Parduman Kumar Khanna, New Delhi V. ITO, New Delhi

ITA 2526/DEL/2013

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 69492 (ITAT-DELHI)
• Duration Of Justice: 6 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-11-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 30-04-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: YOGESH KUMAR VERMA
• Assessee Lawyers: J C KAPOOR
• Keywords: Opportunity of being heard; Principle of natural justice

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH SMC: NEW DELHI) BEFORE SMT. DIVA SINGH, JUDICIAL MEMBER ITA NOS.2526 & 2527 /DEL/ 2013 (ASSESSMENT YEAR :2009-10) PARDUMAN KUMAR KHANNA VS. ITO PROP. M/S KHANNA ENTERPRISES WARD-29 (1) 1635-A, SP MUKHERJEE MARG NEW DELHI NEW DELHI AAQPK9346F (APPELLANT) (RESPONDENT) ASSESSEE BY :SHRI J. C. KAPOOR, C.A REVENUE BY : SHRI YOGESH KUMAR VERMA, CIT DR ORDER BOTH THESE APPEALS HAVE BEEN FILED BY THE ASSESSEE AGAINST THE SEPARATE ORDERS DATED 21/1/2013 UPHOLDING THE PENAL TY IMPOSED BY THE A.O U/S 271(1)(C) AND 271B. FOR THE SAKE OF CONVENIENCE BOT H THE APPEALS ARE BEING DECIDED BY A COMMON ORDER AS THE RELEVANT FACTS REM AIN IDENTICAL IN BOTH THE APPEALS. A PERUSAL OF THE RECORD SHOWS THAT THE IM PUGNED ORDER WAS PASSED EX-PARTE ON THE BASIS OF WRITTEN SUBMISSIONS FILED BY THE ASSESSEE. IT IS SEEN THAT AGAINST THE IMPOSITION OF PENALTY U/S 271(1)(C ) AND 271B AS PER THE IMPUGNED ORDER THE ASSESSEE WAS PUT TO NOTICE BY TH E FIRST APPELLATE AUTHORITY ON 9/1/2013 TO BE PRESENT FOR HEARING ON 21/1/2013. THE RECORD SHOWS THAT THE IMPUGNED ORDER WAS PASSED ON THE SAID DATE ITSELF W ITHOUT AFFORDING THE ASSESSEE AN OPPORTUNITY OF HEARING AND INSTEAD TAKI NG INTO CONSIDERATION SOME WRITTEN SUBMISSIONS FILED ON BEHALF OF THE ASSESSEE ON AN EARLIER DATED. MR. J. ITA NOS. 2526 & 2527.DEL.13 2 C. KAPOOR APPEARING ON BEHALF OF THE ASSESSEE SUBMI TTED THAT IN THE WRITTEN SUBMISSIONS FILED BEFORE THE LD. CIT (A) EXPLANATIO N WAS OFFERED JUSTIFYING THE QUASHING OF THE PROCEEDINGS. A PERUSAL OF THE IMPUGNED ORDERS SHOWS THAT THE ACTION OF THE A.O HAS BEEN CONFIRMED ON THE GRO UND THAT THE EXPLANATION OFFERED BY THE ASSESSEE WAS NOT SATISFACTORY. VARI OUS PROPOSITIONS LAID DOWN IN DECISION HAVE BEEN RELIED UPON WHICH HAVE BEEN D ELIBERATED AT LENGTH HOWEVER WHAT WAS THE EXPLANATION OFFERED HAS NOT BE EN DISCUSSED. THE SETTLED LEGAL POSITION APPLIES TO FACTS AND THE ABSENCE OF A DISCUSSION OF THE EXPLANATION OFFERED IN THE BODY OF THE ORDER IT IS NOT APPROPRIATE NOR POSSIBLE TO CONCLUDE THAT THE LEGAL POSITION IS AGAINST THE ASSESSEE. AS DISCUSSED IS SEEN THAT BOTH THE ORDERS HAVE BEEN PASSED WITHOUT HEARI NG THE ASSESSEE. 2. RIGHT TO BE HEARD IS AN IMPORTANT RIGHT T O WHICH A PARTY WHO IS FACED WITH AN ADVERSE VIEW IS ENTITLED TO AUDI ALTERAM P ARTEM IS ONE OF THE MOST FAMOUS AND CELEBRATED RULE OF NATURAL JUSTICE. THE PRINCIPLES OF NATURAL JUSTICE ARE THOSE WHICH HAVE BEEN LAID OUT BY THE C OURTS AS BEING THE MINIMUM PROTECTION OF THE RIGHTS OF AN INDIVIDUAL AGAINST T HE ARBITRARY PROCEDURE THAT MAY BE ADOPTED BY A JUDICIAL, QUASI-JUDICIAL AND AD MINISTRATIVE AUTHORITY WHILE MAKING AN ORDER AFFECTING THOSE RIGHTS. A CAREFUL PERUSAL OF THE CONSISTENT JUDGMENTS OF THE APEX COURT WOULD SHOW THAT IT HAS CONSISTENTLY BEEN HELD THAT THE RULES OF NATURAL JUSTICE ARE NOT EMBODIED RULES AND THE SAID PHRASE IS NOT AND CANNOT BE CAPABLE OF A PRECISE DEFINITION. THE UNDERLYING PRINCIPLE OF NATURAL JUSTICE EVOLVED UNDER THE COMMON LAW IS TO CHECK ARBITRARY EXERCISE OF POWER BY THE STATE OR ITS FUNCTIONARIES. ACCORDING LY, THE PRINCIPLE BY ITS VERY NATURE IMPLIES THE DUTY TO ACT FAIRLY I.E. FAIR PLA Y IN ACTION MUST BE EVIDENT AT EVERY STAGE. FAIR PLAY DEMANDS THAT NOBODY SHALL B E CONDEMNED UNHEARD. ITA NOS. 2526 & 2527.DEL.13 3 2.1 IN THE CELEBRATED JUDGMENT OF THE APEX C OURT IN THE CASE OF A. K. KRAIPAK-VS-UNION OF INDIA (1969) 2 SCC 262, IT IS O BSERVED THAT THE AIM OF RULES OF NATURAL JUSTICE IS TO SECURE JUSTICE OR TO PUT IT NEGATIVELY TO PREVENT MISCARRIAGE OF JUSTICE. THE SAID RULES ARE MEANS T O AN END AND NOT AN END IN THEMSELVES AND THOUGH IT IS NOT POSSIBLE TO MAKE AN EXHAUSTIVE CATALOGUE OF SUCH RULES HOWEVER IT CAN BE READILY SAID THAT THER E ARE TWO BASIC MAXIMS OF NATURAL JUSTICE NAMELY AUDI ALTERAM PARTEM AND N EMO JUDEX IN RE SUA. IN THE PRESENT FACTS OF THE CASE WE ARE CONCERNED WITH THE MAXIM AUDI ALTERM PARTEM WHICH AGAIN MAY HAVE MANY FACETS TWO OF THEM (A) NOTICE OF THE CASE TO BE MET; AND (B) OPPORTUNITY TO EXPLAIN. THEIR L ORDSHIPS HAVE CAUTIONED THAT THESE RULES CANNOT BE SACRIFICED AT THE ALTAR OF TH E ADMINISTRATIVE CONVENIENCE OR CELEBRITY. THE ASSESSEE HAS RAISED GROUND NO.-1 IN REGARD TO THE OPPORTUNITY OF BEING HEARD AGITATED BEFORE US AND C ONSIDERING THE SUBMISSIONS OF EITHER SIDE WHERE IN THE SOLE ISSUE AGITATED BEF ORE US IS PERTAINING TO GRANTING OF OPPORTUNITY OF BEING HEARD WHICH ADMITT EDLY HAS NOT BEEN MADE AVAILABLE TO THE ASSESSEE WE ARE INCLINED TO ACCEPT THE PRAYER OF THE ASSESSEE ON A CAREFUL CONSIDERATION OF THE LEGAL POSITION TH EREON. ACCORDINGLY I DEEM IT APPROPRIATE IN THE PECULIAR FACTS AND CIRCUMSTANCES AFTER HEARING BOTH THE PARTIES TO RESTORE THE ISSUE BACK TO THE FILE OF TH E LD. CIT (A) WITH THE DIRECTION TO DECIDE THE SAME IN ACCORDANCE WITH LAW AFTER GIVING THE ASSESSEE A REASONABLE OPPORTUNITY OF BEING HEARD. 4. IN THE RESULT THE APPEALS OF THE ASSE SSEE ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON 14/11/2013. SD/- (DIVA SINGH) (JUDICIAL MEMBER) DATED THE 14 TH DAY OF NOVEMBER , 2013 ITA NOS. 2526 & 2527.DEL.13 4 R. NAHEED COPY FORWARDED TO 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. CIT(ITAT), NEW DELHI. AR,ITAT NEW DELHI.