RUSAN PHARMA LTD, MUMBAI V. DCIT 9(3), MUMBAI

ITA 3167/MUM/2013

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 3405 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 10 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-03-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 02-12-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 25-04-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: UDAY B JAKKE
• Keywords: Opportunity of being heard; Principle of natural justice
• Section: 143(3); 10B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, MUM BAI BEFORE SHRI B.R. BASKARAN, AM AND SHRI SANDEEP GOSA IN, JM ./ I.T.A. NO. 3167/MUM/2013 ( / ASSESSMENT YEAR: 2007-08) RUSAN PHARMA LTD. RUSAN HOUSE, 58-D, GOVT. INDUSTRIAL ESTATE, CHARKOP, KANDIVALI, MUMBAI-400 067. / VS. DCIT-9 (3), AYAKAR BHAVAN MUMBAI. ./ ./PAN/GIR NO. AABCR 3179H ( /APPELLANT ) : ( / RESPONDENT ) / APPELLANT BY : SHRI PRAKASH PANDIT / RESPONDENT BY : SHRI UDAY B. JAKKE / DATE OF HEARING : 02/12/2016 !'# / DATE OF PRONOUNCEMENT : 23/03/2016 $% / O R D E R PER SANDEEP GOSAIN, J. M.: THE PRESENT APPEAL HAS BEEN FILED BY THE ASSESSEE A GAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)- 20, DATED 21. 02.2013 FOR A.Y. 2007-08 THEREBY UPHOLDING THE ORDER OF PENALTY PASSED BY DC IT-9(3), ON THE FOLLOWING GROUNDS OF APPEAL. 2 ITA NO. 3167/MUM/2013 (A.Y. 2007-08) RUSAN PHARMA LTD. VS. DCIT 1. IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LEARNED CIT(APPEALS) ERRED IN CONFIRMING THE PENALTY LEVIED BY A.O OF RS.66,01,074/- UNDER SECTION 271(1)(C) OF THE INCOM E TAX ACT 1961. 2. REASONS GIVEN BY LEARNED CIT (APPEALS) FOR CONFIRMI NG THE PENALTY LEVIED BY A.O. OF RS.66,01,074/- UNDER SECTION 271 (1)(C) OF THE INCOME TAX ACT 1961, ARE WRONG INSUFFICIENT AND CONTRARY TO THE FACTS A ND EVIDENCE ON RECORD. 3. THE APPELLANT CRAVES LEAVE TO ADD, AMEND, ALTER, MO DIFY OR OMIT ANY OF THE AFORESAID GROUNDS OF APPEAL AS OCCASION MAY ARISE O F DEMAND. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ORDER U /S 143(3) OF THE INCOME TAX ACT,1961 WAS PASSED ON 18.12.2009 DETERMINING TOTAL INCOME AT RS.59,71,190/- AGAINST THE LOSS OF RS.1,83,48,646/- AS PER THE RET URN OF INCOME FILED BY THE ASSESSEE. DURING THE COURSE OF ASSESSMENT PROCEEDIN G, FOLLOWING ADDITIONS/DISALLOWANCES WERE MADE ON WHICH PENALTY PROCEEDINGS WERE INITIATED BY SERVING STATUTORY NOTICE. THE DETAILS OF WHICH ARE AS UNDER: SR. NO. NATURE OF DISALLOWANCES/ADDITIONS AMOUNT INVOLVED (IN RS.) 01 EXCLUSION OF OTHER INCOME FROM PROFITS EXEMP U/S10A & 10B 83,21,090 02 DISALLOWANCE OF EXPENSES RELATING TO DEHRADUN UNIT. 11,06,715 03 ADDITION OF UNREALIZED EXPORT PROCEEDS 1,01,83,2 29 TOTAL 1,96,11,034 3 ITA NO. 3167/MUM/2013 (A.Y. 2007-08) RUSAN PHARMA LTD. VS. DCIT ALTHOUGH APPEAL WAS FILED BEFORE CIT(A) BUT AFTER M INOR VARIATIONS CIT(A) UPHELD THE ORDER OF ASSESSMENT PASSED BY AO. ON THE BASIS OF ADDITIONS MADE BY AO IN ASSESSMENT ORDER PASSED U/S 143(3) PENALTY PROCEED INGS WERE INITIATED AND AFTER CONSIDERING THE REPLY OF ASSESSEE PENALTY ORDER WAS PASSED THEREBY LEVYING PENALTY OF RS.66,01,074/- . 3. AGGRIEVED BY THE ORDER OF PENALTY PASSED BY DCIT , ASSESSEE FILED THE APPEAL BEFORE CIT(A) AND THE CIT(A) AFTER CONSIDERING THE CASE OF THE ASSESSEE HAD PARTLY ALLOWED THE APPEAL VIDE ITS ORDER DATED 21.02.2013 RESTRICTING THE QUANTUM OF PENALTY. 4. AGGRIEVED BY THE ORDER OF CIT(A), THE ASSESSEE F ILED THE PRESENT APPEAL BEFORE US ON THE GROUNDS MENTIONED HEREIN ABOVE. 5. AT THE VERY OUTSET LD. AR REPRESENTING THE ASSES SEE ARGUED ON THE MERITS OF THE CASE WHILE CHALLENGING THE IMPUGNED ORDER PASSE D BY THE CIT(A) HOWEVER ON PERUSAL OF THE IMPUGNED ORDER PASSED BY THE CIT(A), WE NOTICED THAT THE ORDER PASSED BY THE CIT(A) WAS PASSED EX PARTE IN THE ABS ENCE OF THE ASSESSEE AND IN THIS REGARD RELEVANT PARA IS REPRODUCED BELOW: 4 ITA NO. 3167/MUM/2013 (A.Y. 2007-08) RUSAN PHARMA LTD. VS. DCIT AFTER RECEIPT OF APPEAL CASE WAS FIXED FOR HEARING BY ISSUE OF NOTICE NO.CIT (A)20/DCIT-9(3)/IT-190/12-13 DATED 13.12.201 2 ON 07.01.2013 AT 10.45 AM. THIS NOTICE WAS SERVED UPON THE APPELLANT THROUGH RPAD AND ACKNOWLEDGEMENT IS KEPT ON RECORD. BUT IT IS FOUND THAT INSPITE OF RECEIPT OF NOTICE APPELLANT DOES NO T WANT TO REPRESENT THE CASE OR SUBSTANTIATE THE GROUNDS OF APPEAL, THE REFORE, IT IS TAKEN ON RECORD THAT APPELLANT DOES NOT WANT TO PROSECUTE TH E APPEAL HENCE DESERVES DISMISSAL. HOWEVER, APPEAL IS DECIDED ON M ERIT. 6. AFTER ANALYZING THE AFORE MENTIONED ORDER WE FOU ND THAT NOBODY APPEARED ON BEHALF OF ASSESSEE BEFORE THE CIT(A) TO SUBSTANT IATE THE GROUNDS OF APPEAL AND THEREFORE, THE CIT(A) TAKEN IT ON RECORD THAT THE A SSESSEE DO NOT WANT TO PROSECUTE THE APPEAL AND THEREFORE DECIDED THE APPEAL ON MERI TS EX PARTE. 7. SINCE BEFORE US, LD. AR HAS CHALLENGED THE IMPUG NED ORDER PASSED BY THE CIT(A) THEREFORE IN OUR CONSIDERED VIEW WHILE CONSI DERING THE PRINCIPLES OF NATURAL JUSTICE SET ASIDE THE IMPUGNED ORDER AND RESTORE TH E CASE BACK TO THE FILE OF THE CIT(A) WITH A DIRECTION TO PASS AFRESH ORDER AFTER PROVIDING OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 5 ITA NO. 3167/MUM/2013 (A.Y. 2007-08) RUSAN PHARMA LTD. VS. DCIT 8. IN THE RESULT, THE ASSESSEES APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 23 RD MARCH, 2016 SD/- SD/- (B.R. BASKARAN) (SANDEEP GOSAIN) $ / ACCOUNTANT MEMBER &' $ / JUDICIAL MEMBER ( ) MUMBAI; *$ DATED :23.03.2016 PS. ASHWINI / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. + ( ) / THE CIT(A) 4. + / CIT - CONCERNED 5. ./0 ''12 , 12# , ( ) / DR, ITAT, MUMBAI 6. 045 6 / GUARD FILE / BY ORDER, / !'# (DY./ASSTT. REGISTRAR) #$ %, ( ) / ITAT, MUMBAI