M/s. Vinex Enterprises (P) Ltd., Meerut V. ACIT, Meerut

ITA 2714/DEL/2013

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 6804 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 9 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-02-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 31-01-2017
• Assessment Year: 2008-2009
• Appeal Filed On: 03-05-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: UMESH CHAND DUBEY
• Keywords: Revision of order; Opportunity of being heard; Principle of natural justice; Set aside
• Section: 32; 147; 131; 68; 246; 69; 145; 27; 148; 54; 37; 6; 56; 263; 63; 132; 12; 28; 144; 10; 90; 154; 2; 11; 15; 271(1)(b); 139; 143(3); 92; 143(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH D , NEW DELHI BEFORE SH. N. K. SAINI, AM AND SMT. BEENA PILLAI , JM ITA NO. 2714 /DEL/2013 : ASSTT. YEAR : 2008 - 0 9 M/S VINEX ENTERPRISES (P) LTD., 226, PHASE - I I, MORAKHPUR, DELHI ROAD, MEERUT VS ACIT, MEERUT - 2, MEERUT (APPELLANT) (RESPONDENT) PAN NO. A A BCV6381M ASSESSEE BY : SH. VINOD KUMAR GOEL, ADV. REVENUE BY : SH. UMESH CHAND DUBEY, SR. DR DATE OF HEARING : 31.01 .201 7 DATE OF PRON OUNCEMENT : 08 . 02 .201 7 ORDER PER N. K. SAINI, AM: THIS IS AN APPEAL BY THE ASSESSEE AGAINST THE ORDER DATED 25.03 .2013 OF LD. CIT , MEERUT . 2. FOLLOWING GROUNDS HAVE BEEN RAISED IN THIS APPEAL: 1. THAT NOTICE U/S 263 ISSUED BY C IT, MEERUT WAS VAGUE AND IS BASED UPON INCORRECT FACTS AND LAW AND NO REASONABLE AND PROPER OPPORTUNITY BEING HEARD WAS ALLOWED. HENCE, ENTIRE PROCEEDING IS AGAINST THE PRINCIPLE OF NATURAL JUSTICE. 2. THAT THE FINDING GIVEN BY THE LD. CIT, MEERUT RELATIN G TO ADMISSIBILITY OF EXPENSES ON FOREIGN TOUR, REPAIRS AND MAINTENANCE ACCOUNT IS ALREADY EXAMINE D BY THE A.O. AND TAKEN ONE OF THE POSSIBLE VIEW IN ITA NO. 2714 /DEL /201 3 VINEX ENTERPRISES (P) LTD. 2 FAVOUR OF THE ASSESSEE. THEREFORE, TO SET ASIDE THIS ISSUE AGAINST ASSESSEE IS NOTHING BUT DUPLICATION OF WORK. THEREFORE, FINDING GIVEN BY THE CIT IS UNJUSTIFIED & UNNECESSARY IN VIEW OF HON'BLE SUPREME COURT & ALLAHABAD HIGH COURT JUDGMENT. 3. THAT THE ASSESSEE HAS RIGHT TO ADD, DELETE OR MODIFY ANY GROUNDS DURING THE APPEAL PROCEEDING. 3. FROM THE ABOVE GROUNDS, IT IS GATHERED THAT THE MAIN GRIEVANCE OF THE ASSESSEE RELATES TO THE PROPER OPPORTUNITY OF BEING HEARD NOT PROVIDED WHILE PASSING THE IMPUGNED ORDER U/S 263 OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) 4. FACTS OF THE CASE I N BRIEF ARE THAT THE ASSESSEE E - FILED ITS RETURN OF INCOME ON 30.09.2008 DECLARING A LOSS OF RS.9,44,077/ - WHICH WAS PROCESSED U/S 143(1) OF THE ACT ON NIL INCOME. LATER ON, THE CASE WAS SELECTED FOR SCRUTINY AND THE AO FRAMED THE ASSESSMENT U/S 143(3) OF THE ACT BY MAKING AN ADDITION OF RS.2,38,568/ - ON ACCOUNT OF DISALLOWANCE OF EXPENSES UNDER THE HEAD FREIGHT & CARTAGE, ELECTRICITY & GENERATOR, WAGES & INCENTIVE, PACKING MATERIAL ETC. THEREAFTER, THE LD. CIT, MEERUT INVOKED THE PROVISIONS OF SECTION 263 OF THE ACT BY OBSERVING THAT THE ASSESSMENT ORDER APPEARS TO HAVE BEEN PASSED WITHOUT PROPER INVESTIGATION AND INQUIRY AND THUS FOUND TO BE ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE. ITA NO. 2714 /DEL /201 3 VINEX ENTERPRISES (P) LTD. 3 5. THE LD. CIT OBSERVED IN THE IMPUGNED ORDER AS UNDER: AS REGARDS ADMISSIBILITY OF EXPENSES ON FOREIGN TOUR, REPAIRS AND MAINTENANCE ACCOUNT OF VEHICLE EVEN THE DETAILS HAVE NOW BEEN GIVEN DURING 263 PROCEEDINGS. SIMILARLY THE ASSESSEE HAS ENCLOSED FRESH P&L A/C GIVING THE PROVISIONS OF MAT AS PER SECTION 115 JB OF THE INCOME TAX ACT NOW DURING 263 PROCEEDINGS. IT IS REITERATED THAT GIVING INFORMATION IN 263 PROCEEDINGS. IT IS VERY WELL SETTLED THAT WITHOUT FURNISHING SOME INFORMATION DURING 263 PROCEEDINGS DOES NOT ABSOLVE THE AO OF HIS DUTY TO CALL FOR SUCH D ETAILS AND EXAMINE THEM PROPERLY. 6. THE LD. CIT DIRECTED THE AO TO EXAMINE THE ISSUE PROPERLY ON EACH ASPECT AND PASS THE FRESH ORDER. 7. NOW THE ASSESSEE IS IN APPEAL. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT A REASONABLE AND PROPER OPPORTUNITY OF BEING HEARD WAS NOT PROVIDED BY THE LD. CIT . IT WAS FURTHER SUBMITTED THAT THE LD. CIT(A) HAD NOT GIVEN ANY SPECIFIC DIRECTION TO THE AO BY POINTING OUT THAT HOW AND IN WHAT MANNER THE ASSESSMENT ORDER DATED 24.12.2010 U/S 143(3) OF THE ACT PASSED BY H IM WAS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE. 8. IN HIS RIVAL SUBMISSIONS THE LD. DR SUPPORTED THE IMPUGNED ORDER OF THE LD. CIT. 9. WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE PARTIES AND PERUSED THE MATERIAL AVAILABLE ON THE RECO RD. IN THE PRESENT CASE, IT IS ITA NO. 2714 /DEL /201 3 VINEX ENTERPRISES (P) LTD. 4 NOTICED THAT THE LD. CIT IN THE BODY OF THE IMPUGNED ORDER CATEGORICALLY STATED THAT THE ASSESSMENT ORDER PASSED BY THE ASSISTANT COMMISSIONER, CIRCLE - 2, MEERUT APPEARS TO HAVE BEEN PASSED WITHOUT PROPER INVESTIGATION AND INQ UIRY FROM THAT OBSERVATION. FROM THE SAID OBSERVATION OF THE LD. CIT, I T IS CLEAR THAT HE WAS NOT SURE HOW AND IN WHAT MANNER THE ASSESSMENT ORDER PASSED WAS WITHOUT INVESTIGATION AND INQUIRY DONE BY THE AO, THE WORD IT APPEARS USED BY HIM SHOWS THAT HE WAS NOT SURE . MOREOVER, THE LD. CIT STATED THAT SH. RAJIV JAIN, CA ATTENDED ON BEHALF OF THE ASSESSEE WITH WHOM THE ISSUE S WERE DISCUSSED. HOWEVER, NOWHERE IT IS STATED THAT WHAT WERE THE SUBMISSION OF THE ASSESSEE AND WHY THOSE WERE NOT ACCEPTED. FU R THERM ORE, THE LD. CIT ADMITTED THAT THE ASSESSEE HAD FURNISHED THE DETAILS RELATING TO ADMISSIBILITY OF EXPENSES ON FOREIGN TOUR, REPAIRS & MAINTENANCE, ACCOUNT OF VEHICLES BUT NO FINDINGS HAVE BEEN GIVEN ON THE SAID DETAILS, NEITHER ANY REMAND REPORT WAS SOUGH T , IT IS ALSO NOT DIRECTED WHICH INQUIRY WAS TO BE MADE BY THE AO. HE SIMPLY DIRECTED THE AO TO EXAMINE THE ISSUE AGAIN AND TO PASS A FRESH ORDER. IN OUR OPINION, THE ORDER PASSED BY THE LD. CIT IS A NON - SPEAKING ORDER. WE, THEREFORE, DEEM IT APPROPRIATE T O SET ASIDE THE IMPUGNED ORDER TO THE FILE OF THE LD. CIT FOR DECIDING THE ISSUE AFRESH IN ACCORDANCE WITH LAW AFTER PROVIDING DUE AND REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. ITA NO. 2714 /DEL /201 3 VINEX ENTERPRISES (P) LTD. 5 10 . IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR S TATISTICAL PURPOSES . (ORDER PRONOUNCED IN THE COURT ON 08 /02/2017 ) SD/ - SD/ - (BEENA PILLAI ) (N. K. SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER DAT ED: 08 /02 /201 7 *SUBODH* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR