Rajiv Yashwant Bhale, Pune V. Income tax Officer, Pune

ITA 341/PUN/2017

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 9307 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-02-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 05-01-2018
• Assessment Year: 2012-2013
• Appeal Filed On: 10-02-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Opportunity of being heard; Principle of natural justice; Application of stay
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B , PUNE , , . , BEFORE MS. SUSHMA CHOWLA, JM AND SHRI D. KARUNAKARA RAO , AM . / ITA NO. 341 /P U N/201 7 / ASSESSMENT YEAR : 20 1 2 - 1 3 MR. RAJIV BHALE, 1194/27A, SHIVAJI NAGAR, YASHOMALA, PUNE 411005 . / APPELLANT PAN: A ARPB9109L VS. THE INCOME TAX OFFICER, WARD 2(5), PUNE . / RESPONDENT SA NO.03/PUN/2018 ARISING OUT OF ITA NO.341/PUN/2017 ASSESSMENT YEAR : 2012 - 13 MR. RAJIV BHALE, 1194/27A, SHIVAJI NAGAR, YASHOMALA, PUNE 411005 . APP LICA NT PAN: AARPB9109L VS. THE INCOME TAX OFFICER, WARD 2(5), PUNE . RESPONDENT ASSESSEE BY : SHRI KISHORE PHADKE REVENUE BY : SHRI PRASHANT GADEKAR / DATE OF HEARING : 0 7 . 0 2 . 201 8 / DATE OF PRONOUNCEMENT: 23 . 0 2 .201 8 ITA NO. 341 /P U N/20 1 7 SA NO.03/PUN/2018 2 / ORDER PER SUSHMA CHOWLA, J M : TH E APPEAL FILED BY THE ASSESSEE IS AGAINST THE ORDER OF CIT (A) - 2, PUNE , DATED 26 . 1 2 .201 6 RELATING TO ASSESSMENT YEAR 20 1 2 - 1 3 AGAINST ORDER PASSED UNDER SECTION 143(3) OF THE INCOME - TAX ACT , 1961 (IN SHORT THE ACT) . THE ASSESSEE ALSO MOVED THE CAPTIONED STAY APPLICATION . 2 . THE APPEAL OF ASSESSEE AND STAY APPLICATION WERE HEARD TOGETHER. 3 . THE ASSESSEE IN QUANTUM APPEAL IS AGGRIEVED BY THE EX PARTE ORDER PASSED BY THE CIT(A) IN NOT ALLOWING SUFFICIENT REASONABLE OPPORTUNITY OF HEARING TO THE ASSESSEE. 4. THE FIRST GROUND OF APPEAL RAISED BY THE ASSESSEE READS AS UNDER: - 1. THE LEARNED CIT 11, PUNE ERRED IN LAW AND ON FACTS IN DISMISSING THE APPEAL OF THE APPELLANT WITHOUT GIVING A SUFFICIENT REASONABLE OPPORTUNITY OF BEING HEARD TO THE APPELLANT. THE LEARNED CIT( A) OUGHT TO HAVE APPRECIATED THE APPELLANTS DIRE AND PRECARIOUS FINANCIAL CONDITIONS, EVENTS OF AUCTION OF OFFICES, ETC. DUE TO WHICH, APPELLANTS ABILITY TO PROVIDE EXPLANATIONS WAS SEVERELY JEOPARDIZED. THE LEARNED CIT(A) ERRED IN NOT ASSUMING A REASON ABLE / PRACTICAL APPROACH OF THE SITUATION. 5. BRIEFLY, IN THE FACTS OF THE CASE, THE ASSESSEE HAD FURNISHED RETURN OF INCOME DECLARING TOTAL INCOME AT NIL. THE ASSESSEE HAD ALSO CLAIMED CARRY FORWARD OF LOSSES OF 2.40 CRORES IN THE RETURN OF INCOME. THE CASE OF ASSESSEE WAS SELECTED FOR SCRUTINY. HOWEVER, BECAUSE WANT OF PROPER COMPLIANCE BEFORE THE ASSESSING OFFICER, ADDITION OF 29,52,80,184/ - WAS MADE ON ACCOUNT OF UNEXPLAINED CASH CREDITS. 6. THE CIT(A) ISSUED THREE NOTICES OF HEARING TO THE ASSESSEE. HOWEVER, NONE APPEARED ON BEHALF OF THE ASSESSEE. THE CIT(A) THEREFORE, UPHELD THE ADDITION IN THE HANDS OF ASSESSEE. ITA NO. 341 /P U N/20 1 7 SA NO.03/PUN/2018 3 7. THE CASE OF ASSESSEE BEFORE US IS THAT THERE WAS SEARCH ON THE ASSESSEE AND IN RESPECT OF BLOCK PERIOD, A PETITION WAS FI LED BEFORE THE SETTLEMENT COMMISSION, WHERE TAX LIABILITY OF 11 - 12 CRORES WAS DETERMINED. THE ASSESSEE COULD NOT PAY THE INSTALLMENTS GRANTED TO IT, CONSEQUENT TO WHICH ALL THE BANK ACCOUNTS OF ASSESSEE AND ALL THE PROPERTIES WERE ATTACHED. THE RESIDEN TIAL HOUSE OF ASSESSEE W AS AUCTIONED FOR RECOVERY OF DEMAND . THERE WAS TURMOIL IN THE AFFAIRS OF ASSESSEE AND THE ASSESSEE WAS ALSO GOING THROUGH EXTREME FINANCIAL CRISIS. CONSEQUENTLY, THERE WAS NON - APPEARANCE BEFORE THE ASSESSING OFFICER AND CIT(A). T HE ASSESSEE IN THIS CONNECTION HAS MADE A PLEA THAT REASONABLE OPPORTUNITY OF HEARING MAY BE ALLOWED TO THE ASSESSEE. 8. WE FIND MERIT IN THE CLAIM OF ASSESSEE. WE HAVE GONE THROUGH THE RECORDS AND NECESSARY INFORMATION FILED BY THE ASSESSEE DURING STAY PROCEEDINGS . T HE EVENTS OF AUCTION OF RESIDENTIAL PREMISES STAND S ESTABLISHE D. A LL THE BANK ACCOUNTS OF ASSESSEE HAVE BEEN ATTACHED AND THE ATTACHMENT ORDERS CONTINUE TO BE IN FORCE , DESPITE THE FACT THE ENTIRE DEMAND PAYABLE BY THE ASSESSEE WAS ALREADY ADJUSTED AGAINST THE SALE PROCEEDS OF THE RESIDENTIAL HOUSE OF THE ASSESSEE. ALL THESE EVENTS CONTRIBUTED FOR THE FAILURE OF THE ASSESSEE FOR ATTENDING AT THE GIVEN SCHEDULED DATES BY THE ASSESSING OFFICER / CIT. WE FIND THE EXPLANATIONS OF THE ASSESSEE ARE NOT CONTRADICTED BY THE REVENUE. IN THE ENTIRETY OF THE ABOVE SAID FACTS AND CIRCUMSTANCES, WE HOLD THAT THE ASSESSEE WAS PREVENTED BY SUFFICIENT CAUSE FROM NON - APPEARANCE BEFORE BOTH THE ASSESSING OFFICER AND CIT(A). IT IS A TRITE LAW THAT PRINCIPLES OF NATURAL JUSTICE DEMANDS THAT NO PERSON SHOULD BE CONDEMNED UNHEARD. ACCO RDINGLY, WE REMIT THE MATTER BACK TO THE FILE OF ASSESSING OFFICER FOR CARRYING OUT DE NOVO ASSESSMENT AFTER AFFORDING REASONABLE OPPORTUNITY OF HEARING TO THE ASSESSEE. THE ASSESSEE IS ALSO DIRECTED TO COOPERATE AND APPEAR BEFORE THE ASSESSING OFFICER AN D FURNISH NECESSARY INFORMATION. THUS, ITA NO. 341 /P U N/20 1 7 SA NO.03/PUN/2018 4 THE GROUND OF APPEAL NO.1 RAISED BY THE ASSESSEE IS ALLOWED. THE ISSUE RAISED ON MERITS THUS, BECOMES ACADEMIC. 9. IN VIEW OF OUR DECISION OF SETTING ASIDE THE MATTER TO THE FILE OF ASSESSING OFFICER, THE DEMAND BE COMES UNCOLLECTABLE. CONSEQUENTLY, THE STAY APPLICATION MOVED BY THE ASSESSEE BECOMES ACADEMIC. 10 . IN THE RESULT, APPEAL OF ASSESSEE AND STAY APPLICATION ARE DISPOSED OF AS INDICATED ABOVE. ORDER PRONOUNCED ON THIS 23 RD DAY OF FEBR UARY , 201 8 . SD/ - SD/ - ( D.KARUNAKARA RAO ) (SUSHMA CHOWLA ) / ACCOUNTANT MEMBER / JUDICIAL MEMBER / PUNE ; DATED : 23 RD FEBR UARY , 201 8 . GCVSR / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APPELLANT ; 2. / THE RESPONDENT; 3. ( ) / THE CIT (A) - 2, PUNE ; 4. THE PR. CIT - 2, PUNE ; 5. , , / DR B , ITAT, PUNE; 6. / GUARD FILE . / BY ORDER , // TRUE COPY // / SR. PRIVATE SECRETARY , / ITAT, PUNE