Glair Infrastructure Ltd, New Delhi V. DCIT, Circle-10(1), New Delhio

ITA 4710/DEL/2019

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 2836 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 6 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-11-2020
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Assessment Year: 2015-2016
• Appeal Filed On: 23-05-2019
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Principle of natural justice; TDS
• Section: 143(3)

Judgement Text

1 ITA NOS. 4709 & 4710/DEL/2019 IN THE INCOME TAX APPELLAT E TRIBUNAL DELHI BENCH: G NEW DELHI BEFORE SHRI R. K. PANDA, ACCOUNTANT MEMBE R AND MS SUCHITRA KAMBLE, JUDIC IAL MEMBER ITA NO. 4709/DEL/2019 ( A .Y 2014-15) ITA NO. 4710/DEL/2019 ( A .Y 2015-16)) (THROUGH VIDEO CONFEREN CING) GLAIR INFRASTRUCTURE LTD. C/O. M/S S G JAIN & CO. 202- 204, VINAYAK COMPLEX, 76- VIJAY BLOCK, LAXMI NAGAR NEW DELHI AAECG2308Q (APPELLANT) VS DCIT CIRCLE-10(1) C. R. BUILDING, NEW DELHI (RESPONDENT) APPELLANT BY SH. VIJAY PRATAP SINGH, AR RESPONDENT BY SH. VIPUL KASHYAP, SR. DR ORDER PER SUCHITRA KAMBLE, JM THESE TWO APPEALS ARE FILED BY THE ASSESSEE AGAINS T THE ORDER DATED 20/3/2019 PASSED BY CIT(A)-22, NEW DELHI FOR ASSES SMENT YEAR 2014-15 & 2015-16 RESPECTIVELY. 2. THE GROUNDS OF APPEAL ARE AS UNDER:- ITA NO. 4709/DEL/2019 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF CASE AND IN LAW, THE LD OFFICER/CIT (A)-22 ERRED IN CREATING ILLEGAL DEMAND AMOUNTING TO RS. 34,71,837/-. AMBIVALENT ASSESSMENT (CHARGE NOT CLEAR) 2. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF CASE AND IN LAW, THE LD DATE OF HEARING 18.11.2020 DATE OF PRONOUNCEMENT 25.11.2020 2 ITA NOS. 4709 & 4710/DEL/2019 CIT(A) ERRED IN IMPOSING SUBJECT DEMAND U/S 143(3) AMOUNTING TO RS 34,71,837/-, ASSESSEE NOT RECEIVED ANY NOTICE FOR T HE SAME, AND ALSO NO ASSESSMENT ORDER WAS SERVED TO THE ASSESSEE, AS NO NOTICE BEFORE THE SAME WAS RECEIVED BY THE ASSESSEE, AND AS PER THE ORDER PASSED U/S 143(3) OF I. T. ACT 1961, PROCEEDING WAS PASSED ON 20-03-2019. AS STATED ABOVE THE ASSESSEE IS NOT RECEIVED THE NO TICE ON THE GIVEN ADDRESS OR THE SAME MAY BE DELIVERED TO SOME OTHER PERSONAL , DETAIL OF THE SAME WAS RECEIVED BY THE ASSESS ON EMAIL ON 25/3/2019 WHEREA S CIT(A) CONSIDER VALUE OF ORDER OF AO AND PASSED THE EX PARTE ORDER ON 20/ 3/2019 AND CREATED AND DISMISSED THE APPEAL AND ACCEPTED THE DEMAND OF RS. 34,71,837/- . FURTHER IN THE ABSENCE OF CLEAR INFORMATION CIT(A) PASSED I NACCURATE ORDER AS VALID DETAILS ARE AVAILABLE WILL BE SHOWN TO YOU AT THE T IME OF HEARING. LD CIT(A) HAS NOTABLY USED EXPRESSIONS 'APPELLANT IS NOT INTE RESTED IN PURSUING THE APPEAL', THEREBY VITIATING WHOLE DEMAND ORDER ON TH IS LIMITED COUNT. ON MERITS: ADDITION IN PARA (3,4 & 5)CONCEIVED 3. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF CASE AND IN LAW, THE LD CIT ERRED IN IMPOSING ADDITION MADE/ACCEPTED ON ACCOUNT OF ADDITION OF OPENING BALANCES OF CST PAYABLE, TDS PAYABLE, & SERVICE TAX PAYABLE AMOUNTING RS. 11,40,715/- WHICH WAS NOT RELATE TO THE ASSESSMENT YEAR IN WHICH THE SAME HAS BEEN ADDED BACK. 4. LD. OFFICER/CIT(A) MADE/ACCEPTED DISALLOWANCE OF T HE INTEREST ON BORROWING AT RS. 22,65,677/- FOR THE INTEREST FREE LOAN PROVIDED TO THE RELATED/UNRELATED PARTIES WHICH TRANSACTION WAS TOT ALLY IN THE NATURE OF BUSINESS. 5. LD. OFFICER/CIT(A) MADE/ACCEPTED ON THE BASIS OF I NFORMATION RECEIVED FROM AIR BECAUSE THE COPY OF REGISTRY NOT PROVIDED AS THE SAME WAS NOT AVAILABLE AT THE TIME OF ASSESSMENT PROCEEDINGS WHI CH HAS BEEN SHOWN TO THE AO ON LATER STAGE AND CONFIRMED THAT THE CONSIDERAT ION WAS ALREADY TAKEN INTO THE ACCOUNT IN THE FLING OF INCOME TAX RETURN. DUE TO WHICH THE INCOME WAS TAXED TWICE. 3 ITA NOS. 4709 & 4710/DEL/2019 ITA NO. 4710/DEL/2019 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF CASE AND IN LAW, THE LD OFFICER/CIT (A)-22 ERRED IN CREATING ILLEGAL DEMAND AMOUNTING TO RS. 80,45,687/-. AMBIVALENT ASSESSMENT (CHARGE NOT CLEAR) 2. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF CASE AND IN LAW, THE LD CIT(A) ERRED IN IMPOSING SUBJECT DEMAND U/S 143(3) AMOUNTING TO RS 80,45,687/-, ASSESSEE NOT RECEIVED ANY NOTICE FOR T HE SAME, AND ALSO NO ASSESSMENT ORDER WAS SERVED TO THE ASSESSEE, AS NO NOTICE BEFORE THE SAME WAS RECEIVED BY THE ASSESSEE, AND AS PER THE ORDER PASSED U/S 143(3) OF I. T. ACT 1961, PROCEEDING WAS PASSED ON 20-03-2019. AS STATED ABOVE THE ASSESSEE IS NOT RECEIVED THE NO TICE ON THE GIVEN ADDRESS OR THE SAME MAY BE DELIVERED TO SOME OTHER PERSONAL , DETAIL OF THE SAME WAS RECEIVED BY THE ASSESS ON EMAIL ON 25.03.2019, WHEREAS CIT(A) CONSIDER VALUE OF ORDER OF AO AND PA SSED THE EX PARTE ORDER ON 20/3/2019 AND CREATED AND DISMISSED THE APPEAL AND ACCEPTED THE DEMAND OF RS. 80,45,687/- . FURTHER IN THE ABSENCE OF CLEAR INFORMATION CIT(A) PASSED INACCURATE ORDER AS VALID DETAILS ARE AVAILABLE WILL BE SHOWN TO YOU AT THE TIME OF HEARING. LD CIT(A) HAS NOTABLY USED EXPRESSIONS 'APPELLANT IS NOT INTERESTED IN PURSUIN G THE APPEAL', THEREBY VITIATING WHOLE DEMAND ORDER ON THIS LIMITED COUNT. ON MERITS: ADDITION IN PARA (4)CONCEIVED 3. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF CASE AND IN LAW, THE LD CIT ERRED IN IMPOSING SUBJECT DEMAND U/S 143(3) AMOUNTI NG TO RS 80,45,687/- WITHOUT TAKING THE LAW INTO CONSIDERATION FOR APPLI CALBITY OF PROVISION OF TDS ON THE EXPENSES DISALLOWED IN THE CASE, EXPENDITURE DISALLOWED ARE OUTSIDE THE AMBIT OF THE PROVISION OF DEDUCTION OF TDS. 3. BOTH THE APPEALS ARE IDENTICAL HENCE WE ARE TAKI NG THE FACTS OF A.Y. 2014- 15. THE ASSESSEE IS ENGAGED IN THE BUSINESS OF CIVI L AND ROAD CONSTRUCTION 4 ITA NOS. 4709 & 4710/DEL/2019 WORKS AND SUPPLY OF PRE-ENGINEERING STEEL STRUCTURE BUILDING. THE ASSESSEE FILED RETURN OF INCOME ON 30.03.2015 DECLARING INCOME OF RS. 1,18,63,440/-. THE ASSESSING OFFICER ASSESSED THE INCOME OF THE ASSESS EE AT RS. 2,00,54,830/- THEREBY MAKING VARIOUS ADDITIONS. 4. BEING AGGRIEVED BY THE ASSESSMENT ORDER, THE ASS ESSEE FILED APPEAL BEFORE THE CIT(A). THE CIT(A) DISMISSED THE APPEAL OF THE ASSESSEE. 5. THE LD. AR SUBMITTED THAT THE CIT(A) HAS NOT GIV EN THE APPROPRIATE OPPORTUNITY OF HEARING TO THE ASSESSEE TO REPRESEN T HIS CASE. 6. THE LD. DR RELIED UPON THE ASSESSMENT ORDER AND THE ORDER OF THE CIT(A). 7. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE M ATERIAL AVAILABLE ON RECORD. IT IS PERTINENT TO NOTE THAT THE CIT(A) HA S NOT GIVEN ANY CATEGORICAL FINDING ON MERIT OF THE CASE AND ALSO DID NOT GIVE SUFFICIENT OPPORTUNITY OF HEARING TO THE ASSESSEE. THEREFORE, THE CIT(A) WAS NOT RIGHT IN DISMISSING THE APPEAL OF THE ASSESSEE WITHOUT GIVING PROPER OPPORT UNITY OF HEARING. HENCE, WE ARE REMANDING BACK THE ENTIRE ISSUE TO THE FILE OF THE CIT(A) TO BE DECIDED ON MERIT. NEEDLESS TO SAY, THE ASSESSEE BE GIVEN OPPO RTUNITY OF HEARING BY FOLLOWING PRINCIPLES OF NATURAL JUSTICE. BOTH THE A PPEALS OF THE ASSESSEE ARE PARTLY ALLOWED FOR STATISTICAL PURPOSE. 8. IN RESULT, BOTH THE APPEALS FILED BY THE ASSESS EE ARE PARTLY ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 25TH DAY OF NOVEMBER, 2020 . SD/- SD/- (R. K. PANDA) (SUCHITRA KAMBLE) ACCOUNTANT MEMBER JUDICIAL M EMBER 5 ITA NOS. 4709 & 4710/DEL/2019 DATED: 25/11/2020 R. NAHEED COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI