M/s Partap Silicamet (P) Ltd., New Delhi V. ITO, New Delhi

ITA 4808/DEL/2010

• Counselvise Citation: [2015] 121 COUNSELVISE.COM (IT) 0209 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 8 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-07-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Next Hearing Date: 20-07-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 03-11-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIKRAM SAHAY
• Assessee Lawyers: R S ADLAKHA
• Keywords: Principle of natural justice; Capital expenditure
• Section: 40A(3); 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH F, NEW DELHI) BEFORE SHRI I. C. SUDHIR, JUDICIAL MEMBER AND SHRI J. S. REDDY, ACCOUNTANT MEMBER I.T.A. NO.4808 /DEL/2010 ASSESSMENT YEAR : 2007-08 M/S. PRATAP SILICAMET (P) LTD., VS. ITO, WARD 14 (2), 101, SEWAK CHAMBER I, NEW DELHI 2099/38, NAIWALA, KAROL BAGH, NEW DELHI GIR / PAN:AADCP3715D (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI R. S. ADLAKHA, ADV. RESPONDENT BY : SHRI VIKRAM SAHAY, SR. DR DATE OF HEARING : 20.07.2015 DATE OF PRONOUNCEMENT : 22.07.2015 ORDER PER J. S. REDDY, AM: THIS IS AN APPEAL FILED BY ASSESSEE DIRECTED AGAIN ST THE ORDER OF LD. CIT(A) XVII, NEW DELHI DATED 25.08.2010 FOR THE ASS ESSMENT YEAR 2007- 08 ON THE FOLLOWING GROUNDS: 1. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANC ES OF THE CASE, LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN DECIDIN G THE APPEAL OF THE ASSESSEE THAT TOO WITHOUT GIVING ADEQUATE OPPORTUNI TY OF HEARING AND WITHOUT APPRECIATING THE FACTS AND CIRCUMSTANCES OF THE CASE. 2. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANCE S OF THE CASE, LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN CONFIRM ING THE ACTION OF LD. AO IN MAKING ADDITION OF RS.80,00,000/- ON ACCO UNT OF SHARE CAPITAL RECEIVED MORE SO WHEN THE AMOUNT WAS RECEIV ED BEFORE THE COMMENCEMENT OF BUSINESS OF THE ASSESSEE. ITA NO.4808/DEL/2010 2 3. THAT IN ANY CASE AND IN ANY VIEW OF THE MATTER, ACTION OF LD. CTT(A) IN CONFIRMING THE ACTION OF LD. AO IN MAKING THE IMPUGNED ADDITION IS ILLEGAL AND AGAINST THE FACTS AND CIRCU MSTANCES OF THE CASE. 4. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANCE S OF THE CASE, LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN CONFIRM ING THE ACTION OF LD. AO IN MAKING DISALLOWANCE OF RS.18,05,500/- (I. E. 20% OF 90,27,500/-) ON ACCOUNT OF ALLEGED CASH PAYMENT U/S 40A(3) BY RECORDING INCORRECT FACTS AND FINDINGS AND WITHOUT GIVING ADEQUATE OPPORTUNITY OF HEARING. 5. THAT IN ANY CASE AND IN ANY VIEW OF THE MATTER, ACTION OF LD. CIT(A) IN CONFIRMING THE ACTION OF LD. AO IN MAKING THE IMPUGNED ADDITION IS ILLEGAL AND AGAINST THE FACTS AND CIRCU MSTANCES OF THE CASE. 6. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANCE S OF THE CASE, LD. CIT (A) HAS ERRED IN LAW AND ON FACTS IN CONFIR MING THE ACTION OF LD. AO MAKING ADDITION OF RS4,997/- BEING DIFFERENC E OF PRELIMINARY EXPENSES BY TREATING IT AS CAPITAL EXPENDITURE. 7. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANCE S OF THE CASE, ACTION OF LD. CIT(A) IN CONFIRMING THE ACTION OF LD . A.O. IN MAKING THE IMPUGNED ADDITIONS/DISALLOWANCES AND IN FRAMING THE IMPUGNED ORDER WHICH IS UNJUSTIFIED, VOID AB INITIO AND AGAINST THE PRINCIP LES OF NATURAL JUSTICE AND BY RECORDING INCORRECT FACTS AND FINDINGS AND W ITHOUT GIVING ADEQUATE OPPORTUNITY OF HEARING AND THE SAME IS NOT SUSTAINABLE ON VARIOUS LEGAL AND FACTUAL GROUNDS. 2. THE ASSESSEE IS A COMPANY DEALING IN STOCK IN SH ARES. IN THE RETURN OF INCOME FOR THE ASSESSMENT YEAR 2007-08 FILED ON 29. 09.2007, THE ASSESSEE DECLARED INCOME OF RS.4,720/-. THE A.O. COMPLETED ASSESSMENT U/S 143(3) DETERMINING TOTAL INCOME OF ASSESSEE AT RS.98,15,24 7/-. AGGRIEVED, THE ASSESSEE CARRIED THE MATTER IN APPEAL. THE FIRST A PPELLATE AUTHORITY DISPOSED OF THE CASE EX-PARTE, FOR THE REASON THAT THE ASSES SEE HAD NOT ATTENDED HEARING DESPITE SEVERAL NOTICES. AGGRIEVED, ASSESSEE IS IN APPEAL BEFORE US. 3. WE HAVE HEARD LD. A.R. SHRI R. S. ADLAKHA ON BEH ALF OF ASSESSEE AND LD. D.R. SHRI VIKRAM SAHAY ON BEHALF OF REVENUE. O N A CLOSE PERUSAL OF THE ITA NO.4808/DEL/2010 3 ORDER OF FIRST APPELLATE AUTHORITY WE OBSERVE THAT PAPERS ON RECORD AND DOCUMENTARY EVIDENCE WERE NOT CONSIDERED WHILE ADJU DICATING THE CASE EX- PARTE. THE ASSESSEE HAS ALSO NOT COOPERATED WITH T HE FIRST APPELLATE AUTHORITY IN THE APPELLATE PROCEEDINGS. THE LD. COUNSEL FOR THE ASSESSEE DEMONSTRATED BEFORE US, AS TO WHY THE ASSESSEE COULD NOT APPEAR BEFORE THE LD. CIT(A). UNDER THESE CIRCUMSTANCES, WE ARE OF THE CONSIDERED OPINION THAT THE ENDS OF JUSTICE WILL BE MET IF THE APPEAL IS SET ASIDE TO T HE FILE OF FIRST APPELLATE AUTHORITY FOR FRESH ADJUDICATION IN ACCORDANCE WITH LAW. THE ASSESSEE SHALL COOPERATE IN DISPOSING OFF THE APPEAL WITH THE FIRS T APPELLATE AUTHORITY. AS THE EARLIER NOTICES HAVE NOT BEEN RESPONDED TO BY T HE ASSESSEE, WE DIRECT THE ASSESSEE TO PRESENT ITSELF BEFORE THE FIRST APPELLA TE AUTHORITY ON 07.09.2015 AND OBTAIN NOTICE OF HEARING AND THEREAFTER COOPERA TE IN THE DISPOSAL OF APPEAL. 4. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. 5. ORDER PRONOUNCED IN THE OPEN COURT ON 22 ND JULY 2015. SD./- SD./- ( I. C. SUDHIR) (J. S. RED DY) JUDICIAL MEMBER ACCOUNTANT MEMBER DATE: 22 ND JULY, 2015 SP COPY FORWARDED TO:- 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT (A)-, NEW DELHI. 5. THE DR, ITAT, LOKNAYAK BHAWAN, KHAN MARKET, NEW DEL HI. TRUE COPY. ITA NO.4808/DEL/2010 4 BY ORDER (ITAT, NEW DELHI). S.NO. DETAILS DATE INITIALS DESIGNATION 1 DRAFT DICTATED ON 20/7 SR. PS/PS 2 DRAFT PLACED BEFORE AUTHOR 21/7 SR. PS/PS 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER AM/AM 5 APPROVED DRAFT COMES TO THE SR. PS/PS 22/7 SR. PS/PS 6 KEPT FOR PRONOUNCEMENT 22/7 SR. PS/PS 7 FILE SENT TO BENCH CLERK 23/7 SR. PS/PS 8 DATE ON WHICH THE FILE GOES TO HEAD CLERK 9 DATE ON WHICH FILE GOES TO A.R. 10 DATE OF DISPATCH OF ORDER