INSTITUTE OF INDIAN INTERIOR DESIGNERS, MUMBAI V. ITO (E) II(1), MUMBAI

ITA 4760/MUM/2015

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 3541 (ITAT-MUMBAI)
• Duration Of Justice: 11 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-08-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2009-2010
• Appeal Filed On: 21-08-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DEEPAK RIPOTE
• Section: 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH I, MUMBAI BEFORE SHRI G.S.PANNU, ACCOUNTANT MEMBER AND SHRI AMARJIT SINGH, JUDICIAL MEMBER ITA NO. 4760/MUM/2015 (ASSESSMENT YEAR : 2009-10) M/S. INSTITUTE OF INDIAN INTERIOR DESIGNERS, 109, SUMER KENDRA, PANDURANG BUDHKAR MARG, MUMBAI 400 018 ...... APPELLANT PAN: AAATI0712K VS. THE ITO (EXEMPTION) II(1) PIRAMAL CHAMBER, 5 TH FLOOR, LALBAUG, MUMBAI 400 012. .... RESPONDENT APPELLANT BY : SHRI RAKESH RESPONDENT BY : SHRI DEEPAK RIPOTE DATE OF HEARING : 10/07/2016 DATE OF PRONOUNCEMENT : 17/08/2016 ORDER PER G.S.PANNU,A.M: THE CAPTIONED APPEAL FILED BY THE ASSESSEE PERTAIN ING TO ASSESSMENT YEAR 2010-11 IS DIRECTED AGAINST AN ORD ER PASSED BY CIT(A)- 7, MUMBAI DATED 30/04/2015, WHICH IN TURN ARISES OU T OF AN ORDER PASSED BY THE ASSESSING OFFICER UNDER SECTION 143(3 ) OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT) DATED 26/03/2013. 2. IN THIS APPEAL, THE PRIMARY DISPUTE ARISES FROM THE ACTION OF THE INCOME TAX AUTHORITIES IN DENYING EXEMPTION UNDER S ECTION 11 OF THE 2 ITA NO. 4760/MUM/2015 (ASSESSMENT YEAR : 2009-10) ACT ON THE GROUND THAT THE ACTIVITIES CARRIED ON BY THE ASSESSEE ARE IN THE NATURE OF BUSINESS AND NOT FOR CHARITABLE PURPO SES. 3. THE RELEVANT FACTS ARE THAT THE ASSESSEE TRUST F IELD ITS RETURN OF INCOME DECLARING NIL INCOME, WHEREIN EXEMPTION UN DER SECTIONS 11/12 OF THE ACT WAS CLAIMED. IN THE ASSESSMENT PROCEEDI NGS THE ASSESSING OFFICER CAME TO CONCLUDE THAT IN VIEW OF THE PROVIS O INSERTED IN SECTION 2(15) OF THE ACT W.E.F. 01/04/2009 ASSESSEE WAS NOT ENTITLED TO EXEMPTION AS IT WAS CARRYING ON ACTIVITIES IN THE N ATURE OF BUSINESS AND ALSO CHARGING FEE FOR SUCH SERVICES. ACCORDINGLY, THE TOTAL INCOME WAS ASSESSED AT RS.1,12,18,840/- AFTER DENYING THE EXEM PTION UNDER SECTION 11 OF THE ACT. THE ASSESSEE FILED AN APPEAL BEFORE CIT(A) CHALLENGING THE ORDER OF THE ASSESSING OFFICER ON FACTS AND IN LAW. THE CIT(A) HAS DISMISSED THE APPEAL OF THE ASSESSEE PRIMARILY ON T HE GROUND THAT ASSESSEE DID NOT APPEAR IN RESPONSE TO THE NOTICES ISSUED FOR HEARING. ACCORDING TO THE CIT(A) ABSENCE OF THE ASSESSEE SHO WED THAT IT WAS NOT INTERESTED IN PROSECUTING THE APPEAL. THE CIT(A) P ROCEEDED TO UPHOLD THE ACTION OF THE ASSESSING OFFICER ON THE BASIS OF THE DISCUSSION MADE IN THE ASSESSMENT ORDER ITSELF. AGAINST SUCH A DEC ISION OF THE CIT(A), ASSESSEE IS IN FURTHER APPEAL BEFORE US. 4. BEFORE US, THE LD. REPRESENTATIVE FOR THE ASSESS EE, AT THE OUTSET, POINTED OUT THAT THE CIT(A) HAS MISDIRECTED HIMSELF IN CONCLUDING THAT ASSESSEE WAS NOT INTERESTED IN PURSUING THE APPEAL. IT WAS POINTED OUT THAT DUE TO CERTAIN UNAVOIDABLE REASONS, APPEARAN CE COULD NOT BE MADE BEFORE THE CIT(A) ON THE APPOINTED DATE OF HEA RING. SO HOWEVER, IT WAS SUBMITTED THAT THE ASSESSEE WOULD BE SATISFI ED FOR THE PRESENT IF 3 ITA NO. 4760/MUM/2015 (ASSESSMENT YEAR : 2009-10) THE MATTER IS RESTORED BACK TO THE FILE OF CIT(A) F OR ADJUDICATION AFRESH AFTER HEARING THE ASSESSEE ON MERITS. 5. THE LD. DEPARTMENTAL REPRESENTATIVE HAS NOT OPPO SED THE PLEA OF THE ASSESSEE FOR REMANDING THE MATTER BACK TO TH E FILE OF ASSESSING OFFICER. 6. HAVING CONSIDERED THE RIVAL STANDS, WE FIND THAT THE CIT(A) HAS PRIMARILY PROCEEDED ON THE BASIS OF THE STAND TAKEN BY THE ASSESSING OFFICER IN THE ASSESSMENT ORDER. IT IS ALSO EVIDEN T THAT THE CIT(A) HAS NOT ADVERTED TO THE GROUNDS OF APPEAL RAISED BEF ORE HIM AND, THEREFORE, IN OUR VIEW THE APPEAL HAS BEEN DISMISSE D IN A MANNER, WHICH IS NON-COMPLIANT WITH THE REQUIREMENTS OF SEC TION 250(6) OF THE ACT. OSTENSIBLY, THE CIT(A) IS OBLIGATED TO DISPOS E OF THE APPEAL IN THE MANNER PRESCRIBED IN SECTION 250(6) OF THE ACT , WH ICH REQUIRES THAT THE ISSUES RAISED BEFORE HIM BY WAY OF GROUNDS OF APPEA L ARE ADDRESSED, DECISION RENDERED THEREON BY STATING THE REASONS FOR SUCH A DECISION. THE SAID APPROACH IS CONSPICUOUS BY ITS ABSENCE IN THE IMPUGNED ORDER OF THE CIT(A), WHEREIN THE APPEAL HAS BEEN DISMISSE D IN-LIMINE WITHOUT APPROPRIATELY ADVERTING TO THE MERITS OF THE GROUND S OF APPEAL RAISED BEFORE HIM. THEREFORE, ON THIS COUNT ITSELF THE IM PUGNED ORDER OF THE CIT(A) IS UNSUSTAINABLE. BE THAT AS IT MAY, WE HER EBY SET-ASIDE THE ORDER OF CIT(A) AND RESTORE THE MATTER BACK TO HIS FILE FOR ADJUDICATION AFRESH, AFTER ALLOWING THE ASSESSEE A REASONABLE OP PORTUNITY OF BEING HEARD IN ACCORDANCE WITH LAW. 4 ITA NO. 4760/MUM/2015 (ASSESSMENT YEAR : 2009-10) 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 17/08/2016 SD/- SD/- (AMARJIT SINGH) (G.S. PANNU) JUDICIAL MEMBER ACCOCUNTANT MEMBER MUMBAI, DATED 17/08/2016 VM , SR. PS 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// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI