M/s. Shiva Rubber Industries, New Delhi V. ITO, Gurgaon

ITA 4897/DEL/2015

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 0697 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 1 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-09-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: G
• Assessment Year: 2006-2007
• Appeal Filed On: 29-07-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: DR RAKESH GUPTA
• Keywords: Principle of natural justice
• Section: 143(3)

Judgement Text

1 ITA NO. 4897/DEL/2015 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: G NEW DELHI BEFORE SHRI R. K. PANDA, ACCOUNTANT MEM BER AND MS SUCHITRA KAMBLE, JUDI CIAL MEMBER ITA NO. 4897/DEL/2015 ( A.Y 2006-07) SHIVA RUBBER INDUSTRIES C/O. M/S. RRA TAX INDIA D-28, SOUTH EXTENSION, PART-1 NEW DELHI AAEFS7221G (APPELLANT) VS ITO WARD-II (2) GURGAON (RESPONDENT) APPELLANT BY DR. RAKESH GUPTA, ADV RESPONDENT BY SH. ANOOP SINGH, SR. DR ORDER PER SUCHITRA KAMBLE, JM THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE OR DER DATED 03/06/2015 PASSED BY CIT (A)-1, GURGAON, FOR ASSESSMENT YEAR 2 006-07. 2. THE GROUNDS OF APPEAL ARE AS UNDER:- 1. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANC ES OF THE CASE, LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE ACT ION OF LD. AO IN IMPOSING PENALTY OF RS. 1,13,830/- U/S 271(L)(C) AN D THAT TOO WITHOUT RECORDING THE MANDATORY SATISFACTION AS PER LAW. 2. THAT IN ANY VIEW OF THE MATTER AND IN ANY CASE, ACTION OF LD. CIT (A) IN CONFIRMING THE ACTION OF LD. AO IN FRAMING THE IMPU GNED PENALTY ORDER WHICH IS BEYOND JURISDICTION, ILLEGAL, IN VIOLATION OF PRINCIPLES OF NATURAL JUSTICE, BY RECORDING INCORRECT FACTS AND FINDINGS, BARRED BY LIMITATION, CONTRARY TO THE LAW AND FACTS AND DESERVES TO BE QU ASHED. 3. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANC ES OF THE CASE, LD. CIT(A) DATE OF HEARING 13.09.2018 DATE OF PRONOUNCEMENT 17.09.2018 2 ITA NO. 4897/DEL/2015 HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE ACT ION OF LD. AO IN LEVYING THE PENALTY U/S 271(L)(C) AND PASSING THE IMPUGNED PENALTY ORDER IN AS MUCH AS THE ASSESSMENT ORDER PASSED U/S 143(3) DATE D 29-12-2008 IS IN VIOLATION OF PRINCIPLES OF NATURAL JUSTICE, BEYOND JURISDICTION, BARRED BY LIMITATION, CONTRARY TO LAW AND FACTS, UNJUSTIFIED, ILLEGAL, VOID AB-INITIO AND WITHOUT GIVING ADEQUATE OPPORTUNITY OF HEARING TO T HE ASSESSEE. 4. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANC ES OF THE CASE, LD. CIT (A) HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE ACT ION OF LD. AO IN LEVYING THE PENALTY U/S 271(L)(C) AND IN MAKING ADDITION IN THE ASSESSMENT ORDER PASSED U/S 143(3) DATED 29-12-2008 AS THESE ADDITIO NS ARE ALSO CONTRARY TO LAW AND FACTS, UNJUSTIFIED, ILLEGAL AND VOID AB INITIO. 5. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANC ES OF THE CASE, LD. CIT (A) HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE ACT ION OF LD. AO IN LEVYING THE PENALTY AND PASSING THE IMPUGNED PENALTY ORDER THAT TOO WITHOUT COMPLYING WITH THE DIRECTIONS GIVEN BY LD. CIT(A) W HILE DECIDING THE APPEAL OF THE ASSESSEE IN QUANTUM PROCEEDINGS. 6. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANC ES OF THE CASE, LD. CIT (A) HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE ACT ION OF LD. AO IN LEVYING THE PENALTY U/S 271(L)(C) THAT TOO WITHOUT SERVING THE APPEAL EFFECT ORDER TO THE ASSESSEE. 7. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANC ES OF THE CASE, LD. CIT (A) HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE ACT ION OF LD. AO IN LEVYING THE PENALTY AND PASSING THE IMPUGNED ORDER THAT TOO WITHOUT DISCHARGING HIS BURDEN AS ENVISAGED UNDER THE LAW OF PROVING CO NCEALMENT OF INCOME OR FURNISHING INACCURATE PARTICULARS BY THE ASSESSE E. 3. ASSESSMENT WAS FRAMED BY THE ASSESSING OFFICER U /S 143(3) OF THE INCOME TAX ACT, 1961 ON 29/12/2008. THE ASSESSING OFFICER MADE ADDITION OF RS.24,82,871/- ON ACCOUNT OF 15 UNEXPLAINED SUNDRY CREDITORS. BEING AGGRIEVED BY THE ASSESSMENT ORDER, THE ASSESSEE FIL ED APPEAL BEFORE THE CIT(A) AND THE CIT(A) HAS GIVEN A DIRECTION TO THE ASSESSI NG OFFICER TO VERIFY CERTAIN CREDITORS AFTER DELETING ADDITION OF RS.20,40,399/- . THE ASSESSING OFFICER YET NOT GIVEN THE EFFECT OF ORDER OF THE CIT(A) DATED 1 6/09/2009 PASSED IN THE ORIGINAL ASSESSMENT ORDER. IN THE MEANWHILE, THE A SSESSING OFFICER IMPOSED THE PENALTY OF RS.1,13,830/- U/S 271 (1)(C) OF THE INCOME TAX ACT. 4. BEING AGGRIEVED BY THE PENALTY ORDER, THE ASSESS EE FILED APPEAL BEFORE THE 3 ITA NO. 4897/DEL/2015 CIT(A). THE CIT(A) DISMISSED THE APPEAL OF THE ASS ESSEE WITHOUT TAKING THE COGNIZANCE OF THE PARTIAL DELETION OF THE ADDITION MADE BY THE CIT(A) REGARDING ORIGINAL ASSESSMENT ORDER. 5. THE LD. AR SUBMITTED THAT SINCE IN THE ORIGINAL ASSESSMENT U/S 143(3)/147 OF THE ACT, THE CIT(A) DELETED THE ADDIT ION OF RS.20,40,399/-, THE ASSESSING OFFICER SHOULD HAVE GIVEN THE EFFECT OF T HE SAID ORDER AND ACCORDINGLY SHOULD HAVE PASSED PENALTY ORDER. THEREFORE, THIS PENALTY ORDER HAS TO BE DELETED. 6. THE LD. DR RELIED UPON THE ORDER OF THE CIT(A) A S WELL AS OF THE PENALTY ORDER. 7. WE HAVE HEARD BOTH THE PARTIES AND PERUSED ALL R ELEVANT MATERIAL AVAILABLE ON RECORD. THE ORIGINAL ASSESSMENT ORDER PASSED U/S 143(3)/147 HAS BEEN PARTIALLY CONFIRMED BY THE CIT(A) AND ADDITION OF RS.20,40,399/- WAS DELETED. THUS, THE PENALTY FOR ORIGINAL ASSESSMENT ORDER DOES NOT SUSTAIN IN TOTO BUT PARTIALLY. THEREFORE, IT WILL BE APPROPRI ATE TO REMAND BACK THIS ISSUE TO THE FILE OF THE ASSESSING OFFICER AS THERE IS NO O RDER GIVING EFFECT TO THE CIT(A)S ORDER. THE MATTER IS REMANDED BACK TO THE FILE OF THE ASSESSING OFFICER. NEEDLESS TO SAY, THE ASSESSEE BE GIVEN OPPORTUNITY OF HEARING BY FOLLOWING PRINCIPLES OF NATURAL JUSTICE. 8. IN RESULT, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT ON 17 TH SEPTEMBER, 2018. SD/- SD/- (R. K. PANDA) (SUCHITRA KAMBLE) ACCOUNTANT MEMBER JUDICIAL MEM BER 4 ITA NO. 4897/DEL/2015 DATED: 17/09/2018 R.N* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI DATE OF DICTATION 13.09.2018 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 14.09.2018 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. PS/PS DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. PS/PS 1 7 .09.2018 DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WEBSITE OF ITAT 1 7 .09.2018 DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 1 7 .09.2018 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER 5 ITA NO. 4897/DEL/2015 DATE OF DISPATCH OF THE ORDER