Sangameshwar Industries , Gadag V. Income Tax Officer Ward-2 , Gadag

ITA 3257/BANG/2018

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 0364 (ITAT-BANGALORE)
• Duration Of Justice: 9 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-09-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2014-2015
• Appeal Filed On: 03-12-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: GANESH R G
• Assessee Lawyers: R CHANDRASHEKAR
• Keywords: Opportunity of being heard; Set aside
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC A BENCH : BANGALORE BEFORE SHRI N.V. VASUDEVAN, VICE PRESIDENT ITA NO. 3257/BANG/2018 ASSESSMENT YEAR : 2014 - 15 SANGAMESHWAR INDUSTRIES, YELAMALI PLOT, KASHI VISHWANATH NAGAR, NEAR APMC POST, GADAG 582 101. PAN: AAEFS 0021R VS. THE INCOME TAX OFFICER, WARD II, GADAG. APP ELLANT RESPONDENT APP ELLANT BY : SHRI R. CHANDRASHEKAR, ADV OCATE RESPONDENT BY : SHRI G A NESH R.G., STANDING COUNSEL DATE O F HEARING : 0 4 .09.2019 DATE O F PRONOUNCEMENT : 06. 09.2019 O R D E R THIS APPEAL BY THE ASSESSEE IS AGAINST THE ORD ER DATED 25.09.2018 OF THE CIT(APPEALS), HUBBALLI, RELATING TO ASSESSME NT YEAR 2014-15. 2. THE ASSESSEE IS A PARTNERSHIP FIRM ENGAGED IN TH E BUSINESS OF WHOLESALE DEALING IN GROUNDNUT, GROUNDNUT SEEDS AND HUSK. IN THE ORDER DATED 6.12.2016 PASSED U/S. 143(3) OF THE INCOME-TA X ACT, 1961 [THE ACT], THE AO MADE THE FOLLOWING ADDITIONS TO THE T OTAL INCOME DECLARED BY THE ASSESSEE :- ITA NO. 3257/BANG/2018 PAGE 2 OF 5 TOTAL INCOME RETURNED : RS. 74,400 ADD: 1) ADDITION ON ACCOUNT OF GP AS DISCUSSED IN PARA 6 : RS. 18,547 2) SALES TAX PAID DISALLOWED AS DISCUSSED IN PARA 7 : RS.1,67,275 3) DISALLOWANCE AS DISCUSSED IN PARA 8 : RS. 30,670 4) DISALLOWANCE U/S. 40(A)(I) AS DISCUSSED IN PARA 9 : RS.2,00,317 5) INTEREST PAID TO BANK AND OTHERS DISALLOWED AS DISCUSSED IN PARA NO.10 : RS.9,82,201 TOTAL INCOME: RS.14,73,450/- 3. AGAINST THE AFORESAID ADDITIONS MADE BY THE AO, THE ASSESSEE PREFERRED APPEAL BEFORE THE CIT(APPEALS). THE APPE AL OF THE ASSESSEE WAS FIXED FOR HEARING BEFORE THE CIT(A) ON 2.5.18, 24.5.18, 11.6.18, 25.6.18 AND 9.8.18. ACCORDING TO THE CIT(A), THE ASSESSEE APPEARED ONLY ON 11.6.18 THROUGH HIS AR AND REQUESTED FOR TIME WHICH WAS ALLOWED TILL 25.6.18. THEREAFTER NONE APPEARED ON BEHALF OF THE ASSESSEE. FINALLY, THE CIT(APPEALS) FIXED THE APPEAL FOR HEARING ON 30.8.1 8, BUT STILL THERE WAS NO APPEARANCE ON BEHALF OF THE ASSESSEE. IN THE CIRCU MSTANCES, THE CIT(A) DISMISSED THE APPEAL OF ASSESSEE, AS HE FOUND NO GR OUNDS TO INTERFERE WITH THE ORDER OF AO. 4. AGGRIEVED BY THE ORDER OF LD. CIT(APPEALS), THE ASSESSEE HAS FILED THE APPEAL BEFORE THE TRIBUNAL. AT THE TIME OF HEA RING, THE LD. COUNSEL FOR THE ASSESSEE BROUGHT TO OUR NOTICE AN AFFIDAVIT FIL ED BY THE ASSESSEE IN WHICH IT HAS BEEN AVERRED THAT ON 2.5.2018, ONE OF THE PARTNERS OF THE ASSESSEE SHRI JAIDEV T, YELAMALLI APPEARED ALONG W ITH THE AR AND FILED ITA NO. 3257/BANG/2018 PAGE 3 OF 5 WRITTEN SUBMISSIONS AND OTHER DOCUMENTS. EVEN ON 2 4.5.2018, THE ASSESSEE APPEARED BEFORE THE CIT(APPEALS). THEREAF TER, THERE WAS NO APPEARANCE BEFORE THE CIT(APPEALS). IT WAS ALSO SU BMITTED THAT NOTICES OF HEARING HAD BEEN SENT TO THE FIRMS ADDRESS AND SIN CE THE BUSINESS OF ASSESSEE HAD CLOSED SINCE 2017 DUE TO HUGE LOSSES, THE NOTICES WERE NOT RECEIVED BY THE ASSESSEE. THE LD. COUNSEL FOR THE ASSESSEE BROUGHT TO OUR NOTICE THAT ITAT BANGALORE BENCH IN THE CASE OF ANO THER SISTER FIRM OF THE ASSESSEE, HAD ALSO FILED APPEAL AGAINST THE ORDER O F ASSESSMENT BY THE AO BEFORE THE CIT(A) I.E., SISTER CONCERN BY NAME SANG AMESHWAR TRADING COMPANY. EVEN IN THAT CASE, AN EX PARTE ORDER WAS PASSED BY THE CIT(A) AND THE TRIBUNAL SET ASIDE THE ORDER OF CIT(A) AND RESTORED THE ISSUE FOR CONSIDERATION AFRESH BY THE CIT(APPEALS) ON MERITS. A COPY OF THE ITAT ORDER IN ITA NO.3233/BANG/2018 FOR AY 2014-15 DATED 31.5.2019 WAS FILED BEFORE US. 5. THE LD. DR RELIED ON THE ORDER OF CIT(APPEALS). I HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIONS. ON IDENTICAL FAC TS AND CIRCUMSTANCES IN THE CASE OF SISTER CONCERN OF ASSESSEE, THIS TRIBU NAL HAS SET ASIDE THE ORDER OF CIT(APPEALS) OBSERVING AS FOLLOWS:- 3. AT THE VERY OUTSET, IT WAS SUBMITTED BY ID. AR OF ASSESSEE THAT THE ORDER OF CIT(A) IS EX-PARTE QUA THE ASSESS EE. IT IS ALSO SUBMITTED THAT AS NOTED BY CIT (A) IN PARA 3 OF HIS ORDER, SIX DATES OF HEARING WERE FIXED BY CIT (A) AND THE ASSE SSEE COULD NOT MAKE COMPLIANCE. IN THIS REGARD, HE SUBMITTED THAT ON PAGES 52 & 53 OF PAPER BOOK IS THE AFFIDAVIT OF SHRI JAYADEV T OTAPPA YELAMALI, ONE OF THE PARTNERS OF THE ASSESSEE FIRM IN WHICH HE EXPLAINED THAT HE HAS APPEARED BEFORE CIT (A) ALONG WITH HIS AUDITOR AND PRESENTED THE CASE OF THE ASSESSEE AND WRITTEN SUBMISSIONS WERE ALSO FILED. IT IS ALSO STATED IN T HE AFFIDAVIT THAT LD. CIT (A) SAID THAT NO NEW EVIDENCES WILL BE ENTE RTAINED AT THE APPELLATE STAGE AND IN SPITE OF THIS, IT WAS SUBMIT TED BY ASSESSEE BEFORE CIT (A) THAT ASSESSEE HAS ALREADY FILED ALL THE DETAILS BEFORE THE AO AND WHAT THEY ARE FILING IS ONLY EXTR ACTS FROM THE ITA NO. 3257/BANG/2018 PAGE 4 OF 5 BOOKS OF ACCOUNTS OF THE FIRM WHICH WERE PRODUCED B EFORE THE AO FOR VERIFICATION. HE ALSO POINTED OUT THAT IT IS ALSO STATED IN THE AFFIDAVIT THAT IT WAS EXPLAINED BEFORE CIT(A) O RALLY THAT THE BUSINESS HAS BEEN CLOSED AND ANY FURTHER COMMUNICAT ION BE SENT TO THE AUDITOR OF THE ASSESSEE FIRM AND AFTER THAT, NO NOTICE WAS RECEIVED BY THE ASSESSEE. HE SUBMITTED THAT IN THE INTEREST OF JUSTICE, THE MATTER MAY BE RESTORED BACK TO THE FIL E OF CIT(A) FOR FRESH DECISION. THE ID. DR OF REVENUE SUPPORTED THE ORDERS OF AUTHORITIES BELOW. 4. I HAVE CONSIDERED THE RIVAL SUBMISSIONS. I FIND THAT THIS IS NOTED BY CIT (A) IN PARA 3 OF HIS ORDER THAT SIX DA TES OF HEARING WERE FIXED BY HIM FOR HEARING BUT IT IS STATED BY C IT (A) IN THIS PARA THAT ASSESSEE FAILED TO APPEAR OR MAKE ANY SUB MISSION. AS AGAINST THIS, AS PER THE AFFIDAVIT OF THE PARTNER O F THE ASSESSEE FIRM, IT IS STATED THAT HE HAD APPEARED BEFORE CIT( A) ALONG WITH THE AUDITOR AND FILED WRITTEN SUBMISSION ALSO AND E XPLAINED THE CASE. COPY OF WRITTEN SUBMISSIONS SAID TO HAVE BEEN FILED BEFORE CIT (A) IS AVAILABLE ON PAGES 7 AND 8 OF THE PAPER BOOK. CONSIDERING ALL THESE FACTS, I FEEL IT PROPER THAT IN THE INTEREST OF JUSTICE, THE ASSESSEE SHOULD BE PROVIDED ONE MORE O PPORTUNITY FOR PROPER COMPLIANCE AND HENCE, I SET ASIDE THE ORDER OF CIT (A) AND RESTORE THE MATTER BACK TO THE FILE OF CIT (A) FOR FRESH DECISION AFTER PROVIDING ADEQUATE OPPORTUNITY OF BEING HEARD TO BOTH SIDES. IN VIEW OF THIS, NO ADJUDICATION ON MERIT IS CALLED FOR AT THE PRESENT STAGE. 5. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. 6. I AM OF THE VIEW THAT THE FACTS AND CIRCUMSTANCE S ARE IDENTICAL TO THE CASE DECIDED BY THE TRIBUNAL SUPRA . FOLLOWING THE SAID ORDER, I AM OF THE VIEW THAT IN THE INTEREST OF JUSTICE, THE ASSESSEE SHOULD BE PROVIDED OPPORTUNITY OF BEING HEARD BEFORE THE CIT(APPEALS). I THEREFORE SET ASIDE THE ORDER OF CIT(APPEALS) AND RESTORE THE ISSUE BEF ORE THE CIT(APPEALS) FOR FRESH CONSIDERATION BY THE CIT(APPEALS) ON MERITS, AFTER AFFORDING THE ASSESSEE OPPORTUNITY OF BEING HEARD. ITA NO. 3257/BANG/2018 PAGE 5 OF 5 7. IN THE RESULT, THE APPEAL OF ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON THIS 6 TH DAY OF SEPTEMBER, 2019. SD/- ( N.V. VASUDEVAN ) VICE PRESIDENT BANGALORE, DATED, THE 6 TH SEPTEMBER, 2019. / D ESAI S MURTHY / COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, I TAT, BANGALORE. 6. GUARD FIL E BY ORDER ASSISTANT REGISTRAR, ITAT, BANGALORE.