M/s Eni India Limited, New Delhi V. Addl. CIT, Dehradun

ITA 5091/DEL/2010

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 6394 (ITAT-DELHI)
• Duration Of Justice: 6 year(s) 4 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-03-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 10-01-2017
• Assessment Year: 2007-2008
• Appeal Filed On: 18-11-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: CR
• Keywords: Non passing of speaking order
• Section: 32; 147; 131; 68; 246; 69; 145; 27; 148; 54; 37; 6; 56; 263; 63; 132; 12; 28; 144; 10; 90; 154; 2; 11; 15; 271(1)(b); 139; 92; 144C; 13

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH B , NEW DELHI BEFORE SRI AMIT SHUKLA, JUDICIAL MEMBER AND SRI O.P. KANT, ACCOUNTANT MEMBER ITA NO. 5091/DEL/2010 AY: 2007 - 08 & ITA NO. 6416 /DEL/201 2 AY: 200 8 - 09 M/S ENI INDIA LTD. VS. ASST. DIRECTOR OF INCOME TAX 507, BHIKAJI CAMA BHAVAN INTERNATIONAL TAXATION BHIKAJI KAMA PLACE DEHRADUN NEW DELHI 110 066 (APPELLANT) (RESPONDENT) APPELLANT BY : SH. RUPESH JAIN, ADV. RESPONDENT BY : SH. ANUJ ARORA, CIT, CR . ORDER PER AMIT SHUKLA, JUDICIAL MEMBER THE AFORESAID APPEALS HAVE BEEN FILED AGAINST FINAL ASSESSMENT ORDER DT. 30.8.2010 AND 25.10.2012 , PASSED UNDER SECTION 143 (3)/ 144C ( 13 ) FOR THE QUANTUM OF ASSESSMENT F OR THE ASSESSMENT YEAR S (A.Y.) 2007 08 AND 2008 09 RESPECTIVELY. BOTH THE ASSESSMENT ORDERS HAVE BEEN PASSED IN PURSUANCE OF THE DIRECTIONS GIVEN BY THE D ISPUTE R ESOLUTION P ANEL ( DRP ) V IDE ORDER DATED 16.6.2010 AND 28.8.2012 , FOR TH E A.Y. 2007 08 AND 2008 09 RESPECTIVELY. ITA 5091/DEL/10 AY 2007 - 08 ITA 6416/DEL/2012 AY 2008 - 09 M/S ENI INDIA LTD., NEW DELHI 2 2. AT THE OUTSET THE L D. COUNSEL FOR THE ASSESSEE SUBMITTED THAT IN BOTH THE YEARS THE ISSUES INVOLVED ARE SAME ARISING OUT OF IDENTICAL SET OF FACTS. HE POINTED OUT THAT IN BOTH THE YEARS AGAINST THE DRAFT ASSESSMENT ORDER , THE ASSESSEE HA D FILED DETA ILED OBJECTIONS AND SUBMISSIONS BEFORE TH E LD. DRP, HOWEVER, IN BOTH THE YEARS THE LD.DRP WITHOUT CONSIDERING THE ASSESSEE S OBJECTIONS AND EXPLANATIONS AS WELL AS MOST OF THE GROUNDS TAKEN IN FORM NUMBER 35A , HAS NOT PROPERLY ADJUDICATED A N Y O F T H E I S S U E S . T O P R O V E H I S P O I N T H E A L S O DRE W OUR ATTENTION TO THE DIRECTIONS OF THE DRP A S C O N T A I N E D I N T H E O R D E R F O R T H E IN A.Y. 2007 08 AND SUBMITTED THAT THEY HAVE SIMPLY HELD THAT THE EXPENSES DISALLOWED BY THE A.O. A R E CORRECT . T HERE IS NO FINDING OR REASONING ON THE VARIOUS G R O U N D S OF OBJECTIONS RAIS ED QUA THE VARIOUS DISALLOWANCES OF EXPENDITURE . IN THE ASSESSMENT YEAR 2008 09 ALSO , THE DRP AGAIN DID NOT GIVE ANY REASONING OR FINDING ON VARIOUS OBJECTIONS RELATING TO DISALLOWANCES MADE BY THE A.O. I N P U R S U A N C E O F S U C H A NON SPEAKING ORDER , THE FINAL ASSESSMENT ORDER HAS BEEN PASSED W H I C H H A S L E D T O G R E A T H A R D S H I P , I N J U S T I C E , T O T H E A S S E S S E E . T H E R E F O R E , HE SUBMITTED THAT EITHER THE FINAL ASSESSMENT ORDER PASSED IN PURSUANCE OF DR P S ORDER SHOULD BE CANCELLED ; OR ALTERNATIVELY THE MATTER SHOULD BE RESTORED BACK TO THE FIL E OF THE DRP TO PASS A WELL REASONED ORDER AFTER CONSIDERING ASSESSEE S OBJECTIONS. 3. ON THE OTHER HAND LD.CIT, D.R. SUBMITTED THAT THE A.O. IN T H E IMPUGNED ASSESSMENT ORDER HAS GIVEN A DETAILED REASONING WHILE MAKING TH E DISALLOWANCE AND THEREFORE , SUCH AN ORDER SHOULD BE UPHELD. ITA 5091/DEL/10 AY 2007 - 08 ITA 6416/DEL/2012 AY 2008 - 09 M/S ENI INDIA LTD., NEW DELHI 3 4. A FTER CONSIDERING TH E AFORESAID PRELIMINARY OBJECTIONS AS RAISED BY THE LEARNED COUNSEL AND ALSO ON PERUSAL OF THE ORDERS OF THE DRP IN BOTH THE YEARS, WE FIND THAT THE LD.DRP HAS NOT ASCRIBED ANY REASONS ON THE GROUNDS O N WHICH THE ASSESSEE S OBJECTIONS HAVE BEEN DISMISSED SUMMARILY , W H I L E UPHOLDING THE ORDER OF THE A.O. T HIS IS EVIDENT FROM THE FOLLOWING CONCLUSION OF THE DRP IN THE ASSESSMENT YEAR 2007 08 WHICH R EADS AS UNDER : 4. DURING THE RELEVANT A.Y. EXPENSES OF RS.74,57,505/ - WHICH HEAD WISE BREAKUP IS AS FOLLOWS. SL.NO. LICENSE AND SUBSCRIPTION AMOUNT RS. 1. LICENSE AND SUBSCRIPTION 95,520/ - 2. AUDIT FEE 2,032,563 3. PROFESSIONAL SERVICE FEE 348,841 4. FEE FOR ATTENDING SEMINAR, CONFERENCE ETC. 3,228,064 5. HOSPITALITY AND CATERING 57,630 6. ROC FILING FEE 5,000 7. PAYMENT OF INTEREST 683,010 8. FRINGE BENEFIT TAX 1,006,777 C LAIMED BY THE ASSESSEE WERE DISALLOWED BY THE AO ON THE GROUND THAT THE PRODUCTION HAS NOT COMMENCED. ASSESSEE HAS FURNISHED SUBMISSION IN SUPPORT OF GROUNDS OF OBJECTIONS. HOWEVER, AFTER GOING THROUGH THE ORDER OF AO, SUBMISSION OF THE ASSESSEE AND MATERIAL AVAILABLE ON RECORD, WE ARE OF THE OPINION THAT THE EXPENSES OF RS.74,57,505 / - WERE CORRECTLY DISALLOWED AND HENCE WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE AO. ITA 5091/DEL/10 AY 2007 - 08 ITA 6416/DEL/2012 AY 2008 - 09 M/S ENI INDIA LTD., NEW DELHI 4 4. 1 . F ROM THE ABOVE OBSERVATION IT C A N B E SEEN THAT , NEITHER THE DRP HAS CONSIDERED ASSESSEE S OB JECTION S PROPERLY NOR HAS GIVEN ANY P R O P E R REASONS FOR SUSTAINING THE A.O S DRAFT A S S E S S M E N T ORDER. SIMILAR OBSERVATION S AND FINDING HAS BEEN PERPETUATED IN THE ASSESSMENT YEAR 2008 09 ALSO. SUCH KIND OF CALLOUS ATTITUDE IN PASSING THE ORDER BY SUCH A HIGH QUASI - JUDICIA L AUTHORITY IS NOT APPRECIATED , BECAUSE WHILE DISPOSING OF A LIS , IT IS OBLIGAT ORY ON THE PART OF THE QUASI - JUDICIAL AUTHORITY TO ASCRIBE PROPER REASONING AS TO WHY THE CONTENTION / OBJECTIONS OF THE APPELLANT A R E NOT SUSTAINABLE . WE, THEREFORE, IN THE INTEREST OF JUSTICE A R E O F T H E O P I N I O N T H A T T H E G R O U N D S A N D I S S U E S W H I C H H A V E B E E N R A I S E D B E F O R E U S I N B O T H T H E Y E A R S , SHOULD BE REMITTED BACK TO THE FILE OF THE L D . DRP TO PASS A SPEAKING AND WELL REASONED ORDER ON THE VARIOUS OBJECTIONS RAISED BY THE ASSESSEE ON DISALLOWANCES MADE BY THE A.O. THE L D . DRP B E F O R E P A S S I N G A N Y O R D E R S H A L L PROVIDE REASONABLE AND ADEQUATE OPPORTUNITY O F H E A R I N G TO THE ASSESSEE TO REPRESENT IT'S CASE. WE ORDER ACCORDINGLY . 5. IN THE RESULT BOTH THE APPEALS OF THE ASSESSEE ARE SET A SIDE TO THE FILE OF THE DRP TO BE DECIDED AFRESH IN ACCORDANCE WITH LAW. 6. IN THE RESULT BOTH THE APPEALS OF THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 2 0 T H MARCH, 2017. S D / - S D / - (O.P. KANT) (AMIT SHUKLA) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: THE 2 0 T H MARCH, 2 017 MANGA ITA 5091/DEL/10 AY 2007 - 08 ITA 6416/DEL/2012 AY 2008 - 09 M/S ENI INDIA LTD., NEW DELHI 5 COPY FORWARDED TO: - 1 . APPELLANT 2 . RESPONDENT 3 . CIT 4 . CIT(A) 5 . DR, ITAT - TRUE COPY - BY ORDER, ASSISTANT REGISTRAR