Munka Dall & Oil Mills Pvt. Ltd., Jaipur V. ITO, WARD-4(2), JAIPUR

ITA 242/JPR/2020

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 8661 (ITAT-JAIPUR)
• Duration Of Justice: 4 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-07-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 17-03-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: CHANCHAL MEENA ACIT
• Assessee Lawyers: S L PODDAR
• Keywords: Business income; Condonation of delay; Bonafide mistake; Set aside
• Section: 271(1)(c); 250

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S,B JAIPUR JH FOT; IKY JKO] U;KF;D LNL; ,OA JH FOE FLAG ;KNO] YS[KK LNL; DS LE{K BEFORE: SHRI VIJAY PAL RAO, JM & SHRI VIKRAM SINGH YADAV, AM VK;DJ VIHY LA- @ ITA NO. 242/JP/2020 FU/KZKJ.K O'K Z @ ASSESSMENT YEAR : 2010-11 MUNKA DALL & OIL MILLS PVT. LTD. FLAT NO. 102, SUNSHIN PALM, SIKAR ROAD, JAIPUR. CUKE VS. THE ITO, WARD-4(2), JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AABCM 0932 D VIHYKFKHZ@ APPE LLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ L S@ ASSESSEE BY : SHRI S. L. PODDAR (ADV.) JKTLO DH VKSJ LS @ REVENUE BY : MISS CHANCHAL MEENA (ACIT) LQUOKBZ DH RKJH[ K@ DATE OF HEARING : 15/07/2020 MN?KKS'K.KK DH RKJH[ K@ DATE OF PRONOUNCEMENT: 20/07/2020 VKNS'K@ ORDER PER: VIJAY PAL RAO, J.M. THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER DATED 09.01.2019 OF LD. CIT(A), JAIPUR FOR THE ASSESSMENT ORDER 2010-11. DUE TO PREVAILING COVID-19 PANDEMIC CONDITION THE HEARI NG OF THE APPEAL IS CONCLUDED THROUGH VIDEO CONFERENCE. 2. THERE IS DELAY OF 349 DAYS IN FILING THE PRESENT APPEAL. THE ASSESSEE HAS FILED AN APPLICATION FOR CONDONATION O F DELAY WHICH IS SUPPORTED BY THE AFFIDAVIT OF THE ASSESSEE. ITA NO. 242/JP/2020 MUNKA DALL & OIL MILLS PVT. LTD. VS. ITO 2 3. WE HAVE HEARD THE LD. AR AS WELL AS THE LD. DR ON CONDONATION OF DELAY IN FILING THE PRESENT APPEAL. THE LD. AR O F THE ASSESSEE HAS SUBMITTED THAT THE NOTICES ISSUED BY THE LD. CIT(A) AFTER THE CASE WAS TRANSFERRED FROM THE LD. CIT(A)-II, JAIPUR TO LD. C IT(A), AJMER WAS NOT RECEIVED BY THE ASSESSEE DUE TO THE REASON THAT THE ASSESSEE HAS SOLD ITS FACTORY PREMISES IN THE YEAR 2018 AND CONSEQUEN TLY THE ADDRESS OF THE ASSESSEE WAS CHANGED TO FLAT NO. 102 SUNSHIN PA LM, SIKAR ROAD, JAIPUR. THE LD. AR OF THE ASSESSEE HAS SUBMITTED TH AT THE ASSESSEE IN THE RETURN OF INCOME FOR THE ASSESSMENT YEAR 2018-1 9 AS WELL AS FOR THE ASSESSMENT YEAR 2019-20 HAS GIVEN A NEW ADDRESS OF THE ASSESSEE THEREFORE, CHANGE OF THE ADDRESS WAS DULY INTIMATED TO THE DEPARTMENT WHEN THE ASSESSEE FILED HIS RETURN OF INCOME FOR TH E ASSESSMENT YEAR 2018-19 AND FOR THE ASSESSMENT YEAR 2019-20. HE HAS ALSO POINTED OUT THAT THE ASSESSEE ALSO INTIMATED ABOUT THE CHANGE O F ADDRESS TO THE ROC AND OTHER GOVERNMENT DEPARTMENTS AND NECESSARY CHANGES WERE MADE IN THIS RESPECT. THUS, THE LD. AR HAS SUBMITTE D THAT DUE TO CHANGE OF ADDRESS OF THE ASSESSEE NEITHER NOTICES ISSUED B Y THE LD. CIT(A), AJMER AFTER THE CASE WAS TRANSFERRED FROM THE LD. C ITI(A), JAIPUR TO LD. CIT(A), AJMER NOR THE IMPUGNED ORDER PASSED BY THE LD. CIT(A) WAS RECEIVED BY THE ASSESSEE AS THESE WERE SENT TO THE OLD ADDRESS OF THE ITA NO. 242/JP/2020 MUNKA DALL & OIL MILLS PVT. LTD. VS. ITO 3 ASSESSEE. THUS, THE LD. AR HAS SUBMITTED THAT ONLY WHEN THE ASSESSEE RECEIVED THE PENALTY ORDER PASSED U/S 271(1)(C) OF THE IT ACT IT CAME TO KNOW ABOUT THE IMPUGNED ORDER OF THE LD. CIT(A) AND IMMEDIATELY FILED THE PRESENT APPEAL. THUS, THE DELAY IN FILING THE A PPEAL IS NEITHER WILLFUL NOR DELIBERATE BUT DUE TO BONAFIDE REASON OF NOT RE CEIVING THE IMPUGNED ORDER BY THE ASSESSEE PRIOR TO THE DATE WH EN THE PENALTY ORDER U/S 271(1)(C) OF THE ACT RECEIVED BY THE ASSE SSEE. HE HAS FURTHER POINTED OUT THAT THE PENALTY ORDER U/S 271(1)(C) OF THE ACT WAS ALSO PASSED BY THE AO EX-PART AND THE SERVICE OF THE SAI D ORDER DATED 12.03.2020 WAS AFFECTED THROUGH DEPARTMENTAL PROCES S SERVER. ONCE, CHANGE OF ADDRESS WAS DULY INTIMATED TO THE AO THE N IT WAS THE DUTY OF THE AO TO COMMUNICATE THE SAME TO THE LD. CIT(A). T HE LD. AR HAS PLEADED THAT WHEN THE ASSESSEE HAS EXPLAINED A REAS ONABLE AND BONAFIDE CAUSE FOR DELAY IN FILING THE APPEAL THEN THE SAME MAY BE CONDONED SO AS TO DECIDE THE APPEAL OF THE ASSESSEE ON MERITS. IN SUPPORT OF HIS CONTENTION, HE HAS RELIED UPON THE F OLLOWING ORDER AS UNDER:- I. VIJAY VISHAN MEGHANI VS. DCIT (2017) 398 ITR 250 . II. JUST STEEL VS. DCIT (2012) 74 DTR (MA) 86. ITA NO. 242/JP/2020 MUNKA DALL & OIL MILLS PVT. LTD. VS. ITO 4 III. IMPROVEMENT TRUST VS. UJAGAR SINGH (SC) CIVIL APPEAL NOS. 2395 OF 2008 DATED 26.06.2010. THE LD. AR HAS ALSO REFERRED TO NUMBER OF OTHER DEC ISIONS ON THIS POINT THAT WHEN SUBSTANTIAL JUSTICE AND TECHNICAL CONSIDE RATIONS ARE PITTED AGAINST EACH OTHER, THE CAUSE OF SUBSTANTIAL JUSTIC E DESERVES TO BE PREFERRED. HE HAS CONTENDED THAT TIME AND AGAIN THE HONBLE SUPREME COURT HAS OBSERVED THAT THERE SHOULD BE A LIBERAL, PRAGMATIC, JUSTICE ORIENTED, NON-PEDANTIC APPROACH WHILE DEALING WITH AN APPLICATION FOR CONDONATION OF DELAY. THE TERM SUFFICIENT CAUSE S HOULD BE UNDERSTOOD IN ITS PROPER SPIRIT, PHILOSOPHY AND PURPOSE SO THA T SUBSTANTIAL JUSTICE SHOULD BE PREFERRED THEN THE TECHNICAL CONSIDERATIO NS. ACCORDINGLY, HE HAS PRAYED THE DELAY IN FILING THE APPEAL MAY BE CO NDONED. 4. ON THE OTHER HAND, LD. DR HAS SUBMITTED THAT THE REASON EXPLAINED BY THE ASSESSEE BEING NON RECEIPT OF NOTI CES ARE CONTRARY TO THE FACT THAT THE NOTICES AS WELL AS IMPUGNED ORDER WERE SENT TO THE ASSESSEE AT THE ADDRESS GIVEN BY THE ASSESSEE IN FO RM NO. 35. IN THE ABSENCE OF CHANGE OF ADDRESS GIVEN BY THE ASSESSEE OR ANY SUCH FACT BROUGHT ON RECORD OF THE LD. CIT(A) THERE IS NO OCC ASION FOR THE LD. CIT(A) TO SEND THE NOTICES OR THE IMPUGNED ORDER AT THE NEW ADDRESS. THE ASSESSEE CANNOT SHIFT THE BURDEN WITHOUT GIVING A FRESH ADDRESSS TO ITA NO. 242/JP/2020 MUNKA DALL & OIL MILLS PVT. LTD. VS. ITO 5 THE LD. CIT(A). THE LD. DR HAS FURTHER CONTENDED TH AT THIS CANNOT BE CONSIDERED AS BONAFIDE MISTAKE AS THE ASSESSEE DID NOT EVEN BOTHERED ABOUT THE PENDENCY OF ITS APPEAL BEFORE THE LD. CIT (A) OR TO VERIFY THE STATUS OF THE APPEAL FILED BY THE ASSESSEE FOR A LO NG TIME AND ONLY WHEN THE PENALTY ORDER PASSED U/S 271(1)(C) OF THE ACT W AS SERVED UPON THE ASSESSEE, THE ASSESSEE HAS TAKEN THESE STEPS FOR FI LING THE APPEAL. THEREFORE, THESE EXPLANATION OF THE ASSESSEE ARE NO THING BUT GROSS NEGLIGENCE ON THE PART OF THE ASSESSEE NOT TO PURSU E OR EVEN BOTHERED ABOUT THE APPEAL FILED BEFORE THE LD. CIT(A). SHE H AS OPPOSED TO THE CONDONATION OF DELAY. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WELL AS RELEVANT MATERIAL ON RECORD. THE ASSESSEE FILED THE APPEAL B EFORE THE LD. CIT(A) ON 25.01.2018 SUBSEQUENTLY, THE APPEAL WAS TRANSFER RED FROM THE LD. CIT(A)-II, JAIPUR TO LD. CIT(A), AJMER VIDE NOTIFIC ATION DATED 25.09.2018. IN THE MEAN TIME THE ASSESSEE SOLD THE PREMISES AT C-186, ROAD NO. 9, VKI AREA, JAIPUR AND SIFTED TO NEW ADDR ESS AT FLAT NO. 102 SUNSHIN PALM, SIKAR ROAD, JAIPUR HOWEVER, THE SAID CHANGE OF THE ADDRESS OF THE ASSESSEE WAS NOT INTIMATED TO THE LD . CIT(A). THEREFORE, NOTHING WAS BROUGHT ON RECORD OF THE LD. CIT(A) REG ARDING THE CHANGE OF ADDRESS OF THE ASSESSEE. IN THESE FACTS THE LD. CIT(A) WAS NOT ITA NO. 242/JP/2020 MUNKA DALL & OIL MILLS PVT. LTD. VS. ITO 6 SUPPOSED TO ISSUE THE NOTICES AT THE NEW ADDRESS OF THE ASSESSEE. THE LD. CIT(A) HAS GIVEN REASON FOR DECIDING THE APPEAL EX-PARTE IN PARA 3 OF THE IMPUGNED ORDER AS UNDER:- 3.0 DURING THE COURSE OF APPELLATE PROCEEDINGS, TH E APPEAL WAS FIXED FOR HEARING ON 25.10.2018, 13.11.2018, 11.12. 2018 AND 27.12.2018. THE APPEAL WAS LAST FIXED FOR HEARING O N 09.01.2019. NO ONE HAS ATTENDED ON ANY OF THE DATE OF HEARING A ND NO WRITTEN SUBMISSION HAS BEEN FILED. THEREFORE, THE A PPEAL IS DECIDED AFTER GOING THROUGH THE ASSESSMENT ORDER AN D GROUNDS OF APPEAL AS UNDER. THUS, IT IS CLEAR THAT AFTER THE CASE WAS TRANSFERR ED TO THE JURISDICTION OF THE LD. CIT(A), AJMER THE ASSESSEE NEVER APPEARED A ND ATTENDED THE PROCEEDINGS AND CONSEQUENTLY THE APPEAL OF THE ASSE SSEE WAS DECIDED BY IMPUGNED EX-PARTE ORDER. THE ASSESSEE HAS EXPLAI NED THE REASONS FOR DELAY IN FILING THE APPEAL THAT THE ASSESSEE HA S NOT RECEIVED THE IMPUGNED ORDER AND CAME TO KNOW ABOUT THE SAME ONLY WHEN THE ORDER PASSED U/S 271(1)(C) OF THE ACT DATED 12.03.2020 WA S SERVED UPON THE ASSESSEE AT THE NEW ADDRESS THROUGH THE PROCESS SER VER OF THE DEPARTMENT. THERE IS NO DISPUTE ABOUT THE FACT THAT BECAUSE OF THE FAILURE ON THE PART OF THE ASSESSEE TO INTIMATE THE NEW ADDRESS TO THE LD. CIT(A) THE NOTICES ISSUED BY THE LD. CIT(A) AS WELL AS IMPUGNED ORDER COULD NOT BE RECEIVED BY THE ASSESSEE. THUS, WE FIND THAT ITA NO. 242/JP/2020 MUNKA DALL & OIL MILLS PVT. LTD. VS. ITO 7 EXPLANATION OF NON RECEIPT OF THE IMPUGNED ORDER BY THE ASSESSEE IS FACTUALLY CORRECT HOWEVER, THE REASON FOR SUCH NON RECEIPT OF THE IMPUGNED ORDER IS THE FAILURE ON THE PART OF THE AS SESSEE TO GIVE THE FRESH ADDRESS TO THE LD. CIT(A). THEREFORE, IN THES E FACTS AND CIRCUMSTANCES OF THE CASE WHEN THE LD. CIT(A) HAS D ECIDED THE APPEAL OF THE ASSESSEE VIDE IMPUGNED EX-PARTE ORDER, THE D ELAY IN FILING THE APPEAL IS DUE TO MISTAKE ON THE PART OF THE ASSESSE E WHICH CANNOT BE REGARDED AS A DELIBERATE OR WILLFUL DEFAULT ON THE PART OF THE ASSESSEE. IT IS SETTLED PROPOSITION OF LAW IF THE CAUSE OF DELAY AS EXPLAINED BY THE ASSESSEE IS FOUND TO BE FACTUAL CORRECT THEN LAPS O N THE PART OF THE ASSESSEE CANNOT BE A GROUND FOR REJECTING THE CONDO NATION OF DELAY. THE CAUSE OF SUBSTANTIAL JUSTICE HAS TO BE PREFERRE D THEN THE TECHNICAL CONSIDERATION. THEREFORE, EVEN IF THERE IS LAPSE OR INACTION ON THE PART OF THE ASSESSEE A JUSTICE ORIENTED LIBERAL APPROACH HA S TO BE TAKEN WHILE CONSIDERING THE CONDONATION OF DELAY. ACCORDINGLY, IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN THE INTEREST OF JU STICE WE CONDONE THE DELAY OF 349 DAYS SUBJECT TO COST OF 2500/-. 6. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS:- 1. UNDER THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ACTION O F THE LEARNED ITA NO. 242/JP/2020 MUNKA DALL & OIL MILLS PVT. LTD. VS. ITO 8 AO IN PASSING THE ORDER U/S 147/143(3) WHICH IS VOI D AB-INITIO DESERVES TO BE QUASHED. 2. UNDER THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LEARNED CIT(A) HAS ERRED IN PASSING THE EX-PARTE OR DER WITHOUT SERVING THE NOTICE OF HEARING TO THE ASSESSEE. 3. UNDER THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ADDITION OF RS. 1,52,457/- ON ACCOUNT OF MISUSE OF CCM FACILITY. 4. UNDER THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ADDITION OF RS. 3049/- FOR COMMISSION PAYMENT FOR AVAILING CCM FACILITY. 5. UNDER THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ADDITION OF RS. 44,93,115/- ON ACCOUNT OF SPECULATION AND F &O LOSS ES SET OFF AGAINST THE BUSINESS INCOME. 7. WE HAVE HEARD THE LD. AR AS WELL AS LD. DR AND C ONSIDERED THE RELEVANT MATERIAL ON RECORD. THE APPEAL OF THE ASSE SSEE WAS DECIDED BY THE LD. CIT(A) BY IMPUGNED EX-PARTE ORDER. THE FACT S AND CIRCUMSTANCES UNDER WHICH THE APPEAL OF THE ASSESSEE WAS DISMISSE D BY EX-PARTE ORDER HAS BEEN DISCUSSED BY US WHILE DECIDING THE A PPLICATION FOR CONDONATION OF DELAY IN FOREGOING IN PARA OF THIS O RDER. WHEN NOTICES ISSUED BY THE LD. CIT(A) AT THE OLD ADDRESS AND THE ASSESSEE HAS ALREADY SIFTED TO THE NEW ADDRESS THEN CONSIDERING THE FACTS AND CIRCUMSTANCE OF THE CASE AS WELL AS IN THE INTEREST OF JUSTICE WE SET ASIDE THE IMPUGNED ORDER OF THE LD. CIT(A) AND REMI T THE MATTER TO THE ITA NO. 242/JP/2020 MUNKA DALL & OIL MILLS PVT. LTD. VS. ITO 9 RECORD OF THE LD. CIT(A) FOR DECIDING THE SAME AFRE SH AFTER GIVING ONE MORE OPPORTUNITY OF HEARING TO THE ASSESSEE. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOW ED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 20/07/2020. SD/- SD/- FOE FLAG ;KNO FOT; IKY JKO (VIKRAM SINGH YADAV) (VIJAY PAL RAO) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 20/07/2020. * SANTOSH. VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- MUNKA DALL & OIL MILLS PVT. LTD., JA IPUR. 2. IZR;FKHZ@ THE RESPONDENT- ITO, WARD-4(2), JAIPUR. 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDR@ CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR. 6. XKMZ QKBZY@ GUARD FILE {ITA NO. 242/JP/2020} VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASST. REGISTRAR