Sabic Innovative Plastics India Pvt.Ltd., Baroda V. The ACIT, Circle-2(1)(1), Baroda

ITA 367/AHD/2015

• Counselvise Citation: 36720514 RSA 2015
• Duration Of Justice: 5 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-08-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 03-08-2015
• Assessment Year: 2010-2011
• Appeal Filed On: 19-02-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R I PATEL
• Keywords: Transfer pricing; Opportunity of being heard; Principle of natural justice
• Section: 143(3); 144; 11

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, AHMEDABAD BEFORE SHRI G.D. AGRAWAL, VICE PRESIDENT AND SHRI S. S. GODARA, JUDICIAL MEMBER IT(TP)A NO. 367/AHD/2015 / ASSESSMENT YEAR: 2010-11 SABIC INNOVATIVE PLASTICS INDIA PRIVATE LIMITED, PLASTICS AVENUE, PO JAWAHARNAGAR, DIST. VADODARA PAN : AABCE 7565 N VS. ACIT, CIRCLE-2(1)(1) BARODA / // / (APPELLANT) / // / (RESPONDENT) ASSESSEE(S) BY : SHRI MANOJ PARDASANI WITH ANISH MEHTA, AR REVENUE BY : SHRI R.I. PATEL, CIT-DR ! ' #$%/ // / DATE OF HEARING : 03/08/2015 &' ' #$% / // / DATE OF PRONOUNCEMENT: 07/08/2015 () () () ()/ // / O R D E R PER G.D. AGRAWAL, VICE PRESIDENT: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE TRANSFER PRICING OFFICER (IN SHORT TPO) PASSED U/ S 143(3) R.W.S. 92CA R.W.S. 144C(13) OF THE INCOME-TAX ACT, DATED 23.12. 2014 FOR ASSESSMENT YEAR 2010-11. 2. IN THIS APPEAL BY THE ASSESSEE VARIOUS GROUNDS A RE RAISED. THE GROUND NO.16 OF THE ASSESSEES APPEAL, WHICH WAS AR GUED FIRST, READS AS UNDER:- IT(TP)A NO. 367/AHD/2015 SABIC INNOVATIVE PLASTICS INDIA PVT LTD VS. ACIT AY 2010-11 2 16. THE LD. AO AND HONBLE DRP ERRED IN LAW IN GRO SSLY VIOLATING THE PRINCIPLE OF NATURAL JUSTICE BY FAILING TO PROVIDE REASONABLE OPPORTUNITY TO THE APPELLANT TO FURNISH DOCUMENTS AND EVIDENCES . 3. AT THE TIME OF HEARING BEFORE US, IT WAS CONTEND ED BY THE LD. COUNSEL FOR THE ASSESSEE THAT THE ORDER OF THE DISP UTE RESOLUTION PANEL (IN SHORT DRP) IS DATED 27.11.2014; HOWEVER, THE DR P HAS FIXED THE HEARING BEFORE IT FOR THE FIRST TIME ON 28.11.2014 AND ON THE SAID DATE, IT WAS ADJOURNED TO 05.12.2014 FOR FILING CERTAIN DETA ILS AND INFORMATION. THAT, THOUGH THE DETAILS AND INFORMATION AS ASKED F OR BY THE DRP WAS FILED ON 03.12.2014, BUT THE DRP HAS PASSED THE ORD ER ISSUING DIRECTION TO THE ASSESSING OFFICER ON 27.11.2014, WHICH WAS P RIOR TO THE DATE OF HEARING. HE, THEREFORE, SUBMITTED THAT THE ORDER OF THE DRP WHICH IS PASSED WITHOUT ALLOWING ANY OPPORTUNITY OF BEING HE ARD TO THE ASSESSEE IS ILLEGAL, VOID AND SHOULD BE QUASHED AND CONSEQUENTLY, RESULTANT ASSESSMENT ORDER SHOULD ALSO BE QUASHED. 4. THE LD. CIT-DR, ON THE OTHER HAND, STATED THAT T HERE IS A TYPOGRAPHICAL ERROR IN THE ORDER OF THE DRP. HE ST ATED THAT THE ORIGINAL ORDER OF THE DRP AS AVAILABLE ON THE FILE OF THE DRP IS DATED 09.12.2014. HE PRODUCED BEFORE US THE FILE OF THE DRP IN WHICH THERE IS AN ORDER OF THE DRP SIGNED BY ALL THE THREE CITS AN D THE DATE MENTIONED ON THE SAID ORDER IS 09.12.2014. HE, THE REFORE, SUBMITTED THAT THE ORDER OF THE DRP IS A VALID ORDER WHICH HA S BEEN PASSED IN ACCORDANCE WITH LAW AFTER ALLOWING ADEQUATE OPPORTU NITY OF BEING HEARD TO THE ASSESSEE. HE HAS ALSO PRODUCED BEFORE US THE PHOTOCOPY OF THE ORDER AND PHOTOCOPY OF THE ORDER-SHEET. IT(TP)A NO. 367/AHD/2015 SABIC INNOVATIVE PLASTICS INDIA PVT LTD VS. ACIT AY 2010-11 3 5. THE LD. COUNSEL FOR THE ASSESSEE, IN THE REJOIND ER, STATED IF THE ORIGINAL ORDER IS DATED 09.12.2014, THEN HOW IN THE ORDER SUPPLIED TO THE ASSESSEE THE DATE IS MENTIONED AS 27.11.2014. HE STATED THAT ONCE THE ORDER IS SIGNED BY THE DRP, THE CLERICAL STAFF WILL NOT MODIFY THE DATE OF THE ORDER. HE ALSO POINTED OUT THAT IN THE ORIGINAL ORDER WHICH IS AVAILABLE IN THE FILE OF THE DRP, THERE IS NO DA TE AFTER THE SIGNATURE OF ANY MEMBER OF THE DRP. IT IS ONLY ON THE FIRST PAG E THE DATE IS MENTIONED AS 09.12.2014; HOWEVER, THIS PAGE IS NOT INITIALED BY ANYBODY. HE, THEREFORE, REITERATED THAT THE ORDER OF THE DRP IS PASSED WITHOUT ALLOWING ANY OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. HE SUBMITTED THAT AS PER SUB-SECTION 11 TO SECTION 144 C, THE DRP CANNOT ISSUE ANY DIRECTION UNLESS AN OPPORTUNITY OF BEING HEARD IS GIVEN TO THE ASSESSEE AND THE ASSESSING OFFICER. SINCE THE D RP HAS ISSUED THE DIRECTION WITHOUT ALLOWING ANY OPPORTUNITY OF BEING HEARD TO THE ASSESSEE, THE ORDER PASSED BY THE DRP SHOULD BE ANN ULLED. 6. WE HAVE CAREFULLY CONSIDERED THE ARGUMENTS OF B OTH THE SIDES AND PERUSED THE MATERIAL PLACED BEFORE US. THE PHO TOCOPY OF THE ORDER-SHEET AS PRODUCED BY THE LD. CIT-DR BEFORE US READS AS UNDER:- DISPUTE RESOLUTION PANEL, AHMEDABAD SABIC INNOVATIVE PLASTICS INDIA PVT LTD AY 2010- 11 11.11.2014 RECEIVED OBJECTIONS ON 09.04.2014 IN QUADRUPLICATE, AGAINST THE DRAFT ASSESSMENT ORDER DATED 10.03.2014 U.S, 143(3) R.W.S. 144C OF THE ACT PASSED BY THE ACIT, CIRCLE-4, BARODA. NOTICE ISSUE D TODAY SCHEDULING THE HEARING IN THIS CASE FOR 28/11/2014 AT 4.45 PM. IT(TP)A NO. 367/AHD/2015 SABIC INNOVATIVE PLASTICS INDIA PVT LTD VS. ACIT AY 2010-11 4 28.11.2014 AT 3.45 PM SHRI V.K. MONGOTRA, ADVOCATE, AND NITIN DALMIA FROM KPMG ATTEND. THE CASE IS HEARD. THE AR WAS ASKED TO FILE A CHART/SUBMISSION REGARDI NG COMPUTATION OF INCOME AND RECONCILIATION STATEMENT PROVISION FOR DOUBTFUL LOANS AND ADVANCES . TIME GRANTED UPTO 5/12/2014. 7. FROM THE ABOVE, IT IS EVIDENT THAT FIRST ENTRY I S DATED 11.11.2014 WHICH RECORDS THE ISSUE OF NOTICE FOR HEARING ON 28 .11.2014. ON 28.11.2014, THERE IS A NOTING AS PER WHICH THE ASSE SSEE WAS ASKED TO FILE A CHART/SUBMISSION AND TIME WAS GRANTED UP TO 05.12 .2014. THEREAFTER, THERE IS NO NOTING ON THE ORDER-SHEET E ITHER FOR ANY HEARING ON 05.12.2014 OR WITH REGARD TO PASSING OF THE ORDE R. AS PER THE PHOTOCOPY OF THE ORDER FILED BY THE ASSESSEE ALONG WITH APPEAL MEMO, THE DATE OF THE ORDER OF THE DRP IS 27.11.2014 WHIC H IS CERTAINLY PRIOR TO FIRST DATE OF HEARING ALLOWED BY DRP. THE FILE OF THE DRP IS PRODUCED BEFORE US IN WHICH THERE IS AN ORIGINAL OR DER WHICH IS SIGNED BY ALL THE THREE MEMBERS OF DRP. HOWEVER, NO DATE IS PUT BY ANY OF THE MEMBER OF THE DRP AFTER THEIR SIGNATURE; BUT, O N THE FIRST PAGE OF THE ORIGINAL ORDER THE DATE IS 09.12.2014. IN THE ORDER OF THE DRP AT PAGE NO.10, PARAGRAPH NO. 3.4, THE DRP HAS DISCUSSE D ABOUT THE ARGUMENTS PUT FORWARD BY THE ASSESSEE IN ITS SUPPOR T. HOWEVER, THERE IS NO MENTION OF THE WRITTEN SUBMISSIONS AND THE DE TAILED EXPLANATION CLAIMED TO HAVE BEEN FURNISHED BY THE ASSESSEE WITH DRP ON 03.12.2014. THE ASSESSEE HAS FILED BEFORE US THE P HOTOCOPY OF REPLY DATED 03.12.2014, WHICH IS PLACED AT PAGE NO.905 OF THE ASSESSEES PAPER-BOOK. FROM THE SAID COPY, IT IS EVIDENT THAT IT WAS FURNISHED IT(TP)A NO. 367/AHD/2015 SABIC INNOVATIVE PLASTICS INDIA PVT LTD VS. ACIT AY 2010-11 5 WITH THE OFFICE OF THE INCOME TAX OFFICER. THE DAT E OF RECEIPT IS NOT CLEARLY LEGIBLE; HOWEVER, MONTH IS DECEMBER 2014. THE ASSESSEE WAS ASKED TO SHOW THE ORIGINAL COPY OF SUCH LETTER WHIC H ASSESSEE WAS UNABLE TO PRODUCE AT THE TIME OF HEARING BEFORE US. FROM THE ABOVE SEAL, WHICH IS DEPICTED ON THE PHOTOCOPY OF THE LET TER DATED 03.12.2014, IT IS NOT EVIDENT THAT THE SAID LETTER WAS FILED IN THE DRP BECAUSE THE RECEIPT SHOWS OFFICE OF THE INCOME TAX OFFICER AND DATE IS ALSO NOT LEGIBLE. AFTER CONSIDERING THE TOTALITY OF THE FACT S AND THE ARGUMENTS OF BOTH THE SIDES, IN OUR OPINION, IT WOULD MEET THE E NDS OF JUSTICE IF THE ORDER OF THE DRP IS SET ASIDE, BECAUSE IN OUR OPINI ON CERTAINLY ADEQUATE OPPORTUNITY OF BEING HEARD IS NOT ALLOWED BY THE DRP TO THE ASSESSEE. THERE ARE DIFFERENT DATES MENTIONED IN TH E ORDER OF THE DRP SUPPLIED TO THE ASSESSEE AND THE ORDER IN THE FILE OF THE DRP. NO SATISFACTORY EXPLANATION FOR THIS VARIATION IN DATE S IN BOTH THE ORDERS COULD BE GIVEN BY THE LD. CIT-DR. IN THE ORDER-SHEE T THERE IS A NOTING OF ONLY ONE DATE OF HEARING, I.E., 28.11.2014 ON WH ICH DATE THE ASSESSEE WAS DIRECTED TO FILE CHART/SUBMISSION AND TIME WAS GRANTED UP TO 05.12.2014. HOWEVER, THEREAFTER THERE IS NO OTHER NOTING WHETHER ANY FURTHER HEARING TOOK PLACE OR NOT. CONSIDERING THE TOTALITY OF THESE FACTS, WE ARE OF THE OPINION THAT THE DRP HAS PASSE D THE ORDER WITHOUT ALLOWING ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. WE, THEREFORE, SET ASIDE THE ORDER OF THE DRP AND RESTO RE THE MATTER BACK TO ITS FILE. WE DIRECT THE DRP TO ALLOW ADEQUATE OPPO RTUNITY OF BEING HEARD TO THE ASSESSEE, AND THEREAFTER PASS A SPEAKI NG ORDER IN RESPECT OF ASSESSEES OBJECTIONS IN ACCORDANCE WITH LAW. S INCE WE HAVE SET ASIDE THE ORDER OF THE DRP, THE ASSESSMENT ORDER PA SSED BY THE IT(TP)A NO. 367/AHD/2015 SABIC INNOVATIVE PLASTICS INDIA PVT LTD VS. ACIT AY 2010-11 6 ASSESSING OFFICER IN ACCORDANCE WITH THE DIRECTIONS OF THE DRP CANNOT SURVIVE. WE, THEREFORE, SET ASIDE THE ASSESSMENT O RDER DATED 23.12.2014 AND RESTORE THE SAME BACK TO THE FILE OF THE ASSESS ING OFFICER. WE DIRECT HIM TO PASS THE FRESH ASSESSMENT ORDER IN AC CORDANCE WITH LAW AFTER RECEIVING FRESH DIRECTION OF THE DRP. 8. SINCE WE HAVE SET ASIDE THE ASSESSMENT ORDER, TH E VARIOUS OTHER GROUNDS RAISED IN THE APPEAL OF THE ASSESSEE NEED N O FURTHER ADJUDICATION AT THIS STAGE. 9. IN THE RESULT, ASSESSEES APPEAL IS DEEMED TO BE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE COURT ON 07 TH AUGUST, 2015 AT AHMEDABAD. SD/- SD/- (S. S. GODARA) JUDICIAL MEMBER (G.D. AGRAWAL) VICE-PRESIDENT AHMEDABAD; DATED 07/08/2015 BIJU T., PS () ' #* +(*# () ' #* +(*# () ' #* +(*# () ' #* +(*#/ COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ,, # - / CONCERNED CIT 4. - ( ) / THE CIT(A) 5. *01 # , , / D R, ITAT, AHMEDABAD 6. 13 4! / GUARD FILE . () () () () / BY ORDER, TRUE COPY 5 55 5/ // / ,6 ,6 ,6 ,6 ( DY./ASSTT.REGISTRAR) , , , , / ITAT, AHMEDABAD