INTER CARAT JEWELLERY PRIVATE LIMITED, MUMBAI V. INCOME TAX OFFICER 10(1)(2), MUMBAI

ITA 308/MUM/2018

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 7254 (ITAT-MUMBAI)
• Duration Of Justice: 3 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-05-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2007-2008
• Appeal Filed On: 12-01-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N HEMLATHADR
• Keywords: Unexplained expenditure; Opportunity of being heard; Principle of natural justice
• Section: 147

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES G, MUMBAI , . , , BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER, AND SHRI G. MANJUNATHA, ACCOUNTANT MEMBER ITA NOS.308 & 309/MUM/2018 ASSESSMENT YEARS: 2007-08 & 2008-09 INTER CARAT JEWELLERY PRIVATE LIMITED, UNIT NO.14, NEW NANDU INDUSTRIAL ESTATE, SHANTI NAGAR, MAHAKALI CAVES RAOD, ANDHERI (EAST), MUMBAI-400093 / VS. INCOME TAX OFFICER-10(1)(2) 02 ND FLOOR, AAYAKAR BHAVAN, M. K. ROAD, MUMBAI-400020 ( ! /ASSESSEE) ( ' / REVENUE) P.A. NO.AABCI1023K ! / ASSESSEE BY SHRI PRAKASH JOTWANI ' / REVENUE BY MS. N. HEMLATHA-DR '$ % !& / DATE OF HEARING : 03/05/2018 % !& / DATE OF PRONOUNCEMENT 03/05/2018 ITA NOS.308 & 309/MUM/2018 M/S INTER CARAT JEWELLERY PVT LTD. 2 / O R D E R PER JOGINDER SINGH (JUDICIAL MEMBER) THESE TWO APPEALS ARE BY THE ASSESSEE AGAINST THE IMPUGNED EX-PARTE ORDERS BOTH DATED 29/06/2017 OF T HE LD. FIRST APPELLATE AUTHORITY, MUMBAI. 2. DURING HEARING, THE LD. COUNSEL FOR THE ASSESSEE, SHRI PRAKASH JOTWANI, CONTENDED THAT NO NOTICE OF HEARING WAS EVER SERVED UPON THE ASSESSEE AND THUS AN EX-PARTE ORDER WAS PASSED BY THE FIRST APPE LLATE AUTHORITY, WHICH IS VIOLATION OF PRINCIPLE OF NATUR AL JUSTICE. ON THE OTHER HAND, MS. N. HEMLATHA, LD. SR . DR, CONTENDED THAT IT WAS THE DUTY OF THE ASSESSEE TO M AKE EFFECTIVE REPRESENTATION BEFORE THE LD. COMMISSIONE R OF INCOME TAX (APPEAL), THEREFORE, THE APPEALS WERE RI GHTLY REJECTED. 2.1. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WITHOUT G OING INTO THE MERITS OF THE APPEAL, WE NOTE THAT THE ASS ESSEE IS PRIVATE LIMITED COMPANY ENGAGED IN THE BUSINESS, ITA NOS.308 & 309/MUM/2018 M/S INTER CARAT JEWELLERY PVT LTD. 3 MANUFACTURING AND TRADING IN JEWELLERY. THE ASSESSE E DECLARED NIL INCOME IN ITS RETURN, WHICH WAS PROCES SED U/S 143(1) OF THE ACT ON 22/01/2019 ACCEPTING THE RETURNED INCOME AT NIL. THEREAFTER, THE ASSESSMENT WAS REOPENED U/S 147 OF THE ACT ON THE BASIS OF INFORMA TION WITH RESPECT TO UNEXPLAINED EXPENDITURE. THE ASSES SEE WAS CLAIMED TO BE ONE OF THE BENEFICIARIES OF OBTAI NING BOGUS BILLS FOR NON-EXISTING PURCHASES AMOUNTING TO RS.1,06,784/- (ASSESSMENT YEAR 2007-08). HOWEVER, W E ARE OF THE VIEW THAT AS PER MANDATE OF ARTICLE 265 OF CONSTITUTION OF INDIA, ONLY DUE TAXES HAS TO BE LEVIED/COLLECTED. KEEPING IN VIEW, THE PRINCIPLE OF NATURAL JUSTICE THAT NO PERSON SHOULD BE CONDEMNED UNHEARD AND SINCE NO SERVICE OF NOTICE WAS EFFECTED UPON TH E ASSESSEE, WE DEEM IT APPROPRIATE TO REMAND BOTH THE SE APPEALS TO THE FILE OF THE LD. COMMISSIONER OF INCO ME TAX (APPEAL) FOR FRESH ADJUDICATION ON MERIT. THE ASSES SEE BE GIVEN OPPORTUNITY OF BEING HEARD WITH FURTHER LIBER TY TO FURNISH NECESSARY EVIDENCE, IF ANY, TO SUBSTANTIATE ITS CLAIM. THE APPEALS OF THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. ITA NOS.308 & 309/MUM/2018 M/S INTER CARAT JEWELLERY PVT LTD. 4 FINALLY, THE APPEALS OF THE ASSESSEE ARE ALLOWED FO R STATISTICAL PURPOSES. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. REPRESENTATIVES FROM BOTH SIDES AT THE CONCLUSION OF THE HEARING ON 03/05/2018. SD/- (G. MANJUNATHA) SD/- (JOGINDER SINGH) '# / ACCOUNTANT MEMBER $# / JUDICIAL MEMBER $ MUMBAI; + DATED : 03/05/2018 F{X~{T? P.S/. . . , %$&'()(*& / COPY OF THE ORDER FORWARDED TO : 1. ,-./ / THE APPELLANT 2. 01./ / THE RESPONDENT. 3. 2 2 3! , ( ,- ) / THE CIT, MUMBAI. 4. 2 2 3! / CIT(A)- , MUMBAI 5. 5'6 0! , 2 ,-& , , $ / DR, ITAT, MUMBAI 6. 7 8$ / GUARD FILE. / BY ORDER, / (DY./ASSTT. REGISTRAR) , $ / ITAT, MUMBAI