POWERCAP CAPACITORS PRIVATE LIMITED, MUMBAI V. DEPUTY COMMISSIONER OF INCOME TAX-2(2)(1), MUMBAI, MUMBAI

ITA 2474/MUM/2023

• Counselvise Citation: [2023] 102 COUNSELVISE.COM (IT) 0192 (ITAT-MUMBAI)
• Duration Of Justice: 3 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-11-2023
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: C
• Next Hearing Date: 01-11-2023
• Assessment Year: 2018-2019
• Appeal Filed On: 13-07-2023
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Validity of assessment; Set aside
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “C” MUMBAI BEFORE SHRI OM PRAKASH KANT (ACCOUNTANT MEMBER) AND SHRI RAHUL CHAUDHARY (JUDICIAL MEMBER) ITA No. 2474/MUM/2023 Assessment Year: 2018-19 Powercap Capacitors Pvt. Ltd., 803, Swastik Chambers, CST Road, Chembur, Mumbai-400071. Vs. DCIT-2(2)(1), Mumbai. PAN No. AAACM 0152 G Appellant Respondent Assessee by : Mr. Himanshu Gandhi Revenue by : Mr. H M Bhatt, DR Date of Hearing : 02/11/2023 Date of pronouncement : 03/11/2023 ORDER PER OM PRAKASH KANT, AM This appeal by the assessee is directed against order dated 22.02.2023 passed by the Ld. Commissioner of Income-tax (Appeals) – National Faceless Appeal Centre, Delhi [in short ‘the Ld. CIT(A)’] for assessment year 2018-19, raising following grounds: 1. On the facts and circumstances of the case and law, the Ld. CIT(A) erred in not adjudicating grounds of appeal on merit. 2. 2. On the facts and circumstances of the case and law, the Ld. CIT(A) erred in confirming validity of assessment order passed under section 143(3) r.w.s. 144B of income tax act, 1961 without providing fair opportunity of being heard. Hence, the order passed by Ld. CIT(A) is against the principal of natural Justice and required to be quash. 3. 3. On the facts and circumstances of the case and law, the Ld. CIT(A) erred confirming disallowing of interest expenses of Rs 1637947. 4. 4. On the facts and circumstances of the case and law, the Ld. CIT(A) failed to considered that disallowance made by Ld. AO is without pointing out the section under which disallowance is made is bad in law and required to be deleted. 5. 5. On the facts and circumstances of the case and law, the Ld. CIT(A) failed to considered that advances were given to related party is out of own fu wholly and exclusively for the purpose of business only and allowable in nature. 6. 6. On the facts and circumstances of the case and law, the Ld. CIT(A) erred in confirming addition of Rs. 3048 on account of duty draw addition was made and even without considering the fact that appellant had not received such duty draw back. 7. 7. On the facts and circumstances of the case and law, the Ld. CIT(A) erred in confirming invocation 270A of Income Tax Act, 1961. 2. At the outset, the Ld. Counsel this appeal has been filed with a delay of 82 days. The Ld. Counsel for the assessee filed an of his office, he could not attend before the Ld. CIT(A) and therefore, was not aware of the appellate order passed by him in delay in filing the appeal by 82 days. The filed by the Ld. Counsel of the assessee “4. NFAC again fixed the case for hearing on 20.02.2023. But during that period, my house inauguration was there on 16.02.2023. In that period, I was shifting my house and office to my new house Flat No. 1202, Lodha Grandeur, Prabhadevi, Mumbai misplaced the file & documents of PCPL and couldn't file a submission before the NFAC on 20.02.2023. 5. On 13th July 2023, the PCPL approach me to know abou of appeal proceeding status for their financial statement contingent liability reporting. 6. That time I checked on Income Tax Portal & come to know that the appeal order is alread he facts and circumstances of the case and law, the Ld. CIT(A) erred confirming disallowing of interest expenses of Rs 1637947. 4. On the facts and circumstances of the case and law, the Ld. CIT(A) failed to considered that disallowance made by Ld. AO ithout pointing out the section under which disallowance is made is bad in law and required to be deleted. 5. On the facts and circumstances of the case and law, the Ld. CIT(A) failed to considered that advances were given to related party is out of own funds and interest paid on borrowing is wholly and exclusively for the purpose of business only and allowable in nature. 6. On the facts and circumstances of the case and law, the Ld. CIT(A) erred in confirming addition of Rs. 3048 on account of duty draw back without pointing out under which section addition was made and even without considering the fact that appellant had not received such duty draw back. 7. On the facts and circumstances of the case and law, the Ld. CIT(A) erred in confirming invocation of penalty under section 270A of Income Tax Act, 1961. At the outset, the Ld. Counsel for the assessee submitted that this appeal has been filed with a delay of 82 days. The Ld. Counsel filed an affidavit and submitted that due to shift of his office, he could not attend before the Ld. CIT(A) and therefore, was not aware of the appellate order passed by him in delay in filing the appeal by 82 days. The contents of the affidavit filed by the Ld. Counsel of the assessee are reproduced as under: 4. NFAC again fixed the case for hearing on 20.02.2023. But during that period, my house inauguration was there on 16.02.2023. In that period, I was shifting my house and office to my new house Flat No. 1202, Lodha Grandeur, Sayani Road, Opp. Parel S.T. Depot, Prabhadevi, Mumbai-400025. In shifting process, unfortunately 1 misplaced the file & documents of PCPL and couldn't file a submission before the NFAC on 20.02.2023. 5. On 13th July 2023, the PCPL approach me to know about the status of appeal proceeding status for their financial statement contingent liability reporting. 6. That time I checked on Income Tax Portal & come to know that the appeal order is already passed on 22.02.2023 ex-party. Powercap Capcitors Pvt. Ltd. 2 ITA No. 2474/Mum/2023 he facts and circumstances of the case and law, the Ld. CIT(A) erred confirming disallowing of interest expenses of Rs 4. On the facts and circumstances of the case and law, the Ld. CIT(A) failed to considered that disallowance made by Ld. AO ithout pointing out the section under which disallowance is 5. On the facts and circumstances of the case and law, the Ld. CIT(A) failed to considered that advances were given to related nds and interest paid on borrowing is wholly and exclusively for the purpose of business only and 6. On the facts and circumstances of the case and law, the Ld. CIT(A) erred in confirming addition of Rs. 3048 on account of back without pointing out under which section addition was made and even without considering the fact that 7. On the facts and circumstances of the case and law, the Ld. of penalty under section the assessee submitted that this appeal has been filed with a delay of 82 days. The Ld. Counsel affidavit and submitted that due to shifting of his office, he could not attend before the Ld. CIT(A) and therefore, was not aware of the appellate order passed by him ,which resulted contents of the affidavit reproduced as under: 4. NFAC again fixed the case for hearing on 20.02.2023. But during that period, my house inauguration was there on 16.02.2023. In that period, I was shifting my house and office to my new house Flat No. Sayani Road, Opp. Parel S.T. Depot, 400025. In shifting process, unfortunately 1 misplaced the file & documents of PCPL and couldn't file a submission t the status of appeal proceeding status for their financial statement contingent 6. That time I checked on Income Tax Portal & come to know that the 7. I immediately initiate the Tribunal and the appeal was filed before the Hon'ble Tribunal on 14.07.2023. 8. NFAC decided the matter Ex for that I tender my sincere apology to Hon'ble Members and promise to me more vigilant in future. 9. Due to such unfortunate events, there has been a delay of 82 days in filing Appeal. Under the aforesaid circumstances, the I submits that the delay in filling appeal was neither attributable to the PCPL nor intentional nor wa will suffer irreparable loss and injury, due to mistake on my part. Therefore, the delay caused due to genuine and bona fide reasons, So I request your honour to kindly condone the delay in the interest of justice and equity. 3. The Ld. Departmental Representative (DR) did not seriously objected for admission of the appeal. 4. In view of the reasons for delay explained by the assessee, we find that delay was cause due to bona therefore, we admit the appeal for adjudication. 5. Before us, the Ld. Counsel representation could be made before the Ld. CIT(A) due to mistake on his part and therefore, matter may be restored back for deciding afresh. The Ld. Counsel given undertaking that all notices issued either physically or electronically shall be complied and cooperation shall be extended in the appellate proceedings. We find that the Ld. CIT(A) has passed the order ex appeal on merit. In our opinion as per the provisions of section 250(6) of the Act, the Ld. CIT(A) is required to pass a reasoned order even in absence of any submission on the part of the assessee on merit. Therefore, we feel it appropriate to set aside t immediately initiate the process of filling appeal before Hon ble Tribunal and the appeal was filed before the Hon'ble Tribunal on 8. NFAC decided the matter Ex-party, due to mistake on my part and for that I tender my sincere apology to Hon'ble Members and promise me more vigilant in future. 9. Due to such unfortunate events, there has been a delay of 82 days in filing Appeal. Under the aforesaid circumstances, the I submits that the delay in filling appeal was neither attributable to the PCPL nor intentional nor warranted and if the delay is not condoned then PCPL will suffer irreparable loss and injury, due to mistake on my part. Therefore, the delay caused due to genuine and bona fide reasons, So I request your honour to kindly condone the delay in the interest of justice and equity.” The Ld. Departmental Representative (DR) did not seriously admission of the appeal. In view of the reasons for delay explained by the assessee, we was cause due to bonafide and sufficient refore, we admit the appeal for adjudication. Before us, the Ld. Counsel for the assessee submitted that no representation could be made before the Ld. CIT(A) due to mistake on his part and therefore, matter may be restored back for deciding Ld. Counsel given undertaking that all notices issued either physically or electronically shall be complied and cooperation shall be extended in the appellate proceedings. We find that the Ld. CIT(A) has passed the order ex-parte but without deciding the appeal on merit. In our opinion as per the provisions of section 250(6) of the Act, the Ld. CIT(A) is required to pass a reasoned order even in absence of any submission on the part of the assessee on merit. Therefore, we feel it appropriate to set aside t Powercap Capcitors Pvt. Ltd. 3 ITA No. 2474/Mum/2023 process of filling appeal before Hon ble Tribunal and the appeal was filed before the Hon'ble Tribunal on party, due to mistake on my part and for that I tender my sincere apology to Hon'ble Members and promise 9. Due to such unfortunate events, there has been a delay of 82 days in filing Appeal. Under the aforesaid circumstances, the I submits that the delay in filling appeal was neither attributable to the PCPL nor rranted and if the delay is not condoned then PCPL will suffer irreparable loss and injury, due to mistake on my part. Therefore, the delay caused due to genuine and bona fide reasons, So I request your honour to kindly condone the delay in the interest of The Ld. Departmental Representative (DR) did not seriously In view of the reasons for delay explained by the assessee, we fide and sufficient cause; the assessee submitted that no representation could be made before the Ld. CIT(A) due to mistake on his part and therefore, matter may be restored back for deciding Ld. Counsel given undertaking that all notices issued either physically or electronically shall be complied and cooperation shall be extended in the appellate proceedings. We find that the Ld. parte but without deciding the appeal on merit. In our opinion as per the provisions of section 250(6) of the Act, the Ld. CIT(A) is required to pass a reasoned order even in absence of any submission on the part of the assessee on merit. Therefore, we feel it appropriate to set aside the order of the Ld. CIT(A) and restore taking into consideration submission of the assessee. The ground No. 2 of the appeal of the assessee is accordingly allowed. The other grounds raised by the assessee are accor and therefore we are not required 6. In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced in the open Court on Sd/ (RAHUL CHAUDHARY JUDICIAL MEMBER Mumbai; Dated: 03/11/2023 Rahul Sharma, Sr. P.S. Copy of the Order forwarded to 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file. //True Copy// Ld. CIT(A) and restore the matter back for deciding afresh after taking into consideration submission of the assessee. The ground No. 2 of the appeal of the assessee is accordingly allowed. The other raised by the assessee are accordingly rendered academic therefore we are not required to adjudicate at this stage. In the result, the appeal filed by the assessee is allowed for nounced in the open Court on 03/1 Sd/- RAHUL CHAUDHARY) (OM PRAKASH KANT JUDICIAL MEMBER ACCOUNTANT MEMBER Copy of the Order forwarded to : BY ORDER, (Assistant Registrar) ITAT, Mumbai Powercap Capcitors Pvt. Ltd. 4 ITA No. 2474/Mum/2023 the matter back for deciding afresh after taking into consideration submission of the assessee. The ground No. 2 of the appeal of the assessee is accordingly allowed. The other dingly rendered academic at this stage. In the result, the appeal filed by the assessee is allowed for /11/2023. Sd/- PRAKASH KANT) ACCOUNTANT MEMBER BY ORDER, (Assistant Registrar) ITAT, Mumbai