Kamakhya Impex Pvt. Ltd., New Delhi V. DCIT, New Delhi

ITA 3182/DEL/2015

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 2773 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 1 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-07-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 03-07-2017
• Assessment Year: 2010-2011
• Appeal Filed On: 19-05-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Principle of natural justice; Speculation loss
• Section: 43(5)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH B , NEW DELHI BEFORE SH. N. K. SAINI, AM AND SH. K. N. CHARY , JM ITA NO. 3182 /DEL/2015 : ASSTT. YEAR : 2010 - 11 KAMAKHYA IMPEX PVT. LTD., J - 4/40, FLAT NO. B - 20 , KHIRKI EXTENSION, MALVIYA NAGAR, NEW DELHI - 110085 VS DCIT, CIRCLE - 5(1), NEW DELHI (APPELLANT) (RESPONDENT) PAN NO. A ACCK5274F ASSESSEE BY : SH. VED JAIN, CA REVENUE BY : SH. ANSHU PRAKASH , SR. DR DATE OF HEARING : 03.07 .201 7 D ATE OF PRONOUNCEMENT : 03 . 07 .201 7 ORDER PER N. K. SAINI, AM: THIS IS AN APPEAL BY THE ASSESSEE AGAINST THE ORDER DATED 11.03 .2015 OF LD. CIT(A) - V , NEW DELHI . 2. FOLLOWING GROUNDS HAVE BEEN RAISED IN THIS APPEAL: 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE ORDER PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) [CIT(A)] IS BAD BOTH IN THE EYE OF LAW AND ON FACTS. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED BOTH ON FACTS AND IN LAW IN PA SSING THE ORDER WITHOUT GIVING ASSESSEE AN OPPORTUNITY OF BEING HEARD IN VIOLATION OF PRINCIPLE OF NATURAL JUSTICE. ITA NO. 3182 /DEL /201 5 KAMAKHYA IMPEX PVT. LTD. 2 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED BOTH ON FACTS AND IN LAW IN PASSING THE EX - PARTE ORDER WITHOUT D ISCUSSING THE ISSUES ON MERITS. 4. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED BOTH ON FACTS AND IN LAW IN CONFIRMING THE ACTION OF AO IN MAKING ADDITION OF AN AMOUNT OF RS.69,76,327/ - ON ACCOUNT OF LOSS ON SALE OF FIXED ASSET S. 5(I) ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED BOTH ON FACTS AND IN LAW IN CONFIRMING THE ACTION OF AO IN DISALLOWING AN AMOUNT OF RS.18,78,705/ - ON ACCOUNT OF LOSS ON DERIVATIVES TREATING THE SAME AS SPECULATION LOSS . (II) THAT THE ABOVESAID ACTION OF THE LEARNED CIT(A) IS IN CLEAR CONTRAVENTION OF THE PROVISIONS OF SECTION 43(5) OF THE ACT. 6. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED BOTH ON FACTS AND IN LAW IN CONFIRMING THE ADDITION OF RS.3,04,24,673/ - MADE BY AO ON ACCOUNT OF SHORT TERM CAPITAL GAIN. 7. THAT THE APPELLANT CRAVES LEAVE TO ADD, AMEND OR A L TER ANY OF THE GROUNDS OF APPEAL. 3. VIDE GROUND NOS. 1 TO 3, THE GRIEVANCE OF THE ASSESSEE RELATES TO THE EX - PARTE ORDER PASSED BY THE LD. CIT(A) WITHOUT PROVIDING OPPORTUNITY OF BEING HEARD , IN VIOLATION OF PRINCIPLE OF NATURAL JUSTICE. ITA NO. 3182 /DEL /201 5 KAMAKHYA IMPEX PVT. LTD. 3 4 . FACTS OF THE CASE IN BRIEF ARE THAT THE ASSESSEE WAS ENGAGED IN THE BUSINESS OF TRADING IN SHARES, DERIVATIVES & COMMODITIES. THE RETURN OF INC OME WAS E - FILED ON 15.01.2011 DECLARING LOSS OF RS.90,31,631/ - , WHICH WAS PROCESSED U/S 143(1) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT). LATER ON, THE CASE WAS SELECTED FOR SCRUTINY. THE AO FRAMED THE ASSESSMENT AT AN INCOME OF RS.3 ,02,47,074/ - BY MAKING THE VARIOUS ADDITIONS AND DISALLOWANCES. 5 . BEING AGGRIEVED THE ASSESSEE CARRIED THE MATTER TO THE LD. CIT(A) WHO DISMISSED THE APPEAL EX - PARTE AND SUSTAINED THE ADDITION S MADE BY THE AO BY OBSERVING THAT NEITHER THE ASSESSEE NOR H IS AUTHORIZED REPRESENTATIVE APPEARED BEFORE HIM. 6 . NOW THE ASSESSEE IS IN APPEAL. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT NO NOTICE OF HEARING WAS SERVED UPON THE ASSESSEE BY THE LD. CIT(A). THEREFORE, THE DISMISSAL OF THE APPEAL WITHOUT PROVIDI NG OPPORTUNITY OF BEING HEARD IN LIMINE WAS NOT JUSTIFIED. IT WAS FURTHER SUBMITTED THAT THE LD. CIT(A) HAD NOT DECIDED THE APPEAL ON MERIT AND SIMPLY CONFIRMED THE ORDER PASSED BY THE AO. ITA NO. 3182 /DEL /201 5 KAMAKHYA IMPEX PVT. LTD. 4 7 . IN HIS RIVAL SUBMISSIONS THE LD. DR STRONGLY SUPPORTED THE ORDE R OF THE AO AND FURTHER SUBMITTED THAT THE ASSESSEE DID NOT COMPLY WITH THE VARIOUS NOTICES ISSUED BY THE LD. CIT(A), SO THERE WAS NO ALTERNATIVE EXCEPT TO DECIDE THE APPEAL EX - PARTE. 8. WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE PARTIES AND PERUSED T HE MATERIAL AVAILABLE ON THE RECORD. IN THE PRESENT CASE, IT IS NOTICED THAT THE LD. CIT(A) MENTIONED IN THE IMPUGNED ORDER THAT SEVERAL NOTICES WERE ISSUED FOR THE HEARING TO THE ASSESSEE BUT NONE APPEARED. HE NOWHERE STATED THAT ANY OF THE NOTICE ISSUED WAS SERVED UPON THE ASSESSEE. MOREOVER, THE LD. CIT(A) SIMPLY CONFIRMED THE ORDER OF THE AO. HE DID NOT DECIDE THE ISSUES ON MERIT. WE, THEREFORE, CONSIDERING THE TOTALITY OF THE FACTS AS DISCUSSED HEREINABOVE ARE OF THE VIEW THAT THE IMPUGNED ORDER DESERV ES TO BE SET ASIDE, PARTICULARLY WHEN NO EFFECTIVE OPPORTUNITY OF BEING HEARD WAS PROVIDED TO THE ASSESSEE. IT IS WELL SETTLED THAT NOBODY SHOULD BE CONDEMNED UNHEARD AS PER THE MAXIM AUDI ALTERAM PARTEM AND IN THE PRESENT CASE AS WE HAVE ALREADY POINTED OUT THAT NO EFFECTIVE HEARING WAS PROVIDE TO THE ASSESSEE BY THE LD. CIT(A), THEREFORE, THE IMPUGNED ORDER IS SET ASIDE AND THE MATTER IS RESTORED BACK TO THE FILE OF THE LD. CIT(A) TO BE ADJUDICATED AFRESH IN ACCORDANCE WITH LAW AFTER PROVIDING DUE AND R EASONABLE OPPORTUNITY OF BEING HEARD TO THE ITA NO. 3182 /DEL /201 5 KAMAKHYA IMPEX PVT. LTD. 5 ASSESSEE. WE ALSO DIRECT THE ASSESSEE TO COOPERATE AND NOT TO SEEK UNDUE OR UNWARRANTED ADJOURNMENTS. 9 . IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES . ( ORDER PRON OUNCED IN THE COUR T ON 03 /0 7 /2017 ) SD/ - SD/ - ( K. N. CHARY ) (N. K. SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER DAT ED: 03 /07 /2017 *SUBODH* COPY FORWARDED TO: 1 . APPELLANT 2 . RESPONDENT 3 . CIT 4 . CIT(APPEALS ) 5 . DR: ITAT ASSISTANT REGISTRAR