National Bakery Machine, Meerut V. ITO, Meerut

ITA 3997/DEL/2013

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 3106 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 10 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-05-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Next Hearing Date: 22-05-2017
• Assessment Year: 2009-2010
• Appeal Filed On: 27-06-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Opportunity of being heard
• Section: 142(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH E , NEW DELHI BEFORE SH. N. K. SAINI, AM AND SMT. BEENA A. PILLAI , JM IT A NO. 3997 /DEL/201 3 : ASSTT. YEAR : 200 9 - 10 NATIONAL BAKERY MACHINE, C/O B.P. GUPTA &CO., TAX LAWS CONSULTANTS, 186, W.K. ROAD, OPP. NAGIN PRAKASHAN, MEERUT - 25001(UP) VS INCOME TAX OFFICER, WARD - 2(1), MEERUT (APPELLANT) (RESPONDENT) PAN NO. A AEFN1513H ASSESSEE BY : SH. K. SAMPATH, ADV. REVENUE BY : SH. RAJESH KUMAR , SR. DR DATE OF HEARING : 22 .0 5 .201 7 DATE OF PRONOUNCE MENT : 23 .05 . 201 7 ORDER PER N. K. SAINI, AM : THIS IS AN APPEAL BY THE ASSESSEE AGAINST THE ORDER DATED 31.03.2013 OF LD. CIT(A) , MEERUT . 2 . F OLLOWING GROUNDS HAVE BEEN RAISED IN THIS APPEAL: 1. THAT IN THIS CASE THE LD. A.O. HAD PROCEEDED WITH THE ASSESSMENT PROCEEDINGS WITHOUT SERVING THE NOTICE U/S 143(2) OF THE INCOME TAX ACT ON THE APPELLANT. 2. THAT THE LD. CIT (A) ERRED IN LAW AND ON FACTS IN NOT CONSIDERING THE ISSUE OF NOTICE U/S 143(2) AS BEING COVERED IN GROUND NO. 1 OF GROUNDS OF APPEAL TAKEN BEFORE HIM. ITA NO. 39 97/DEL/2013 NATIONAL BAKERY MACHINE 2 3. THAT THE LD. CIT (A), ERRED IN LAW A ND ON FACT S IN NOT ADMITTING THE ADDITIONAL GROUND OF APPEAL AS AN ALTERNATIVE THAT NOTICE U/S 143 (2) WAS NOT SERVED UPON THE APPELLANT. 4. THAT IN THE ABSENCE OF SERVICE OF NOTICE U/S 143(2) OF THE INCOME TAX ACT, THE LD. C.I.T.(A) ERRED IN LAW AND ON FACTS IN N OT HOLDING THE ASSESSMENT PROCEEDINGS AS INVALID. 5. THAT WITHOUT PREJUDICE TO GROUNDS NO. 1 , 2, 3, & 4 THE LD. CIT (A), ERRED IN LAW AND ON FACTS IN MAINTAINING THE ADDITION OF RS.19 , 90 , 944/ - MADE BY THE LD. A.O. FOR PURCHASES OF IRON AS INGENUINE. THAT IN RESPECT OF THIS ADDITION OF RS.19,90,944/ - THE OBSERVATIONS OF THE LD. CIT (A) WERE ALSO INCONSISTENT WITH THE FACTUAL AND LEGAL POSITION OF THE CASE. 6. THAT WITHOUT PREJUDICE TO GROUND NO.5 THE LD. CIT (A) ERRED IN LAW AND ON FACTS IN NOT ANNULLING T HE ASSESSMENT AS A WHOLE FOR LACK OF SERVICE OF NOTICE U/S 143(2) ON APPELLANT AS MENTIONED IN GROUNDS NO. 1 , 2, 3, & 4 ABOVE. 3 . VIDE GROUND NOS. 1 TO 4 AND 6, THE GRIEVANCE OF THE ASSESSEE RELATES TO THE JURISDICTION OF THE AO FOR INITIATING THE ASSESS MENT PROCEEDINGS WITHOUT SERVING THE NOTICE U/S 143(2) OF THE INCOME - TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT). 4 . DURING THE COURSE OF HEARING THE LD. COUNSEL FOR THE ASSESSEE AT THE VERY OUTSET STATED THAT THIS ISSUE WAS RAISED BEFORE THE LD. C IT(A) VIDE AN ADDITIONAL GROUND. HOWEVER, THIS GROUND WAS NOT ADMITTED ITA NO. 39 97/DEL/2013 NATIONAL BAKERY MACHINE 3 AND ADJUDICATED BY THE LD. CIT(A). A REFERENCE WAS MADE TO PARA 5 OF THE IMPUGNED ORDER. 5 . IN HIS RIVAL SUBMISSIONS THE LD. DR SUPPORTED THE ORDER OF THE LD. CIT(A). 6 . WE HAVE CONSI DERED THE SUBMISSIONS OF BOTH THE PARTIES AND CAREFULLY GONE THROUGH THE MATERIAL AVAILABLE ON THE RECORD. IT IS NOTICED THAT THE ASSESSEE RAISED AN ADDITIONAL GROUND RELATING TO THE SERVICE OF NOTICE U/S 143(2) OF THE ACT BUT FINDINGS HAVE NOT BEEN GIVEN BY THE LD. CIT(A) ON THIS ISSUE, WHICH IS EVIDENT FROM PARA 5 OF THE IMPUGNED ORDER WHICH READ AS UNDER: 5. IT IS NOTED THAT DURING THE APPEAL PROCEEDINGS, AN ADDITIONAL GROUND OF APPEAL WAS SOUGHT TO BE RAISED. IT WAS THAT THE NOTICE U/S 143(2) OF THE IT ACT WAS NEVER SERVED UPON THE APPELLANT AND AS MUCH, THE ASSESSMENT PROCEEDINGS AND THE ASSESSMENT MADE WERE NOT VALID IN LAW. THOUGH THIS GROUND OF APPEAL HAS NOT BEEN ADMITTED, IT IS NOTED THAT IN THE ASSESSMENT ORDER, IT HAS BEEN CATEGORICALLY STATED B Y THE AO THAT NOTICE U/S 143(2) OF THE ACT DATED 23.03.2010 WAS ISSUED TO THE ASSESSEE. THE PROVISION OF SUBSECTION 3 OF SECTION 124 WOULD ALSO BE APPLICABLE IN THIS CASE AS NOTICE U/S 142(1) OF THE ACT WAS ALSO ISSUED (AS STATED IN THE ASSESSMENT ORDER AN D NOT DENIED BY THE ASSESSEE) AND NO OBJECTION WAS FILED CALLING IN QUESTION THE JURISDICTION OF THE AO TO TAKE UP THE CASE FOR SCRUTINY ASSESSMENT ORDER. THE ISSUE OF SERVICE OF NOTICE HAS BEEN RAISED FOR THE FIRST TIME DURING THE APPEAL PROCEEDINGS. THER EFORE, THE SAME IS NOT TENABLE. ITA NO. 39 97/DEL/2013 NATIONAL BAKERY MACHINE 4 7 . FROM THE AFORESAID OBSERVATION OF THE LD. CIT(A), IT IS CLEAR THAT A LEGAL ISSUE WAS RAISED BY THE ASSESSEE BEFORE THE LD. CIT(A) BUT THE SAME WAS NOT ADJUDICATED BY OBSERVING THAT THE ASSESSEE RAISED THIS ISSUE FIRST T IME BEFORE THE LD. CIT(A) DURING THE APPELLATE PROCEEDINGS. IT IS WELL SETTLED THAT A LEGAL ISSUE CAN BE RAISED AT ANY STAGE. WE, THEREFORE, DEEM IT APPROPRIATE TO SET ASIDE THIS ISSUE BACK TO THE FILE OF THE LD. CIT(A) AND DIRECT HIM TO ADJUDICATE THIS IS SUE IN ACCORDANCE WITH LAW AFTER PROVIDING DUE AND REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 8 . IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES . (O RDER PRONOUNCED IN THE OPEN COURT ON 23 /0 5 /2017 ) SD/ - SD/ - ( BEE NA A. PILLAI ) (N. K. SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 23 /05 /2017 *SUBODH* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR