ITO 9(1)-2, MUMBAI V. CALAMA INDUSTRIES P. LTD, MUMBAI

ITA 3278/MUM/2009

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 7643 (ITAT-MUMBAI)
• Duration Of Justice: 9 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-03-2010
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 26-02-2010
• Assessment Year: 2004-2005
• Appeal Filed On: 18-05-2009
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: S M KESHKMAT
• Keywords: Opportunity of being heard; Reasonable cause; Tax effect; Set aside
• Section: 133(6); 22

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH C, MUMBAI BEFORE SHRI T.R. SOOD, AM AND SHRI V. DURG RAO, JM I.T.A.NO. 3278/MUM/2009 ASSESSMENT YEAR : 2004-05 THE INCOME-TAX OFFICER-9(1)(2), ROOM NO. 226, 2ND FLOOR, AAYAKAR BHAVAN, M.K.ROAD, MUMBAI 400 020. VS. M/S. CALAMA INDUSTRIES PVT. LTD., 7, GAIWADI INDUSTRIAL ESTATE, S.V. ROAD, GOREGAON (W), MUMBAI 400 062. PAN: AAACC 2497C (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI S.M. KESHKMAT RESPONDENT BY : SHRI VIJAY MEHTA O R D E R PER T.R. SOOD, AM: IN THIS APPEAL THE REVENUE HAS RAISED THE FOLLOWIN G GROUND: ON THE FACTS AND IN THE CIRCUMSTANCE S OF THE CASE AND IN LAW, THE LEARNED CIT(A) ERRED IN DELETING ADDITION OF RS. 8, 69,356/- MADE ON ACCOUNT OF UNPROVED PURCHASES BY ADMITTING ADDIT IONAL EVIDENCE IN CONTRAVENTION TO PROCEDURES LAID DOWN I N RULE 46A OF I.T. RULES. 2. BOTH PARTIES WERE HEARD. 3. AFTER CONSIDERING THE RIVAL SUBMISSIONS WE FIND THAT DURING THE ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER HAD ISSUED A NOTI CE UNDER SECTION 133(6) TO M/S. R.K. INDUSTRIES FROM WHOM THE ASSESSEE HAD MADE PUR CHASES. HOWEVER, THIS NOTICE WAS RETURNED BACK BY THE POSTAL AUTHORITIES WITH THE REMARK LEFT. SINCE THE COMPANY DID NOT SUBMIT ANY OTHER CONFIRMATION, THIS AMOUNT WAS ADDED TO THE INCOME OF THE ASSESSEE. 4. ON APPEAL BEFORE THE LEARNED CIT(A) IT WAS POINT ED OUT THAT M/S. R.K. INDUSTRIES HAD CHANGED ITS ADDRESS. IT WAS ALSO ARG UED THAT M/S. R.K. INDUSTRIES HAD FILED A SUIT AGAINST THE ASSESSEE BEFORE THE HO NBLE BOMBAY HIGH COURT AND SOME SETTLEMENT HAS ALSO BEEN REACHED. ON THE BASIS OF THIS MATERIAL THE ADDITION WAS DELETED. HOWEVER, WE FIND THAT THE LEARNED CIT( A) NEVER REFERRED THIS MATERIAL ITA NO.3278/M/09 M/S. CALAMA INDS. P.LTD. 2 TO THE ASSESSING OFFICER FOR HIS COMMENTS, WHICH IS CLEARLY IN VIOLATION OF RULE 46A OF THE INCOME-TAX RULES. THEREFORE, IN THE INTEREST OF JUSTICE, WE SET ASIDE THE ORDER OF THE LEARNED CIT(A) AND REMIT THE MATTER BA CK TO THE FILE OF THE ASSESSING OFFICER WITH DIRECTION TO CONSIDER THE MATERIAL FIL ED BEFORE THE LEARNED CIT(A) AND DECIDE THE ISSUE. NEEDLESS TO SAY THAT THE ASSESSE E SHOULD BE GIVEN ADEQUATE OPPORTUNITY OF BEING HEARD. 5. IN THE RESULT, THE APPEAL IS ALLOWED FOR STATIST ICAL PURPOSES. ORDER PRONOUNCED ON THIS 3 RD DAY OF MARCH 2010. SD. SD. (V.DURGA RAO) (T. R. SOOD) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI DATED THE 3 RD MARCH, 2010. KN COPY TO: 1. THE ASSESSEE 2. THE REVENUE 3. THE CIT-IX, MUMBAI 4. THE CIT(A)-IX, MUMBAI 5. THE DR C BENCH, MUMBAI BY ORDER /TRUE COPY/ ASST. REGISTRAR, ITAT, MUMBAI ITA NO.3278/M/09 M/S. CALAMA INDS. P.LTD. 3 S.NO. DETAILS DATE INITIALS DESIGNATION 1 DRAFT DICTATED ON 26.02.2010 SR.PS/PS 2 DRAFT PLACED BEFORE AUTHOR 26.02.2010 SR.PS/PS 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER JM/A M 5. APPROVED DRAFT COMES TO THE SR.PS/PS SR.PS/PS 6. KEPT FOR PRONOUNCEMENT ON SR.PS/PS 7. FILE SENT TO THE BENCH CLERK SR.PS/PS 8 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK 9 DATE OF DISPATCH OF ORDER ITA NO.3278/M/09 M/S. CALAMA INDS. P.LTD. 4 ORDER PRONCOUNCED ON . 2. AT THE TIME OF HEARING NONE APPEARED ON BEHALF O F THE ASSESSEE- APPELLANT AS WELL AS NO PETITION FOR ADJOURNMENT WA S FILED. WE FIND FROM THE RECORDS THAT ASSESSEE-APPELLANT WAS SERVED NOTICE B Y REGISTERED POST ACKNOWLEDGEMENT DUE TWICE AND THE ACKNOWLEDG EMENT CARDS DULY SIGNED BY THE ASSESSEE ON 25.07.2007 AND 16.11.2 007 , RECEIVED BACK. IT IS THEREFORE, PRESUMED THAT THE ASSESSEE IS NOT INT ERESTED IN PURSUING THE APPEAL FILED BY IT. IT HAS BEEN HELD BY THE HONBLE MADHYA PRADESH HIGH COURT IN ESTATE OF LATE TUKOJIRAO HOLKAR VS. CWT (2 23 ITR 480)(MP) THAT IF THE PARTY, AT WHOSE INSTANCE THE REFERENCE IS MADE, FAILS TO APPEAR AT THE HEARING OR FAILS IN TAKING STEPS FOR PREPARATION OF PAPER-BOOKS, SO AS TO ENABLE HEARING OF THE REFERENCE, THE COURT IS NOT B OUND TO ANSWER THE REFERENCE. THE DECISION OF THE DELHI BENCH OF THE TRIBUNAL IN CIT VS. MULTIPLAN (INDIA) PVT. LTD., 38 ITD 320 (DEL.) IS A LSO TO THE SAME EFFECT. IN THE FACTS OF THE CASE WE HOLD THAT THE ASSESSEE IS NOT INTERESTED IN PURSUING THE PRESENT APPEAL BEFORE THE TRIBUNAL, ACCORDINGLY THE APPEAL OF THE ITA NO.3278/M/09 M/S. CALAMA INDS. P.LTD. 5 ASSESSEE IS DISMISSED AS UNADMITTED. THE ASSESSEE, IF SO ADVISED, SHALL BE FREE TO MOVE THE TRIBUNAL PRAYING FOR RECALLING OF THIS ORDER PROVIDED THE ASSESSEE IS ABLE TO ESTABLISH THE REASONABLE CAUSE BEHIND THE NON- APPEARANCE ON THE DATE OF HEARING AND IN THAT CASE THE TRIBUNAL MAY IN ITS DISCRETION RECALL THIS ORDER AND THE APPEAL MAY BE RESTORED FOR RE-HEARING. 3. IN THE RESULT, APPEAL OF THE ASSESSEE IS DISMISS ED. ORDER PRONOUNCED IN THE OPEN COURT ON 18.12.2 007. 2. FROM THE GROUNDS FILED BY THE ASSESSEE BEFORE TH E LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) WE FIND THAT THE LEVY PERTA INED TO CONCEALMENT OF INCOME OF RS. 1,02,744/- AND THE PENALTY LEVIED WAS RS. 22 ,248/-. THEREFORE IN VIEW OF CBDT CIRCULAR F.NO. 279/MISC.142/2007-IT DATED 15 TH MAY, 2008 THE APPEAL IS NOT MAINTAINABLE, TAX EFFECT BEING LESS THAN RS. 2 LAKH S. VIDE PARA 4 OF THIS CIRCULAR IT IS CLEARLY MENTIONED THAT THE TAX EFFECT IN ASCERTA INING MONETARY LIMITS FOR FILING OF APPEALS, IN THE CASE OF PENALTY ORDERS, WOULD MEAN QUANTUM OF PENALTY DELETED OR REDUCED. 3. THEREFORE, APPEAL OF THE REVENUE IS DISMISSED AS NOT MAINTAINABLE. ORDER PRONOUNCED ON THIS _______ DAY OF MAY, 2009 . (G.C. GUPTA) (ABRAHAM P. GEORGE) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI DATED THE ______MAY, 2009. KN COPY TO: 6. THE ASSESSEE 7. THE ITO-26(1)(2), MUMBAI. 8. THE CIT, CITY-XXVI, MUMBAI 9. THE CIT(A)-XXVIII, MUMBAI 10. THE DR, G BENCH, MUMBAI BY ORDER /TRUE COPY/ ASST. REGISTRAR, ITAT, MUMBAI ITA NO.3278/M/09 M/S. CALAMA INDS. P.LTD. 6 S.NO. DETAILS DATE INITIALS DESIGNATION 1 DRAFT DICTATED ON 18.05.09 SR.PS/PS 2 DRAFT PLACED BEFORE AUTHOR 18.05.09 SR.PS/PS 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS SR.PS/PS 6. KEPT FOR PRONOUNCEMENT ON SR.PS/PS 7. FILE SENT TO THE BENCH CLERK SR.PS/PS 8 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK 9 DATE OF DISPATCH OF ORDER ITA NO.3278/M/09 M/S. CALAMA INDS. P.LTD. 7