The Income Tax Officer, Ward - 1, Udupi V. M/s Udupi Urban Development Authority, Bannanje

ITA 239/PAN/2018

AI Insights

The case involves multiple appeals by the Income Tax Officer, Ward-1, Udupi against the M/s. Udupi Urban Development Authority concerning the assessment years 2010-11, 2011-12, 2014-15, and 2015-16. The appeals were consolidated due to identical facts and circumstances across the cases. The primary issue revolved around the reliance on a Government of Karnataka notification dated 10/03/2006 by the Commissioner of Income Tax (Appeals) to grant relief to the assessee without allowing the Assessing Officer to comment on its applicability. The Tribunal found this procedure to be in violation of the principles of natural justice and remanded the matter back to the Assessing Officer for a thorough examination and a speaking order.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 136896 (ITAT-PANAJI)
• Duration Of Justice: 5 year(s) 1 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-07-2023
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: WT(D)
• Next Hearing Date: 06-07-2023
• Assessment Year: 2011-2012
• Appeal Filed On: 10-06-2018
• Laws Referred To: Government of Karnataka Notification no. UDD 522 MyAaPra 2005, dated 10/03/2006
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: K.S. BALASUBRAMANYA
• Keywords: Principle of natural justice

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PANAJI BENCH :: PANAJI BEFORE SHRI R.S. SYAL, HON.VICE-PRESIDENT & SHRI PARTHA SARATHI CHAUDHURY, HON.JUDICIAL MEMBER (Through virtual hearing) ITA No.238, 239, 241 & 242/PAN/2018 (A.Y. 2010-11, 2011-12, 2014-15 & 2015-16) ITO, Ward-1, Udupi. vs M/s. Udupi Urban Development Authority, Bannanje, Udupi. PAN : AAALC 0600 J Appellant Respondent Assessee by : Shri K.S. Balasubramanya, FCA Revenue by : Shri N. Shrikanth, DR Date of hearing : 07/07/2023 Date of pronouncement : 11/07/2023 O R D E R Per PARTHA SARATHI CHAUDHURY, JM: These appeals preferred by the Revenue emanates from the separate orders for A.Ys. 2010-11 & 2011-12 and combined order for A.Ys. 2014-15 & 2015-16 passed by the Commissioner of Income Tax (Appeals), Manguluru, all dated 27.03.2023 as per the grounds of appeals on record. 2. At the very outset, the parties herein conceded that the facts and circumstances and the issues involved in all these appeals are absolutely identical and similar and, therefore, all these appeals were heard together and were disposed of by this consolidated order. 3. Ld.DR opening his arguments submitted that for the purpose of ITA Nos.238, 239, 241 & 242/PAN/2018 M/s. Udupi Urban Development Authority 2 adjudication, ITA No.238/PAN/2018 for A.Y. 2010-11 may be taken as lead case. He further submitted that in all these cases, ld. CIT(A) has given relief to the assessee placing reliance on the notification of Govt. of Karnataka, dated 10/03/2006. Ld.DR further submitted that this notification was not sent to the AO for his comments and the ld.CIT(A) without calling for any remand report, had suo motu given relief, based on this notification. It was further submitted by the ld.DR that the AO must also be given an opportunity to verify the applicability of this notification to the facts of the assessee’s case and, therefore this matter may be remanded back to the file of the AO for adjudication as per law. 4. Ld.AR, on the other hand, could not demonstrate whether the said notification was sent to the AO for his comments regarding the applicability of the said notification to the facts of the assessee’s case. Ld.AR simply supported the findings of the ld. CIT(A). 5. We have heard the rival submissions and considered the facts and circumstances in this case. We find that at para 5.16, the ld.CIT(A) had relied on the Government of Karnataka Notification no. UDD 522 MyAaPra 2005, dated 10/03/2006, however, as rightly submitted by the ld.DR, the ld. CIT(A) had not called for any report from the AO regarding the applicability of the said notification to the facts of the assessee’s case and have simply given relief to the assessee based on this notification. The principles of natural justice ITA Nos.238, 239, 241 & 242/PAN/2018 M/s. Udupi Urban Development Authority 3 demands that any government order, notification, circular etc. if it is relied on by the first appellate authority, the concerned Assessing Officer should also be given an opportunity to give his submissions and comments on the applicability of such circular, notifications etc. In this regard before us, it is very clear and precise that the ld. CIT(A) has passed his decision on the aforesaid notification of the Government of Karnataka, but has not allowed the AO to put on record his comments/views on the subject matter. That, even the ld.AR was unable to demonstrate whether his jurisdictional Assessing Officer was referred to on this issue by the ld. CIT(A). We are of the considered view that in the interest of natural justice, ld. CIT(A) should have given an opportunity to the AO to place his comments on the applicability of the said notification. In view thereof, we set aside the order of the ld. CIT(A) and remand the matter to the file of the AO for adjudication as per law, verifying the applicability of the said notification of Government of Karnataka vis-a-vis- facts of the assessee’s case and come out with speaking order complying with the principles of natural justice. ITA No.238/PUN/2018 is allowed for statistical purposes. 6 At the outset, the parties herein conceded that facts and circumstances and issues involved in all these appeals are absolutely identical and similar, and therefore, our decision in ITA No. 238/PAN/2018 for A.Y. 2010-11 shall apply mutatis mutandis to the ITA Nos.238, 239, 241 & 242/PAN/2018 M/s. Udupi Urban Development Authority 4 remaining appeals. Therefore, ITA Nos.239, 241 & 242/PAN/2018 stands similarly allowed for statistical purposes. 7. In the combined result, appeals of the Revenue are allowed for statistical purposes. Order pronounced in open Court on 11 th July, 2023. Sd/- Sd/- (R.S. SYAL) (PARTHA SARATHI CHAUDHURY) VICE-PRESIDENT JUDICIAL MEMBER Dated : 11 th July, 2023 vr/- Copy to : 1. The Appellant. 2. The Respondent. 3. The Pr. CIT concerned. 5. The DR, ITAT, Panaji Bench, Panaji. 6. Guard File. By Order // TRUE COPY // Senior Private Secretary ITAT, Pune.