Sh. Baldev Raj Madaan, Amritsar. V. The Income Tax Officer, Amritsar.

ITA 413/ASR/2010

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 5750 (ITAT-AMRITSAR)
• Duration Of Justice: 8 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-06-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2001-2002
• Appeal Filed On: 29-09-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: ASHWANI GUPTA
• Keywords: Opportunity of being heard; Right to appeal; Reason to believe

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH: AMRITSAR. BEFORE SHRI H.L. KARWA, VICE PRESIDENT AND SHRI MEHAR SINGH, ACCOUNTANT MEMBER. I.T.A. NO.413ASR)/2010. (ASSESSMENT YEAR: 2001-02) SHRI BALDEV RAJ MADAAN, THE INCOME TAX OFFICER, 13, AMAN AVENUE, WARD 3(1), AMRITSAR. OUTSIDE GATE HAKIMA, AMRITSAR. (APPELLANT) VS. (RESPONDENT) APPELLANT BY: SHRI ASHWANI GUPTA, C.A. RESPONDENT BY: SHRI TARSEM LAL, D.R. ORDER PER H.L. KARWA, VICE PRESIDENT. THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST HE ORDER OF THE CIT(A), AMRITSAR DATED 9-7-2010, RELATING TO THE AS SESSMENT YEAR 2001-02. 2. IN THIS APPEAL, THE ASSESSEE HAS TAKEN THE FOLLO WING:- 1. THAT THE WORTHY CIT(A), AMRITSAR HAS WRONGLY PA SSED THE EXPARTE ORDER WITHOUT GIVING REASONABLE OPPORTUNITY TO THE ASSESSEE TO EXPLAIN HIS CASE. 2. THAT WITHOUT PREJUDICE TO THE ABOVE, THE FOLLOWI NG SUBMISSIONS MAY ALSO BE TAKEN INTO CONSIDERATION:- A) THAT THE WORTHY CIT(A) HAS ERRED IN CONFIRMING T HE ACTION OF THE ASSESSING OFFICER IN ISSUING THE NOTI CE U/S.148 OF THE INCOME TAX ACT, 1961 WITHOUT RECORDI NG PROPER REASON TO BELIEVE. 2 B) THAT THE WORTHY CIT(A) HAS ERRED IN CONFIRMING T HE ACTION OF THE ASSESSING OFFICER OF MAKING THE ASSES SMENT WITHOUT ISSUING THE SPEAKING ORDER ON THE OBJECTION S FILED BY THE ASSESSEE. C) THAT THE WORTHY CIT(A) HAS ALSO ERRED IN CONFIRM ING THE ADDITION OF RS.2579330/- BY APPLYING THE NET PROFIT RATE OF 1% ON THE TOTAL TURNOVER IN THE BANK ACCOUNT AT RS.257933040/-. D) THAT THE CIT(A) HAS ALSO FAILED TO APPRECIATE TH AT THE ASSESSEE WAS MERELY A COMMISSION AGENT/BROKER AND N OT A TRADER AS HELD BY THE A.O. 3. THAT THE CIT(A) HAS ALSO ERRED IN CONFIRMING THE ACTION OF ASSESSING OFFICER IN CHARGING THE INTEREST U/S.234A & 234B. 4. THAT THE APPELLANT CRAVES LEAVE TO ADD OR AMEND THE GROUNDS OF APPEAL BEFORE THE APPEAL IS FINALLY HEARD OR DISPOS ED OFF. 3. AT THE VERY OUTSET, AS REGARDS TO GROUND NO.1 OF THE APPEAL, SHRI ASHWANI GUPTA, C.A., THE LEARNED COUNSEL FOR THE AS SESSEE, SUBMITTED THAT THE CIT(A) HAS PASSED THE IMPUGNED ORDER WITHOUT GI VING ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. HE FUR THER SUBMITTED THAT THE CIT(A) HAS PASSED THE ORDER ON 9-7-2010 AND INVITED OUR ATTENTION TO PARA 5 OF THE ORDER AND SUBMITTED THAT THE CIT(A) HAS OBS ERVED THAT LAST DATE OF HEARING WAS FIXED ON 5-3-2010 ON WHICH DATE NOBODY APPEARED ON BEHALF OF THE ASSESSEE AND, THEREFORE, HE PROCEEDED TO DECIDE THE APPEAL EXPARTE. SHRI ASHWANI GUPTA, C.A., THE LEARNED COUNSEL FOR THE AS SESSEE, FILED A COPY OF NOTICE DATED 15-4-2010 ISSUED BY SHRI NARINDER DUTT , O.S. O/O COMMISSIONER OF INCOME TAX (APPEALS), AMRITSAR, WHE REIN HE HAS STATED THAT THE APPEAL OF THE ASSESSEE WAS FIXED FOR HEARING FO R DISPOSAL ON 12-5-2010 AT 3 10.30 AM IN THE OFFICE OF THE CIT(A), AMRITSAR. HE , THEREFORE, SUBMITTED THAT THE OBSERVATIONS MADE BY THE CIT(A) IN PARA 5 OF THE IMPUGNED ORDER ARE INCORRECT AND, THEREFORE, NOT TENABLE IN LAW. SHRI ASHWANI GUPTA, C.A., THE LEARNED COUNSEL FOR THE ASSESSEE ALSO SUBMITTED THAT ON 12-5-2010, HE APPEARED BEFORE THE CIT(A) AND THE CIT(A) WAS ON LE AVE AND THEREAFTER NO NOTICE OF HEARING WAS RECEIVED BY THE ASSESSEE. TH E ASSESSEE AFTER RECEIVING THE IMPUGNED ORDER CAME TO KNOW THAT HIS APPEAL HAS BEEN DECIDED EXPARTE. IN VIEW OF THIS, SHRI ASHWANI GUPTA, C.A., THE LEAR NED COUNSEL FOR THE ASSESSEE, SUBMITTED THAT HE ORDER OF THE CIT(A) MAY BE SET-ASIDE AND THE MATTER MAY BE REMANDED TO THE CIT(A), WITH A DIRECT ION TO DECIDE THE APPEAL AFRESH ON MERITS IN ACCORDANCE WITH LAW AFTER AFFOR DING DUE AND REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 4. SHRI TARSEM LAL, THE LEARNED D.R VEHEMENTLY OPPO SED THE ABOVE CONTENTION OF SHRI ASHWANI GUPTA, C.A., THE LEARNED COUNSEL FOR THE ASSESSEE. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE ALS O PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND SUBSTANCE IN THE ABOVE SUBMISSIONS OF SHRI ASHWANI GUPTA, C.A., THE LEARNED COUNSEL FOR T HE ASSESSEE. 6. AFTER PERUSAL OF THE ORDER OF THE CIT(A), WE FIN D THAT THE CIT(A) HAS DECIDED THE APPEAL OF THE ASSESSEE EXPARTE. FROM TH E IMPUGNED ORDER, IT IS CLEAR THAT THE CIT(A) HAS NOT PROVIDED ADEQUATE OPP ORTUNITY OF BEING HEARD TO THE ASSESSEE BEFORE DECIDING THE APPEAL. IN OUR OPINION, THE LD. CIT(A) SHOULD HAVE AFFORDED ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE BEFORE DECIDING THE APPEAL. IN THE CASE OF RADHIKA CHARAN BANERJEE VS. SAMBAPUR MUNICIPALITY, AIR (1979) ORISSA 69, THE HO NBLE ORISSA HIGH COURT HELD THAT A RIGHT OF APPEAL WHEREVER CONFERR ED INCLUDES A RIGHT OF BEING AFFORDED AN OPPORTUNITY OF BEING HEARD, IRRES PECTIVE OF THE LANGUAGE 4 CONFERRING SUCH RIGHT. THAT IS A PART AND PARCEL O F THE PRINCIPLE OF NATURE JUSTICE. WHERE AN AUTHORITY IS REQUIRED TO ACT IN A QUASI-JUDICIAL CAPACITY, IT IS IMPERATIVE TO GIVE THE APPELLANT AN ADEQUATE OPP ORTUNITY OF BEING HEARD BEFORE DECIDING THE APPEAL. THUS, CONSIDERING THE ENTIRE FACTS OF THE PRESENT CASE, WE THINK IT PROPER TO SET ASIDE THE ORDER OF THE LD. CIT(A) IN TOTO AND RESTORE THE MATTER TO HIS FILE WITH A DIRECTION TO DECIDE THE APPEAL AFRESH ON MERITS IN ACCORDANCE WITH LAW AFTER AFFORDING DUE A ND REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. WE ALSO DIRECT THE CIT(A) TO DECIDE THE APPEAL PREFERABLY WITHIN TWO MONTHS FROM THE DATE OF RECEIPT OF ORDER. AT THIS JUNCTURE, WE ALSO DIRECT THE ASSESS EE TO ATTEND THE HEARING BEFORE THE CIT(A) AND COOPERATE. 7. IN VIEW O THE ABOVE, WE DO NOT THINK IT NECESSAR Y TO GIVE ANY FINDING ON THE MERITS OF THE CASE. 8. IN THE RESULT, THE APPEAL IS ALLOWED FOR STATIST ICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 16 TH JUNE, 2011. SD/- SD/- (MEHAR SINGH) (H.L. KARWA) ACCOUNTANT MEMBER. VICE PRESIDENT. DATED: 16 TH JUNE, 2011. KC/- COPY OF THE ORDER FORWARDED TO: (1) THE ASSESSEE: SHRI BALDEV RAJ MADAAN, 13, AMAN AVE NUE, OUTSIDE GATE HAKIMAN, ASR. (2) THE ITO, WARD 3(1), ASR. (3) THE CIT, ASR. (4) THE CIT(A), ASR. (5) THE SR.D.R., ITAT, ASR. TRUE COPY BY ORDER ASSTT. REGISTRAR, INCOME TAX APPELLATE TRIBUNAL, 5