M/s. ISOE Printpack Industries (P) Ltd., New Delhi V. ITO, New Delhi

ITA 2906/DEL/2012

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 61730 (ITAT-DELHI)
• Duration Of Justice: 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-06-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 15-05-2013
• Assessment Year: 2008-2009
• Appeal Filed On: 11-06-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SATPAL SINGH
• Assessee Lawyers: U S AGARWAL
• Keywords: Opportunity of being heard; Principle of natural justice
• Section: 68; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH C: NEW DELHI BEFORE SHRI S.V. MEHROTRA, ACCOUNTANT MEMBER & SHRI A.D. JAIN, JUDICIAL MEMBER ITA NO.2906/DEL/2012 ASSESSMENT YEAR: 2008-09 M/S ISOE PRINTPACK INDUSTRIES (P) LTD., B-1/1691, VASANT KUNJ, NEW DELHI. PAN NO. AABC16734P VS. ITO, WARD 11(4), NEW DELHI. (APPELLANT) (RESPONDENT) APPELLANT BY: SH. U.S. AGARWAL, ADV. RESPONDENT BY: SH. SATPAL SINGH, SR. DR O R D E R PER S.V. MEHROTRA, A.M. THIS APPEAL, FILED BY THE ASSESSEE, IS DIRECTED A GAINST THE ORDER DATED 02/04/2012 OF CIT(A)-XV, NEW DELHI FOR A.Y. 2 008-09. 2. BRIEF FACTS OF THE CASE ARE THAT ASSESSMENT WAS COMPLETED U/S 144 ON 21/12/2010 AT AN INCOME OF RS. 12,33,711/- AS AGAIN ST NIL INCOME DECLARED BY THE ASSESSE. THE ASSESSEE PREFERRED APPEAL BEFO RE LD. CIT(A), WHO DISMISSED THE APPEAL EX-PARTE. 2.1 THE ASSESSEE HAS, INTER-ALIA, TAKEN FOLLOWING G ROUNDS OF APPEAL: 1. THAT THE LD. AUTHORITIES BELOW HAVE ERRED IN LAW A S WELL AS ON FACTS OF THE CASE IN MAKING AND CONFIRMING ADDITION OF RS. 12,33,711/-. THUS, THE ADDITIONS MADE AND SUSTAINE D IS TOTALLY WRONG, ILLEGAL AND EXCESSIVE IN NATURE. ITA NO. 2906/DEL/2012- ISOE PRINTPACK INDU STRIES (P) LTD. 2 2. THAT NO PROPER AND REASONABLE OPPORTUNITY OF HEARIN G WAS AFFORDED TO THE APPELLANT BEFORE PASSING EX-PARTE O RDERS, THEREBY VIOLATING THE PRINCIPLES OF NATURAL JUSTICE . 3. THAT THE LD. CIT(APPEALS)XV HAS FURTHER ERRED IN SU STAINING AD- HOC ADDITION OF RS. 11,33,711/- MERELY BY APPLYING NET PROFIT RATE OF 8% ON TOTAL TURNOVER WITHOUT ANY COGENT REA SON OR BASIS. THUS AD-HOC ESTIMATE OF INCOME WITHOUT POIN TED OUT ANY DEFECT OR DEFICIENCY IN AUDITED ACCOUNTS IS TOTALLY WRONG AND ILLEGAL. 4. THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS)XV HAS FURTHER ERRED IN LAW IN SUSTAINING ADDITION OF RS. 1,00,000/- AS SHARE CAPITAL U/S 68 OF THE I.T. ACT, THOUGH IDENTI TY, CAPACITY AND GENUINENESS WAS ESTABLISHED. AND THE AO HAS FA ILED TO DISCHARGE ONUS LIED ON HIM. THUS, THE ADDITION OF RS. 1,00,000/- MADE U/S 68 IS TOTALLY WRONG, ILLEGAL AN D EXCESSIVE IN NATURE. 5. THAT EVEN IN EX-PARTE ASSESSMENT U/S 144 OF THE I.T . ACT THE LD. ASSESSING OFFICER HAS TO MAKE BEST JUDGMENT ASSESS MENT AND NOT ESTIMATE ASSESSMENT. BUT THE ASSESSING OFF ICER HAS TOTALLY IGNORED MATERIAL ON RECORD SUCH AS AUDITED ACCOUNT ETC. AND HAS ESTIMATED AD-HOC INCOME AT 8% NET PROFIT OF TOTAL TURNOVER WHICH IS TOTALLY WRONG & ILLEGAL. 3. LD. COUNSEL FOR THE ASSESSEE REFERRED TO THE AFF IDAVIT OF ASSESSEES COUNSEL, SUNIL KUMAR VARSHNEY CHARTERED ACCOUNTANT, WHEREIN HE HAS, INTER-ALIA, AVERRED THAT ON 23/02/2012 HE COULD NOT APPEAR BEFORE LD. CIT(A)-XV, AS HE WAS FORCED TO GO TO ALIGARH AS HIS COUSIN WAS VERY CRITICAL WHO ULTIMATELY EXPIRED ON 10/03/2012. THUS, THE NO N ATTENDANCE ON 23/02/2012 BEFORE LD. CIT(APPEALS)-XV, WAS BEYOND H IS CONTROL. LD. ITA NO. 2906/DEL/2012- ISOE PRINTPACK INDU STRIES (P) LTD. 3 COUNSEL, THEREFORE, SUBMITTED THAT THE ASSESSEE MAY BE PROVIDED AN OPPORTUNITY TO EXPLAIN HIS CASE. 4. LD. DR RELIED ON THE ORDER OF LD. CIT(A). 5. WE HAVE CONSIDERED THE SUBMISSIONS AND HAVE PERU SED THE RECORD OF THE CASE. WE FIND THAT ASSESSMENT WAS COMPLETED B EFORE ASSESSING OFFICER U/S 144 BECAUSE OF NON-COMPLIANCE OF VARIOU S NOTICES ISSUED TO THE ASSESSEE. BEFORE LD. CIT(A) THE ASSESSEES REPRESE NTATIVE HAD APPEARED TWICE ON 17/01/2012 AND AGAIN ON 06/02/2012 WHEN AD JOURNMENTS WERE SOUGHT. THE CASE WAS FINALLY FIXED FOR HEARING ON 23/02/2012 ON WHICH DATE THE ASSESSEES REPRESENTATIVE COULD NOT APPEAR BECA USE OF THE REASONS MENTIONED IN THE AFFIDAVIT OF CA, SUNIL KUMAR VARSH NEY, AS NOTED EARLIER. UNDER THESE CIRCUMSTANCES, WE ARE OF THE OPINION TH AT ASSESSEE SHOULD BE AFFORDED ONE MORE OPPORTUNITY TO SUBSTANTIATE ITS C LAIM. WE, THEREFORE, RESTORE THIS MATTER TO THE FILE OF AO FOR MAKING DE NOVO ASSESSMENT AFTER AFFORDING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. IT NEED NOT TO BE EMPHASIZED THAT ASSESSEE SHOULD COOPERATE IN THE FINALIZATION OF ASSESSMENT. 6. IN THE RESULT, THE APPEAL IS ALLOWED FOR STATIST ICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 21/06/2013 SD/- SD/- (A.D. JAIN) JUDICIAL MEMBER (S.V. MEHROTRA) ACCOUNTANT MEMBER DATED: 21/06/2013 *KAVITA ITA NO. 2906/DEL/2012- ISOE PRINTPACK INDU STRIES (P) LTD. 4 COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT, NEW DELHI. TRUE COPY BY ORDER ASSISTANT REGISTRAR