SONU SYNTHETICS LTD, MUMBAI V. DCIT 8(3), MUMBAI

ITA 3588/MUM/2012

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 8402 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 6 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-11-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Next Hearing Date: 20-11-2014
• Assessment Year: 2006-2007
• Appeal Filed On: 21-05-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: LOVE KUMAR
• Assessee Lawyers: DARMESH SHAH
• Section: 142(1)

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL E BENCH, M UMBAI BEFORE HONBLE S/SHRI VIJAY PAL RAO (JM) , AND B.R.BASKARAN (AM) , . . , ./I.T.A. NO.3588/MUM/2012 ( / ASSESSMENT YEAR: 2006-07) M/S SONU SYNTHETICS LTD., 131/B SANJAY BUILDING, ANDHERI (E), MUMBAI-400059 / VS. DY.COMMISSIONER OF INCOME TAX- 8(3), MUMBAI. ( / APPELLANT) .. ( / RESPONDENT) ./ ./ PAN/GIRNO.:AAEPD6497Q ! / APPELLANT BY : SHRI DARMESH SHAH ' ! /RESPONDENT BY SHRI LOVE KUMAR # ' $% / DATE OF HEARING : 20.11.2014 &' ' $% /DATE OF PRONOUNCEMENT : 21.11.2014. / O R D E R PER B.R.BASKARAN, ACCOUNTANT MEMBER: THE APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST THE ORDER DATED 20.12.2012 PASSED BY COMMISSIONER OF INCOME TAX(A)- 18, MUMBAI AND IT RELATES THE ASSESSMENT YEAR-2006-07. 2. THE LD. COUNSEL APPEARING FOR THE ASSESSEE SUBMI TTED THAT THE FIRST APPELLATE AUTHORITY HAS PASSED THE IMPUGNED ORDER-E X-PARTE AND HE HAS ALSO FAILED TO ADJUDICATE SOME IMPORTANT GROUNDS URGED B EFORE HIM. INVITING OUR ATTENTION TO THE GROUNDS OF APPEAL RAISED BEFORE TH E LD.CIT(A), THE LD. COUNSEL SUBMITTED THAT THE FIRST APPELLATE AUTHORITY FAILE D TO ADJUDICATE THE ISSUE RELATING TO ENCUMBRANCES AND FINANCIAL CHARGES. HE FURT HER SUBMITTED BOTH THE ISSUES ARE CRUCIAL IN DETERMINING THE INCOME OF THE ASSESS EE. THE LD. COUNSEL FURTHER SUBMITTED THAT THE BUSINESS OF THE ASSESSEE WAS IN BAD SHAPE AND HENCE IT HAS TO CHANGE ITS BUSINESS PREMISES VERY FREQUENTLY AND THE SAME HAS RESULTED IN ITA NO.3588/M/2012 2 NON-COMPLIANCE OF VARIOUS NOTICES ISSUED BY THE INC OME TAX AUTHORITIES. HE FURTHER SUBMITTED THAT THE ASSESSEE HAS, HOWEVER, R ECEIVED THE ASSESSMENT ORDER AND APPELLATE ORDER AND SOME OF THE NOTICES I SSUED BY THE TAX AUTHORITIES. ACCORDINGLY HE SUBMITTED THAT THE NON-COMPLIANCE TO SOME OF THE NOTICES WERE FOR THE REASONS BEYOND THE CONTROL OF THE ASSESSEE. HE FURTHER SUBMITTED THAT THE ASSESSEE ALSO COULD NOT PROPERLY PRESENTED THE FACT S RELATING TO THE ENCUMBRANCE AND FINANCIAL CHARGES BEFORE THE A O. ACCORDINGLY, HE SUBMITTED THAT THE ASSESSEE MAY BE PROVIDED ONE MOR E OPPORTUNITY TO PRESENT FULL FACTS RELATING TO THE RELEVANT ISSUES IN ORDER TO GET JUSTICE FROM THE INCOME TAX AUTHORITIES. 3. ON THE CONTRARY, THE LD. DR STRONGLY OBJECTED TO THE PLEA PUT FORTH BY THE LD. AR AND SUBMITTED THAT THE ASSESSEE HAS BEEN GIVEN N UMBER OF OPPORTUNITIES BY THE TAX AUTHORITIES, BUT IT HAS WILLFULLY FAILED TO AVAIL THE SAME. THE LD D.R SUBMITTED THAT THE ASSESSEE HAS REFUSED TO ACCEPT THE NOTICE AT ONE POINT OF TIME. 4. IN REJOINDER, THE AR SUBMITTED THAT THE ASSESSEE WAS SHIFTING ITS ADDRESSES VERY FREQUENTLY AND THERE WAS A POSSIBILI TY THAT THE NOTICE SERVED TO THE OLD ADDRESS OF THE ASSESSEE MIGHT HAVE BEEN REF USED TO BE ACCEPTED. THE LD A.R SUBMITTED THAT THE ASSESSEE WOULD BE FULLY C O-OPERATING WITH THE TAX AUTHORITIES IN ORDER TO SETTLE THIS ISSUE AND ACCOR DINGLY PLEADED FOR ONE MORE OPPORTUNITY. 5. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. WE NOTICE FROM THE ASSESSMENT ORDER THAT THE NOTICE ISSUED U/ S 143(2) AND 142(1) OF THE ACT WAS RETURNED UN-SERVED BY THE POSTAL AUTHORITY. LATER ON, A CHARTERED ACCOUNTANT NAMED M/S JAGIWALA AND CO. SUBMITTED A LETTER DATED 30.11.2010 THROUGH TAPAL TO THE AO WITHOUT ATTACHING A LETTER OF AUTHORIZATION AND HENCE THE AO HAS REFUSED TO TAKE COGNIZANCE OF THE LETTE R SO FILED. ACCORDINGLY IT IS SEEN THAT THE AO HAS PROCEEDED TO DETERMINE THE SHO RT TERM CAPITAL GAIN ARISING ON SALE OF ASSETS BELONGING TO THE ASSESSEE . IN THE APPELLATE PROCEEDINGS, WE NOTICE THAT THE LD. CIT(A) HAS ISSU ED NOTICES ON SIX OCCASIONS. ON THREE OCCASIONS, EVEN THOUGH THE NOTICES WERE S ERVED, YET NO ONE ATTENDED ITA NO.3588/M/2012 3 BEFORE LD CIT(A). ON ONE OCCASION, NOTICE WAS NOT A CCEPTED BY THE ASSESSEE. THESE FACTS SHOW THAT THE CALLOUS ATTITUDE AND CARE LESSNESS ON THE PART OF THE ASSESSEE CANNOT BE ALTOGETHER RULED OUT. AT THE SA ME TIME, WE NOTICE THAT THE TAXING AUTHORITIES HAVE PASSED THE IMPUGNED ORDERS WITHOUT HEARING THE ASSESSEE. THE LD. AR NOW ASSURES THAT THE ASSESSEE WOULD EXTEND FULL CO- OPERATION AND FURNISH ALL THE FACTS RELATING TO THE ISSUE. IN THE INTEREST OF JUSTICE, WE FIND SOME JUSTIFICATION IN THE PLEA PUT FORTH BY THE ASSESSEE. HOWEVER, WE ARE OF THE VIEW THAT THE SAID REQUEST OF THE ASSESSEE C AN BE ACCEPTED ON CERTAIN TERMS ONLY. ACCORDINGLY, WE IMPOSE A COST OF RS.5, 000/- (RUPEES FIVE THOUSAND ) UPON THE ASSESSEE AND DIRECT IT TO PAY THE SAME TO THE ACCOUNT OF INCOME TAX DEPARTMENT IN THE SAME MANNER AS THE APPEAL FEE IS PAID. WE FURTHER DIRECT THE ASSESSEE THAT THE ABOVE SAID COST SHOULD BE PAID ON OR BEFORE 12.12.2014 AND FURNISH COPY OF THE SAME TO THE ASSESSING OFFICER. 6. SUBJECT TO THE PAYMENT OF THE COST STATED AB OVE, ALL THE ISSUES CONTESTED BEFORE US ARE RESTORED TO THE FILE OF THE AO WITH T HE DIRECTION TO EXAMINE THEM AFRESH AFTER AFFORDING THE NECESSARY OPPORTUNITY O F BEING HEARD TO THE ASSESSEE AND TAKE APPROPRIATE DECISION IN ACCORDANCE WITH TH E LAW. ACCORDINGLY, THE ORDER PASSED BY LD. CIT(A) ON THE ISSUES CONTESTED BEFORE US IS SET ASIDE. WE MAKE IT CLEAR THAT IF THE ASSESSEE FAILS TO PAY THE COST ST ATED ABOVE ON OR BEFORE THE DATE SPECIFIED ABOVE, THEN THE ORDER OF LD CIT(A) SHALL STAND UPHOLD. 7. SUBJECT TO THE TERMS DISCUSSED ABOVE, THE APPEAL OF THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. THE ABOVE ORDER WAS PRONOUNCED IN THE OP EN COURT ON 21ST NOV, 2014 . &' # () * + 21ST NOV , 2014 ' ' , - SD SD ( / VIJAY PAL RAO ) ( . . ,/ B.R. BASKARAN ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER ( # MUMBAI: 21 ST NOV,2014. . . ./ SRL , SR. PS ITA NO.3588/M/2012 4 !'# $#%! / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. # 0$ ( ) / THE CIT(A)- CONCERNED 4. # 0$ / CIT CONCERNED 5. 6. 1, $ 2 , % 2 , ( # / DR, ITAT, MUMBAI CONCERNED ,3 4 / GUARD FILE. 5 # / BY ORDER, TRUE COPY 6 (ASSTT. REGISTRAR) % 2 , ( # /ITAT, MUMBAI