Highland Tradelink Pvt. Ltd., Kolkata V. ITO, Ward - 1(4), Kolkata

ITA 2584/KOL/2018

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 4774 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 2 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-02-2020
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 19-12-2019
• Assessment Year: 2009-2010
• Appeal Filed On: 11-12-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RADHEY SHYAM
• Assessee Lawyers: MIRAJ D. SHAH
• Keywords: Opportunity of being heard; Set aside
• Section: 143(3); 22; 263

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B, BENC H KOLKATA BEFORE SHRI S.S.GODARA, JM &DR. A.L.SAINI, AM ./ITA NO.2584/KOL/2018 ( / ASSESSMENT YEAR: 2009-10) HIGHLAND TRADELINK PVT. LTD. C/O, MANOJ JAIN, 15B, DR. RAJENDRA PRASAD SARANI, KOLKATA-700001 VS. ITO, WARD-1(4), KOLKATA ./ ./PAN/GIR NO.: AACCH 0875 R (APPELLANT) .. (RESPONDENT) ./ITA NO.2587/KOL/2018 ( / ASSESSMENT YEAR: 2009-10) SUMERU RETAILERS PVT. LTD. C/O, VASUDHA JAIN, 15B, DR. RAJENDRA PRASAD SARANI, KOLKATA-700001 VS. ITO, WARD-1(4), KOLKATA ./ ./PAN/GIR NO.: AAMCS 2504 C (APPELLANT) .. (RESPONDENT) APPELLANT BY : SHRI MIRAJ D SHAH, A.R. RESPONDENT BY : SHRI RADHEY SHYAM, CIT / DATE OF HEARING : 19/12/2019 /DATE OF PRONOUNCEMENT : 21/02/2020 HIGHLAND TRADELINK PVT. LTD. SUMERU RETAILERS PVT. LTD. ITA NOS.2584&2587/KOL/2018 ASSESSMENT YEAR:2009-10 P PP PA AA AG GG GE EE E | || | 2 22 2 / O R D E R PER DR. A. L. SAINI: THE CAPTIONED TWO APPEALS FILED BY THE DIFFERENT ASSESSEES, PERTAINING TO ASSESSMENT YEAR 2009-10 ARE DIRECTED AGAINST THE SE PARATEORDERS PASSED BY THE COMMISSIONER OF INCOME TAX (APPEAL)-5, KOLKATA IN A PPEAL NOS. 469&468/CIT(A)-5/WD-1(4)/18-19/KOL, WHICH IN TURN A RISE OUT OF SEPARATE ASSESSMENT ORDERS PASSED BY THE ASSESSING OFFICER U /S 143(3)/ 263 / 147 / 143(3) OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT) DA TED 31.03.2016. 2. THESE TWO APPEALS RELATE TO DIFFERENT ASSESSEES , BUT COMMON AND IDENTICAL ISSUES ARE INVOLVED THEREFORE THESE HAVE BEEN CLUBB ED AND HEARD TOGETHER AND A CONSOLIDATED ORDER IS BEING PASSED FOR THE SAKE OF CONVENIENCE AND BREVITY. THE ASSESSEES APPEAL IN ITA NO. 2584/KOL/2018, FOR A.Y . 2009-10 IN CASE OF HIGHLAND TRADELINK PVT. LTD. IS TAKEN AS A LEAD CAS E. 3. AT THE OUTSET ITSELF, THE LD. COUNSEL FOR THE AS SESSEE SUBMITTED THAT DURING THE ASSESSMENT STAGE THE ASSESSING OFFICER HAS RECORDED THE FINDINGS IN PARA 5.3.(IV) OF HIS ORDER, WHEREIN THE ASSESSING OFFICER MENTIONED THAT THE ASSESSEE COMPANY AS WELL AS SHARE SUBSCRIBERS COMPANIES DO NOT EXIST PH YSICALLY AND THEY DO NOT HAVE ELECTRICITY CONNECTION. THESE ASSESSEES COMPANIES AND SHARE SUBSCRIBING COMPANIES DO NOT HAVE TELEPHONE CONNECTION, DO NOT HAVE RENTED OFFICE AND POSTAL ADDRESS OF THESE COMPANIES SHOW THAT THEY DO NOT HA VE PHYSICAL SET UP AT THEIR ADDRESSES. THE LD. COUNSEL FOR THE ASSESSEE SUBMITT ED THAT THE FINDINGS RECORDED BY THE ASSESSING OFFICER IS WRONG, IN FACT THESE COMPA NIES HAVE THEIR OWN OFFICES, ELECTRICITY CONNECTION, TELEPHONE CONNECTION, OWN O FFICE AND THESE COMPANIES ARE SITUATED AT THE POSTAL ADDRESSES GIVEN TO THE ASSES SING OFFICER. THEREFORE, THE FINDINGS RECORDED BY THE ASSESSING OFFICER IS NOT T ENABLE AND THE ASSESSEE SHOULD BE GIVEN ONE MORE OPPORTUNITY TO REPRESENT THE FACT S BEFORE THE ASSESSING OFFICER HIGHLAND TRADELINK PVT. LTD. SUMERU RETAILERS PVT. LTD. ITA NOS.2584&2587/KOL/2018 ASSESSMENT YEAR:2009-10 P PP PA AA AG GG GE EE E | || | 3 33 3 AND THEREFORE, THE ISSUE MAY BE REMITTED BACK TO TH E FILE OF THE ASSESSING OFFICER FOR DE NOVO ADJUDICATION. 4. ON THE OTHER HAND, THE LD. D.R. FOR THE REVENUE OBJECTED THAT THE ASSESSING OFFICER HAS RECORDED THESE FINDINGS AS THE ASSESSEE DID NOT PROVIDE ANY EVIDENCE ABOUT THEIR PHYSICAL EXISTENCE, TELEPHONE CONNECTIO N, ELECTRICITY CONNECTION AND THEIR OWN OFFICES. PER CONTRA, THE LD. COUNSEL SUBM ITTED THAT THESE INFORMATION WERE FILED BY THE ASSESSEE DURING THE ASSESSMENT ST AGE AND IN FACT, NOW THE ASSESSEE IS READY TO FILE THESE INFORMATION, IF ONE MORE OPPORTUNITY IS GIVEN TO HIM TO PLEAD HIS CASE BEFORE THE ASSESSING OFFICER. 5. WE HAVE HEARD BOTH THE PARTIES AND CAREFULLY GON E THROUGH THE SUBMISSION PUT FORTH ON BEHALF OF THE ASSESSEE ALONG WITH THE DOCU MENTS FURNISHED AND THE CASE LAWS RELIED UPON, AND PERUSED THE FACT OF THE CASE INCLUDING THE FINDINGS OF THE LD CIT(A) AND OTHER MATERIALS AVAILABLE ON RECORD.WE N OTE THAT ASSESSING OFFICER HAS MADE ADDITION SOLELY ON THE REASON THAT ASSESSEE HA S FAILED TO FURNISH EVIDENCES SUCH AS ELECTRICITY CONNECTION, TELEPHONE CONNECTIO N, POSTAL ADDRESSES AND DOCUMENTS / EVIDENCES RELATING TO PHYSICAL EXISTENC E OF SHARE SUBSCRIBING COMPANIES. THE LD. COUNSEL SUBMITTED BEFORE US THAT THESE DOCUMENTS / EVIDENCES AND INFORMATION WERE SUBMITTED BY THE ASSESSEE DURI NG THE ASSESSMENT STAGE BUT ASSESSING OFFICER HAS NOT CONSIDERED THE SAME. THER EFORE, WE ARE OF THE VIEW THAT ASSESSEE DID NOT GET PROPER OPPORTUNITY TO REPRESEN T HIS CASE BEFORE ASSESSING OFFICER. THEREFORE, WE ARE OF THE VIEW THAT ONE MOR E OPPORTUNITY SHOULD BE GIVEN TO THE ASSESSEE TO PLEAD HIS CASE BEFORE ASSESSING OFFICER. FOR THAT WE RELY ON THE JUDGMENT OF HONBLE SUPREME COURT IN THE CASE OF TI N BOX CO. VS. CIT REPORTED IN (2011) 116 TAXMAN 491 (SC) WHEREIN IT WAS HELD A S FOLLOWS: HELD THAT THE ASSESSEE COULD HAVE PLACED EVIDENCE BEFORE THE FIRST APPELLATE AUTHORITY OR BEFORE THE TRIBUN AL WAS REALLY OF NO CONSEQUENCE FOR IT IS THE ASSESSMENT O RDER THAT COUNTS. THAT ORDER MUST BE MADE AFTER THE ASSESSEE HAS BEEN GIVEN A REASONABLE OPPORTUNITY OF SETTING OUT HIS CASE. THEREFORE, THE TRIBUNAL WAS NOT JUSTIFIED IN NOT SET TING ASIDE THE ASSESSMENT ORDER IN SPITE OF A FINDI NG ARRIVED AT BY IT THAT THE ITO HAD NOT GIVEN A PROPER OPPORT UNITY OF HEARING TO THE ASSESSEE. ACCORDINGLY, THE APPEALS WERE ALLOWED. THE ORDER UNDE R CHALLENGE WAS SET ASIDE. THE ASSESSMENT ORDERS, TH AT OF THE COMMISSIONER (APPEALS) AND OF THE TRIBUNAL, WE RE ALSO SET ASIDE. THE MATTER SHALL BE REMANDED TO THE ASSESSING AUTHORITY FOR FRESH CONSIDERATION. HIGHLAND TRADELINK PVT. LTD. SUMERU RETAILERS PVT. LTD. ITA NOS.2584&2587/KOL/2018 ASSESSMENT YEAR:2009-10 P PP PA AA AG GG GE EE E | || | 4 44 4 ORDER 1. IT IS UNNECESSARY TO GO INTO GREAT DETAIL IN THESE MATTERS FOR THERE IS A STATEMENT IN THE ORDER OF T HE TRIBUNAL, THE FACT-FINDING AUTHORITY, THAT READS TH US : 'WE WILL STRAIGHTWAY AGREE WITH THE ASSESSEES SUBMISS ION THAT THE ITO HAD NOT GIVEN TO THE ASSESSEE PROPER OPPORTUNITY OF BEING HEARD.' THAT THE ASSESSEE COULD HAVE PLACED EVIDENCE BEFORE THE FIRST APPELLATE AUTHORITY OR BEFORE THE TRIBUN AL IS REALLY OF NO CONSEQUENCE FOR IT IS THE ASSESSMENT O RDER THAT COUNTS. THAT ORDER MUST BE MADE AFTER THE ASSESSEE HAS BEEN GIVEN A REASONABLE OPPORTUNITY OF SETTING OUT HIS CASE. WE, THEREFORE, DO NOT AGREE WITH THE TRIBUNAL AND THE HIGH COURT THAT IT WAS NOT NECESSAR Y TO SET ASIDE THE ORDER OF ASSESSMENT AND REMAND T HE MATTER TO THE ASSESSING AUTHORITY FOR FRESH ASSESSM ENT AFTER GIVING TO THE ASSESSEE A PROPER OPPORTUNI TY OF BEING HEARD. 2. TWO QUESTIONS WERE PLACED BEFORE THE HIGH COURT, OF WHICH THE SECOND QUESTION IS NOT PRESSED. THE FIRST QUESTION READS THUS : '1. WHETHER, ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE TRIBUNAL WAS JUSTIFIED IN NOT SETTI NG ASIDE THE ASSESSMENT ORDER IN SPITE OF A FINDING AR RIVED AT BY IT THAT THE INCOME-TAX OFFICER HAD NOT GIVEN A PROPER OPPORTUNITY OF HEARING TO THE ASSESSEE ?' IN OUR OPINION, THERE CAN ONLY BE ONE ANSWER TO THIS QUESTION WHICH IS INHERENT IN THE QUESTION ITSELF : IN THE NEGATIVE AND IN FAVOUR OF THE ASSESSEE. 3. THE APPEALS ARE ALLOWED. THE ORDER UNDER CHALLENGE IS SET ASIDE. THE ASSESSMENT ORDERS, THAT OF THE COMMISSIONER (APPEALS) AND OF THE TRIBUNAL ARE ALSO SET ASIDE. THE MATTER SHALL NOW BE REMANDED TO THE ASSESSING AUTHORITY FOR FRESH CONSIDERATION, AS AFO RESTATED. NO ORDER AS TO COSTS. CONSIDERING THE FACTUAL POSITION AS NARRATED ABOVE , WE ARE OF THE VIEW THAT ONE MORE OPPORTUNITY SHOULD BE GIVEN THESE ASSESSEES TO PLEAD THEIR CASES BEFORE THE ASSESSING OFFICER. THEREFORE, WE THINK IT FIT AND P ROPER TO REMIT THIS ISSUE BACK TO THE FILE OF THE ASSESSING OFFICER. HENCE, WE SET AS IDE THE ORDER OF THE LD. CIT(A) AND REMIT THE ISSUE BACK TO THE FILE OF ASSESSING O FFICER FOR DE NOVO ADJUDICATION. 6. IN THE RESULT, BOTH THE APPEALS ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE COURT ON 21.02.2020 SD/- ( S.S.GODARA ) SD/- (A.L.SAINI) / JUDICIAL MEMBER / ACCOUNTANT MEMBER /KOLKATA; / DATE: 21/02/2020 ( SB, SR.PS ) HIGHLAND TRADELINK PVT. LTD. SUMERU RETAILERS PVT. LTD. ITA NOS.2584&2587/KOL/2018 ASSESSMENT YEAR:2009-10 P PP PA AA AG GG GE EE E | || | 5 55 5 COPY OF THE ORDER FORWARDED TO: 1. I) HIGHLAND TRADELINK PVT. LTD. II) SUMERU RETAILERS PVT. LTD. 2. ITO, WARD-1(4), KOLKATA 3. C.I.T(A)- 4. C.I.T.- KOLKATA. 5. CIT(DR), KOLKATABENCHES, KOLKATA. 6. GUARD FILE. TRUE COPY BY ORDER ASSIST ANT REGISTRAR ITAT, KOLKA TA BENCHES