLAIMED TO HAVE PAID COMMISSION O F RS. 26,11,884/ - TO VARIOUS PERSONS. THE APPELLANT SUBMITTED BEFORE THE ASSESSING OFFICER THAT IT HAD FAILED TO DEDUCT TAX AS REQUIRED UNDER SECTION ~ 94H, AS 'WE HAVE NOT GOT REGISTERED UNDER THE PROCESS OF TAN'. THE ASSESSING OFFICER DISALLOWED THE PAYM ENT OF COMMISSION BY INVOKING THE PROVISIONS OF SECTION 40(A)(LA). IN THE STATEMENT OF FACTS FILED WITH THE APPEAL, THE PLEA TAKEN IS THAT THE COMMISSION PAID WAS ACTUALLY REBATE OR DISCOUNT OFFERED ITA NO. 2361/ DEL/ 2013 4 TO PROSPECTIVE BUYERS. NO DETAILS OF NAMES, ADDRESSES OR PROOF OF IDENTITY OF SUCH PERSONS IS PROVIDED. NO DETAILS OF THE PLOTS ON WHICH 'REBATE OR DISCOUNT' WAS OFFERED IS FILED. IT IS NOT AT ALL CLEAR HOW THE APPELLANT COULD HAVE OFFERED REBATE OR DISCOUNT ON 'PLOTS SOLD BY THE TWO COMPANIES FROM WHOM IT RECEI VED COMMISSION. IN THE ABSENCE OF ANY EVIDENCE REGARDING GENUINENESS OF SUCH PAYMENTS, LET ALONE THE APPLICABILITY OR OTHERWISE OF SECTION 194H, THE ADDITION MADE BY THE ASSESSING OFFICER DESERVES TO BE SUSTAINED. {6} IN THE RESULT, THE APPEAL IS DISMISS ED. 4 . AFTER THOROUGHLY GOING THROUGH THE AFORESAID IMPUGNED ORDER PASSED BY THE CIT(A) , W E ARE OF THE VIEW THAT THE SAID IMPUGNED ORDER IS CLEARLY VIOLATIVE OF THE EXPRESS PROVISION OF SECTION 250(6), WHICH PROVIDES THAT THE APPELLANT ORDERS OF THE CIT(A) ARE TO STATE THE POINTS RAISING IN THE APPEAL, THE DECISION OF AUTHORITY THEREON AND THE REASONS FOR SUCH DECISION. THE UNDERLYING RATIONAL OF THE PROVISION IS THAT SUCH ORDERS ARE SUBJECT TO FURTHER APPEAL TO THE TRIBUNAL. SPEAKING ORDER WOULD OBVIOUSLY ENABLE A PARTY TO KNOW PRECISE POINTS DECIDED IN HIS FAVOUR OR AGAINST HIM. ABSENCE OF THE FORMULATION OF THE POINT FOR DECISION FOR WANT OF CLARITY IN A DECISION UNDOUBTEDLY PUTS A PARTY IN QUANDARY. SECTION 250(6) EXPRESSLY EMBODIES THE PRINCIPLES OF NATURAL JUSTICE AND SUCH A PROVISION IS CLEARLY MANDATORY IN NATURE. THE IMPUGNED ORDER PASSED BY THE CIT(A) IN VIOLATION OF THE PROVISIONS OF SECTION 250(6) CANNOT, THEREFORE, BE SUSTAINED. REGARDING THE DECISION OF THE DELHI BENCH OF THE TRIBUNAL IN MULTIPLAN INDIA LIMITED (SUPRA) CITED BY THE LD. CIT(A), WE FIND THAT THE SAID DECISION IS CLEARLY DISTINGUISHABLE. SECTION 254 REFERRING TO THE ORDERS OF THE TRIBUNAL CONFERS PLENARY JURISDICTION ON THE TRIBUNAL IN THE MATTER OF PASSING ORDERS U/S 254(1). THERE IS NO SUCH EXPRESS STIPULATION IN SECTION 254 AS CONTAINED UNDER THE PROVISIONS OF SECTION 250(6) RELATING TO THE ORDERS OF LD. FIRST APPELLATE AUTHORITY. THEREFORE, RELIANCE PLACED BY THE LD. CIT(A) ON MULTIPLAN INDIA LIMITED (SUPRA) IS ENTIRELY MISPLACED. ITA NO. 2361/ DEL/ 2013 5 5 . KEEPING IN VIEW OF THE FACTS AND CIRCUMSTANCES EXPLAINED ABOVE, WE ARE OF THE VIEW THAT THE IMPUGNED ORDER PASSED BY THE LD. FIRST APPELLATE AUTHORITY IS NOT SUSTAINABLE IN THE EYE OF LAW. THEREFORE, WE CANCEL THE IMPUGNED ORDER DATED 31 . 1 .2013 PASSED BY THE LD. CIT(A) BY ACCEPTING THE APPEAL FILED BY THE ASSESSEE. KEEPING IN VIEW OF THE ISSUES IN DISPUTE AND THE EVIDENCES FILED BY THE ASSESSEE BEFORE THE REVENUE AUTHORITIES, WE ARE OF THE CONSIDERED VIEW THAT THE ISSUE REQUIRES ADJUDICATION BY THE LD. CIT(A), AFTER GIVING PROPER OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. ACC ORDINGLY, IN THE INTEREST OF JUSTICE, WE SET ASIDE THE ISSUE IN DISPUTE TO THE FILE OF THE LD. CIT(A) TO DECIDE THE SAME AFRESH UNDER THE LAW AFTER GIVING OPPORTUNITY TO THE ASSESSEE FOR SUBSTANTIATING ITS CLAIM. 6 . IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE O PEN C OURT ON 29 / 10 /20 1 4 ,UPON CONCLUSION OF HEARING. SD/ - SD/ - [ T.S. KAPOOR ] [ H.S. SIDHU ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATE 29 / 10 /201 4 SRBHATNAGAR COPY FORWARDED TO: - 1. APPELLANT - 2. RESPONDENT - 3. CIT 4. CIT (A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR, ITAT, DELHI BENCHES ITA NO. 2361/ DEL/ 2013 6