ITO 13(3)(2), MUMBAI V. WELLBERT PHARMACEUTICAL BOMBAY P.LTD, MUMBAI

ITA 3935/MUM/2017

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 8036 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 3 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-09-2018
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: G
• Assessment Year: 2012-2013
• Appeal Filed On: 30-05-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: NISHANT SOMAIYA
• Keywords: Principle of natural justice

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL G BENCH, MUMBAI BEFORE SHRI B.R. BASKARAN (AM) & SHRI RAVISH SOOD (JM) I.T.A. NO. 3935 /MUM/20 1 7 (ASSESSMENT YEAR 20 12 - 13 ) ITO 13(3)(2) ROOM NO. 227 AAYAKAR BHAVAN 2 ND FLOOR M.K. ROAD MUMBAI - 400020. VS. M/S. WE LLBERT PHARMACEUTICAL BOMBAY PVT. LTD. 702 - A, SAI SMRUTI APARTMENT WAMAN BHOIR MARG, KANDAR PADA, DAHISAR (WEST) MUMBAI - 400 068. PAN : AAACW0953D ( APPELLANT ) ( RESPONDENT ) ASSESSEE BY NONE DEPARTMENT BY S HRI NISHANT SOMAIYA DATE OF HEARING 24 . 9 . 201 8 DATE OF PRONOUNCEMENT 24 . 9 . 201 8 O R D E R PER B.R. BASKARAN (AM) : - THE APPEAL FILED BY THE REVENUE IS DIRECTED AGAINST THE ORDER DATED 22 - 03 - 2017 PASSED BY LD CIT(A) - 21, MUMBAI AND IT RELATES TO THE ASSESSMENT YEAR 2012 - 13. THE REVENU E IS AGGRIEVED BY THE DECISION OF LD CIT(A) IN DELETING THE ADDITION OF RS.347.66 LAKHS MADE BY THE AO U/S 41(1) OF THE ACT ON ACCOUNT OF REMISSION/CESSATION OF LIABILITY. 2. NONE APPEARED ON BEHALF OF THE ASSESSEE. HOWEVER, A PETITION SEEKING ADJOUR NMENT WAS FILED, WHEREIN IT IS STATED THAT THE COMPANY HAS BEEN CLOSED ABOUT THREE YEARS BACK AND FURTHER THE DIRECTORS ARE NOT KEEPING GOOD HEALTH. THE LD D.R STRONGLY OBJECTED TO THE ADJOURNMENT PETITION FILED BY THE ASSESSEE. HE SUBMITTED THAT THE LD CIT(A) HAS GRANTED RELIEF TO THE ASSESSEE WITHOUT PASSING A REASONED ORDER. 3. WE AGREE WITH THE CONTENTIONS OF THE LD D.R. IT IS THE DUTY OF THE ASSESSEE TO DEFEND THE APPEAL AND THE REASONS CITED BY THE ASSESSEE FOR SEEKING ADJOURNMENT ARE NOT PROPE R REASONS. ACCORDINGLY WE REJECT THE PETITION FILED BY M/S. WELLBERT PHARMACEUTICAL BOMBAY PVT. LTD. 2 THE ASSESSEE AND PROCEED TO DISPOSE OF THE APPEAL, EX - PARTE, WITHOUT PRESENCE OF THE ASSESSEE. 4. WE HEARD LD D.R AND PERUSED THE RECORD. WE NOTICE THAT THE AO, DURING THE COURSE OF ASSESSMENT PR OCEEDINGS, ASKED FOR DETAILS OF SUNDRY CREDITORS ALONG WITH NAME, ADDRESSES, PAN AND AMOUNT. SINCE THE ASSESSEE HAS FAILED TO FURNISH THE SAME, THE AO ASSESSED THE OUTSTANDING AMOUNT AS INCOME OF THE ASSESSEE U/S 41(1) OF THE ACT. THE LD CIT(A) HAS DELET ED THE SAME ON THE REASONING THAT THE AO HAS NOT BROUGHT ANY MATERIAL TO SHOW THAT THE ENTIRE LIABILITY HAS CEASED. 5. THE MAIN CONTENTION OF LD D.R WAS THAT THE ASSESSEE HAS FAILED TO FURNISH THE DETAILS THAT WERE CALLED FOR BY THE AO IN ORDER TO PROVE THAT THE LIABILITY OF THE ASSESSEE TOWARDS SUNDRY CREDITORS SUBSISTS AS ON THE LAST DAY OF THE FINANCIAL YEAR. HE SUBMITTED THAT THE LD CIT(A) WAS NOT RIGHT IN GRANTING RELIEF TO THE ASSESSEE, SINCE THE ASSESSEE HAS FAILED TO PROVE THE SAME EVEN BEFORE L D CIT(A). 6. WE AGREE WITH THE CONTENTIONS OF THE LD D.R. THERE SHOULD NOT BE ANY DOUBT THAT THE RESPONSIBILITY IS PLACED UPON THE ASSESSEE TO PROVE THAT THE LIABILITY TOWARDS SUNDRY CREDITORS IS SUBSISTING AS ON THE LAST DATE OF THE PREVIOUS YEAR. IN THE INSTANT CASE, THE ASSESSEE HAS NOT FURNISHED THE DETAILS THAT WERE CALLED FOR BY THE AO AND IT DID NOT FURNISH THE DETAILS EVEN BEFORE LD CIT(A). HENCE THE LD CIT(A) WAS NOT JUSTIFIED IN DELETING THE ADDITION BY PUTTING BLAME ON THE AO, WHEN THE AS SESSEE HAS FAILED TO FURNISH THE DETAILS. AT THE SAME TIME, WE ARE OF THE VIEW THAT, IN THE INTEREST OF NATURAL JUSTICE, THE ASSESSEE MAY BE GIVEN ONE MORE OPPORTUNITY TO PROVE ITS CASE BEFORE THE AO. ACCORDINGLY WE SET ASIDE THE ORDER PASSED BY LD CIT(A ) ON THIS ISSUE AND DIRECT THE AO TO RE - EXAMINE THE IMPUGNED ISSUE AFRESH. THE ASSESSEE IS DIRECTED TO FURNISH ALL THE DETAILS THAT WERE/ MAY BE CALLED BY THE AO. AFTER CONSIDERING M/S. WELLBERT PHARMACEUTICAL BOMBAY PVT. LTD. 3 THE DETAILS, INFORMATION AND EXPLANATIONS, THE ASSESSING OFFICER MAY TAKE APPROPRIATE DECISION IN ACCORDANCE WITH THE LAW. 7. IN THE RESULT, THE APPEAL OF THE REVENUE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER HAS BE EN PRONOUNCED IN THE COURT ON 24 . 9 .201 8 . SD/ - SD/ - (RAVISH SOOD ) (B.R.BAS KARAN) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; DATED : 24 / 9 / 20 1 8 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// ( SENIOR PRIVATE SECRETARY ) PS ITAT, MUMBAI