M/s. Sarku Engineering Services SDN BHD, Dehradun V. ADIT, Dehradun

ITA 479/DEL/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 97277 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 7 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-09-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 16-09-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 28-01-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANIL K MISRA
• Assessee Lawyers: O P SAPRA; JEETAN NAGPAL
• Keywords: Opportunity of being heard; Principle of natural justice; Additional evidence; Corroborative evidences
• Section: 143(3); 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES : G : NEW DELHI BEFORE SHRI R.S. SYAL, AM AND SHRI C.M. GARG, JM ITA NO.479/DEL/2013 ASSESSMENT YEAR : 2008-09 SARKU ENGINEERING SERVICES SDN BHD, C/O HEMAND ARORA & CO, CA, 1, TYAGI ROAD, DEHRADUN. PAN: AAJCS6265K VS. ADIT, INTERNATIONAL TAXATION, 13-A, SUBHASH ROAD, DEHRADUN. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI O.P. SAPRA, ADVOCATE & SHRI JEETAN NAGPAL, CA DEPARTMENT BY : SHRI ANIL K. MISRA, CIT, DR DATE OF HEARING : 16.09.2015 DATE OF PRONOUNCEMENT : 18.09.2015 ORDER PER R.S. SYAL, AM: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E FINAL ASSESSMENT ORDER PASSED BY THE ASSESSING OFFICER (AO) ON 30.11 .2012 U/S 143(3) ITA NO.479/DEL/2013 2 READ WITH SECTION 144C(13) OF THE INCOME-TAX ACT, 1 961 (HEREINAFTER ALSO CALLED THE ACT) IN RELATION TO THE A.Y. 2007-08. 2. GROUND NO. 3 OF THE ASSESSEES APPEAL IS AGA INST THE REJECTION OF ITS REQUEST BY THE DISPUTE RESOLUTION PANEL (DRP) FOR A DMISSION OF ADDITIONAL EVIDENCE. GROUND NO. 8 IS AGAINST NOT P ROVIDING SUFFICIENT OPPORTUNITY. 3. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT T HE DRAFT ASSESSMENT ORDER IN THIS CASE WAS PASSED ON 30.12.2011 PROPOSI NG CERTAIN ADDITIONS. THE ASSESSEE OBJECTED TO THE VARIATIONS MADE IN THE DRAFT ORDER BY FILING OBJECTIONS BEFORE THE DRP. DURING THE COURSE OF PR OCEEDINGS BEFORE THE DRP, THE ASSESSEE FILED ADDITIONAL EVIDENCE UNDER T HE RESPECTIVE DRP RULES BY CONTENDING THAT THE DRAFT ORDER WAS PASSED BY THE AO IN VIOLATION OF PRINCIPLES OF NATURAL JUSTICE AND WITH OUT PROVIDING SUFFICIENT OPPORTUNITY TO THE ASSESSEE. IT WAS CONTENDED THAT IN SPITE OF NUMBER OF HEARINGS CONDUCTED BY THE AO DURING THE COURSE OF D RAFT PROCEEDINGS, IT WAS ONLY ON 16.12.2011, I.E., JUST TWO WEEKS BEFORE THE DATE OF LIMITATION, THAT THE AO REQUIRED THE ASSESSEE TO SU BMIT SUPPORTING ITA NO.479/DEL/2013 3 EVIDENCE IN THE FORM OF BILLS/VOUCHERS/INVOICES, ET C., TO SUBSTANTIATE THE CLAIM IN RESPECT OF THE EXPENSES. THE ASSESSEE SUB MITTED THAT THE VOLUMINOUS DETAILS COULD NOT BE COMPILED DURING SUC H A SHORT PERIOD AS RECORDS WERE MAINTAINED AT KUALA LUMPUR. THE ASSES SEE FILED ADDITIONAL EVIDENCE BEFORE THE DRP IN THE FORM OF 35 VOLUMES A ND REQUESTED FOR THEIR ACCEPTANCE AS ADDITIONAL EVIDENCE. THE DRP D IRECTED THE AO TO EXAMINE THE ADDITIONAL EVIDENCE AND SUBMIT A REPORT . THE AO SENT HIS REPORT VIDE HIS LETTER DATED 24.8.2012 OBJECTING TO THE ACCEPTANCE OF THE ADDITIONAL EVIDENCE. HE CLAIMED THAT ADEQUATE OPPOR TUNITY WAS AFFORDED TO THE ASSESSEE AND AS SUCH NO FURTHER EVIDENCE BE ACCEPTED. IN THE REJOINDER FILED BEFORE THE DRP, THE ASSESSEE REQUES TED THE DRP ITSELF FOR ADMISSION OF ADDITIONAL EVIDENCE RUNNING INTO MORE THAN 4000 PAGES. THE DRP ALSO REJECTED THE ASSESSEES REQUEST FOR AD MISSION OF SUCH ADDITIONAL EVIDENCE AND ISSUED NECESSARY DIRECTION, ON THE BASIS OF WHICH THE ASSESSMENT ORDER CAME TO BE FINALIZED. THE LD. AR CONTENDED THAT BOTH THE AO AS WELL AS THE DRP FAILED TO GIVE ADEQU ATE OPPORTUNITY OF HEARING TO THE ASSESSEE. THIS WAS COUNTERED BY THE LD. DR. ITA NO.479/DEL/2013 4 4. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIAL ON RECORD. IT IS APPARENT FROM THE DIRECTI ON ISSUED BY THE DRP THAT THE ASSESSEE CATEGORICALLY CONTENDED BEFORE IT THAT THE AO GAVE PERIOD OF LESS THAN TWO WEEKS BEFORE THE DATE OF LI MITATION TO SUBMIT SUPPORTING EVIDENCE IN THE FORM OF BILLS/VOUCHERS/I NVOICES, ETC., WHICH WERE TO BE COLLECTED FROM THE RECORDS MAINTAINED AT KUALA LUMPUR. THE AO, DURING THE COURSE OF REMAND PROCEEDINGS DID NOT CONTROVERT THIS POSITION. DESPITE THAT, HE REFUSED TO ACCEPT THE A DDITIONAL EVIDENCE. THE SAME COURSE OF ACTION WAS FOLLOWED BY THE DRP AS WE LL, WHICH REJECTED THE ASSESSEES REQUEST FOR ADMISSION OF ADDITIONAL EVIDENCE. THE FACTUAL POSITION NARRATED ABOVE CLEARLY INDICATES THAT THE ASSESSEE WAS NOT ALLOWED ADEQUATE OPPORTUNITY OF HEARING INASMUCH AS ONLY A PERIOD OF LESS THAN TWO WEEKS WAS ALLOWED BY THE AO FOR FILIN G NECESSARY EVIDENCE/BILLS/VOUCHERS WHICH WERE TO BE COLLECTED FROM THE RECORDS MAINTAINED AT KUALA LUMPUR. IN OUR CONSIDERED OPIN ION, THE ENDS OF JUSTICE WOULD MEET ADEQUATELY IF THE IMPUGNED ORDER IS SET ASIDE AND THE MATTER IS RESTORED TO THE FILE OF AO AT THE DRAFT S TAGE FOR ALLOWING A REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESS EE. WE ORDER ITA NO.479/DEL/2013 5 ACCORDINGLY AND DIRECT THE AO TO COMMENCE THE PROCE EDINGS FROM THE STAGE OF DRAFT ORDER BY ALLOWING ADEQUATE OPPORTUNI TY OF HEARING TO THE ASSESSEE. NEEDLESS TO SAY, THE ASSESSEE WILL BE AT LIBERTY TO LEAD ANY EVIDENCE BEFORE THE AO IN SUPPORT OF ITS CLAIMS. 5. IN THE RESULT, THE APPEAL IS ALLOWED FOR STATIST ICAL PURPOSES. THE ORDER PRONOUNCED IN THE OPEN COURT ON 18.09.201 5. SD/- SD/- [C.M. GARG] [R.S. SYAL] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED, 18 TH SEPTEMBER, 2015. DK COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR, ITAT AR, ITAT, NEW DELHI.