M/s Valley Extraction Pvt. Ltd., Shimla V. JCIT, Shimla

ITA 243/CHANDI/2011

• Counselvise Citation: 24321514 RSA 2011
• Duration Of Justice: 10 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-01-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 16-01-2012
• Assessment Year: 2006-2007
• Appeal Filed On: 09-03-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Principle of natural justice; Right to appeal

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDGARH BENCH A BEFORE SHRI H.L. KARWA AND SHRI D.K. SRIVASTAVA ITA NO. 243/CHD/2011 A.Y. 2006-07 M/S VALLEY EXTRACTION VS JCIT, PVT. LTD., KNOLLSWOOD ESTATE, SHIMLA RANGE CHOTTA SHIMLA, SHIMLA. SHIMLA. PAN: AABCV2161K (APPELLANT) (RESPONDENT) APPELLANT BY : SH. SUDHIR SEHGAL RESPONDENT BY : SH. AKHILESH GUPTA DATE OF HEARING : 16.01.2012 DATE OF PRONOUNCEMENT : 16.01.2012 O R D E R PER H.L. KARWA: THE APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINS T THE ORDER OF THE CIT(A), SHIMLA DATED 18.01.2011 I N CONFIRMING THE PENALTY OF RS. 30, 26,000/- LEVIED U /S 271D OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT ) FOR THE ASSESSMENT YEAR 2006-07. 2. BRIEFLY STATED THE FACTS OF THE CASE ARE THAT TH E ASSESSEE IS A COMPANY ENGAGED IN EXTRACTION OF CEDA R OIL. DURING THE COURSE OF PROCEEDINGS FOR ASSESSMENT YEA R 2006-07, IT WAS OBSERVED THAT THE COMPANY HAD RECEI VED A SUM OF RS. 30,26,000/- IN CASH AS SHARE APPLICATION MONEY FROM SH. TIJENDER SINGH, ONE OF THE DIRECTORS OF THE 2 COMPANY. SINCE CASH TRANSACTION EXCEEDED RS. 20,000 /-, PROVISIONS OF SECTION 269SS OF THE INCOME TAX ACT W ERE CONTRAVENED AND CONSEQUENTLY PENALTY PROCEEDINGS U/ S 271D OF THE ACT WERE INITIATED. THE AO VIDE ORDER D ATED 31.08.2009 LEVIED A PENALTY OF RS. 30,26,000/- U/S 271D OF THE ACT. 3. ON APPEAL, THE CIT(A) DISMISSED THE APPEAL OF TH E ASSESSEE EX PARTE FOR WANT OF PROSECUTION. HE FURTH ER STATED THAT ORDER OF THE ASSESSING OFFICER IS WELL REASONED AND BASED ON FACTS OF THE CASE. 4. WE HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE ALS O PERUSED THE MATERIAL AVAILABLE ON THE RECORD. IT IS TRUE THAT THE LD. CIT(A) HAS DECIDED THE APPEAL OF THE A SSESSEE EX PARTE. AFTER PERUSING THE IMPUGNED ORDER, IT WOU LD BE CLEAR THAT THE LD. CIT(A) HAS NOT PROVIDED ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE BEFORE D ECIDING THE APPEAL. IN OUR OPINION, THE LD. CIT(A) SHOULD H AVE AFFORDED ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE BEFORE DECIDING THE APPEAL. IN THE CASE OF RADHIKA CHARAN BANERJEE VS SAMBALPUR MUNICIPALITY, AIR (1979 ORISSA 69, THE HONBLE ORISSA HIGH COURT HELD THAT A RIGHT OF APPEAL WHEREVER CONFERRED INCLUDES A RIG HT OF BEING AFFORDED AN OPPORTUNITY OF BEING HEARD, IRRES PECTIVE OF THE LANGUAGE CONFERRING SUCH RIGHT. THAT IS A PA RT AND PARCEL OF THE PRINCIPLE OF NATURAL JUSTICE. WHERE A N 3 AUTHORITY IS REQUIRED TO ACT IN A QUASI-JUDICIAL CA PACITY, IT IS IMPERATIVE TO GIVE THE APPELLANT AND ADEQUATE OPPORTUNITY OF BEING HEARD BEFORE THE APPEAL. THUS, CONSIDERING THE ENTIRE FACTS OF THE PRESENT CASE, W E THINK IT PROPER TO SET ASIDE THE ORDER OF THE LD. CIT(A) IN TOTO AND RESTORE THE MATTER TO HIS FILE WITH A DIRECTION TO DECIDE THE APPEAL AFRESH ON MERITS IN ACCORDANCE WI TH LAW AFTER AFFORDING DUE AND REASONABLE OPPORTUNITY OF B EING HEARD TO THE ASSESSEE. 5. BESIDE THE ABOVE, THE LD. CIT(A) PASSED THE IMPU GNED ORDER IN UTTER VIOLATION OF THE PROVISIONS OF SECTI ON 250(6) OF THE ACT. THE PROVISIONS OF SECTION 250(6) PROVID ES THAT THE APPELLATE ORDERS OF THE COMMISSIONER (APPEALS) ARE TO STATE THE POINTS ARISING IN THE APPEAL, THE DECISIO N OF THE AUTHORITY THEREON AND THE REASONS FOR SUCH DECISION . THE UNDERLYING RATIONALE OF THE PROVISION IS THAT SUCH ORDERS ARE SUBJECT TO FURTHER APPEAL TO THE TRIBUNAL. SPEA KING ORDER WOULD OBVIOUSLY ENABLE A PARTY TO KNOW PRECIS E POINTS DECIDED IN HIS FAVOUR OR AGAINST HIM. ABSENC E 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 PAS SED BY THE COMMISSIONER (APPEALS) IN VIOLATION OF THE 4 PROVISIONS OF SECTION 250(6) COULD NOT, THEREFORE, BE SUSTAINED. 6. IN VIEW OF THE ABOVE, WE DIRECT THE LD. CIT(A) T O DECIDE THE APPEAL OF THE ASSESSEE PREFERABLY WITHIN 02 MONTHS FROM THE DATE OF RECEIPT OF A COPY OF THIS O RDER. AT THE SAME TIME WE ALSO DIRECT THE ASSESSEE TO COOPER ATE AND ATTEND THE HEARING TO BE FIXED BY THE CIT(A). 7. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER WAS PRONOUNCED IN THE OPEN COURT ON 16.01.2012. SD/- SD/- (D.K. SRIVASTAVA) (H.L. KARWA) ACCOUNTANT MEMBER VICE PRESIDENT DATED: 16.01.2012 COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT(A) 4. CIT 5. DR