Malhar Hotels Pvt. Ltd., Indore V. The ACIT 3(1), Indore

ITA 520/IND/2013

• Counselvise Citation: 52022714 RSA 2013
• Duration Of Justice: 2 year(s) 5 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-12-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 22-12-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 04-07-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R A VERMA
• Keywords: Opportunity of being heard; Principle of natural justice
• Section: 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE BEFORE SHRI D.T. GARASIA, JUDICIAL MEMBER AND SHRI B.C.MEENA, ACCOUNTANT MEMBER I.T.A.NO. 520/IND/2013 A.Y. : 2009-10. MALHAR HOTELS PVT.LTD., ACIT, VIJAY NAGAR, VS. 3(1), INDORE. INDORE. APPELLANT RESPONDENT PAN NO. AAECM5745R APPELLANTS BY : SHRI PRAKASH JAIN, C. A. RESPONDENT BY : SHRI R. A. VERMA, DR O R D E R PER D.T.GARASIA, J.M. THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF CIT(A)-I, INDORE, DATED 28.03.2013 FOR THE ASSES SMENT YEAR 2009-10. DATE OF HEARING : 22 . 12 .201 5 DATE OF PRONOUNCEMENT : 22 . 12 .201 5 MALHAR HOTELS PVT.LTD., INDROE VS. ACIT, INDORE - I.T.A.NO. 520 /IND/2014 A.Y. 2009-10 2 2 2. FOLLOWING GROUNDS HAVE BEEN TAKEN BY THE ASSESSEE : - 1. THAT IMPUGNED ORDER PASSED BY THE LD. CIT(A) IS BAD IN LAW AS WELL AS ON THE FACTS. IT IS BASED ON INCORRECT INTERPRETATION OF LAW AND THE FACTS HAVE ALSO BEEN INCORRECTLY CONSTRUED. 2. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) ERRED IN DISMISSING THE APPEAL BY AN EX PARTE ORDER CONFIRMING WITHOUT ALLOWING PROPER OPPORTUNITY OF BEING HERD WHICH IS AGAINST THE BASIC PRINCIPLE OF LAW AND NATURAL JUSTICE. 3. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) FAILED TO APPRECIATE THE FACT THAT NO NEW/FRESH APP0LICATION MONEY IS RECEIVED DURING THE YEAR AND SHARE APPLICATION MONEY APPEARING IN THE BALANCE SHEET IS BROUGHT FORWARD AMOUNT FROM PREVIOUS YEAR. 4. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) ERRED IN NOT DECIDING THE FOLLOWING GROUNDS OF APPEAL TAKEN BEFORE HIM IN THE APPEAL MEMO ITSELF :- MALHAR HOTELS PVT.LTD., INDROE VS. ACIT, INDORE - I.T.A.NO. 520 /IND/2014 A.Y. 2009-10 3 3 (I) THE LD. AO HAS PASSED THE ORDER U/S 144 WITHOUT ISSUING THE NOTICE ON THE PROPER ADDRESS. THE ASSESSMENT IS BAD IN LAW. (II) THE LD. AO HAS ERRED IN MAKING THE ADDITION OF RS. 2,00,00,000/- BEING AMOUNT UNDER THE HEAD UNSECURED LOANS. (III) THE LD. AO HAS MADE THE ADDITION ON SURMISES AND HYPOTHETICAL GROUNDS WITHOUT REFERRING TO THE EARLIER BALANCE SHEET. THE ASSESSEE HAS FILED REGULAR RETURNS AND IN THE EARLIER BALANCE SHEET THIS AMOUNT HAS ALREADY BEEN SHOWN AS A CREDIT BALANCE AND HAS ALSO BEEN TAXED DOUBLY. (IV) THE ADDITION HAS BEEN FRAMED ON SURMISES, CONJECTURES AND WHIMS WITHOUT CONSIDERING THE EARLIER BALANCE SHEET ON DESERVES TO BE DELETED. THE LD. CIT(A) THEREFORE, DIRECTED TO DECIDE THE APPEAL AFTER ALLOWING PROPER OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. MALHAR HOTELS PVT.LTD., INDROE VS. ACIT, INDORE - I.T.A.NO. 520 /IND/2014 A.Y. 2009-10 4 4 3. THE LD. COUNSEL FOR THE ASSESSEE CONTENDED THAT NO PROPER OPPORTUNITY OF HEARING WAS GIVEN TO THE ASSE SSEE AND THE ORDER WAS PASSED EX-PARTE. 4. THE LD. DR DID NOT OBJECT TO RESTORATION OF THE APP EAL. 5. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES. WE FIND THAT THE CASE WAS FIXED FOR HEARI NG ON 27.2.2013 THROUGH A NOTICE DATED 18.2.2013, WHICH W AS SERVED UPON THE ASSESSEE ON 19.02.2013. ON THE REQU EST FROM ASSESSEES OFFICE, THE CASE WAS ADJOURNED AND FIXED FOR HEARING ON 15.3.2013. ON THE DATE OF HEARING, NOBODY APPEAR ED ON BEHALF OF THE ASSESSEE NOR ANY WRITTEN SUBMISSION W AS FILED. THEREFORE, THE LD. CIT(A) HAS DISMISSED THE APPEAL OF THE ASSESSEE STATING THAT THE ASSESSEE IS NOT INTERESTE D IN PURSUING HIS APPEALS FOR THREE YEARS. THE PRINCIPLE OF AUDI ALTERAM PARTEM IS THE BASIC CONCEPT OF NATURAL JUSTICE. THE EXPRESSION AUDI ALTERAM PARTEM IMPLIES THAT A PERSON MUST BE GIVEN OPPORTUNITY TO DEFEND HIMSELF. THIS PRINCI PLE IS SINE QUA NON OF EVERY CIVILIZED SOCIETY. THE RIGHT TO NOTICE, RIGHT TO PRESENT CASE AND EVIDENCE, RIGHT TO REBUT ADVERSE E VIDENCE, MALHAR HOTELS PVT.LTD., INDROE VS. ACIT, INDORE - I.T.A.NO. 520 /IND/2014 A.Y. 2009-10 5 5 RIGHT TO CROSS EXAMINATION, RIGHT TO LEGAL REPRESEN TATION , DISCLOSURE OF EVIDENCE TO PARTY, REPORT OF ENQUIRY TO BE SHOWN TO THE OTHER PARTY AND REASONED DECISIONS OR SPEAKI NG ORDERS. WE FIND THAT THE RIGHT OF HEARING IS DECIDED BY THE HON'BLE SUPREME COURT IN THE CASE OF MANEKA GANDHI VS. UNIO N OF INDIA, WHEREIN HON'BLE SUPREME COURT HAS HELD THAT RULE OF FAIR HEARING IS NECESSARY BEFORE PASSING ANY ORDER. WE FIND THAT IT IS PRE-DECISION HEARING STANDARD OF NORM OF RULE OF AUDI ALTERM PARTEM. WE FIND THAT IN THIS INSTANT CASE, THE ASSESSEE WAS NOT GIVEN PROPER HEARING. THEREFORE, WE ARE OF THE VIEW THAT THE ASSESSEE MUST BE GIVEN ONE MORE OPPORTUNIT Y OF HEARING AND TO REPRESENT HIS CASE. THEREFORE, WE AL LOW THIS APPEAL ON THE CONDITION THAT THE ASSESSEE MUST BE P RESENT ON THE DATE FIXED FOR HEARING. THE ASSESSEE IS DIRECTE D TO REMAIN PRESENT BEFORE THE LD. CIT(A) WITHIN 2 MONTHS AFTER THE RECEIPT OF THIS ORDER. THE LD. CIT(A) SHOULD DECIDE THE APP EAL AFTER GIVING DUE OPPORTUNITY OF HEARING TO THE ASSESSEE A S PER LAW. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWE D FOR STATISTICAL PURPOSES. MALHAR HOTELS PVT.LTD., INDROE VS. ACIT, INDORE - I.T.A.NO. 520 /IND/2014 A.Y. 2009-10 6 6 THIS ORDER HAS BEEN PRONOUNCED IN THE OPEN COURT ON 22 ND DECEMBER, 2015. SD/- (B.C.MEENA) ACCOUNTANT MEMBER SD/- ( D.T.GARASIA) JUDICIAL MEMBER DATED : 22 ND DECEMBER, 2015. CPU*