M/s. Ester Industries Ltd., Gurgaon V. ACIT, New Delhi

ITA 5215/DEL/2016

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 5310 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 10 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-08-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 2009-2010
• Appeal Filed On: 03-10-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: NIDHI SRIVASTAVA
• Assessee Lawyers: PREM SHARMA
• Keywords: Principle of natural justice; Reasonable cause; Set aside
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH B, NEW DELHI BEFORE MS. SUCHITRA KAMBLE, JUDICIAL MEMBER AND SH. PRASHANT MAHARISHI, ACCOUNTANT MEMBER ITA NO.5215/DEL/2016 ASSESSMENT YEAR : 2009-10 M/S. ESTER INDUSTRIES LIMITED, BLOCK-A, PLOT NO.11, INFOCITY-I, SECTOR-33 & 34, GURGAON-122001. PAN : AAACE0119E VS. ACIT, CIRCLE-8(2), NEW DELHI. (APPELLANT) (RESPONDENT) APPELLANT BY SH. PREM SHARMA, A R RESPONDENT BY MS. NIDHI SRIVASTAVA, CIT DR DATE OF HEARING 05.08.2019 DATE OF PRONOUNCEMENT 21.08.2019 O R D E R PER S.KAMBLE, J.M: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 08.09.2016 PASSED BY THE CIT(A)-37, NEW DELHI IN RE LATION TO ASSESSMENT YEAR 2009-10 ON THE FOLLOWING GROUNDS:- (A) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE, THE CIT(A) HAS ERRED, BOTH ON FACTS AND IN LAW, IN PASSING THE IMPUGNED E XPARTE ORDER DATED 9.9.2016 DISMISSING THE APPEAL AS NOT MAINTAINABLE AND HE SHOULD HAVE ALLOWED THE APPELLANT ADEQUATE AND REASONABLE OPPOR TUNITY TO REMOVE THE DEFECT. IN THE APPEAL MEMO WHICH IS CURABLE AND SH OULD HAVE THEREAFTER HEARD AND DECIDED THE APPEAL ON MERITS ON ALL THE GROUNDS AND ISSUES RAISED BEFORE HIM AND FAILURE TO DO SO, HAS VITIATE D THE IMPUGNED ORDER. (B) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE, THE CIT(A) HAS ERRED, IN NOT CALLING FOR THE RECORDS RELATING TO ORIGINAL AS SESSMENT AND RE-ASSESSMENT OF THE APPELLANT FROM THE AO AND HAS FAILED TO CONS IDER FAIRLY AND OBJECTIVELY ITA NO.5215/DEL/2016 ASSESSMENT YEAR : 2009-10 PAGE | 2 EACH ONE OF THE GROUNDS PLEADED BY THE APPELLANT AL THOUGH THEY ARE MENTIONED IN PARA 2 OF THE ORDER BUT NONE OF THEM H AD BEEN DEALT WITH OR DECIDED ARID IN VIEW OF THE IMPUGNED ORDER BEING EX PARTE AND THERE WAS VALID AND REASONABLE CAUSE FOR THE APPELLANT SEEKIN G TIME ON 9.9.2016, THE DENIAL OF EFFECTIVE OPPORTUNITY TO THE APPELLANT AN D REFUSAL TO CONSIDER THE APPEAL FOR DECISION ON MERITS HAVE LED TO GRAVE INJ USTICE TO THE APPELLANT FOR WHICH THE IMPUGNED ORDER BE VACATED. (C) THE RECORDS HAVING BEEN RECEIVED ONLY ON 8.8.20 16, THE HEARING NOTICE DATED 24.8.2016 SENT TO THE WRONG/OLD ADDRESS OF TH E APPELLANT INSTEAD OF THE ADDRESS GIVEN ON THE APPEAL MEMO HAD LED TO THE DELAY IN RECEIPT OF NOTICE AND ATTENDING THE PROCEEDINGS FOR WHICH THE APPEAL OUGHT NOT TO HAVE BEEN DISMISSED. (D) THE APPELLANT HAD ACTED BONA FIDE AND THE CURAB LE DEFECT IN THE APPEAL MEMO HAS BEEN CURED BY FILING THE REVISED APPEAL ME MO ALONG WITH APPLICATION FOR RECALL OF EXPARTE ORDER DATED 9.9.2 016 FILED BEFORE CIT(A) AND IN VIEW OF THE SAME, IT IS PRAYED THAT THIS HON'BLE TRIBUNAL MAY BE PLEASED TO SET ASIDE THE IMPUGNED EXPARTE ORDER PASSED BY T HE CIT(A) AND DIRECT THE APPEAL TO BE DECIDED BY HIM CORRECTLY IN ACCORDANCE WITH LAW AND ON MERITS IN RESPECT OF ALL THE GROUNDS RAISED BY THE APPELLA NT AFTER GRANTING EFFECTIVE OPPORTUNITY OF PERSONAL HEARING TO THE APPELLANT AN D, AFTER GETTING THE COMPLETE RECORDS OF THE ASSESSING OFFICER RELATING TO ORIGINAL ASSESSMENT AS WELL AS RE-ASSESSMENT AS EVEN THE RE-ASSESSMENT ORD ER WAS EXPARTE MADE PERVERSELY BY THE A O. 2. M/S. ESTER INDUSTRIES LTD. IS A PUBLIC LIMITED C OMPANY INCORPORATED UNDER THE COMPANIES ACT, 1956, WHICH W AS REGULARLY ASSESSED TO INCOME-TAX. FOR THE ASSESSMENT YEAR 200 9-10, REGULAR ASSESSMENT U/S. 143(3) WAS MADE BY THE ASSESSING OF FICER VIDE ORDER DATED 18.11.2011 BY WHICH THE BOOK PROFITS OF THE A SSESSEE WERE ENHANCED FROM RS.50,36,29,047/- DECLARED BY THE ASS ESSEE TO RS.51,24,47,405/-. ITA NO.5215/DEL/2016 ASSESSMENT YEAR : 2009-10 PAGE | 3 3. BEING AGGRIEVED BY THE ASSESSMENT ORDER, THE ASS ESSEE FILED APPEAL BEFORE THE CIT(A).THE CIT(A) PASSED AN EX-PA RTE ORDER THEREBY PARTLY ALLOWING THE APPEAL OF THE ASSESSEE. 4. THE LD. AR SUBMITTED THAT THE CIT(A) HAS NOT GRA NTED ADEQUATE AND REASONABLE OPPORTUNITY TO REMOVE THE DEFECTS IN THE APPEAL MEMO WHICH IS CURABLE. THE LD.AR FURTHER SUBMITTED THAT THE HEARING NOTICE DATED 24.08.2016 WAS ALSO SENT TO THE WRONG/OLD ADD RESS OF THE ASSESSEE INSTEAD OF ADDRESS GIVEN IN THE APPEAL MEM O, WHICH LED TO DELAY IN RECEIPT OF NOTICE AND ATTENDING THE PROCEE DINGS FOR WHICH THE APPEAL OUGHT NOT TO HAVE BEEN DISMISSED. THEREFORE, THE LD. AR SUBMITTED THAT THE MATTER MAY BE REMANDED BACK TO T HE FILE OF THE CIT(A) FOR DECIDING THE APPEAL ON MERITS BY GIVING PROPER OPPORTUNITY AS PER PRINCIPLES OF NATURAL JUSTICE. 5. THE LD. DR RELIED UPON THE ASSESSMENT ORDER AND THE ORDER OF THE CIT(A). THE LD. DR FURTHER SUBMITTED THAT PROPER OP PORTUNITY WAS GRANTED BY THE CIT(A) TO REMOVE THE DEFECT, WHICH W AS NOT AVAILED BY THE ASSESSEE AT THE RELEVANT TIME. 6. WE HAVE HEARD BOTH THE PARTIES AND PERUSED ALL T HE RELEVANT MATERIAL AVAILABLE ON RECORD. THE CIT(A) HAS DISMIS SED THE APPEAL OF THE ASSESSEE ON THE GROUND THAT THE DEFECT WAS NOT REMO VED IN THE MEMORANDUM OF APPEAL. FROM THE RECORDS, IT CAN BE S EEN THAT THE NOTICE WAS ALSO NOT PROPERLY SERVED TO THE ASSESSEE AT THE ADDRESS MENTIONED IN FORM-35. THEREFORE, IN THE INTEREST OF JUSTICE, IT WILL BE APPROPRIATE TO REMAND BACK THIS MATTER TO THE FILE OF THE CIT(A) AND THE MATTER MAY BE DECIDED ON MERIT. NEEDLESS TO SAY THA T THE ASSESSEE WILL REMOVE THE DEFECT IN APPEAL, I.E., RECTIFY FORM 35 BEFORE THE CIT(A) WITHIN A PERIOD OF 30 DAYS FROM THE RECEIPT OF THIS ORDER. THE ASSESSEE BE GIVEN OPPORTUNITY OF HEARING BY FOLLOWING THE PR INCIPLES OF NATURAL ITA NO.5215/DEL/2016 ASSESSMENT YEAR : 2009-10 PAGE | 4 JUSTICE. ACCORDINGLY, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. 7. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 21 ST DAY OF AUGUST, 2019. SD/- SD/- (PRASHANT MAHARISHI) (SUCHITRA KAMBLE) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 21.08.2019 * AMIT KUMAR* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI