Wilful Finance & Investment Co. Pvt. Ltd., New Delhi V. DCIT, New Delhi

ITA 2584/DEL/2015

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 97804 (ITAT-DELHI)
• Duration Of Justice: 6 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-11-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC 2
• Next Hearing Date: 04-11-2015
• Assessment Year: 2005-2006
• Appeal Filed On: 01-05-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: GARIMA JAIN
• Keywords: Principle of natural justice; Reason to believe
• Section: 147

Judgement Text

ITA NO. 2584/DEL/2015 1 IN THE INCOME TAX APPELATE TRIBUNAL DELHI BENCH SMC-2: NEW DELHI BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER ITA NO. 2584/DEL/2015 A.Y. : 2005-06 M/S WILFUL FINANCE & INVESTMENT VS. DCIT, CI RCLE 18(1), CO. PVT. LTD., NEW DELHI K-7B, GROUND FLOOR, KALKAJI, NEW DELHI 110 019 (PAN : AAACW0280H) (APPELLANT) (RESPONDENT) ASSESSEE BY : SH. RAJESH DUREJA, ADV. DEPARTMENT BY : MS. GARIMA JAIN, SR. DR DATE OF HEARING : 04-11-2015 DATE OF ORDER : 04-11-2015 O R D E R THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST T HE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS)-22, NEW DELHI DATED 25.2.2015 PERTAINING TO ASSESSMENT YEAR 2005-06. 2. THE GROUNDS OF APPEAL READ AS UNDER:- 1. THAT THE ORDER OF THE LD. CIT (A) IS BAD IN LAW AND IS AGAINST THE FACTS AND CIRCUMSTANCES OF THE CASE. 2. THAT HAVING REGARDS TO THE FACTS AND CIRCUMSTANCE S OF THE CASE, THE LD. CIT (A) HAS ERRED IN LAW IN DISMISSING THE G ROUND OF ITA NO. 2584/DEL/2015 2 APPEAL ALLEGING THAT THE IMPUGNED ASSESSMENT IS BAD IN LAW AS THE SAME IS FRAMED WITHOUT A RETURN OF INCOME BEING FILED IN PURSUANCE TO NOTICE ULS 148 OF THE ACT. THAT CIT (A) HAS ALSO ERRED IN DISMISSING THE GROUND OF LIMITATION. 3. THAT THE LD. CIT (A) HAS GROSSLY ERRED IN NOT TAKI NG COGNIZANCE OF ADDITIONAL GROUNDS OF APPEAL FILED WITH HIM ON 18-0 2-2015 CHALLENGING THE RE-OPENING AND AS SUCH HIS APPELLAT E ORDER IS BAD IN LAW TO THAT EFFECT. 4. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT (A) HAS ERRED IN UPHOLDING THE ADDITION OF RS.10,50,000/- MADE ULS 68. 5. THAT THE LD. CIT (A) HAS ERRED IN UPHOLDING THE AC TION OF AO IN MAKING THE ADDITION OF RS.31,500/- ON ACCOUNT OF COM MISSION PAID. 6. THAT THE LD. CIT (A) HAS ERRED IN UPHOLDING THE AC TION OF AO IN MAKING THE DISALLOWANCE OF RS.50,000/- OUT OF SUNDR Y EXPENSES. 7. THAT THE APPELLANT CRAVES THE LEAVE TO ADD, MODIF Y, AMEND OR DELETE ANY OF THE GROUNDS OF THE APPEAL BEFORE OR A T THE TIME OF HEARING. 3. THE FACTS NARRATED BY THE REVENUE AUTHORITIES AR E NOT DISPUTED BY BOTH THE PARTIES, THEREFORE, THE SAME ARE NOT REPEATED HERE FOR THE SAKE OF CONVENIENCE. ITA NO. 2584/DEL/2015 3 4. AT THE TIME OF HEARING, LD. COUNSEL FOR THE AS SESSEE STATED THAT APART FROM THE CONTENTION RAISED BY THE ASSESSEE, BEFORE THE A O AS WELL AS LD. CIT(A), ASSESSEE HAS FILED THE ADDITIONAL GROUNDS BEFORE T HE LD. CIT(A) WHO PASSED THE IMPUGNED ORDER WITHOUT CONSIDERING THE ADDITIONAL GROUNDS RAISED BY THE ASSESSEE VIDE HIS LETTER DATED 18.2.2015 AND REQUESTED THAT THE LD. CIT(A) MAY BE DIRECTED TO ADMIT THE ADDITIONAL GROUNDS AND DECIDE THE ISSUE AFRESH, UNDER THE LAW. 5. ON THE CONTRARY, LD. DR RELIED UPON THE ORDERS O F THE AUTHORITIES BELOW AND OPPOSED THE REQUEST OF THE ASSESSEES COUNSEL. 6. I HAVE HEARD BOTH THE PARTIES AND PERUSED THE OR DERS PASSED BY THE REVENUE AUTHORITIES ALONGWITH RELEVANT RECORDS AVAILABLE ES PECIALLY THE LETTER DATED 18.2.2015 FILED BY THE ASSESSEE BEFORE THE LD. CIT(A) REQUESTING THEREIN ADMISSION OF ADDITIONAL GROUNDS. FOR THE SAKE OF CONVENIENC E, THE CONTENTS OF THE AFORESAID LETTER DATED 18.2.2015 ARE REPRODUCED BELOW:- 18-02-2015 THE COMMISSIONER OF INCOME TAX (APPEALS) - XXII, NEW DELHI. SUB: APPEAL NO. 104/14-15 OF WILFUL FINANCE & INVESTM ENT CO. (P) LTD. - ASSTT. YEAR 2005-06 - ADDITIONAL GROUNDS OF APPEAL- REG.- SIR, THE ASSESSMENT IN THE PRESENT CASE WAS COMPLETED ULS 143(3)/147 ON 31-3-2013. DURING THE COURSE OF RE-ASSESSMENT PROCE EDINGS, THE ASSESSEE ITA NO. 2584/DEL/2015 4 WAS SUPPLIED COPY OF THE REASONS RECORDED FOR ISSUI NG NOTICE U/S 148. AS PER SECTION 147 OF THE ACT, AN ASSESSING OFFICER CAN ASS ESS OR REASSESS THE INCOME OF ANY ASSESSMENT YEAR, SUBJECT TO OTHER SECTIONS O F THE ACT, IF HE HAS REASONS TO BELIEVE THAT ANY INCOME CHARGEABLE TO TAX HAS ES CAPED ASSESSMENT FOR THAT ASSESSMENT YEAR. ON PERUSAL OF THE COPY OF THE REASONS RECORDED IT IS NOTICED THAT NO SUCH BELIEF AS TO ESCAPEMENT OF INC OME HAS BEEN ARRIVED AT BY THE AO. WE HAD CHALLENGED THE IMPUGNED ASSESSMEN T U/S 143(3)/147 BY FILING AN APPEAL AGAINST THE SAID ORDER ON 13-5-2013 WHEREIN WE HAVE TAKEN SEVERAL GROUNDS OF APPEAL BUT DUE TO INADVERTENCE A T THE TIME OF FILING OF THE PRESENT APPEAL WE COULD NOT TAKE THE FOLLOWING GROU NDS OF APPEAL. NOW WE WANT TO TAKE THE FOLLOWING ADDITIONAL GROUNDS, WHIC H MAY BE READ AS GROUND NO. 7 & 8 AND THE GROUND NO. 7 OF APPEAL ALREADY FIL ED MAY KINDLY BE TREATED AS GROUND NO. 9: '7. THAT THE IMPUGNED RE-OPENING IS BAD IN LAW AS T HE NOTICE U/S 148 WAS ISSUED WITHOUT ANY 'REASON TO BELIEVE' THAT CERTAIN INCOME HAS ESCAPED ASSESSMENT. 8. THAT THE RE-OPENING IS VOID AS IT WAS SOLELY ON THE BASIS OF INFORMATION RECEIVED FROM INVESTIGATION WING & WITHOU T ANY INDEPENDENT APPLICATION OF MIND BY THE AO.' IT IS, THEREFORE, REQUESTED THAT THE ABOVE ADDITIONA L GROUNDS OF APPEAL MAY KINDLY BE ADMITTED AS INADVERTENTLY THESE GROUN DS COULD NOT BE TAKEN AT THE TIME OR FILING OF APPEAL. IT IS ALSO REQUESTED T HAT WHILE DECIDING THE PRESENT APPEAL THESE LEGAL GROUNDS MAY ALSO BE CONS IDERED ALONG WITH ITA NO. 2584/DEL/2015 5 GROUNDS OF APPEAL ALREADY TAKEN BECAUSE NON CONSIDE RATION OF THESE LEGAL GROUNDS WOULD LEAD TO TOTAL MISCARRIAGE OF JUSTICE. 7. AFTER PERUSING THE IMPUGNED ORDER, I AM OF THE CO NSIDERED VIEW THAT THE AFORESAID ADDITIONAL GROUNDS HAVE NOT BEEN CONSIDER ED BY THE LD. CIT(A) IN HIS IMPUGNED ORDER, WHICH IS AGAINST THE PRINCIPLE OF NATURAL JUSTICE. THEREFORE, IN THE INTEREST OF JUSTICE, THE IMPUGNED ORDER PASSED BY T HE CIT(A) IS QUASHED AND ALL THE ISSUES IN DISPUTE INCLUDING THE ADDITIONAL GROUNDS RAISED BY THE ASSESSEE ARE REMITTED BACK TO THE FILE OF THE LD. CIT(A) TO DECIDE THE SAME AFRESH, UNDER THE LAW, AFTER GIVING FULL OPPORTUNITY TO THE ASSESSEE OF BE ING HEARD. 8. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE STANDS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 04/11/2015. SD/- [H.S. SIDHU] JUDICIAL MEMBER DATE: 04/11/2015 SRBHATNAGAR COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4.CIT (A) 5. D R, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR, ITAT, DELHI BENCHES