Interglobe Enterprises Ltd., Gurgaon V. DCIT, New Delhi

ITA 338/DEL/2017

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 9950 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 11 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-01-2020
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Assessment Year: 2012-2013
• Appeal Filed On: 20-01-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: INDER PAL SINGH BINDRA
• Assessee Lawyers: NAGESH KUMAR BEHL
• Keywords: Opportunity of being heard; Principle of natural justice; TDS; Rule 8D; Set aside; FORM 26AS
• Section: 143(3); 14A; 250; 251; 246A; 13

Judgement Text

ITA NO.- 338/DEL/2017. INTERGLOBE ENTERPRISES LTD. PAGE 1 OF 14 IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH: C: NEW DELHI) BEFORE SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER AND SHRI ANADEE NATH MISSHRA, ACCOUNTANT MEMBER ITA NO:- 338/DEL/2017 ( ASSESSMENT YEAR: 2012-13) INTERGLOBE ENTERPRISES LIMITED. VS. DY. COMMISSIONER OF INCOME TAX, CIRCLE 12(2), NEW DELHI. PAN NO: AACCI1393M APPELLANT RESPONDENT ASSESSEE BY : SHRI NAGESH KUMAR BEHL, ADV. REVENUE BY : SHRI INDER PAL SINGH BINDRA, CIT(DR) ORDER PER ANADEE NATH MISSHRA, AM (A) THIS APPEAL BY ASSESSEE IS FILED AGAINST THE ORDER OF LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-4, NEW DELHI, [LD. CIT(A), FOR SHOR T] DATED 17.11.2016 FOR ASSESSMENT YEAR 2012-13. THE GROUNDS OF APPEAL ARE AS UNDER: 1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CAS E AND IN LAW, THE ORDER PASSED IS BAD IN LAW HAVING BEEN PASSED IN VIOLATIO N OF THE PRINCIPLES OF NATURAL JUSTICE WITHOUT AFFORDING AN OPPORTUNITY OF BEING HEARD TO THE APPELLANT. 1.1 THAT THE LD. COMMISSIONER OF INCOME TAX- APPEAL S [CIT(A)] ERRED IN HOLDING THAT APPELLANT HAD INTENTIONALLY AND WILLFULLY NOT COOPERATED DURING THE PROCEEDINGS BEFORE HIM AND WAS NOT INTERESTED IN TA KING UP THE MATTER AND MAKING SUBMISSIONS. ITA NO.- 338/DEL/2017. INTERGLOBE ENTERPRISES LTD. PAGE 2 OF 14 2. WITHOUT PREJUDICE, THE LD. CIT(A) HAS ERRED IN C ONFIRMING THE ERRONEOUS COMPUTATION OF DISALLOWANCE BY THE LD. ASSESSING OF FICER U/S 14A OF THE INCOME TAX ACT, 1961 (ACT) READ WITH RULE 8D OF T HE INCOME TAX RULES (RULES), 1962. THE APPELLANT CRAVES LEAVE TO ADD, TO ALTER, AMEND OR VARY FROM THE ABOVE GROUNDS OF APPEAL AT OR BEFORE THE TIME OF HEARING. (B) THE ASSESSMENT ORDER U/S 143(3) OF THE INCOME TAX ACT, 1961 (I.T. ACT FOR SHORT) WAS PASSED ON 23.03.2015 BY ASSESSING OFFICE R (AO, FOR SHORT). THE RELEVANT PORTION OF THE ASSESSMENT ORDER IS REPRODUCED AS UN DER: ITA NO.- 338/DEL/2017. INTERGLOBE ENTERPRISES LTD. PAGE 3 OF 14 ITA NO.- 338/DEL/2017. INTERGLOBE ENTERPRISES LTD. PAGE 4 OF 14 ITA NO.- 338/DEL/2017. INTERGLOBE ENTERPRISES LTD. PAGE 5 OF 14 ITA NO.- 338/DEL/2017. INTERGLOBE ENTERPRISES LTD. PAGE 6 OF 14 ITA NO.- 338/DEL/2017. INTERGLOBE ENTERPRISES LTD. PAGE 7 OF 14 ITA NO.- 338/DEL/2017. INTERGLOBE ENTERPRISES LTD. PAGE 8 OF 14 ITA NO.- 338/DEL/2017. INTERGLOBE ENTERPRISES LTD. PAGE 9 OF 14 (B.1) THE ASSESSEE FILED APPEAL BEFORE THE LD. CIT(A). A S THE ASSESSEE DID NOT APPEAR BEFORE THE LD. CIT(A), THE LD. CIT(A) CONCLUDED TH AT THE ASSESSEE WAS NOT INTERESTED IN PROSECUTING ITS APPEAL, AND HE DISMISSED THE ASS ESSEES APPEAL WITH THE FOLLOWING OBSERVATIONS IN HIS AFORESAID IMPUGNED ORDER DATED 17.11.2016: THIS APPEAL IS FILED ON 20/04/2015 AGAINST THE ORD ER DATED 23/03/2015 PASSED BY DY. COMMISSIONER OF INCOME TAX, CIRCLE 12(2), NEW DELHI (HEREINAFTER REFERRED TO AS THE 'AO') UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1 961 FOR THE ASSESSMENT YEAR 2012- 13. 2. THE CASE WAS FIXED FOR HEARING ON 27/06/2016 WHE N AN ADJOURNMENT APPLICATION DATED 27/06/2016 WAS FILED WHICH WAS SI GNED BY SOME VIKAS WALIA FOR SACHIN MEHTA. IT IS CLEAR THAT IT WAS NOT SIGNED BY THE AUTHORIZED REPRESENTATIVE OF THE COMPANY. AFTER THAT ANOTHER APPLICATION DATED 29/06 /2016 WAS FILED IN THE DAK ON 30/06/2016 SIGNED BY SACHIN MEHTA ALONG WITH ORIGIN AL POWER OF ATTORNEY IN WHICH HE WAS AUTHORIZED BY THE COMPANY. IN THIS APPLICATION A TIME OF 15 DAYS WAS. SOUGHT TO APPEAR. NORMALLY THE AUTHORIZED REPRESENTATIVE APPEARS SEEK ING ANOTHER DATE WHICH IS GIVEN AT THE SAME TIME. NOW IN SUCH A SITUATION IT IS EXPECTED THAT THE AR OF THE APPELLANT WOULD APPEAR HIMSELF AFTER THE PERIOD OF TIME REQUESTED BY HIM. IN THIS CASE NOBODY APPEARED SO FAR TO PRESENT THE MATTER BEFORE ME. IT SEEMS THAT THE APPELLANT IS NOT INTERESTED IN TAKING UP THE MATTER AND MAKE THE SUBMISSIONS. THEREFORE I HEREBY DISMISS THE APPEAL. ITA NO.- 338/DEL/2017. INTERGLOBE ENTERPRISES LTD. PAGE 10 OF 14 3. THE APPEAL IS DISMISSED. (C) THE ASSESSEE FILED THIS PRESENT APPEAL IN INCOME T AX APPELLATE TRIBUNAL (ITAT, FOR SHORT), AGAINST THE IMPUGNED ORDER DATED 17.11. 2016 OF THE LD. CIT(A). WE FIND FROM THE PERUSAL OF RECORD, THAT THE FOLLOWING GROU NDS OF APPEAL WERE RAISED BY THE ASSESSEE BEFORE THE LD. CIT(A). 1. THAT THE LD. ASSESSING OFFICER HAS ERRED ON FAC TS AND IN LAW IN CONSIDERING THE FINANCIAL EXPENSES OF RS. 19,51,133 WHILE COMPU TING THE DISALLOWANCE U/S 14A OF THE INCOME TAX ACT (ACT) READ WITH RULE 8D(II) OF THE INCOME TAX RULES, 1962. 1.1 WITHOUT PREJUDICE, THE LD. ASSESSING OFFICER HA S ERRED ON FACTS AND IN LAW IN CONSIDERING THE INTEREST COST OF RS. 6,17,357/- WHI LE COMPUTING THE DISALLOWANCE UNDER RULE 8D(II) WITHOUT APPRECIATING THAT THE SAM E WAS ALREADY DISALLOWED BY THE APPELLANT IN ITS RETURN OF INCOME. 2. THAT THE LD. ASSESSING OFFICER HAS ERRED ON FACT S AND IN LAW IN COMPUTING CREDIT OF MINIMUM ALTERNATE TAX (MAT) TO BE SET O FF IN TERMS OF PROVISIONS OF SECTION 115JAA OF THE ACT AT RS. 1,245,07,560/- AS AGAINST THE AMOUNT OF RS. 1,25,65,421. 3. THAT THE LD. ASSESSING OFFICER HAS ERRED ON FACT S AND IN LAW IN NOT ALLOWING CREDIT OF PREPAID TAXES AMOUNTING TO RS. 4,46,31,83 0 CLAIMED IN THE RETURN OF INCOME DESPITE OF THE SAME BEING SUPPORTED BY FORM 26AS AND TDS CERTIFICATES. THE APPELLANT CRAVES LEAVE TO ADD, TO ALTER, AMEND OR VARY FROM THE ABOVE GROUNDS OF APPEAL AT OR BEFORE THE TIME OF HEARING. (C.1) HOWEVER, THE LD. CIT(A) IN HIS AFORESAID IMPUGNED O RDER DATED 17.11.2016, HAS NOT DISPOSED OFF VARIOUS GROUNDS OF APPEAL THROUGH A SPEAKING ORDER ON MERITS. IN FACT, THE LD. CIT(A) HAS NOT DECIDED THE APPEAL ON MERITS , AND HAS, INSTEAD DISMISSED ASSESSEES APPEAL IN A SUMMARY MANNER WHILE OBSERVI NG: IT SEEMS THAT THE APPELLANT IS NOT INTERESTED IN TAKING UP THE MATTER AND MAKE THE SUBMISSIONS. THIS IS IN VIOLATION OF SECTION 250(6) OF I.T. ACT, WHICH REQUIRES THE L D. CIT(A) TO STATE THE POINTS FOR DETERMINATION, AND GIVE DECISION THEREON WITH REASO NS. THE RELEVANT PROVISIONS UNDER ITA NO.- 338/DEL/2017. INTERGLOBE ENTERPRISES LTD. PAGE 11 OF 14 I.T. ACT REGARDING PROCEDURE IN APPEAL, AND POWERS OF THE COMMISSIONER [APPEALS] ARE CONTAINED IN SECTIONS 250 AND 251 OF I.T. ACT, WHIC H ARE REPRODUCED BELOW FOR READY REFERENCE: 250. (1) THE COMMISSIONER (APPEALS) SHALL FIX A DAY AND PLACE FOR THE HEARING OF THE APPEAL, AND SHALL GIVE NOTICE OF THE SAME TO TH E APPELLANT AND TO THE ASSESSING OFFICER AGAINST WHOSE ORDER THE APPEAL IS PREFERRED . (2) THE FOLLOWING SHALL HAVE THE RIGHT TO BE HEARD AT THE HEARING OF THE APPEAL (A) THE APPELLANT EITHER IN PERSON OR BY AN AUTHOR IZED REPRESENTATIVE; (B) THE ASSESSING OFFICER, EITHER IN PERSON OR BY A REPRESENTATIVE. (3) THE COMMISSIONER (APPEALS) SHALL HAVE THE POWER TO ADJOURN THE HEARING OF THE APPEAL FROM TIME TO TIME. (4) THE COMMISSIONER (APPEALS) MAY, BEFORE DISPOSIN G OF ANY APPEAL, MAKE SUCH FURTHER INQUIRY AS HE THINKS FIT, OR MAY DIRECT THE ASSESSING OFFICER TO MAKE FURTHER INQUIRY AND REPORT THE RESULT OF THE SAME TO THE CO MMISSIONER (APPEALS). (5) THE COMMISSIONER (APPEALS) MAY, AT THE HEARING OF AN APPEAL, ALLOW THE APPELLANT TO GO INTO ANY GROUND OF APPEAL NOT SPECI FIED IN THE GROUNDS OF APPEAL, IF THE COMMISSIONER (APPEALS) IS SATISFIED THAT THE OM ISSION OF THAT GROUND FROM THE FORM OF APPEAL WAS NOT WILFUL OR UNREASONABLE. (6) THE ORDER OF THE COMMISSIONER (APPEALS) DISPOSI NG OF THE APPEAL SHALL BE IN WRITING AND SHALL STATE THE POINTS FOR DETERMINATIO N, THE DECISION THEREON AND THE REASON FOR THE DECISION. [(6A) IN EVERY APPEAL, THE COMMISSIONER (APPEALS), WHERE IT IS POSSIBLE, MAY HEAR AND DECIDE SUCH APPEAL WITHIN A PERIOD OF ONE YEAR FROM THE END OF THE FINANCIAL YEAR IN WHICH SUCH APPEAL IS FILED BEFORE HIM UNDER SUB-SECTION (1) OF SECTION 246A (7) ON THE DISPOSAL OF THE APPEAL, THE COMMISSIONER (APPEALS) SHALL COMMUNICATE THE ORDER PASSED BY HIM TO THE ASSESSEE AND TO THE PRINCIPAL CHIEF COMMISSIONER OR CHIEF COMMISSIONER OR PRINCIPAL COMMISSIONER OR COMMISSIONER. 251. ( 1) IN DISPOSING OF AN APPEAL, THE COMMISSIONER (APP EALS) SHALL HAVE THE FOLLOWING POWERS (A) IN APPEAL AGAINST AN ORDER OF ASSESSMENT, MAY CONFI RM, REDUCE, ENHANCE OR ANNUAL THE ASSESSMENT (AA) IN APPEAL AGAINST THE ORDER OF ASSESSMENT IN R ESPECT OF WHICH THE PROCEEDING BEFORE THE SETTLEMENT COMMISSION ABATES UNDER SECTI ON 245HA, HE MAY, AFTER TAKING INTO CONSIDERATION ALL THE MATERIAL AND OTHE R INFORMATION PRODUCED BY THE ASSESSEE BEFORE, OR THE RESULTS OF THE INQUIRY HELD OR EVIDENCE RECORDED BY, THE ITA NO.- 338/DEL/2017. INTERGLOBE ENTERPRISES LTD. PAGE 12 OF 14 SETTLEMENT COMMISSION, IN THE COURSE OF THE PROCEED ING BEFORE IT AND SUCH OTHER MATERIAL AS MAY BE BROUGHT ON HIS RECORD, CONFIRM, REDUCE, ENHANCE OR ANNUL THE ASSESSMENT; (B) IN AN APPEAL AGAINST AN ORDER IMPOSING A PENALT Y, HE MAY CONFIRM OR CANCEL SUCH ORDER OR VARY IT SO AS EITHER TO ENHANCE OR TO REDUCE THE PENALTY; (C) IN ANY OTHER CASE, HE MAY PASS SUCH ORDERS IN T HE APPEAL AS HE THINKS FIT. (2) THE COMMISSIONER (APPEALS) SHALL NOT ENHANCE AN ASSESSMENT OR A PENALTY OR REDUCE THE AMOUNT OF REFUND UNLESS THE APPELLANT HA S HAD A REASONABLE OPPORTUNITY OF SHOWING CAUSE AGAINST SUCH ENHANCEMENT OR REDUCT ION. EXPLANATION.IN DISPOSING OF AN APPEAL, THE COMMISS IONER (APPEALS) MAY CONSIDER AND DECIDE ANY MATTER ARISING OUT OF THE P ROCEEDINGS IN WHICH THE ORDER APPEALED AGAINST WAS PASSED, NOTWITHSTANDING THAT S UCH MATTER WAS NOT RAISED BEFORE THE COMMISSIONER (APPEALS) BY THE APPELLANT. SE MORE (C.2) A PERUSAL OF THE ABOVE PROVISIONS OF LAW SHOWS THAT U/S 250(6) OF I.T. ACT THE LD. CIT(A) WAS OBLIGED TO DISPOSE OF THE APPEAL IN WRITING AFTER STATING THE POINTS FOR DETERMINATION AND TO THEN PASS AN ORDER ON EACH OF THE POINTS WHICH AROSE FOR CONSIDERATION; AND THE LD. CIT(A) WAS FURTHER OBLIG ED TO STATE THE REASONS FOR HIS DECISION ON EACH SUCH POINTS WHICH AROSE FOR DETERM INATION. IN THE PRESENT APPEAL BEFORE US, THE LD. CIT(A) HAS PASSED A SUMMARY ORDE R WITHOUT DECIDING THE ISSUES ON MERITS. THIS IS IN VIOLATION OF SECTION 250(6) OF I.T. ACT, WHICH REQUIRES THE LD. CIT(A) TO STATE THE POINTS FOR DETERMINATION, AND GIVE DEC ISION THEREON WITH REASONS. IN VIEW OF THE FOREGOING AND ON CAREFUL PERUSAL OF SECTION 250 (6) R.W.S. 250(4), 250(5), 251(1)(A), 251(1)(B) AND EXPLANATION TO SECTION 251(2) OF I.T. ACT; IT IS AMPLY CLEAR THAT LD. CIT(A) HAS NO POWER TO DISMISS APPEAL IN LIMINE FOR NON-PR OSECUTION OF APPEAL BY THE ASSESSEE. (C.3) AT THE TIME OF HEARING BEFORE US, BOTH SIDES WERE IN AGREEMENT THAT THE IMPUGNED ORDER OF LD. CIT(A) MAY BE SET ASIDE, AND THE DISPUTED ISSUES IN THE PRESENT ITA NO.- 338/DEL/2017. INTERGLOBE ENTERPRISES LTD. PAGE 13 OF 14 APPEAL MAY BE RESTORED TO THE FILE OF THE LD. CIT(A ) FOR FRESH ORDER IN COMPLIANCE OF SECTION 250(6) OF I.T. ACT; HAVING REGARD TO THE FA CT THAT THE LD. CIT(A) HAD NOT DECIDED THE ISSUES ON MERITS. (D) WE HAVE HEARD BOTH SIDES CAREFULLY. WE HAVE PERUS ED THE MATERIALS AVAILABLE ON RECORD. WE ARE OF THE VIEW THAT THE LD. CIT(A) ER RED IN DISMISSING ASSESSEES APPEAL ON MERITS IN A SUMMARY MANNER, WITHOUT GIVING DETAI LED REASONS FOR HIS ORDER, ON VARIOUS GROUNDS OF APPEAL BEFORE HIM. WE FURTHER H OLD THAT THE LD. CIT(A) ERRED IN PASSING A NON-SPEAKING ORDER ON EACH OF THE POINTS WHICH AROSE FOR HIS CONSIDERATION AND HE FAILED IN DISCHARGING THE STATUTORY OBLIGATI ON TO STATE THE REASONS FOR HIS DECISION ON EACH SUCH POINTS, WHICH AROSE FOR DETERMINATION IN ASSESSEES APPEAL BEFORE THE LD. CIT(A). IN VIEW OF THE FOREGOING, AND AS BOTH SIDE S HAVE AGREED TO THIS AT THE TIME OF HEARING BEFORE US, WE SET ASIDE THE IMPUGNED ORDER DATED 17.11.2016 OF LD. CIT(A); AND WE DIRECT THE LD. CIT(A) TO PASS FRESH ORDER, A SPEAKING ORDER ON MERITS ON THE ISSUES IN DISPUTE, IN ACCORDANCE WITH SECTION 250(6 ) OF I.T. ACT. (E) IN THE RESULT, ASSESSEES APPEAL IS TREATED AS PAR TLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 03/01/20. SD/- SD/- (SUDHANSHU SRIVASTAVA) (ANADEE NATH MISS HRA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 03/01/20. POOJA/- ITA NO.- 338/DEL/2017. INTERGLOBE ENTERPRISES LTD. PAGE 14 OF 14 COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI DATE OF DICTATION DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. PS/PS DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. PS/PS DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WEBSITE OF ITAT DATE ON WHICH THE FILE GOES TO THE BENCH CLERK DATE ON WHICH THE FILE GOES TO THE HEAD CLERK THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER