Nandi PVC Products Private Limited , Kurnool V. Asst. Commissioner of Income Tax, Circle-1, Kurnool

ITA 447/Hyd/2020

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 2257 (ITAT-HYDERABAD)
• Duration Of Justice: 10 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-06-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB-B
• Assessment Year: 2013-2014
• Appeal Filed On: 17-08-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: D V ANJANEYULU
• Keywords: Opportunity of being heard; Principle of natural justice; Revised return; Set aside
• Section: 147; 148; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES B : HYDERABAD (THROUGH VIRTUAL CONFERENCE) BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER AND SHRI LAXMI PRASAD SAHU, ACCOUNTANT MEMBER IT A NO. 447 /H/20 20 ASSESSMENT YEAR: 2 0 1 3 - 14 NA NDI PVC PRODUCTS PVT. LTD., KURNOOL. PAN A A BCN 3050F VS. ASST. COMMISSIONER OF INCOME - TAX, CIRCLE 1, KURNOOL. (APPELLANT) (RESPONDENT) ASSESSEE BY: SHRI DV ANJANEYULU REVENUE BY: S HRI ROHIT MUJUMDAR DATE OF HEARING: 28 /0 6 /2021 DATE OF PRONOUNCEMENT: 30 /0 6 /2021 O R D E R PER L.P. SAHU, A.M. : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST CIT(A) 6 , KURNOOL S ORDER DATED 31 / 0 1 /20 20 FOR AY 20 1 3 - 1 4 INVOLVING PROCEEDINGS U/S 14 4 RWS 147 OF THE INCOME - TAX ACT, 1961; IN SHORT THE ACT ON THE FOLLOWING GROUNDS OF APPEAL: 1. THE ORDER OF LD. CIT (A) IN DISMISSING THE APPEAL IN LIMINE ON ACCOUNT OF NON - PAYMENT OF ADMITTED TAX U/S 249 (4) (A) AND DELAY IN FILING THE APPEAL U/S 249(3) BY I TA NO. 447 /HYD /20 20 NANDI PVC PRODUCTS PVT. LTD., KURNOOL . : - 2 - : 14 DAYS WITHOUT GIVING ADEQUATE OPPORTUNITY IS AGAINST THE PRINCIPLES OF EQUITY AND NATURAL JUSTICE. 2. THE ACTION OF LD. CIT(A) IN REFUSING TO ADMIT THE APPEAL SIMPLY B Y STATING THAT ADMITTED TAX U/S 249(4)(A) WAS NOT PAID WITHOUT GIVING ANY OPPORTUNITY TO CURE THE DEFECT IS AGAINST THE PRINCIPLES OF NATURAL JUSTICE AS THE PROVISIONS OF SECTION 249(4)(A) ARE MANDATORY BUT THE PAYMENT OF SELF ASSESSMENT TAX BEFORE FILING THE APPEAL IS DIRECTORY IN NATURE AS HELD BY HON'BLE ITAT IN BHUMIRAJ CONSTRUCTIONS V ADDL. CIT [2011J 131 LTD 406 (MUM.) AND THE DELAY IN PAYMENT OF ADMITTED TAX IS PURELY OUT OF GRAVE FINANCIAL DIFFICULTIES AS THE APPELLANT'S ACCOUNTS ARE DECLARED AS NPA BY CANARA BANK AND PLANT CEASED OPERATIONS AND ATTACHED DURING FY 2015 - 16. 3. LD . CIT(A) OUGHT TO HAVE CONDONED THE DELAY IN FILING THE APPEAL BEFORE HIM U / S 249(3) BY 14 DAYS AS THE APPELLANT WAS PREVENTED BY SUFFICIENT CAUSE IN FILING THE APPEAL AS TH E CONCERNED PERSON HANDLING THE ACCOUNTS WAS ON LEAVE AND IT TOOK TIME TO APPROACH COUNSEL WHO IS NOT BASED AT NANDYAL AND SUCH DELAY OUGHT TO HAVE BEEN CONDONED TO MEET THE ENDS OF JUSTICE AS HELD IN THE CASE OF COLLECTOR, LAND ACQUISITION V MST. KATIJI & OTHERS [1987J 167 ITR 471 (SC ) 4. FOR THESE AND OTHER REASONS THAT MAY BE URGED AT THE TIME OF HEARING, THE APPELLANT PRAYS THE HONORABLE TRIBUNAL TO KINDLY RESTORE THE APPEAL BACK TO THE FILE OF HON'BLE CIT (A). 2. WE NOTICE AT THE OUTSET THAT ASSESSEE S INSTANT APPEAL S SUFFER S FRO M 134 DAYS DELAY . TO THIS EFFECT, THE ASSESSEE FILED A CONDONATION PETITION ALONG WITH AN AFFIDAVIT AFFIRMING THEREIN THAT THE DUE TO THE ONGOING COVID - 19 PANDEMIC AND THE SUBSEQUENT LOCKDOWN IMPOSED BY THE I TA NO. 447 /HYD /20 20 NANDI PVC PRODUCTS PVT. LTD., KURNOOL . : - 3 - : CENTRAL AND STATEMENT GOVERNMENTS, THE PETITIONE R COULD NOT APPROACH THEIR COUNSEL FOR FILING THE APPEAL WHICH CAUSED THE IMPUGNED DELAY IN FILING OF THE INSTANT APPEAL. CASE LAW COLLECTOR LAND ACQUISITION VS MST. KATIJI & ORS, 1987 AIR 1353 (SC) AND UNIVERSITY OF DELHI VS. UNION OF INDIA, CIVIL APPEA L NO. 9488 & 9489/2019 DATED 17 DECEMBER, 2019, HOLD THAT SUCH A DELAY; SUPPORTED BY COGENT REASONS, DESERVES TO BE CONDONED SO AS TO MAKE WAY FOR THE CAUSE OF SUBSTANTIAL JUSTICE. WE ACCORDINGLY HOLD THAT ASSESSEE S IMPUGNED DELAY IN FILING THE APPEAL IS NEITHER INTENTIONAL NOR DELIBERATE BUT DUE TO THE CIRCUMSTANCES BEYOND ITS CONTROL. THE SAME STANDS CONDONED. CASE IS NOW TAKEN UP FOR ADJUDICATION ON MERITS. 3. BRIEFLY THE FACTS OF THE CASE ARE THAT THE ASSESSEE , A COMPANY DERIVING INCOME FROM MANU FACTURING AND SALE OF PVC PRODUCTS, FILED ITS E - RETURN OF INCOME FOR AY 2013 - 14 ON 30/03/2015 DECLARING TAXABLE INCOME OF RS. 18,14,277/ - WITHOUT PAYING SELF - ASSESSMENT TAXES OF RS. 7,79,890/ - , WHICH WAS INVALIDATED BY CPC. THE AO REOPENED THE CASE FOR SC RUTINY/S147 AFTER OBTAINING APPROVAL FROM ADDITIONAL CIT, KURNOOL RANGE, KURNOOL AND ACCORDINGLY, NOTICE U/S 148 WAS ISSUED ON THE ASSESSEE ON 29/03/2018, AGAINST WHICH, THE ASSESSEE FILED REVISED RETURN OF INCOME ON 12/12/2018 DECLARING TAXABLE INCOME OF RS. 18,14,280/ - WITHOUT PAYING SELF ASSESSMENT TAX OF RS. 4,66,660/ - . ACCORDINGLY, STATUTORY NOTICES WERE ISSUED TO THE ASSESSEE I TA NO. 447 /HYD /20 20 NANDI PVC PRODUCTS PVT. LTD., KURNOOL . : - 4 - : ON 15/12/2018, BUT, THE ASSESSEE FAILED TO SUBMIT ANY REQUISITE INFORMATION. THEREFORE, THE AO COMPLETED THE ASSESSMENT U/S 144 OF THE ACT BY MAKING ADDITIONS OF RS. 21,54,083/ - TOWARDS INCOME FROM OTHER SOURCES AND RS. 1,15,50,890/ - TOWARDS UN EXPLAINED INVESTMENT NOT RECORDED IN THE BOOKS OF ACCOUNT. 4 . AGGRIEVED BY THE ORDER OF AO, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE C IT(A) WITH A DELAY OF 14 DAYS. THE CIT(A) DISMISSED THE APPEAL OF THE ASSESSEE IN LIMINE ON ACCOUNT OF I) NON - PAYMENT OF ADMITTED TAX ON THE RETURNED INCOME U/S 249(4)(A) OF THE ACT AND 2) DELAY IN FILING THE APPEAL U/S 249(3) OF THE ACT. 5 . AGGRIEVED BY THE ORDER OF THE CIT(A), THE ASSESSEE IS IN APPEAL BEFORE THE CIT(A). 6 . BEFORE US, THE LD. AR OF THE ASSESSEE SUBMITTE D THAT THE ORDER OF THE CIT(A) IN DISMISSING THE APPEAL IN LIMINE ON ACCOUNT OF NON PAYMENT OF ADMITTED TAX U/S 249(4)(A) AND DELAY IN FILING THE APPEAL U/S 249(3) BY 14 DAYS WITHOUT GIVING ADEQUATE OPPORTUNITY IS AGAINST THE PRINCIPLES OF EQUITY AND NATURAL JUSTICE. FOR THIS PROPOSITION, HE RELIED ON THE DECISION OF ITAT IN THE CASE OF BHUMIRAJ CONSTRUCTIONS VS. ADDL. CIT 92011 131 ITD 406 (MUM.) FOR NON PAYMENT OF ADMITTED TAX AND FOR DELAY IN FILING THE APPEAL RELIED ON THE JUDGMENT OF THE HONBLE SUPREME COURT IN THE CASE OF I TA NO. 447 /HYD /20 20 NANDI PVC PRODUCTS PVT. LTD., KURNOOL . : - 5 - : COLLECTOR, LAND ACQUISITION VS. MST. KATIJ & OTHERS, [1987] 167 ITR 471 (SC). ALSO RELIED ON THE JUDGMENT OF HONBLE KARNATAKA HIGH COURT IN THE CASE OF CIT VS. K. SATISH KUMAR SINGH [2012] 209 TAXMAN 502 (KAR.) 6 .1 HE FURTHER SUBMITTED THAT DESPITE BEING IN GRAVE FINANCIAL DIFFICULTIES AND COMPLETE CLOSURE OF PLANT AND SEIZURE OF BANK ACCOUNT, THE ASSESSEE HAS MADE PAYMENT OF RS. 4,70,000 THROUGH OWN SOURCES ON 16/07/2020 VIDE CHALLAN NO. 00154, BSR CODE : 0341101. IN THIS REGARD, HE HAS FILED AN AFFIDAVIT WHICH IS PLACED ON RECORD. THUS, THE ENTIRE SELF ASSESSMENT TAX ALONG WITH APPLICABLE INTEREST IS NOW PAID BY THE ASSESSEE AND, THEREFORE, THE LD. AR PRAYED THE BENCH TO KINDLY RESTORE THE APPEAL TO THE FILE OF CIT(A) FOR ADJUDICATION ON MERITS. 7 . THE LD. DR, ON THE OTHER HAND, RELIED ON THE ORDERS OF REVENUE AUTHORITIES. 8 . WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD AND GONE THROUGH THE ORDERS OF REVENUE AUTHORITIES. SINCE THE ASSESSEE HAS PAID THE SELF - ASSESSMENT TAX OF RS. 4, 70,000/ - AS NOTED IN PARA 6.1 SUPRA , WE SET ASIDE THE ORDER OF CIT(A) AND RESTORE THE FILE BACK TO HIM WITH A DIRECTION TO ADJUDICATE THE APPEAL ON MERITS AND IN ACCORDANCE WITH LAW AFTER PROVIDING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE IN T HE MATTER. THE ASSESSEE IS DIRECTED TO COOPERATE WITH THE I TA NO. 447 /HYD /20 20 NANDI PVC PRODUCTS PVT. LTD., KURNOOL . : - 6 - : CIT(A) FOR EARLY DISPOSAL OF THE APPEAL. THUS, THE GROUNDS RAISED BY THE ASSESSEE ARE TREATED AS ALLOWED FOR STATISTICAL PURPOSES. 9 . IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES IN ABOVE TERMS. PRONOUNCED IN THE OPEN COURT ON 30 TH JUNE , 2021 . SD/ - SD/ - ( S.S. GODARA ) (L . P . SAHU) JUDICIAL MEMBER ACCOUNTANT MEMBER HYDE RABAD, DATED : 30 TH JUNE , 20 2 1 . K V C OPY TO : 1 NANDI PVC PRODUCTS PVT. LTD., M/S ANJANEYULU & CO.,C A S, 30, BHAGYALAKSHMI NAGAR, GANDHI NAGAR, HYD 500 080 2 AC IT, CIRCLE 1 , KURNOOL 3 C I T(A) , KURNOOL 4 PR. CIT , TIRUPATHI 5 ITAT, DR, HYDERABAD. 6 GUARD FILE.