M/s Zenith Overseas Pvt. Ltd., New Delhi V. ITO, New Delhi

ITA 3212/DEL/2013

• Counselvise Citation: 321220114 RSA 2013
• Duration Of Justice: 6 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-11-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Assessment Year: 1996-1997
• Appeal Filed On: 21-05-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SAMEER SHARMA
• Keywords: Opportunity of being heard; Principle of natural justice

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: H NEW DELHI BEFORE SMT DIVA SINGH, JUDICIAL MEMBER AND SHRI B.C.MEENA, ACCOUNTANT MEMBER I.T.A .NO.-3212/DEL/ 2013 (ASSESSMENT YEAR-1996-97) ZENITH OVERSEAS PVT. LTD., 309, SHAKUNTLA BUILDING, 59, NEHRU PLACE, NEW DELHI-110019 P AN-AAACZ0007F (APPELLANT) VS ITO, WARD-18(4),C.R. BUILDING, I.P.ESTATE, NEW DELHI (RESPONDENT) APPELLANT BY NONE RESPONDENT BY SH. SAMEER SHARMA, SR. DR ORDER PER DIVA SINGH, JM THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST TH E ORDER DATED 28.03.2013 OF CIT(A)-XXI, NEW DELHI PERTAINING TO 1996-97 ASS ESSMENT YEAR ON VARIOUS GROUNDS CHALLENGING THE ACTION OF THE CIT(A) IN UPH OLDING THE PENALTY RS.1,75,000/- IMPOSED U/S 271(1)(C) OF THE ACT BY T HE AO. 2. NO ONE WAS PRESENT ON BEHALF OF THE ASSESSEE. H OWEVER AFTER HEARING THE LD. DR CONSIDERING THE FACTS AVAILABLE ON RECORD QU A GROUND NO-4 RAISED BY THE ASSESSEE, IT WAS CONSIDERED APPROPRIATE TO PROCEED WITH THE PRESENT APPEAL EX- PARTE QUA THE ASSESSEE APPELLANT ON MERIT. THE AFO RE-MENTIONED GROUND NO-4 READS AS UNDER :- 4. LD. CIT(A) ERRED IN DECIDING APPEAL EX-PARTE WH ILE NO NOTICE WAS RECEIVED FOR 26.03.2013. AND A SPECIFIC REQUES T WAS MADE FOR PERSONAL HEARING AND CONFIRMATION OF PENALTY IS BAD IN LAW. 2.1. A PERUSAL OF THE IMPUGNED ORDER SHOWS THAT THE CIT(A) IN THE COURSE OF THE HEARING PROVIDED THE ASSESSEE AN OPPORTUNITY ON 19. 03.2013 FIXING THE DATE OF HEARING ON 26.03.2013. SINCE NO ONE WAS PRESENT IN RESPONSE THERETO THE I.T.A .NO.-3212/DEL/2013 2 IMPUGNED ORDER WAS PASSED AFTER TWO DAYS. A PERUSA L OF THE GROUND NO-4 REPRODUCED ABOVE SHOWS THAT THE ASSESSEE DID NOT RE CEIVE THE SAID NOTICE. IN THE AFORE-MENTIONED PECULIAR FACTS AND CIRCUMSTANCES BE ING OF THE VIEW THAT THE RIGHT TO BE HEARD IS AN IMPORTANT RIGHT WHILE DISPOSING J USTICE ACCORDINGLY WE DEEM IT APPROPRIATE TO SET ASIDE THE IMPUGNED ORDER AND RES TORE THE ISSUE BACK TO THE FILE TO THE CIT(A). RIGHT TO BE HEARD IS AN IMPORTANT R IGHT TO WHICH A PARTY WHO IS FACED WITH AN ADVERSE VIEW IS ENTITLED TO AUDI AL TERAM PARTEM IS ONE OF THE MOST FAMOUS AND CELEBRATED RULE OF NATURAL JUSTICE. THE PRINCIPLES OF NATURAL JUSTICE ARE THOSE WHICH HAVE BEEN LAID OUT BY THE C OURTS AS BEING THE MINIMUM PROTECTION OF THE RIGHTS OF AN INDIVIDUAL AGAINST T HE ARBITRARY PROCEDURE THAT MAY BE ADOPTED BY A JUDICIAL, QUASI-JUDICIAL AND ADMINI STRATIVE AUTHORITY WHILE MAKING AN ORDER AFFECTING THOSE RIGHTS. A CAREFUL PERUSAL OF THE CONSISTENT JUDGEMENTS OF THE APEX COURT WOULD SHOW THAT IT HAS CONSISTENTLY BEEN HELD THAT THE RULES OF NATURAL JUSTICE ARE NOT EMBODIED RULES AND THE SAID PHRASE IS NOT AND CANNOT BE CAPABLE OF A PRECISE DEFINITION. THE UNDERLYING PR INCIPLE OF NATURAL JUSTICE EVOLVED UNDER THE COMMON LAW IS TO CHECK ARBITRARY EXERCISE OF POWER BY THE STATE OR ITS FUNCTIONARIES. ACCORDINGLY, THE PRINC IPLE BY ITS VERY NATURE IMPLIES THE DUTY TO ACT FAIRLY I.E. FAIR PLAY IN ACTION MUS T BE EVIDENT AT EVERY STAGE. FAIR PLAY DEMANDS THAT NOBODY SHALL BE CONDEMNED UNHEARD . 2.2. IN THE CELEBRATED JUDGEMENT OF THE APEX COURT IN THE CASE OF A.K.KRAIPAK VS- UNION OF INDIA (1969) 2 SCC 262, IT IS OBSERVE D THAT THE AIM OF RULES OF NATURAL JUSTICE IS TO SECURE JUSTICE OR TO PUT IT N EGATIVELY TO PREVENT MISCARRIAGE OF JUSTICE. THE SAID RULES ARE MEANS TO AN END AND NO T AN END IN THEMSELVES AND THOUGH IT IS NOT POSSIBLE TO MAKE AN EXHAUSTIVE CAT ALOGUE OF SUCH RULES HOWEVER IT CAN BE READILY SAID THAT THERE ARE TWO BASIC MAXIMS OF NATURAL JUSTICE NAMELY AUDI ALTERAM PARTEM AND NEMO JUDEX IN RE SUA. IN THE PRESENT FACTS OF THE CASE WE ARE CONCERNED WITH THE MAXIM AUDI ALTERM P ARTEM WHICH AGAIN MAY HAVE MANY FACETS TWO OF THEM (A) NOTICE OF THE CASE TO B E MET; AND (B) OPPORTUNITY TO I.T.A .NO.-3212/DEL/2013 3 EXPLAIN. THEIR LORDSHIPS HAVE CAUTIONED THAT THESE RULES CANNOT BE SACRIFICED AT THE ALTAR OF THE ADMINISTRATIVE CONVENIENCE OR CELE BRITY. THE ASSESSEE HAS RAISED GROUND NO.-4 IN REGARD TO THE OPPORTUNITY OF BEING HEARD AGITATED BEFORE US AND CONSIDERING THE SUBMISSIONS OF EITHER SIDE WHERE IN THE SOLE ISSUE AGITATED BEFORE US IS PERTAINING TO GRANTING OF OPPORTUNITY OF BEIN G HEARD WHICH ADMITTEDLY HAS NOT BEEN MADE AVAILABLE TO THE ASSESSEE WE ARE INCL INED TO ACCEPT THE PRAYER OF THE ASSESSEE ON A CAREFUL CONSIDERATION OF THE LEGA L POSITION THEREON. ACCORDINGLY THE GROUND NO.-4 RAISED BY THE ASSESSEE IS ALLOWED AND THE REMAINING GROUNDS ARE RESTORED BACK TO THE FILE OF THE CIT(A) WITH THE DI RECTION TO DECIDE THE SAME IN ACCORDANCE WITH LAW AFTER GIVING THE ASSESSEE A REA SONABLE OPPORTUNITY OF BEING HEARD. 3. IN VIEW OF THE ABOVE LEGAL POSITION THE ISSUE IS SET ASIDE TO THE FILE OF THE CIT(A) WITH THE DIRECTION TO DECIDE THE SAME IN ACC ORDANCE WITH LAW AFTER GIVING THE ASSESSEE A REASONABLE OPPORTUNITY OF BEING HEAR D. 4. IN THE RESULT THE APPEAL OF THE ASSESSEE IS ALLO WED FOR STATISTICAL PURPOSES. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 28 TH NOVEMBER 2013. SD/- SD/- (B.C.MEENA) (DIVA SINGH) ACCOUNTANT MEMBER JUDICIAL MEM BER DATED:28/11/2013 *AMIT KUMAR* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT RE GISTRAR ITAT NEW DELHI