M/s. Harsin Marketing Inc., Ahmedabad V. The Dy.CIT.,Circle-11, Ahmedabad

ITA 3144/AHD/2011

• Counselvise Citation: [2015] 120 COUNSELVISE.COM (IT) 9661 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 4 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-04-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2008-2009
• Appeal Filed On: 09-12-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ROOP CHAND
• Assessee Lawyers: S N DIVETIA
• Keywords: Principle of natural justice; Proportionate interest; Additional evidence; Reasonable cause; Non passing of speaking order
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, AHMEDABAD (BEFORE SHRI SHAILENDRA KR. YADAV, J.M. & SHRI ANIL CHATURVEDI, A.M.) I.T. A. NO.3144 /AHD/2011 (ASSESS MENT YEAR: 2008-09) M/S. HARSIN MARKETING INC. NR. NIKOL TOLNAKA, B/H ANIL STARCH, L.B. SHASTRI ROAD, BAPUNAGAR, AHMEDABAD V/S D.C.I.T., CIRCLE-11, AHMEDABAD (APPELLANT) (RESPONDENT) PAN: AABFH 2809P APPELLANT BY : SHRI S.N. DIVETIA, A.R. RESPONDENT BY : SHRI ROOP CHAND, SR. D.R. ( )/ ORDER DATE OF HEARING : 10-04-2015 DATE OF PRONOUNCEMENT : 17 -04-2015 PER SHRI ANIL CHATURVEDI,A.M. 1. THIS APPEAL FILED BY THE ASSESSEE IS AGAINST THE OR DER OF CIT(A)-XVI, AHMEDABAD DATED 08.08.2011 FOR A.Y. 2008-09. 2. AT THE OUTSET, THE LD. A.R. SUBMITTED THAT THERE WA S DELAY IN FILING OF THE PRESENT APPEAL. HE SUBMITTED THAT THE ORDER OF LD. CIT(A) DATED 8/8/2011 WAS RECEIVED BY THE ASSESSEE ON 20/08/2011 AND THER EFORE THE ASSESSEE SHOULD HAVE FILED APPEAL BEFORE HON. TRIBUNAL ON OR BEFORE 07/10/2011 BUT THE SAME WAS FILED ON 09/12/2011 THEREBY CAUSIN G A DELAY OF 51 DAYS. ITA NO 3144/ AHD/2011 . A.Y. 2008-0 9 2 THE ASSESSEE HAS FILED A PETITION FOR CONDONING THE DELAY AND ALSO FILED A SWORN AFFIDAVIT WHEREIN THE REASONS FOR DELAY HAS B EEN STATED AND HAS ALSO PRAYED FOR CONDONING THE DELAY. THE LD. D.R. OBJECT ED TO THE CONDONATION PETITION. 3. WE HAVE HEARD THE RIVAL SUBMISSIONS. AFTER CONSIDER ING THE SUBMISSIONS OF THE LD. A.R. AND THE REASONS GIVEN IN THE AFFIDA VIT FOR DELAY, WE ARE OF THE VIEW THAT THERE WAS A REASONABLE CAUSE FOR DELA Y IN FILING THE PRESENT APPEAL AND WE THEREFORE CONDONE THE DELAY AND ADMIT THE APPEAL FOR HEARING. 4. THE RELEVANT FACTS AS CULLED OUT FROM THE MATERIAL ON RECORD ARE AS UNDER. 5. ASSESSEE IS A PARTNERSHIP FIRM STATED TO BE ENGAGED IN THE BUSINESS OF TRADING & MANUFACTURING OF PHARMACEUTICAL PRODUCTS. ASSESSEE FILED ITS RETURN OF INCOME FOR A.Y. 2008-09 ON 29.09.2008 DEC LARING TOTAL LOSS OF RS. 22,81,343/-. THE CASE WAS SELECTED FOR SCRUTINY AND THEREAFTER THE ASSESSMENT WAS FRAMED UNDER SECTION 143(3) R.W.S. 1 44 OF THE ACT VIDE ORDER DATED 24.12.2010 AND THE TOTAL INCOME WAS DET ERMINED AT RS. 57,520/-. AGGRIEVED BY THE ORDER OF A.O., ASSESSEE CARRIED THE MATTER BEFORE LD. CIT(A) WHO VIDE ORDER DATED 08.08.2011 G RANTED PARTIAL RELIEF TO THE ASSESSEE. AGGRIEVED BY THE AFORESAID ORDER OF LD. CIT(A), ASSESSEE IS NOW IN APPEAL BEFORE US AND HAS RAISED THE FOLLOWING GROUNDS;- 1.1 THE ORDER PASSED U/S.250 ON 08.08.201 1 FOR A.Y .2008-09 BY CIT(A)-XVI, ABAD UPHOLDING THE ADDITIONS/DISALLOWANCES MADE BY AO IS WHOLLY ILLEGAL, UNLAWFUL AND AGAINST THE PRINCIPLES OF NATURAL JUSTICE. ITA NO 3144/ AHD/2011 . A.Y. 2008-0 9 3 1.2 THE LD. CIT(A) HAS GRIEVOUSLY ERRED IN LAW AN D OR ON FACTS IN NOT CONSIDERING FULLY AND PROPERLY THE SUBMISSIONS MADE AND EVIDENC E PRODUCED BY THE APPELLANT WITH REGARD TO THE IMPUGNED ADDITIONS. 2.1 THE LD.CIT(A) HAS GRIEVOUSLY ERRED IN LAW AND O N FACTS IN NOT ADMITTING THE ADDITIONAL EVIDENCE AS WELL AS CALLING FOR CASE REC ORDS FROM AO BEFORE UPHOLDING THAT THE FINDINGS GIVEN BY AO WERE CORRECT AND THE DETAI LS FURNISHED IN THE APPEAL MEMO HAD NO RELEVANCE. THERE WAS GROSS VIOLATION OF THE PRINCIPLES OF NATURAL JUSTICE ON PART OF BOTH THE LOWER AUTHORITIES. 2.2 THAT IN THE FACTS AND CIRCUMSTANCES OF THE CASE AS WELL AS IN LAW, THE LD.CIT(A) OUGHT NOT TO HAVE UPHELD THE FINDINGS GIVEN BY AO W ITH REGARD TO IMPUGNED ADDITION/DISALLOWANCES 3.1 THE LD.CIT(A) HAS ERRED IN UPHOLDING THE FOLLOW ING ADDITION/DISALLOWANCE: (A) PROPORTIONATE INTEREST - RS. 2,00,744 (B) COMMISSION EXPENSE - RS. 7,36,233 (C) SALES PROMOTION EXP. - RS. 2,53,143 (D) OUT OF MR MISC. EXPENSE - R S. 52,567 (E) GP ADDITION - RS. 10,38,525 3.2 THAT IN THE FACTS AND CIRCUMSTANCES OF THE CASE AS WELL AS IN LAW, THE ID. CIT(A) OUGHT NOT TO HAVE CONFIRMED THE ABOVE SAID ADDITION S/DISALLOWANCES . 6. BEFORE US, AT THE OUTSET, LD. A.R. SUBMITTED THAT T HE A.O WAS NOT RIGHT IN STATING THAT THE ASSESSEE HAS NOT FURNISHED THE DET AILS CALLED FOR BY THE A.O AND THEREFORE THE ASSESSMENT WAS FINALIZED ON T HE BASIS OF INFORMATION AVAILABLE ON RECORD. LD. A.R. POINTED T O THE STATEMENT OF FACTS FILED BEFORE LD. CIT(A) AND POINTED TO THE VA RIOUS DATES STATED THEREIN AND WHERE THE ASSESSEE HAD APPEARED AND FIL ED THE NECESSARY DETAILS BEFORE THE A.O. THE LD. A.R. FURTHER SUBMIT TED THAT LD. CIT(A) HAS ALSO PASSED A NON SPEAKING ORDER AND HAS NOT DECIDE D THE ISSUE ON MERITS. THE LD. A.R. ALSO PLACED ON RECORD A PAPER BOOK OF 109 PAGES WHICH ACCORDING TO HIM CONTAINS THE VARIOUS DETAILS THAT WERE SUBMITTED BEFORE A.O AND LD. CIT(A) BUT THE AFORESAID DETAILS HAVE N OT BEEN CONSIDERED BY BOTH THE AUTHORITIES WHILE DECIDING THE ISSUE. HE T HEREFORE SUBMITTED THAT THAT THE MATTER MAY BE REMANDED BACK TO LD. CIT(A). THE LD. D.R. ON THE OTHER HAND SUPPORTED THE ORDER OF A.O AND LD. CIT(A ). ITA NO 3144/ AHD/2011 . A.Y. 2008-0 9 4 7. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. WE FIND THAT WHILE FRAMING THE ASSESSMENT ORDER, A. O HAS NOTED THAT SINCE THE ASSESSEE HAD NOT SUBMITTED THE REQUIRED D ETAILS, THE ASSESSMENT WAS FINALIZED ON THE BASIS OF INFORMATION AVAILABLE ON RECORD AND THEREAFTER ON VARIOUS ISSUES HE HAS PROCEEDED AND M ADE THE IMPUGNED ADDITIONS. FROM THE COPY OF THE STATEMENT OF FACTS THAT WERE FILED BEFORE LD. CIT(A) AND WHICH IS PLACED ON RECORD, WE FIND T HAT ASSESSEE HAS GIVEN THE DETAILS OF VARIOUS DATES WHEN THE REPRESE NTATIVE OF THE ASSESSEE HAD APPEARED WITH THE NECESSARY DETAILS BEFORE THE A.O AND THE COPY OF SUCH DETAILS HAVE ALSO BEEN PLACED ON RECORD IN THE PAPER BOOK. WE ALSO FIND THAT WHILE DISPOSING OF THE APPEAL, LD. CIT(A) HAS NOT CONSIDERED THE SUBMISSIONS MADE BY THE ASSESSEE AND BY A CRYPTIC O RDER HAS DECIDED THE ISSUE BY SUBSTANTIALLY CONFIRMING THE ACTION OF A.O . BEFORE US REVENUE COULD NOT CONTROVERT THE SUBMISSIONS MADE BY LD. A. R NOR PLACED ANY CONTRARY MATERIAL ON RECORD TO CONTROVERT THE SUBMI SSIONS OF LD.A.R. IN VIEW OF THE AFORESAID FACTS, WE ARE OF THE VIEW THA T IN THE INTEREST OF JUSTICE, ONE MORE OPPORTUNITY BE GRANTED TO THE ASS ESSEE. WE THEREFORE REMIT ALL THE ISSUES RAISED IN THE PRESENT APPEAL T O THE FILE OF A.O AND DIRECT HIM TO DECIDE THE ISSUE AFRESH IN ACCORDANCE WITH LAW AND AFTER GIVING A REASONABLE OPPORTUNITY OF HEARING TO THE A SSESSEE. WE ALSO DIRECT THE ASSESSEE TO CO-OPERATE WITH THE REVENUE AUTHORITIES BY FILING PROMPTLY ALL THE DETAILS CALLED FOR BY THE A.O. IN CASE, ASSESSEE FAILS TO FURNISH THE REQUIRED DETAILS, THE A.O SHALL BE FREE TO DECIDE THE MATTER ON THE BASIS OF MATERIAL AVAILABLE ON RECORD. IN VIEW OF OUR DECISION TO RESTORE THE ISSUES TO THE FILE OF A.O, WE ARE NOT A DJUDICATING ON MERITS THE OTHER GROUNDS RAISED BY THE ASSESSEE. IN THE RESULT , THE GROUNDS OF ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. ITA NO 3144/ AHD/2011 . A.Y. 2008-0 9 5 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWE D FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON 17 - 04 - 2015. SD/- SD/- (SHAILENDRA KR. YADAV) (ANIL CHATURVEDI) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD. TRUE COPY RAJESH COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT,A HMEDABAD