Grihalakshmi Productions, Calicut V. The Jt CIT, Calicut

ITA 33/COCH/2014

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 6221 (ITAT-COCHIN)
• Duration Of Justice: 2 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-04-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 31-03-2014
• Assessment Year: 2007-2008
• Appeal Filed On: 31-01-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Charitable institution; Principle of natural justice; Non passing of speaking order

Judgement Text

1 ITA NO.33 & 34/COCH/2014 S.P. NO.03&04/COCH/2014 IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN BEFORE SHRI N.R.S. GANESAN (JM) AND SHRI B.R. BASKA RAN(AM) I.T.A NOS. 33 & 34/COCH/2014 & S.P. NOS.03 & 04/COCH/2014 (ARISING OUT OF I.T.A NOS. 33 & 34/COCH/2014) (ASSESSMENT YEAR 2007-08) M/S GRIHALAXMI PRODUCTS VS THE JT.CIT AZHCHAVATTOM CALICUT CALICUT PAN : AACFG1101A (APPELLANT / APPLICANT) (RESPONDENT) APPELLANT / BY :SHRI T.M SREEDHARAN, LD.SR COUNS EL APPLICANT BY RESPONDENT BY : SMT. LATHA V KUMAR DATE OF HEARING : 04-04-2014 DATE OF PRONOUNCEMENT : 04-04-2014 O R D E R PER N.R.S. GANESAN (JM) BY CONSENT OF BOTH THE PARTIES, THE APPEALS ARE TA KEN UP FOR HEARING TODAY. THE APPEALS ARE DIRECTED AGAINST THE ORDERS OF CIT(A), KOZHIKODE FOR THE ASSESSMENT YEARS 2007-08 CONFIRMING THE IMP OSITION OF PENALTY LEVIED U/S 271D AND 271E OF THE ACT. 2 ITA NO.33 & 34/COCH/2014 S.P. NO.03&04/COCH/2014 2. SHRI T.M. SREEDHARAN, THE LD.SENIOR COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE CIT(A) BY FOLLOWING THE ORDER OF THIS TRIBUNAL IN ITA NO.103/COCH/2011 DATED 28-03-2013 CONFIRMED THE ORD ER OF THE ASSESSING OFFICER. REFERRING TO THE ORDER OF CIT(A), THE LD. SENIOR COUNSEL SUBMITTED THAT THE CIT(A) HAS NOT BROUGHT ON RECORD THE FACTS OF THIS CASE AND HE HAS NOT DISCUSSED ANYTHING AS TO HOW THE TRIBUNAL ORDER IS APPLICABLE TO THE FACTS OF THE CASE FOR THE YEAR UNDER CONSIDERATION. ACCORDING TO THE LD.SENIOR COUNSEL, EACH YEAR IS DIFFERENT AND SEPAR ATE, THEREFORE, THE CIT(A) HAS TO DISCUSS THE FACTS OF EACH CASE AND THEN RECO RD HIS FINDINGS AS TO HOW THE ORDER OF THIS TRIBUNAL IS APPLICABLE TO THE FACTS OF THE CASE. IN THE ABSENCE OF ANY DISCUSSION ABOUT THE APPLICABILITY O F THE TRIBUNAL ORDER IN THE APPELLATE ORDER PASSED, THE CIT(A) IS NOT JUSTI FIED IN CONFIRMING THE ORDERS OF THE ASSESSING OFFICER IN A CRYPTIC MANNER . 3. WE HEARD SMT. LATHA V KUMAR, THE LD.DR ALSO. TH E LD.DR VERY FAIRLY SUBMITTED THAT THE ORDER IS A NON SPEAKING ORDER AN D THERE IS NO DISCUSSION ABOUT THE FACTS OF THE CASE. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. THE CIT( A) CONFIRMED THE PENALTY LEVIED BY THE ASSESSING OFFICER U/S 271D AN D 271E OF THE ACT. THE 3 ITA NO.33 & 34/COCH/2014 S.P. NO.03&04/COCH/2014 CIT(A) BEING THE FIRST APPELLATE AUTHORITY HAS TO B RING ON RECORD THE FACTS OF THE CASE AND HE IS EXPECTED TO DISCUSS HOW THE DECI SION OF THIS TRIBUNAL IS APPLICABLE TO THE FACTS OF THE CASE BEFORE HIM. TH E APPLICATION OF MIND TO THE FACTS OF THE CASE SHALL BE REFLECTED IN THE IMP UGNED ORDER OF CIT(A). UNFORTUNATELY, THE CIT(A) HAS NOT DISCUSSED ANYTHIN G EXCEPT PLACING RELIANCE ON THE ORDER OF THIS TRIBUNAL. THE APPLIC ATION OF MIND DOES NOT REFLECT IN THE IMPUGNED ORDER OF THE CIT(A). UNDER THE SCHEME OF THE INCOME-TAX ACT, THE PROCEEDINGS BEFORE THE CIT(A) A RE JUDICIAL PROCEEDINGS. THEREFORE, THE APPLICATION OF MIND SH ALL BE REFLECTED IN THE ORDER ITSELF. WHEN THE CIT(A) PLACES RELIANCE ON T HE ORDER OF THE TRIBUNAL OR A HIGH COURT OR THE SUPREME COURT, HE HAS TO DIS CUSS THE FACTS OF THE CASE AND RECORD HIS FINDINGS AS TO HOW THE DECISION OF THE TRIBUNAL OR THE HIGH COURT OR SUPREME COURT IS APPLICABLE TO THE FA CTS OF THE CASE. BUT WITHOUT DISCUSSION, HE CANNOT SIMPLY PLACE RELIANCE ON THE DECISION OF THE TRIBUNAL OR THE HIGH COURT OR SUPREME COURT. THE A LLAHABAD HIGH COURT IN A RECENT UNREPORTED JUDGMENT IN THE CASE OF M/S FAT EH CHAND CHARITABLE TRUST IN WRIT TAX NO.1629 OF 2010 (JUDGMENT DATED 2 7-05-2013) HELD THAT FAILURE TO GIVE REASONS AMOUNTS TO DENIAL OF JUSTIC E. REASONS ARE LIVE LINKS BETWEEN THE MIND OF THE DECISION TAKER TO THE CON TROVERSY IN QUESTION AND THE DECISION OR CONCLUSION ARRIVED AT. REASONS SUBSTITUTE SUBJECTIVITY BY OBJECTIVITY. THE EMPHASIS ON RECORDING REASONS IS THAT IF THE DECISION 4 ITA NO.33 & 34/COCH/2014 S.P. NO.03&04/COCH/2014 REVEALS THE INSCRUTABLE FACE OF THE SPHINX, IT CAN , BY ITS SILENCE, RENDER IT VIRTUALLY IMPOSSIBLE FOR THE COURTS TO PERFORM THEI R APPELLATE FUNCTION OR EXERCISE THE POWER OF JUDICIAL REVIEW ON ADJUDGING THE VALIDITY OF THE DECISION. RIGHT TO REASON IS AN INDISPENSABLE PART OF A SOUND JUDICIAL SYSTEM; REASONS AT LEAST SUFFICIENT TO INDICATE AN APPLICATION OF MIND TO THE MATTER BEFORE COURT. ANOTHER RATIONALE IS THAT THE AFFECTED PARTY CAN KNOW WHY THE DECISION HAS GONE AGAINST HIM. ONE OF THE SALUTARY REQUIREMENTS OF NATURAL JUSTICE IS SPELLING OUT REASONS FOR THE ORDER MADE; IN OTHER WORDS, A SPEAKING-OUT. THE INSCRUTABLE FACE OF THE SPHIN X IS ORDINARILY INCONGRUOUS WITH A JUDICIAL OR QUASI-JUDICIAL PERFO RMANCE. 5. IN VIEW OF THE ABOVE, WE ARE UNABLE TO EXAMINE T HE REASONS FOR CONFIRMING THE ORDER OF THE ASSESSING OFFICER BY CI T(A). ACCORDINGLY, WITHOUT GOING INTO THE MERIT OF THE APPEALS, THE OR DER OF THE CIT(A) IS SET ASIDE AND THE ISSUE OF LEVY OF PENALTY U/S 271D AND 271E IS REMITTED BACK TO THE FILE OF THE CIT(A). THE CIT(A) SHALL EXAMIN E THE CASE AND BRING ON RECORD THE FACTS OF THE CASE AND THEN RELY OR DISTI NGUISH ANY DECISION OF THIS TRIBUNAL OR ANY OTHER JUDGMENTS THAT MIGHT BE RELIE D UPON BY THE ASSESSEE THAT MAY OR MAY NOT BE APPLICABLE TO THE FACTS OF T HE CASE. AND IN CASE, THE DECISION OF THIS TRIBUNAL OR THE JUDGMENT OF TH E HIGH COURT OR THE SUPREME COURT IS NOT APPLICABLE HE HAS TO SPECIFICA LLY BRING ON RECORD HOW 5 ITA NO.33 & 34/COCH/2014 S.P. NO.03&04/COCH/2014 IT IS NOT APPLICABLE TO THE FACTS OF THE CASE. THE CIT(A) SHALL GIVE REASONABLE OPPORTUNITY TO THE ASSESSEE AND THEREAFT ER DECIDE THE SAME IN ACCORDANCE WITH LAW. 6. SINCE THE APPEALS ARE DISPOSED OF, THE STAY PETI TIONS FILED BY THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 04 TH APRIL, 2014. SD/- SD/- (B.R. BASKARAN) (N.R.S. GANESAN) ACCOUNTANT MEMBER JUDICIAL MEMBER COCHIN, DT : 04 TH APRIL, 2014 PK/- COPY TO: 1. GRIHALAXMI PRODUCTS, AZHCHAVATTOM, CALICUT 673 0 07 2. THE JT.CIT, RANGE-1, KOZHIKODE 3. THE COMMISSIONER OF INCOME-TAX, KOZHIKODE 4. THE COMMISSIONER OF INCOME-TAX(A), AAYAKAR BHAVA N, MANANCHIRA, KOZHIKODE 673 001 5. THE DR (TRUE COPY) BY ORDER ASSTT. REGISTRAR, INCOME-TAX APPELLATE TRIBUNAL, COCHIN BENCH