Frank P. Monteiro, Kolhapur V. Income-tax Officer, Ward - 2 (2), Kolhapur

ITA 318/PUN/2019

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 5830 (ITAT-PUNE)
• Duration Of Justice: 1 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-04-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 25-02-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: M K VERMA
• Assessee Lawyers: R V KANDREKAR
• Keywords: Business expenditure; Principle of natural justice
• Section: 143(3); 14A

Judgement Text

] IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH SMC, PUNE BEFORE SHRI ANIL CHATURVEDI, AM . / ITA NO.318/PUN/2019 / ASSESSMENT YEAR : 2009-10 FRANK PETER MONTERIO, 241 VICTOR, E WARD, TARABAI PARK, KOLHAPUR. PAN : AFAPM7686K. . / APPELLANT V/S THE INCOME TAX OFFICER, WARD 2(2), KOLHAPUR. . / RESPONDENT ASSESSEE BY : SHRI R.V. KANDREKAR. REVENUE BY : SHRI M.K. VERMA. / ORDER PER ANIL CHATURVEDI, AM : 1. THIS APPEAL FILED BY THE ASSESSEE IS EMANATING OUT OF THE ORDER OF COMMISSIONER OF INCOME TAX (A) 1, KOLHAPUR DAT ED 17.12.2018 FOR THE ASSESSMENT YEAR 2009-10. 2. THE RELEVANT FACTS AS CULLED OUT FROM THE MATERIAL ON R ECORD ARE AS UNDER :- ASSESSEE IS AN INDIVIDUAL AND STATED TO BE DERIVING INCOME FROM SHARE OF PROFIT, INTEREST ON CAPITAL FROM THREE PARTNE RSHIP FIRMS AND INCOME FROM OTHER SOURCES. ASSESSEE FILED HIS RET URN OF INCOME FOR A.Y. 2009-10 ON 10.12.2019 DECLARING TOTAL INCOM E OF RS.3,16,570/-. THE CASE WAS SELECTED FOR SCRUTINY AND THE REAFTER, / DATE OF HEARING : 01.04.2019 / DATE OF PRONOUNCEMENT: 16.04.2019 2 ITA NO.318/PUN/2019 ASSESSMENT WAS FRAMED U/S 143(3) OF THE ACT VIDE ORDER DT.29.11.2011 AND THE TOTAL INCOME WAS DETERMINED AT RS.4,36,633/-. AGGRIEVED BY THE ORDER OF AO, ASSESSEE CA RRIED THE MATTER BEFORE LD.CIT(A), WHO VIDE ORDER DT.17.12.2018 (IN APP EAL NO.KOP/CIT(A)-2/472/11-12) DISMISSED THE APPEAL OF ASSESS EE. AGGRIEVED BY THE ORDER OF LD.CIT(A), ASSESSEE IS NOW IN APP EAL AND HAS RAISED THE FOLLOWING GROUNDS : 1. THAT THE ORDER OF THE LD. COMMISSIONER OF INCOM E TAX (APPEALS) IS DEFECTIVE BOTH IN LAW AND ON FACTS OF THE CASE. 2. THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS ) IS NOT JUSTIFIED IN DISMISSING THE APPEAL ON THE TECHNICAL GROUND TH AT THE APPEAL FORM 35 NOT FILED AS PER THE RULE 45 AS THE APPELLANT HAD DULY FILED THE APPEAL IN THE PRESCRIBED FORM ACCORDING TO THE RULE 45 OF THE INCOME TAX RULES. ' 3. THAT NO COMMUNICATION WAS RECEIVED FROM LEARNED CIT APPEALS POINTING OUT ANY DEFECT IN APPEAL FILED AT THE TIME OF RECEIPT &/OR LATER ON. 4. THAT THE APPEAL SHOULD NOT HAVE BEEN DISPOSED OF F WITHOUT HAVING GROUND (S) OF APPEAL ON RECORD. 3. ALL THE GROUNDS BEING INTER-CONNECTED ARE CONSIDERED TOGETHER. 4. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, AO NOTICE D THAT ASSESSEE HAD CLAIMED CERTAIN DEDUCTIONS AGGREGATING TO RS.1,10,579/- WHICH ARE LISTED AT PARA 3.3 OF THE ASSESSME NT ORDER AND EXPENDITURE ON ACCOUNT OF INTEREST ON BORROWED FUN DS OF RS.1,45,630/- U/S 14A OF THE ACT. THE SUBMISSION OF ASSES SEE THAT HE HAD NOT INCURRED ANY EXPENDITURE TO EARN INCOME FROM INTEREST FROM HIS CAPITAL ACCOUNT AND SALARY FROM THE FIRMS WAS NOT FOUND ACCEPTABLE TO AO AO ACCORDINGLY MADE THE AFORESAID DISALLO WANCES. AGGRIEVED BY THE ORDER OF AO, ASSESSEE CARRIED THE MATT ER BEFORE 3 ITA NO.318/PUN/2019 LD.CIT(A), WHO VIDE EX-PARTE ORDER DISMISSED THE APPEAL OF ASSESSEE. AGGRIEVED BY THE ORDER OF LD.CIT(A), ASSESSEE IS NOW IN APPEAL BEFORE ME. 5. BEFORE ME, LD.A.R. AT THE OUTSET SUBMITTED THAT LD.CIT(A ) HAS PASSED AN EX-PARTE ORDER AND NOT ON MERITS. HE F URTHER SUBMITTED THAT DUE TO UNAVOIDABLE CIRCUMSTANCES, ASSESSE E COULD NOT APPEAR BEFORE LD.CIT(A). HE SUBMITTED THAT IF GIVEN A C HANCE, ASSESSEE UNDERTAKES TO APPEAR BEFORE LOWER AUTHORITIES AND FURNISH ALL THE REQUIRED DETAILS TO SUBSTANTIATE HIS CASE. LD.D.R. ON THE OTHER HAND SUPPORTED THE ORDER OF AO AND LD.CIT(A) AND OBJECTED TO LD.A.R.S PRAYER FOR 2 ND INNINGS. 6. I HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MA TERIAL ON RECORD. THE ISSUE IN THE PRESENT GROUND IS WITH RESP ECT TO DISALLOWANCE OF RS.1,10,579/- AND RS.1,45,630/- ON ACCOUNT OF NON-BUSINESS EXPENDITURE AND INTEREST ON BORROWED FUNDS U/S 14A OF THE ACT, RESPECTIVELY. THE PERUSAL OF ORDER OF LD.CIT(A ) REVEALS THAT LD.CIT(A) HAS PASSED AN EX-PARTE ORDER WITHOUT DECIDING THE ISSUE ON MERITS. I N VIEW OF THE WELL SETTLED PRINCIPLE OF NATURAL JUSTICE THAT SUFFICIENT OPPORTUNITY OF HEARING SHOULD BE AFFOR DED TO THE PARTIES AND NO PARTY SHOULD BE CONDEMNED UNHEARD, I AM OF THE VIEW THAT ONE MORE OPPORTUNITY BE GRANTED TO THE ASSESSEE TO PRESENT HIS CASE. I THEREFORE RESTORE THE MATTER BACK TO THE FILE OF LD.CIT(A) TO DECIDE THE ISSUE ON MERITS IN ACCORDANCE WITH LAW. NEEDLESS TO STATE THAT LD.CIT(A) SHALL GRANT ADEQUATE OPP ORTUNITY OF HEARING TO BOTH THE PARTIES. ASSESSEE IS ALSO DIRECTED TO PROMPTLY FURNISH ALL THE DETAILS CALLED FOR BY THE LOWER AUTHORITIES. IN VIEW OF 4 ITA NO.318/PUN/2019 MY DECISION TO RESTORE THE ISSUE TO LD.CIT(A), I AM NOT ADJUDICATING ON MERITS THE GROUNDS OF THE APPEAL RAISED BY THE ASSESSEE. THUS, THE GROUNDS OF ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWE D FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON THE 16 TH DAY OF APRIL, 2019. S SD/- -- ( ANIL CHATURVEDI ) ' / ACCOUNTANT MEMBER PUNE; DATED : 16 TH APRIL, 2019. YAMINI #$%&'(' % / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. 4. 5 6. CIT(A)-1, KOLHAPUR. PR. CIT-1, KOLHAPUR. '#$ %%&',) &', *+ / DR, ITAT, SMC PUNE; $-.// GUARD FILE. / BY ORDER // TRUE COPY // 012%3&4 / SR. PRIVATE SECRETARY ) &' , / ITAT, PUNE.