UTTAM VALUE STEELS LTD, MUMBAI V. ASST CIT CEN CIR 41, MUMBAI

ITA 3206/MUM/2016

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 3163 (ITAT-MUMBAI)
• Duration Of Justice: 1 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-06-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2007-2008
• Appeal Filed On: 06-05-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A G BHATKAR SR DR
• Keywords: Opportunity of being heard; Condonation of delay

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES D, MUMBAI , , , BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER, AND SHRI ASHWANI TANEJA, ACCOUNTANT MEMBER ITA NOS.3206, 3207 & 3209/MUM/2016 ASSESSMENT YEARS: 2007-08, 2008-09 & 2010-11 UTTAM VALUE STEELS LTD. (FORMERLY LLOYDS STEEL INDUSTRIES LTD.), UTTAM HOUSE, 4 TH FLOOR, 69, P.D. MELLO ROAD, MUMBAI-400009 / VS. ACIT, CENTRAL CIRCLE-41, MUMBAI ( ! /ASSESSEE) ( ' / REVENUE) PAN. NO.AAAC L6670Q ! / ASSESSEE BY SHRI RAHUL HAKANI ' / REVENUE BY SHRI A.G. BHATKAR- SR.DR # '$ % ! & / DATE OF HEARING : 15/06/2016 % ! & / DATE OF ORDER: 15/06/2016 ITA NOS. 3206,3207 & 3209/MUM/2016 UTTAM VALUE STEELS LTD. (FORMERLY LLOYDS STEEL INDUSTRIES LTD.) 2 / O R D E R PER JOGINDER SINGH (JUDICIAL MEMBER) ALL THESE THREE APPEALS ARE BY THE ASSESSEE, AGGRIE VED BY THE IMPUGNED ORDERS ALL DATED 25/02/2016, OF THE LD. FIRST APPELLATE AUTHORITY, MUMBAI, FOR THE ASSESSME NT YEARS 2007-08, 2008-09 AND 2010-11. IN THESE APPEAL S, SINCE, IDENTICAL ISSUE OF CONDONATION OF DELAY IS I NVOLVED, THEREFORE, THESE CAN BE DISPOSED OF BY A COMMON AND CONSOLIDATED ORDER FOR THE SAKE OF BREVITY. 2. DURING HEARING OF THESE APPEALS, LD. COUNSEL FO R THE ASSESSEE, SHRI RAHUL HAKANI, ADVANCED ARGUMENTS WHICH ARE IDENTICAL TO THE GROUND RAISED BY EXPLAIN ING THAT THERE WERE SUFFICIENT REASONS FOR CONDONATION OF DE LAY OF 161 DAYS AND THE DELAY WAS CAUSED DUE TO BONAFIDE REASONS INCLUDING AILMENT OF SHRI SUMIT AGARWAL WHO REMAINED SICK FROM 10 TH MAY TO 22 ND JUNE, 2014 AND THE LEGAL COUNSEL SHRI DILIP LAKHANI WAS NOT AVAILABLE FROM 14 TH JUNE TO 17 TH JULY, 2014. THE ORDER WAS CLAIMED TO BE RECEIVED ON 07/01/2014 AND ON 04/05/2014, AND EARLI ER THERE WAS A DECISION OF THE TRIBUNAL NAMELY DCIT V S TIMES GUARANTEE LTD. (2010) 4 ITR 210, WHICH WAS AGAINST THE ASSESSEE AND LATER ON A DECISION FROM HONBLE GUJAR AT HIGH COURT IN GUJARAT THEMIS BIOSYN LTD. CAME IN FAVOUR OF THE ASSESSEE. IT WAS EXPLAINED THAT ON 08/05/2014, AFTE R CONSULTING LEGAL EXPERT, THE ASSESSEE DECIDED TO PR EFER APPEAL AND THUS NECESSARY PAPERS WERE COLLECTED. SH RI ITA NOS. 3206,3207 & 3209/MUM/2016 UTTAM VALUE STEELS LTD. (FORMERLY LLOYDS STEEL INDUSTRIES LTD.) 3 SUMIT AGARWAL, COUNSEL OF THE ASSESSEE AND ALSO EMP LOYEE OF THE ASSESSEE COMPANY WHO WAS HANDLING TAXATION MATTERS REMAINED UNAVAILABLE DUE TO HEALTH PROBLEMS . THE ASSESSEE ALSO PRODUCED MEDICAL CERTIFICATE DATED 08/05/2014, 23/06/2014 AND ALSO A INTERIM MEDICAL B ILL DATED 19/06/2014 FROM BREACH CANDY HOSPITAL. OUR ATTENTION WAS INVITED TO LETTER DATED 26/07/2014 (R ECEIVED IN THE OFFICE OF THE FIRST APPELLATE AUTHORITY ON 28/07/2014), ADDRESSED TO THE LD. COMMISSIONER OF INCOME TAX (APPEAL) MENTIONING THE NECESSARY FACTUA L MATRIX. IT WAS EXPLAINED THAT THE REASONS OF DELAY OF FILING THE APPEAL BEFORE THE LD. COMMISSIONER OF INCOME TA X (APPEAL) WERE BONAFIDE REASONS AND ALSO THE SAME WE RE BEYOND THE CONTROL OF THE ASSESSEE. IT WAS PLEADED THAT THE ORDER/EX-PARTE ORDER, PASSED BY THE LD. COMMISSIONE R OF INCOME TAX (APPEAL) HAS CAUSED INJUSTICE TO THE ASS ESSEE, THEREFORE, DELAY MAY BE CONDONED AND IN VIEW OF TH E DECISION FROM HONBLE GUJARAT HIGH COURT (SUPRA) TH E CASE MAY BE DECIDED IN FAVOUR OF THE ASSESSEE. FOR COND ONATION OF DELAY VARIOUS CASE LAWS WERE RELIED UPON, WHICH WILL BE DISCUSSED IN LATER PARAS OF THIS ORDER. OUR ATTENT ION WAS INVITED TO VARIOUS PAGES OF THE PAPER BOOK. 2.1. ON THE OTHER HAND, THE LD. DR, SHRI A.G. BHATKAR, CONTENDED THAT THERE IS NO BONAFIDE REASON FOR THE DELAY AND THE ASSESSEE AT THE EARLIER STAGE TOOK A CONSCIOUS DECISION TO NOT TO FILE THE APPEAL AND THE LATER ST AGE, IN VIEW OF THE DECISION FROM HONBLE GUJARAT HIGH COURT, DE CIDED TO ITA NOS. 3206,3207 & 3209/MUM/2016 UTTAM VALUE STEELS LTD. (FORMERLY LLOYDS STEEL INDUSTRIES LTD.) 4 FILE AN APPEAL. IT WAS PRAYED THAT DELAY MAY NOT BE CONDONED AND, IF CONDONED, THE LD. COMMISSIONER OF INCOME TAX (APPEAL) MAY BE PROVIDED OPPORTUNITY TO GO INTO THE MERITS OF THE CASE. 2.2. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. IN VIEW O F THE ASSERTIONS MADE BY THE LD. RESPECTIVE COUNSEL, SO F AR AS, CONDONATION OF DELAY IS CONCERNED NO DOUBT FILING O F AN APPEAL IS A RIGHT GRANTED UNDER THE STATUTE TO THE ASSESSEE AND IS NOT AN AUTOMATIC PRIVILEGE, THEREFORE, THE A SSESSEE IS EXPECTED TO BE VIGILANT IN ADHERING TO THE MANNER A ND MODE IN WHICH THE APPEALS ARE TO BE FILED IN TERMS OF TH E RELEVANT PROVISIONS OF THE ACT. NEVERTHELESS, A LIBERAL APPR OACH HAS TO BE ADOPTED BY THE APPELLATE AUTHORITIES, WHERE DELA Y HAS OCCURRED FOR BONA FIDE REASONS ON THE PART OF THE A SSESSEE OR THE REVENUE IN FILING THE APPEALS. IN MATTERS C ONCERNING THE FILING OF APPEALS, IN EXERCISE OF THE STATUTORY RIGHT, A REFUSAL TO CONDONED THE DELAY CAN RESULT IN A MERIT ORIOUS MATTER BEING THROWN OUT AT THE THRESHOLD, WHICH MAY LEAD TO MISCARRIAGE OF JUSTICE. THE JUDICIARY IS RESPECT ED NOT ON ACCOUNT OF ITS POWER TO LEGALIZE IN JUSTICE ON TECH NICAL GROUNDS BUT BECAUSE IT IS CAPABLE OF REMOVING INJUS TICE AND IS EXPECTED TO DO SO. 2.3. THE HONBLE APEX COURT IN A CELEBRATED DECISI ON IN COLLECTOR, LAND ACQUISITION VS MST. KATIJI & ORS. 1 67 ITR 471 OPINED THAT WHEN TECHNICAL CONSIDERATION AND SUBSTANTIAL JUSTICE ARE PITTED AGAINST EACH OTHER, THE COURTS ITA NOS. 3206,3207 & 3209/MUM/2016 UTTAM VALUE STEELS LTD. (FORMERLY LLOYDS STEEL INDUSTRIES LTD.) 5 ARE EXPECTED TO FURTHER THE CAUSE OF SUBSTANTIAL JU STICE. THIS IS FOR THE REASON THAT AN OPPOSING PARTY, IN A DISPUTE, CANNOT HAVE A VESTED RIGHT IN INJUSTICE BEING DONE BECAUSE OF A NON- DELIBERATE DELAY. THEREFORE, IT FOLLOWS THAT WHILE CONSIDERING MATTERS RELATING TO THE CONDONATION OF DELAY, JUDICIOUS AND LIBERAL APPROACH IS TO BE ADOPTED. I F SUFFICIENT CAUSE IS FOUND TO EXIST, WHICH IS BONA-F IDE ONE, AND NOT DUE TO NEGLIGENCE OF THE ASSESSEE, THE DELA Y NEEDS TO CONDONED IN SUCH CASES. THE EXPRESSION SUFFICI ENT CAUSE IS ADEQUATELY ELASTIC TO ENABLE THE COURTS T O APPLY LAW IN A MEANINGFUL MANNER, WHICH SUB-SERVES THE EN D OF JUSTICE- THAT BEING THE LIFE PURPOSE OF THE EXISTEN CE OF THE INSTITUTION OF THE COURTS. WHEN SUBSTANTIAL JUSTIC E AND TECHNICAL CONSIDERATION ARE PITTED AGAINST EACH OTH ER, THE CAUSE OF SUBSTANTIAL JUSTICE DESERVES TO BE PREFERR ED. THE HONBLE APEX COURT IN VEDABHAI VS SANTARAM 253 ITR 798 OBSERVED THAT INORDINATE DELAY CALLS OF CAUTIOUS AP PROACH. THIS MEANS THAT THERE SHOULD BE NO MALAFIDE OR DILA TORY TACTICS. SUFFICIENT CAUSE SHOULD RECEIVE LIBERAL C ONSTRUCTION TO ADVANCE SUBSTANTIAL JUSTICE. THE HONBLE APEX C OURT IN 167 ITR 471 OBSERVED AS UNDER:- 3. THE LEGISLATURE HAS CONFERRED THE POWER TO COND ONE DELAY BY ENACTING SECTION 51 OF THE LIMITATION ACT OF 196 3 IN ORDER TO ENABLE THE COURTS TO DO SUBSTANTIAL JUSTICE TO P ARTIES BY DISPOSING OF MATTERS ON DE MERITS. THE EXPRESSION SUFFICIENT CAUSE EMPLOYED BY THE LEGISLATURE IS ADEQUATELY EL ASTIC TO ENABLE THE COURTS TO APPLY THE LAW IN A MEANINGFUL MANNER ITA NOS. 3206,3207 & 3209/MUM/2016 UTTAM VALUE STEELS LTD. (FORMERLY LLOYDS STEEL INDUSTRIES LTD.) 6 WHICH SUBSERVES THE ENDS OF JUSTICE THAT BEING THE LIFE-PURPOSE OF THE EXISTENCE OF THE INSTITUTION OF COURTS. IT I S COMMON KNOWLEDGE THAT THIS COURT HAS BEEN MAKING A JUSTIFI ABLY LIBERAL APPROACH IN MATTERS INSTITUTED IN THIS COUR T. BUT THE MESSAGE DOES NOT APPEAR TO HAVE PERCOLATED DOWN TO ALL THE OTHERS COURTS IN THE HIERARCHY. 2.4. FURTHERMORE, THE HON'BLE SUPREME COURT IN THE CASE OF VEDABAI ALIA VAIJAYANATABAI BABURAO PATIL V S. SHANTARAM BABURAO PATIL 253 ITR 798 HELD THAT THE C OURT HAS TO EXERCISE THE DISCRETION ON THE FACTS OF EACH CASE KEEPING IN MIND THAT IN CONSTRUING THE EXPRESSION SUFFICIENT CAUSE, THE PRINCIPLE OF ADVANCING SUBS TANTIAL JUSTICE IS OF PRIME IMPORTANCE. THE COURT HELD THAT THE EXPRESSION SUFFICIENT CAUSE SHOULD RECEIVE LIBERA L CONSTRUCTION. 2.5. THE DECISION OF THE TRIBUNAL IN PEOPLE INFOCO M PRIVATE LTD. V/S CIT (ITA NO.210/MUM/2013) ORDER DA TED 19/05/2016, M/S NEUTRON SERVICES CENTRE PVT. LTD VS ITO (ITA NO.1180/MUM/2012) ORDER DATED 18/02/2016, SHRI SAIDATTA COOP-. CREDIT SOCIETY LTD. V/S ITO (ITA NO.2379/MUM/2015) ORDER DATED 15/01/2016 AND MR. NIKUNJ BAROT (PROP. ENIGMA) VS ITO (ITA NO.4887/MUM/2015) ORDER DATED 06/01/2016, WHEREIN, SUBSTANTIAL DELAY WAS CONDONED, SUPPORTS THE CASE OF THE PRESENT ASSESSEE . HAVING MADE THE AFORESAID OBSERVATION AND VARIOUS DECISIONS DISCUSSED HEREINABOVE, INCLUDING FROM HON BLE ITA NOS. 3206,3207 & 3209/MUM/2016 UTTAM VALUE STEELS LTD. (FORMERLY LLOYDS STEEL INDUSTRIES LTD.) 7 APEX COURT, THE CIRCUMSTANCES NARRATED BY THE ASSES SEE, WHEREIN, HE HAS STATED THE REASONS WHICH CAUSED THE DELAY, THEREFORE, THE DELAY IS CONDONED. THE LD. COMMISSI ONER OF INCOME TAX (APPEAL) IS DIRECTED TO ADJUDICATE THE A PPEALS OF THE ASSESSEE ON MERIT, AFRESH, IN ACCORDANCE WITH L AW. THE ASSESSEE BE GIVEN OPPORTUNITY OF BEING HEARD WITH F URTHER LIBERTY TO FURNISH EVIDENCE, IF ANY, IN SUPPORT OF ITS CLAIM. THE ASSESSEE IS ALSO DIRECTED TO REMAIN VIGILANT IN FUTURE. THUS, THE APPEALS OF THE ASSESSEE ARE ALLOWED FOR S TATISTICAL PURPOSES ONLY FOR FRESH ADJUDICATION. FINALLY, THE APPEALS OF THE ASSESSEE ARE ALLOWED FO R STATISTICAL PURPOSES ONLY. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. REPRESENTATIVES FROM BOTH SIDES AT THE CONCLUSION OF THE HEARING ON 15/06/2016. SD/- SD/- ( AS HWANI TANEJA ) (JOGINDER SINGH) '# / ACCOUNTANT MEMBER $# / JUDICIAL MEMBER # $ MUMBAI; ( DATED : 15/06/2016 F{X~{T? P.S/. . . %$&'()(*& / COPY OF THE ORDER FORWARDED TO : 1. *+,- / THE APPELLANT 2. ./,- / THE RESPONDENT. 3. 0 0 # 1! ( *+ ) / THE CIT, MUMBAI. 4. 0 0 # 1! / CIT(A)- , MUMBAI 5. 3'4 .! , 0 *+& * 5 , # $ / DR, ITAT, MUMBAI ITA NOS. 3206,3207 & 3209/MUM/2016 UTTAM VALUE STEELS LTD. (FORMERLY LLOYDS STEEL INDUSTRIES LTD.) 8 6. 6$ / GUARD FILE. / BY ORDER, /3+! .! //TRUE COPY// / (DY./ASSTT. REGISTRAR) , # $ / ITAT, MUMBAI