K.B.Edison, CHENNAI V. ITO, CHENNAI

ITA 304/CHNY/2012

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 0855 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-02-2013
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 20-02-2013
• Assessment Year: 2005-2006
• Appeal Filed On: 13-02-2012
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: V S JAYAKUMAR
• Section: 263

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, CHENNAI BEFORE SHRI ABRAHAM P.GEORGE , ACCOUNTANT MEMBER AND SHRI VIKAS AWASTHY, JUDICIAL MEMBER ITA NO.304/MDS/2012 ( ASSESSMENT YEAR : 2005-06) MR. K.B. EDISON, NO.7, PUSHPA NAGAR MAIN ROAD, NUNGAMBAKKAM, CHENNAI-34. PAN: AAACE2016P VS. THE INCOME TAX OFFICER, WARD-I(1) CHENNAI-600 034. (APPELLANT) (RESPONDENT) APPELLANT BY : MR. V.S.JAYAKUMAR, ADVOCATE RESPONDENT BY : MR . SHAJI P.JACOB, ADDL. CIT DATE OF HEARING : 20 TH FEBRUARY, 2013 DATE OF PRONOUNCEMENT : 20 TH FEBRUARY, 2013 O R D E R PER VIKAS AWASTHY, JM: THE APPEAL HAS BEEN FILED BY THE ASSESSEE IMPUGNING THE ORDER OF THE COMMISSIONER OF INCOME TAX, CHENN AI-I DATED 5.3.2010. 2. THE ASSESSEE IS A DIRECTOR OF M/S. EDI BUILDERS PVT. LTD. THE ASSESSEE FILED HIS RETURN OF INCOME FOR THE ASS ESSMENT YEAR 2005-06 ON 31.10.2005 ADMITTING TOTAL INCOME O F ` 1,00,528/-. THE ASSESSMENT ORDER UNDER SECTION 143( 3) WAS PASSED IN THE CASE OF THE ASSESSEE ON 20.12.2007 ITA NO.304/MDS/2012 2 DETERMINING TOTAL INCOME OF ` 1,60,400/-. THE CIT VIDE ORDER DATED 6.3.2010 INVOKING THE PROVISIONS UNDER SECTIO N 263 OF THE ACT SET ASIDE THE AFORESAID ASSESSMENT ORDER ON THE GROUND THAT THERE WERE DISCREPANCIES IN THE PROPERT Y PURCHASED BY THE ASSESSEE AT LAKE AREA I & II. THE CIT HAD POINTED OUT THAT THE ASSESSEE HAD CLAIMED CERTAIN A MOUNTS AS SOURCE FOR PURCHASE OF THE PROPERTY AT LAKE AREA I & II. HOWEVER, THE PLEDGE SOURCE I.E. LOAN FROM FINANCIAL INSTITUTION AND OTHER PRIVATE PERSONS WERE TAKEN IN THE NAME OF M/S. EDI BUILDERS PVT.LTD. AND NOT DIRECTLY IN THE NAME OF T HE ASSESSEE. THE ASSESSING OFFICER HAS COMPLETELY FAILED TO VERI FY THIS ASPECT OF THE MATTER WHEN THE ASSESSMENT U/S.143(3) WAS COMPLETED. 3. THE APPEAL HAS BEEN FILED BY THE ASSESSEE WITH T HE DELAY OF 645 DAYS. THE ASSESSEE HAS FILED AN AFFIDA VIT GIVING REASONS FOR DELAY IN FILING OF THE APPEAL. THE RELE VANT EXTRACT OF THE AFFIDAVIT IS REPRODUCED HEREIN BELOW:- I SUBMIT THAT THE ORDER WAS RECEIVED IN OUR OFFICE BY OUR ACCOUNTANT MRS. BERTY, WHO WAS IN-CHARGE OF INCOME TAX MATTERS. SINCE SHE HAD MISPLACED THE ORDER OF THE CIT PASSED U/S.263 AND THE SAME WAS IRRETRIEVABLY LOST, THE APPELLANT WAS ITA NO.304/MDS/2012 3 NOT AWARE OF THE SAID ORDER TO TAKE THE ADVICE OF THE TAX ADVISERS. DURING FEBRUARY, 2012 WHEN THE OLD RECORDS WERE SOUGHT TO BE REARRANGED IN OUR OFFICE, THE IMPUGNED ORDER IN ORIGINAL WAS TRACED. IMMEDIATELY, THE TAX CONSULTANTS WERE CONTACTED AND THE APPEAL PAPERS WERE IMMEDIATELY PREPARED. THE APPEAL WAS FILED ON 13.2.2012. 4. WE ARE SATISFIED THAT THE REASON EXPLAINED IN T HE AFFIDAVIT FOR DELAY IN FILING OF THE APPEAL APPEARS TO BE GENUINE. THE HONBLE APEX COURT IN THE CASE OF RAM NATH SAHU & ORS. VS. GOBARDHAN SAO & ORS. REPORTED AS 2 002(3) SCC 195 HAS HELD THAT, ACCEPTANCE OF EXPLANATION FURNISHED SHOULD BE THE RULE AND REFUSAL AN EXCEPTION MORE S O WHEN NO NEGLIGENCE OR INACTION OR WANT OF BONAFIDE CAN BE I MPUTED TO THE DEFAULTING PARTY. HOWEVER, BY TAKING A PEDANTI C AND HYPER-TECHNICAL VIEW OF THE MATTER THE EXPLANATION FURNISHED SHOULD NOT BE REJECTED WHEN STAKES ARE HIGH AND /O R ARGUABLE POINTS OF FACTS AND LAW ARE INVOLVED IN THE CASE , CAUSING ENORMOUS LOSS AND IRREPARABLE INJURY TO THE PARTY A GAINST WHOM THE LIS TERMINATES EITHER BY DEFAULT OR INACTI ON AND DEFEATING VALUABLE RIGHT OF SUCH A PARTY TO HAVE T HE DECISION ON MERIT. IN VIEW OF THE LAW LAID DOWN BY THE HONBLE ITA NO.304/MDS/2012 4 SUPREME COURT OF INDIA AND THE REASONS EXPLAINED FO R DELAY IN FILING OF THE APPEAL, IN THE INTEREST OF JUSTICE , WE CONDONE THE DELAY OF 649 DAYS IN FILING OF THE APPEAL. THE DELAY IS CONDONED AND THE APPEAL IS ADMITTED TO BE HEARD ON MERITS. 5. SHRI V.S.JAYAKUMAR APPEARING ON BEHALF OF THE ASSESSEE SUBMITTED THAT THE IMPUGNED ORDER PASSED U NDER SECTION 263 IS CONTRARY TO THE LAW, ON FACTS AND IN THE CIRCUMSTANCES OF THE CASE. THE COUNSEL FOR THE ASS ESSEE RELIED ON THE GROUNDS OF APPEAL. 6. ON THE OTHER HAND, SHRI SHAJI P.JACOB APPEARING ON BEHALF OF THE REVENUE STRONGLY SUPPORTED THE ORDER OF THE CIT AND PRAYED FOR DISMISSAL OF THE APPEAL. 7. WE HAVE HEARD THE SUBMISSIONS OF REPRESENTATIVES OF BOTH THE PARTIES AND HAVE GONE THROUGH THE ORDER OF THE CIT DATED 5.3.2010. THE COUNSEL FOR THE ASSESSEE COULD NOT CONTROVERT THE FINDINGS OF THE CIT, WHEREIN THE CIT HAS CATEGORICALLY STATED THAT THE ASSESSEE HAS NOT PROP ERLY EXPLAINED THE TOTAL INVESTMENTS IN THE PROPERTY. T HE CIT HAS ALSO STATED THAT THE ASSESSEE HAS CLAIMED THAT LOAN GIVEN BY SHRI GURUKRISHNAMOORTHY AND FATHER ANTONE TO M/S. E ID ITA NO.304/MDS/2012 5 BUILDERS PVT. LTD. AS SOURCES FOR INVESTMENTS MADE BY HIM. THIS POINT HAS NOT BEEN AGITATED EITHER IN THE REPL Y TO THE NOTICE ISSUED UNDER SECTION 263 OR DURING THE PROCE EDINGS BEFORE THE ASSESSING OFFICER. WE DO NOT FIND ANY I NFIRMITY IN THE ORDER OF THE CIT MUCH LESS THE COUNSEL FOR THE ASSESSEE HAS NOT BEEN ABLE TO SUBSTANTIATE HIS CONTENTIONS R AISED IN THE GROUNDS OF APPEAL. 8. WE, THEREFORE, UPHOLD THE ORDER OF THE CIT AND D ISMISS THE APPEAL OF THE ASSESSEE. ORDER PRONOUNCED IN THE OPEN COURT AT THE TIME OF H EARING ON WEDNESDAY, THE 20 TH DAY OF FEBRUARY, 2013 AT CHENNAI. SD/- SD/- (ABRAHAM P.GEORGE ) (VIKAS AWASTHY) ACCOUNTANT MEMBER JUDICIAL MEMBER CHENNAI, DATED THE 20 TH FEBRUARY, 2013. SOMU COPY TO: (1) APPELLANT (4) CIT(A) (2) RESPONDENT (5) D.R. (3) CIT (6) G.F.