NAAZISH N SHAH, MUMBAI V. ITO 11(3)-1, MUMBAI

ITA 364/MUM/2012

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 8994 (ITAT-MUMBAI)
• Duration Of Justice: 4 year(s) 11 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-01-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 07-12-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 16-01-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SUMAN KUMAR
• Assessee Lawyers: MRS MAMT A PARMAR
• Keywords: Opportunity of being heard
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH B, MUMBAI BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI JASON P. BOAZ ACCOUNTANT MEMBER ITA NO. 364/MUM/2012 (ASSESSMENT YEAR : 2007-08) SMT.NAAZISH N SHAH, C/O. M/S. MITESH MEHTA & ASSOCIATES, 432, LAMINGTON ROAD, OPERA HOUSE, 2 ND FLOOR, ABOVE DENA BANK, MUMBAI 400 006 PAN:AABPS 3536Q ... APPELLANT VS. THE ITO 11(3)1 MUMBAI 400 020 .... RESPONDENT APPELLANT BY : MRS. MAMT A PARMAR RESPONDENT BY : SHRI SUMAN KU MAR DATE OF HEARING : 05/01/2017 DATE OF PRONOUNCEMENT : 11/01/2017 ORDER PER JASON P. BOAZ, A.M: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST T HE EX-PART ORDER OF THE CIT(A)-2, MUMBAI DATED 25/11/2011 FOR ASSES SMENT YEAR 2007- 08. 2. THE FACTS OF THE CASE, BRIEFLY STATED, ARE AS UN DER:- 2.1 THE ASSESSEE AN ADVOCATE BY PROFESSION AND ALSO RUNNING A PART TIME NURSERY SCHOOL, FILED HER RETURN OF INCOME FOR ASSESSMENT YEAR 2 ITA NO. 364/MUM/2012 (ASSESSMENT YEAR : 2007-08) 2007-08 ON 29/10/2007 DECLARING TOTAL INCOME OF RS. 2,98,728/-. THE CASE WAS SELECTED FOR SCRUTINY AND THE ASSESSMENT W AS SUBSEQUENTLY COMPLETED UNDER SECTION 143(3) OF THE INCOME TAX AC T, 1961 ( IN SHORT THE ACT) VIDE ORDER DATED 24/12/2009, WHEREIN THE ASSESSEES INCOME WAS DETERMINED AT RS.11,61,818/- IN VIEW OF THE FOL LOWING ADDITIONS/DISALLOWANCES:- (I) U/S 41(1) CESSATION OF LIABILITY - RS . 7,21,500/- (II)HOUSEHOLD WITHDRAWALS - RS. 94,218/- (III)TRAVELLING EXPENSES - RS. 47,372/- 2.2 AGGRIEVED BY THE ORDER OF ASSESSMENT FOR ASSESS MENT YEAR 2007- 08 DATED 24/12/2009, THE ASSESSEE PREFERRED AN APPE AL BEFORE THE CIT(A) . THE CIT(A) DISMISSED THE ASSESSEES APPEA L EX-PARTE FOR NON- APPEARANCE VIDE ORDER DATED 25/11/2011; FOLLOWING, INTER-ALIA, THE DECISION OF THE ITAT DELHI BENCH IN THE CASE OF CIT V. MULTIPLAN (INDIA) PVT. LTD, 38 ITD 320(DEL). 3.1 AGGRIEVED BY THE ORDER OF THE CIT(A) DATED 25/1 1/2011 FOR ASSESSMENT YEAR 2007-08, THE ASSESSEE HAS PREFERRED THIS APPEAL RAISING THE FOLLOWING GROUNDS:- 1. THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) ERRED IN PASSING APPELLATE ORDER WITHOUT GIVING ANY OPPORTUNITY OF B EING HEARD ON SPECIFIED DATE. 2. THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS ) ERRED IN CONFIRMING THE TOTAL ADDITION OF RS. 7, 68,872/ - WITHOUT VERI FYING THE DETAILS. 3. THE LEARNED CIT (A) ERRED IN LAW AND IN FACTS BY NOT INTERPRETING SEC 41 (1) CORRECTLY. 3 ITA NO. 364/MUM/2012 (ASSESSMENT YEAR : 2007-08) 4. THE LEARNED CIT (A) ALSO ERRED ON FACTS IN DISA LLOWING RS. 47,372 AS TRAVELLING EXPENSES WITHOUT ANY PROPER REASON OR GR OUND OR WITHOUT ANY OPPORTUNITY OF BEING HEARD. 5. THE APPELLANT CRAVES TO INSERT NEW GROUNDS, AND TO ADD, AMEND, ALTER, INSERT, DELETE ANY OF THE ABOVE GROUNDS OF APPEAL E ITHER IN FULL OR IN PART ON OR BEFORE THE FINAL HEARING OF THE APPEAL. 1- 4. GROUND NO.1:- 4.1 IN THIS GROUND, THE ASSESSEE ASSAILS THE IMPUGN ED ORDER OF THE CIT(A) AS BEING ERRONEOUSLY PASSED EX-PARTE WITHOUT AFFORDING THE ASSESSEE ADEQUATE OPPORTUNITIES OF BEING HEARD. WE HAVE HEARD BOTH THE LD. REPRESENTATIVE FOR THE ASSESSEE PRAYING FO R THE IMPUGNED ORDER OF THE CIT(A) TO BE SET ASIDE FOR FRESH HEARING ON MERITS AND THE LD. DEPARTMENTAL REPRESENTATIVE IN THE MATTER. THE CIT (A)S ORDER DISMISSING THE ASSESSEES APPEAL EX-PARTE IS EXTRAC TED IN ENTIRETY HEREUNDER:- THE PRESENT APPEAL HAS BEEN FILED AGAINST THE ASSE SSMENT ORDER PASSED BY THE INCOME-TAX OFFICER - 11(3)-1, MUMBAI U/S. 143(3 ) OF THE I.T.ACT, 1961 DATED 24.12.2009. THERE HAS BEEN CONTINUOUS NON COM PLIANCE OF NOTICES OF HEARING IN THIS CASE. THE FIRST NOTICE WAS ISSUED O N 25/08/2011 FIXING THE CASE ON 15/09/2011. ON THIS DATE, AN ADJOURNMENT APPLICA TION WAS RECEIVED AND THE CASE WAS ADJOURNED TO 07/10/ 2011.0N THIS DATE NOBODY ATTENDED HOWEVER AN ADJOURNMENT APPLICATION WAS FILED THREE DAYS LATE ON 10/10/2011 AND THE CASE WAS ADJOURNED TO 20/10/2011 . ON THIS DATE NOBODY ATTENDED NOR ANY ADJOURNMENT APPLICATION WAS FILE D. LAST OPPORTUNITY WAS GIVEN BY ISSUE OF NOTICE ON 14/11/2011 FIXING THE C ASE ON 25/11/2011. IN RESPONSE TO THIS NOTICE, NOBODY HAS ATTENDED NOR AN Y ADJOURNMENT APPLICATION HAS BEEN FILED. THEREFORE, IT IS APPARE NT THAT THE APPELLANT IS NOT INTERESTED IN PURSUING ITS APPEAL. ACCORDINGLY, IN VIEW OF THE DECISIONS OF HON'BLE . MADHYA PRADESH HIGH COURT IN ESTATE OF L ATE TUKOJIRAO HOLKAR VS CWT 223 ITR 480 (MP) AND BY THE DELHI BENCH OF THE TRIBUNAL IN. THE CASE OF CIT VS. MULTIPLAN (INDIA) PVT. LTD 38 ITD 320 (DEL ), THIS APPEAL STANDS DISMISSED. 4 ITA NO. 364/MUM/2012 (ASSESSMENT YEAR : 2007-08) 4.2 A PERUSAL OF THE IMPUGNED ORDER OF THE CIT(A)(S UPRA) SHOWS THAT THE CIT(A) FIXED THIS CASE FOR HEARING ON FOUR OCCA SIONS BETWEEN 15/09/2011 AND 25/11/2011 (I.E. WITHIN A PERIOD OF 2 MONTHS) AND ADMITTEDLY THE ASSESSEE SOUGHT ADJOURNMENTS OF HEAR INGS. WE FIND FROM THE DETAILS FILED THAT A THIRD ADJOURNMENT LET TER DATED 14/11/2011 SEEKING ADJOURNMENT OF HEARING FIXED FOR 14/11/2011 BY ATLEAST 15 DAYS WAS ALSO FILED BY THE LD. AUTHORIZED REPRESENTATIV E OF THE ASSESSEE ON 14/11/2011 ITSELF (COPY PLACED AT PAGE 26 OF PAPER BOOK), WHICH THOUGH FILED ON THE SAME DAY IN THE OFFICE OF THE CIT(A), FINDS NO MENTION IN THE IMPUGNED ORDER. FOR CLARITY, THIS LETTER IS EXTRAC TED IN ENTIRETY. 14 TH NOVEMBER,2011 THE COMMISSIONER OF INCOME TAX (A)-2, DEAR SIR, REF: SHRI SYED NUSRAT SHAH (PAN AADPS 7089N) SUB:APPEAL PROCEEDINGS FOR ASSESSMENT YEAR 2007-08. WITH REFERENCE TO ABOVE, WE HAVE TO STATE THAT THER E IS VERY SMALL MATTER IN NUSRAT SHAH CASE. WE REGRETFULLY STATE THAT THE BR IEFCASE IN WHICH APPOINTMENT DIARY WAS KEPT WAS STOLEN IN THE TRAIN & THEREFORE WE HAVE LOST ALL THE DATES FOR ALL THE APPEAL AND ALL THE IT NOT ICES, ARTICLES, ETC. NOW WE ARE IN THE PROCESS OF RECONSTRUCTING, ENTIRE NOTICE FILE. SO KINDLY HOLD NUSRAT SHAH & NAAZISH SHAH HEARING TOGETHER AND GRANT US N EW DATE AFTER 15 DAYS & OBLIGE. WITH REGARDS, FOR MITESH MEHTA & ASSOCIATES, CHARTERED ACCOUNTANTS, SD/- MITESH MEHTA PROPRIETOR. 5 ITA NO. 364/MUM/2012 (ASSESSMENT YEAR : 2007-08) A PERUSAL OF THE ASSESSEES LETTER DATED 14/11/2011 GIVES THE REASONS FOR SEEKING ADJOURNMENT BY AT LEAST 15 DAYS. WE FI ND, HOWEVER, THE CIT(A) IGNORING THE SAME, PROCEEDED TO FIX THE NEXT HEARING ON 25/11/2011 AND PROCEEDED TO DISMISS THE CASE EX-PAR TE ON 25/11/2011 ITSELF. 4.2 IN OUR VIEW, AS PER THE DETAILS OF THE CASE IN HAND IN THE IMPUGNED ORDER AND THE MATERIAL ON RECORDS AS LAID OUT ABOVE , IT APPEARS THAT THE CIT(A) HAS FAILED TO AFFORD THE ASSESSEE PROPER AND ADEQUATE OPPORTUNITY OF BEING HEARD BY IGNORING HER LETTER S SEEKING ADJOURNMENT AND HURRIEDLY PASSING THE IMPUGNED ORDE R THEREAFTER. BE THAT AS IT MAY, THE PURPOSE OF ASSESSMENT/APPELLATE PROCEEDINGS IS TO BRING TO TAX THE TRUE AND THE CORRECT INCOME OF AN ASSESSEE AND IN THE CASE ON HAND THIS HAS NOT BEEN DONE SINCE THE ASSES SEES APPEAL HAS NOT BEEN DECIDED ON MERITS BY THE CIT(A). WE ARE OF TH E VIEW THAT IT IS IMPERATIVE THAT THE ASSESSEES GROUNDS RAISED BEFOR E THE CIT(A) BE HEARD AND DECIDED ON MERITS AND THAT NO LOSS WOULD BE CAUSED TO REVENUE IF THE IMPUGNED ORDER OF THE CIT(A) BE SET ASIDE FOR BEING DISPOSED OFF ON MERITS AS THE TRUE AND CORRECT INC OME OF THE ASSESSEE WILL BE BROUGHT TO TAX. IN THIS FACTUAL AND LEGAL MATRIX OF THE CASE ON HAND, WE SET ASIDE THE IMPUGNED ORDER OF THE CIT(A) DATED 25/11/2011 FOR ASSESSMENT YEAR 2007-08 AND RESTORE THE MATTER TO THE FILE OF THE CIT(A) FOR CONSIDERATION AND ADJUDICATION OF THE GR OUNDS RAISED BEFORE HIM (AT S.NO.1 TO 7 DATED 20/1/2010) AFTER AFFORDIN G THE ASSESSEE ADEQUATE OPPORTUNITY TO FILE DETAILS/EVIDENCES, SUB MISSIONS REQUIRED AND ALSO TO THE ASSESSING OFFICER TO REBUT ANY FRE SH EVIDENCES FILED. WE 6 ITA NO. 364/MUM/2012 (ASSESSMENT YEAR : 2007-08) HOLD AND DIRECT ACCORDINGLY. CONSEQUENTLY GROUND N O.1 OF ASSESSEES APPEAL IS ALLOWED FOR STATISTICAL PURPOSES AS INDIC ATED ABOVE. GROUND S NO. 2 TO 6 - ON MERITS: 5.1 IN VIEW OF OUR SETTING ASIDE THE IMPUGNED ORDE R OF THE LD. CIT(A) DATED 25/11/2011 PASSED EX-PART FOR ASSESSMENT YEAR 2007-08 TO BE HEARD AND DISPOSED OFF BY THE LD. CIT(A) ON MERITS , WE DECLINE TO ADJUDICATE THESE GROUNDS 2 TO 5(SUPRA) RAISED ON ME RITS ON VARIOUS ISSUES IN THIS APPEAL. 6. IN THE RESULT, THE ASSESSEES APPEAL FOR ASSESSM ENT YEAR 2007-08 IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES AS I NDICATED ABOVE. ORDER PRONOUNCED IN THE OPEN COURT ON 11 /01/2017 SD/- SD/- (JOGINDER SINGH) (JASON P. BOAZ) JUDICIAL MEMBER ACCOUNTANT ME MBER MUMBAI, DATED 11 /01/2017 COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT , 2. THE RESPONDENT. 3. THE CIT(A)- 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. BY ORDER, //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI VM , SR. PS