Madhuban Dealers Pvt. Ltd, Kolkata V. Pr. CIT-2, Kolkata

ITA 393/KOL/2020

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 6421 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 1 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-08-2021
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 23-08-2021
• Assessment Year: 2010-2011
• Appeal Filed On: 26-06-2020
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: VIJAY SHANKAR CIT LD
• Assessee Lawyers: TEJANDER SINGH LD
• Keywords: Opportunity of being heard; Principle of natural justice; Condonation of delay; Set aside
• Section: 201; 13; 147; 263

Judgement Text

1 ITA NO . 393 /KOL20 AY 201 0 - 11 MADHUBAN DEALERS P.LTD. IN THE INCOME TAX APPELLATE TRIBUNAL , B BENCH, KOLKATA [ BEFORE SHRI P.M. JAGTAP, V.P (KZ) AND S MT. MADHUMITA ROY , JM ] I.T.A. NO. 393 /KOL/2020 ASSESSMENT YEAR: 20 1 0 - 11 MADHUBAN DEALERS PVT. LTD PAN: AAFCM8629M VS. PCIT - 2, KOLKATA APP ELLANT RESPON DENT DATE OF HEARING (VIRTUAL) 23 - 08 - 2021 DATE OF PRONOUNCEMENT 25 - 08 - 2021 FOR THE APPELLANT SHRI TEJANDER SINGH, LD.AR FOR THE RESPONDENT SHRI VIJAY SHANKAR, CIT, LD.DR ORDER PER SMT. MADHUMITA ROY, JM THE INSTANT APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 1 3 - 03 - 2020 PASSED BY THE LD. PR. CIT - 2 , KOLKATA [ IN SHORT, THE LD. PCIT] U/S. 263 OF THE INCOME T AX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT ) FOR THE A SSESSMENT Y EAR S 201 0 - 11 . 2. THERE IS DELAY OF 56 DAYS IN FILING THE INSTANT APPEAL BEFORE US BY THE ASSESSEE. IN THIS REGARD, THE SUBMISSION MADE BY THE LD. COUNSEL FOR THE ASSESSEE AND ALSO APPEARING IN THE APPLICATION FOR CONDONATION OF DELAY IS THIS THAT THE IMPUGNED ORDER PASSED BY THE LD. PCIT THOU GH DATED 13.03.2020, THE ASSESSEE COULD FILE THIS APPEAL ONLY ON 26.06.2020. THE DELAY WAS ON ACCOUNT OF PANDEMIC SITUATION FOLLOWED BY LOCKDOWN DECLARED BY THE GOVT. OF INDIA THROUGHOUT THE COUNTRY. UNDER THIS SITUATION, IT WAS NOT POSSIBLE FOR THE ASSESS EE TO PREPARE THE APPEAL AND TO FILE THE SAME WITHIN THE PRESCRIBED TIME. THE ASSESSEE FURTHER RELIED UPON THE NOTIFICATION/ORDINANCE DATED 31.03.2020 ISSUED BY THE CENTRAL GOVT. GRANTING EXTENSION FOR FILING APPEALS WHOSE DUE DATES WERE FALLING DURING THE PANDEMIC TILL 29.06.2020. THE PLEA TAKEN BY THE ASSESSEE HAS NOT BEEN OBJECTED BY THE LD. DR WITH ALL HIS FAIRNESS. 2 ITA NO . 393 /KOL20 AY 201 0 - 11 MADHUBAN DEALERS P.LTD. 2.1 HAVING REGARD TO THE PRACTICAL DIFFICULTY FACED BY THE ASSESSEE AND THE NOTIFICATION/ORDINANCE IN THIS REGARD ISSUED BY THE GOVT. OF I NDIA, WE FIND IT FIT AND PROPER TO CONDONE THE DELAY FOR THE ENDS OF JUSTICE. HENCE, THE DELAY IS CONDONED. 3 . THE LD. PCIT ISSUED NOTICE U/S. 263 OF THE ACT DATED 07 - 01 - 2020 WITH THE PRIMA - FACIE FINDING OF FAILURE ON THE PART OF THE LD.AO TO ASSESS THE INCOME OF THE ASSESSEE U/S. 144/147 OF THE ACT AND FOUND IT ERRONEOUS AS IT IS PREJUDICIAL TO THE INTEREST OF THE REVENUE WITHIN THE AMBIT OF SECTION 263 OF THE ACT WITH THE FOLLOWING OBSERVATIONS: - IN THIS REGARD THE FOLLOWING DISCREPANCIES HAVE BEE N OBSERVED: INFORMATION FROM INVESTIGATION WING WAS RECEIVED. ON THE BASIS OF THE SAME AND AFTER VERIFICATION OF INFORMATION/RECORDS, THE CASE WAS REOPENED U/S 147 OF THE I. T. ACT, 1961. IT WAS FOUND THAT YOUR COMPANY HAD RECEIVED AN AMOUNT OF RS. 4,95,00 ,000/ - IN THE BANK ACCOUNT(S) FROM VARIOUS COMPANIES AND THESE FUNDS WERE SIPHONED BY YOUR COMPANY USING BANKING SYSTEM. BUT, THE AO COMPLETED THE ASSESSMENT WITHOUT NECESSARY LEGAL VERIFICATION OR INVESTIGATION IN THIS CASE AND ACCORDINGLY WITHOUT MAKING ANY ADDITION IN THE ASSESSMENT ORDER U/S 144/147 DATED 27/12/2017. IN VIEW OF THE ABOVE, YOU ARE HEREBY ALLOWED AN OPPORTUNITY OF BEING HEARD, EITHER PERSONALLY OR THROUGH AN AUTHORIZED REPRESENTATIVE, IN MY OFFICE AT ROOM NO 60, 3RD FLOOR, AAYAKAR BHAWAN , P - 7, CHOWRINGHEE SQUARE, KOLKATA - 700 069 ON 28/01/2020 AT 11:00 A.M/P.M, AND SHOW CAUSE AS TO WHY AN ORDER U/S 263 OF THE I. T. ACT, 1961 SHALL NOT BE PASSED IN YOUR CASE ENHANCING/MODIFYING/CANCELLING THE ASSESSMENT ORDER IN QUESTION OR DIRECTING A FRES H ASSESSMENT TO BE MADE. IN THE EVENT OF FAILURE TO COMPLY WITH THE ABOVE, IT SHALL BE PRESUMED THAT YOU HAVE NO OBJECTION TO THE PROPOSED ACTION AND THE MATTER SHALL BE FINALISED ON MERITS ON THE BASIS OF MATERIAL ON RECORD, WITHOUT FURTHER NOTICE. 4 . T HE LD. PCIT ULTIMATELY SET ASID E THE ISSUE TO THE FILE OF THE AO U/S. 263 OF THE ACT WITH THE DIRECTION UPON HIM TO FRAME THE ASSESSMENT ORDER UPON LOOK ING INTO THE ISSUES AS PER THE OBSERVATIONS MADE IN THE IMPUGNED ORDER. 5 . AT THE TIME OF HEARING OF THE INSTANT APPEAL THE LEARNED COUNSEL APPEARING FOR THE ASSESSEE DREW OUR ATTENTION AT PAGES 9,11,12 OF THE PAPER BOOK FILED BEFORE US WHEREFROM IT 3 ITA NO . 393 /KOL20 AY 201 0 - 11 MADHUBAN DEALERS P.LTD. APPEARS THAT DURING THE PROCEEDINGS U/S. 263 OF THE ACT , THREE(3) NOTICES DT. 07 - 01 - 2020, 29 - 01 - 2020 AND 18 - 02 - 2020 WERE ISSUED, BUT HE FURTHER SUBMITTED THAT THE ASSESSEE HAS NOT RECEIVED ANY ONE OF THE SAME. THE LD. COUNSEL FOR THE ASSESSEE FURTHER DREW OUR ATTENTION TO PAGE - 13 OF THE P.B FILED BEFORE US, WHEREIN IT IS REFLECTED THAT ON 9 - 3 - 2020 THE APPLICANT H AS ALSO SOUGHT FOR ADJOURNMENT AND PRAYER WAS MADE FOR FIXING OF THE MATTER FOR HEARING . IT WAS FURTHER CLARIFIED BY THE ASSESSEE THAT HE COULD COME TO KNOW THAT THE MATTER WAS FIXED FOR HEARING ON 3 - 3 - 2020 ONLY ON 9 - 3 - 2020. THERE WAS SOME LATCHES ON THE IR PART DUE TO ILLNESS OF THE PARTNERS OF THE ASSESSEE COMPANY FOR NOT BEING VIGILANT IN THE MATTER AND FINALLY THE ASSESSEE PRAYED FOR GRANTING OF FRESH DATE OF HEARING ON A SUBSEQUENT DATE . HOWEVER, SUCH PLEA WAS NOT TAKEN INTO CONSIDERATION BY THE LD. PCIT AND FINALLY THE IMPUGNED ORDER WAS PASSED ON 13 - 03 - 2020 WITHOUT HEARING THE ASSESSEE. THE LD. DR, HOWEVER, RELIED UPON THE ORDER PASSED BY THE LD. PCIT . 6 . UPON HEARING THE RESPECTIVE PARTIES AND UPON PERUSAL OF THE ORDERS PASSED BY THE REVENUE AN D ALSO RECORDS AVAILABLE BEFORE US INCLUDING THE NOTICES ISSUED BY REVENUE AND THE ADJOURNMENT LETTER WRITTEN BY THE ASSESSEE AS ANNEXED TO THE PAPER BOOK FILED BY THE ASSESSEE, WE ARE OF THE CONSIDERED OPINION THAT THE IMPUGNED ORDER HAS BEEN PASSED BY TH E LD. PCIT WITHOUT AFFORDING PROPER OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. THOUGH THE THREE (3) NOTICES WERE ISSUED BY THE REVENUE FIXING THE DATE OF HEARING, BUT FINALLY, THE ADJOURNMENT APPLICATION AS PART OF THE RECORD BEFORE US , THOUGH SUGGESTS TH E REQUEST FOR ADJOURNMENT ON BEHALF OF T HE ASSESSEE BEFORE THE LD. PCIT MADE , THE SAME IS NOT REFLECTING IN THE ORDER PASSED BY THE LD. PCIT DT. 13 - 03 - 2020, ISSUED AFTER FOUR(4) DAYS FROM THE DATE OF MAKING SUCH REQUEST . IN THAT EVENT, W E FIND THAT THE PR INCIPLE OF NATURAL JUSTICE HAS NOT BEEN PROPERLY ADHERED T O . THEREFORE, FOR THE ENDS OF JUSTICE, W E FIND IT FIT AND PROPER TO SET ASIDE THE ISSUE TO THE FILE OF THE LD. PCIT WITH A FURTHER DIRECTION UP ON HIM TO ADJUDICATE THE MATTER ON MERITS POSITIVELY UP ON GRANTING AN OPPORTUNITY OF BEING HEARD TO THE ASSESSEE AND UPON TAKING INTO CONSIDERATION THE EVIDENCES , WHICH THE ASSESSEE MAY CHOOSE TO FILE AT THE TIME OF HEARING OF THE MATTER AND TO PASS A REASONED ORDER . IT IS ALSO MADE CLEAR THAT THE 4 ITA NO . 393 /KOL20 AY 201 0 - 11 MADHUBAN DEALERS P.LTD. ASSESSEE WIL L ALSO NOT ASK FOR ANY UNNECESSARY ADJOURNMENT AND WILL COOPERATE WITH THE LD. PCIT DURING THE PROCEEDINGS BEFORE HIM . 7 . IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSE. ORDER IS PRONOUNCED IN THE OPEN COURT ON 25 - 08 - 2021 SD/ - SD/ - ( P.M. JAGTAP ) ( MADHUMITA ROY) VICE - PRESIDENT(KZ) JUDICIAL MEMBER DATED : 25 - 08 - 2021 **PP (SR.P.S.) COPY OF THE ORDER FORWARDED TO: 1. RESPECTIVE APPELLANT / ASSESSEE: M/S. MADHUBAN DEALERS PVT. LTD 113B, MANOHAR D AS KATRA, SHOP NO. 118 DURGA GATE, GROUND FLOOR, KOLKATA - 700 007. 2 RESPONDENT / DEPARTMENT: THE PR. COMMISSIONER OF INCOME TAX - 2, ROOM NO. 60, 3 RD FL., AAYKAR BHAVAN, P - 7 CHOWRINGHEE SQUARE, KOLKATA - 700 069. 3. 4. 5. CIT(A), CIT - , DR, I TAT, KOLKATA. / TRUE COPY, BY ORDER, SENIOR PRIVATE SECRETARY/D.D.O