Shri Satinder Singh, Delhi V. ITO, New Delhi

ITA 3554/DEL/2013

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 4796 (ITAT-DELHI)
• Duration Of Justice: 6 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-12-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Assessment Year: 1996-1997
• Appeal Filed On: 03-06-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANIL SHARKAR
• Assessee Lawyers: NIWESH KUMAR
• Keywords: Opportunity of being heard; Principle of natural justice

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: SMC NEW DELHI BEFORE SMT DIVA SINGH, JUDICIAL MEMBER AND SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER I.T.A .NO. 3552/DEL/2013 (A.Y 1998 -99) I.T.A N0. 3553/DEL/2013 (A.Y 1994- 95) I.T.A N0. 3554/DEL/2013 (A.Y 1996-97) I.T.A N0. 3555/DEL/2013 (A.Y 1997- 98) SATINDER SINGH L/H, SHRI HARI SINGH MALHIYAN 456/4, WAZIRPUR VILLAGE DELHI PAN-AAKPM6695F (APPELLANT) VS ITO WARD-19 (2) NEW DELHI. (RESPONDENT) APPELLANT BY SH. NIWESH KUMAR, SR. DR RESPONDENT BY SH. ANIL SHARKAR, ADV ORDER PER BENCH THESE ARE FOUR APPEALS FILED BY THE ASSESSEE AGAIN ST THE SEPARATE ORDERS DATED 28/1/2013 OF CIT(A)XXII NEW DELHI, PERTAINING TO 19 88-89, 1994-95, 1996-97 & 1997-98 ASSESSMENT YEARS ON IDENTICAL GROUNDS. THE PARTIES WERE HEARD ON GROUND NO. 1 WHICH READS AS UNDER:- 1. THAT THE LD. CIT(A) HAS GROSSLY ERRED IN DISPOSI NG OFF THE APPEALS EX-PARTE IN LIMINI IN VIOLATION OF THE PRINCIPLES OF NATURAL JU STICE AND WITHOUT GRANTING TO THE ASSESEE AN OPPORTUNITY OF BEING HEARD. THE FINDING THAT NEITHER THE ASSESSEE NOR ANY AR APPEARED NOR ANY WRITTEN SUBMISSIONS WERE FILED IS WHOLLY INCORRECT AND WRONG. THE LD. CIT(A) HAS FAILED TO APPRECIATE THAT ON 21/ 1/2013 ASSESSEES AR DULY APPEARED AND WAITED TILL LATE EVENING HOWEVER, HE WAS NOT CA LLED FOR HEARING. ITA NOS. 3552 TO 3553/DEL/13 2 2. A PERUSAL OF THE RECORD SHOWS THAT THE ASSESSEE AGGRIEVED WITH THE ADDITIONS MADE IN THE ASSESSMENT ORDER PASSED U/S 254/143(3) FOR EACH OF THE YEARS CAME UP IN APPEAL BEFORE THE CIT(A) WHO PASSED AN IDENTICAL OR DER IN EACH OF THESE APPEALS WITHOUT REFERRING TO THE SPECIFIC ADDITIONS MADE AN D THE GROUNDS RAISED. FOR READY REFERENCE WE REPRODUCE FROM ITA 3552/DEL/2013 AN EX TRACT OF THE IMPUGNED ORDER:- 2. AGGRIEVED WITH THE SAID ORDER, THE APPELLANT FI LED AN APPEAL WITH 5 GROUNDS OF APPEAL. 3. IN RESPONSE TO NOTICE U/S 250 OF THE I.T ACT, NEITH ER THE ASSESSEE NOR ANY AUTHORIZED REPRESENTATIVE APPEARED, NOR ANY WRITTEN SUBMISSION S WERE FILED. 4. IN THIS CASE NOTICE U/S 250 WAS ISSUED ON 13/12/201 1 FIXING THE DATE OF HEARING FOR 11/1/2012. NO COMPLIANCE WAS MADE ON THIS DATE. S UBSEQUENTLY, ANOTHER NOTICE WAS SENT ON 3/2/2012 FIXING DATE OF HEARING FOR 22/2/20 12. NO COMPLIANCE WAS MADE ON THIS DATE. ANOTHER NOTICE WAS SENT ON 27/7/2012 FIXING DATE OF HEARING FOR 3/8/2012. NO COMPLIANCE WAS MADE ON THIS DATE. SUBSEQUENTLY, AN OTHER NOTICE WAS SENT ON 30/11/2012 FIXING DATE OF HEARING FOR 13/12/2012. NO COMPLIANCE WAS MADE ON THIS DATE. SUBSEQUENTLY, ANOTHER NOTICE WAS SESNT ON 14 /1/2013 FIXING DATE OF HEARING FOR 21/1/2013. AGAIN ON THIS DATE NO COMPLIANCE WAS MAD E, NEITHER ANYBODY ATTENDED NOR ANY WRITTEN SUBMISSIONS WERE FILED NOR ANY APPLICAT ION FOR ADJOURNMENT WAS FILED. 5. IN CIT VS. B. N. BHATTACHARYA (1977) 118 ITR 461 (S C), THE HONBLE SUPREME COURT WHILE DEALING WITH THE ISSUE OF PROSECUTION OF APPE AL HAS STATED THAT PREFERRING AN APPEAL MEANS MORE THAN FORMALLY FILING IT BUT EFFEC TIVELY PURSUING IT. THE HONBLE ITAT, DELHI, IN CIT VS. MULTIPLAN INDIA PVT LTD., A S REPORTED IN 38 ITD 320 (DELHI), WHEN FACED WITH A SIMILAR SITUATION OF NON PROSECUT ION OF APPEAL DISMISSED THE APPEAL OF REVENUE. 6. IN VIEW OF THE ABOVE SITUATION AS DISCUSSED IN P ARA 4, IT IS CLEAR THAT THE APPELLANT IS NOT INTERESTED IN PROSUECTING THE APPEAL. ON THE B ASIS OF THE DECISIONS AS DISCUSSED IN PARA 5, THE APPEAL OF THE ASSESSEE IS, THEREFORE, D ISMISSED AT THE VERY OUTSET. 7. NO DECISION IS GIVEN ON MERITS IN VIEW OF THE ABOVE . 3. QUA THE GROUND RAISED THE LD. AR SUBMITTED THAT THE ORDER HAS BEEN PASSED EX-PARTE HOLDING THAT THE ASSESSSEE IS NOT INTEREST ED IN PROSECUTING THE APPEAL. IT WAS HIS STAND THAT THE FINDING OF THE CIT(A) IS NOT COR RECT AS THE ASSESSEE IS INTERESTED IN PROSECUTING ITS APPEAL AND INFACT THE COUNSEL OF TH E ASSESSEE WAS WAITING TO BE CALLED FOR HEARING TILL THE EVENING AS HAS BEEN SEST OUT I N THE GROUND RAISED. IN THE CIRCUMSTANCES IT WAS HIS SUBMISSION THAT THE IMPUGN ED ORDER SHOULD BE SET ASIDE. ITA NOS. 3552 TO 3553/DEL/13 3 THE LD. AR WAS REQUIRED TO ADDRESS THE NON-REPRESEN TATION OF THE ASSESSEE AS DISCUSSED IN PARA 4 BY THE CIT(A). IN RESPONSE THE RETO IT WAS HIS SUBMISSION THAT HE HAS BEEN INSTRUCTED THAT NOTICES FOR THE SAID DATES WERE NEVER RECEIVED BY THE ASSESSEE. LD. AR SUBMITTED THAT IF THE OPPORTUNITY OF BEING HEARD IS GRANTED THAT HE WOULD GIVE HIS ORAL UNDERTAKING THAT THE ASSESSEE P ARTICIPATES IN THE PROCEEDINGS. 4. WE HAVE HEARD THE LD. SR. DR WHO RELIES ON THE O RDER. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE IMPUGNED ORDER. A PERUSAL OF THE IMPUGNED ORDER SHOWS THAT THE ORDER PASSED BY THE LD. CIT(A) IS NOT AS PER THE STATUTORY REQUIREMENTS OF THE INCOME TAX ACT 1961. THE PROCEDURE REQUIRED TO BE FOLLOWED BY THE CIT(A) IN DECIDING T HE APPEALS HAS BEEN LAID DOWN IN SECTION 250(6) OF THE INCOME TAX ACT. FOR READY RE FERENCE THE SAME IS REPRODUCED HEREUNDER:- 250. (1) THE COMMISSIONER (APPEALS) SHALL FIX A DA Y AND PLACE FOR THE HEARING OF THE APPEAL, AND SHALL GIVE NOTICE OF THE SAME TO THE AP PELLANT 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 POW ER TO ADJOURN THE HEARING OF THE APPEAL FROM TIME TO TIME. (4) THE [COMMISSIONER(APPEALS)] MAY, BEFORE DISPOSI NG 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 TH E SAME TO THE [COMMISSIONER(APPEALS)]. (5) THE [COMMISSIONER(APPEALS)] MAY, AT THE HEARING OF AN APPEAL, ALLOW THE APPELLANT TO GO INTO ANY GROUND OF APPEAL NOT S PECIFIED IN THE GROUNDS OF APPEAL, IF THE [COMMISSIONER(APPEALS)] IS SATISFIED THAT THE OMISSION OF THAT GROUND FROM THE FORM OF APPEAL WAS NOT WILLFUL OR U NREASONABLE. (6) THE ORDER OF THE [COMMISSIONER(APPEALS)] DISPOS ING OF THE APPEAL SHALL BE IN WRITING AND SHALL STATE THE POINTS FOR DETERMINATION, 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]. ITA NOS. 3552 TO 3553/DEL/13 4 (7) ON THE DISPOSAL OF THE APPEAL THE [COMMISSIONER (APPEALS)] SHALL COMMUNICATE THE ORDER PASSED BY HIM TO THE ASSESSEE AND TO THE [CHIEF COMMISSIONER OR COMMISSIONER]. 5.1 IN THE FACTS OF THE PRESENT CASE IT IS EMINENT THAT THE SAID PROCEDURES HAS NOT BEEN FOLLOWED. A PERUSAL OF THE PROVISION EXTRACTED ABOVE SHOWS THAT THE DUTY OF THE CIT(A) IS NOT ONLY LIMITED TO FIXING THE DATE AND P LACE OF HEARING. SECTION 250(6) ALSO MANDATES THAT THE CIT(A) WHILE DISPOSING OF T HE APPEAL SHALL PASS AN ORDER IN WRITING; STATING THE POINTS FOR DETERMINATION AND T HE DECISION THEREON AND THE REASONS FOR THE DECISION. THE SAID EXERCISE IS FOUND MISSI NG IN THE PRESENT ORDER. WE ARE ALSO OF THE VIEW THAT THE RIGHT TO BE HEARD IS AN IMPORT ANT RIGHT TO WHICH A PARTY WHO IS FACED WITH AN ADVERSE VIEW IS ENTITLED TO AUDI AL TERAM PARTEM IS ONE OF THE MOST FAMOUS AND CELEBRATED RULE OF NATURAL JUSTICE. THE PRINCIPLES OF NATURAL JUSTICE ARE THOSE WHICH HAVE BEEN LAID OUT BY THE COURTS AS BEI NG THE MINIMUM PROTECTION OF THE RIGHTS OF AN INDIVIDUAL AGAINST THE ARBITRARY PROCE DURE THAT MAY BE ADOPTED BY A JUDICIAL, QUASI-JUDICIAL AND ADMINISTRATIVE AUTHORI TY WHILE MAKING AN ORDER AFFECTING THOSE RIGHTS. A CAREFUL PERUSAL OF THE CONSISTENT JUDGEMENTS OF THE APEX COURT WOULD SHOW THAT IT HAS CONSISTENTLY BEEN HELD THAT THE RULES OF NATURAL JUSTICE ARE NOT EMBODIED RULES AND THE SAID PHRASE IS NOT AND CANNO T BE CAPABLE OF A PRECISE DEFINITION. THE UNDERLYING PRINCIPLE OF NATURAL JU STICE EVOLVED UNDER THE COMMON LAW IS TO CHECK ARBITRARY EXERCISE OF POWER BY THE STATE OR ITS FUNCTIONARIES. ACCORDINGLY, THE PRINCIPLE BY ITS VERY NATURE IMPLI ES THE DUTY TO ACT FAIRLY I.E. FAIR PLAY IN ACTION MUST BE EVIDENT AT EVERY STAGE. FAI R PLAY DEMANDS THAT NOBODY SHALL BE CONDEMNED UNHEARD. 5.2. IN THE CELEBRATED JUDGMENT OF THE APEX COURT I N THE CASE OF A.K.KRAIPAK VS- UNION OF INDIA (1969) 2 SCC 262, IT IS OBSERVED THA T THE AIM OF RULES OF NATURAL JUSTICE IS TO SECURE JUSTICE OR TO PUT IT NEGATIVEL Y TO PREVENT MISCARRIAGE OF JUSTICE. THE SAID RULES ARE MEANS TO AN END AND NOT AN END I N THEMSELVES AND THOUGH IT IS NOT POSSIBLE TO MAKE AN EXHAUSTIVE CATALOGUE OF SUCH RU LES HOWEVER IT CAN BE READILY ITA NOS. 3552 TO 3553/DEL/13 5 SAID THAT THERE ARE TWO BASIC MAXIMS OF NATURAL JUS TICE NAMELY AUDI ALTERAM PARTEM AND NEMO JUDEX IN RE SUA. IN THE PRESENT FACTS O F THE CASE WE ARE CONCERNED WITH THE MAXIM AUDI ALTERM PARTEM WHICH AGAIN MAY HAVE MANY FACETS TWO OF THEM (A) NOTICE OF THE CASE TO BE MET; AND (B) OPPORTUNITY T O EXPLAIN. THEIR LORDSHIPS HAVE CAUTIONED THAT THESE RULES CANNOT BE SACRIFICED AT THE ALTAR OF THE ADMINISTRATIVE CONVENIENCE OR CELEBRITY. THE ASSESSEE HAS RAISED GROUND NO IN REGARD TO THE OPPORTUNITY OF BEING HEARD AGITATED BEFORE US AND C ONSIDERING MATERIAL AVAILABLE ON RECORD. WE ARE INCLINED TO ACCEPT THE PRAYER OF THE ASSESSEE ON A CAREFUL CONSIDERATION OF THE LEGAL POSITION THEREON. ACCOR DINGLY THE GROUND NOS RAISED BY THE ASSESSEE IS ALLOWED AND THE REMAINING GROUNDS A RE RESTORED BACK TO THE FILE OF THE CIT(A) WITH THE DIRECTION TO DECIDE THE SAME IN ACC ORDANCE WITH LAW AFTER GIVING THE ASSESSEE A REASONABLE OPPORTUNITY OF BEING HEARD. IT IS HOPED THAT THE ASSESSEE DOES NOT ABUSE THE OPPORTUNITY SO GRANTED AND UTILIZES I T IN PROPER LETTER, AND SPIRIT AND PARTICIPATES FULLY IN THE PROCEEDINGS BEFORE THE CI T(A) AS ON THE FAILURE OF THE ASSESSEE TO AVAIL OF THE OPPORTUNITY THE CIT(A) WOU LD BE AT LIBERTY TO PASS A SPEAKING ORDER IN ACCORDANCE WITH LAW AS PER THE SCHEME OF T HE INCOME TAX ACT 1961 WHICH HAS BEEN DELIBERATED ABOVE AT LENGTH. THE SAID ORD ER WAS PRONOUNCED ON THE DATE OF HEARING ITSELF IN THE OPEN COURT. 6. SINCE FACTS CIRCUMSTANCES ARGUMENTS AND THE POSI TION OF LAW ON IDENTICAL GROUND REMAINS THE SAME IN ITA 3552 TO 3555/DEL/201 3 ACCORDINGLY FOR IDENTICAL REASONING THESE APPEALS ARE RESTORE THE CIT(A) AFTE R SETTING ASIDE THE IMPUGNED ORDERS WITH IDENTICAL DIRECTION. 7. IN THE RESULT THE APPEALS OF THE ASSESSEE ARE AL LOWED FOR STATISTICAL PURPOSES. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 13 TH OF DECEMBER 2013. SD/- SD/- (SHAMIM YAHYA) (DIVA SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER ITA NOS. 3552 TO 3553/DEL/13 6 DATED: 13 /12/2013 R. NAHEED* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI