Parulben Jaykantbhai Shah, Vadodara V. Income Tax Officer, Ward-1(3)(8), Surat

ITA 537/SRT/2018

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 0821 (ITAT-SURAT)
• Duration Of Justice: 2 year(s) 11 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-07-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2009-2010
• Appeal Filed On: 01-08-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANUPAMA SINGLA
• Assessee Lawyers: RAJESH UP A DHYAY ITP
• Keywords: Opportunity of being heard; Principle of natural justice; Set aside
• Section: 271(1)(c)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, SURAT BENCH, SURAT BEFORE SHRI PAWAN SINGH, JM & DR. A. L. SAINI, AM ./ITA NO.537/SRT/2018 ( [ [ / ASSESSMENT YEAR: (2009-10) (VIRTUAL COURT HEARING) PARULBEN JAYKANTBHAI SHAH, 39/1,4 TH FLOOR, NR. CROSSWORD, ALKAPURI, VADODARA 390007. V S. THE INCOME TAX OFFICER, WARD-1(3)(8), SURAT. ./ ./ PAN/GIR NO.: AQBPS 7073 C (ASSESSEE) (RESPONDENT) ASSESSEE BY : SHRI RAJESH UPADHYAY - ITP RESPONDENT BY : MS.ANUPAMA SINGLA SR.DR / DATE OF HEARING : 02/07/2021 /DATE OF PRONOUNCEMENT : 06 /07/2021 / O R D E R PER DR. A. L. SAINI, ACCOUNTANT MEMBER: CAPTIONED APPEAL FILED BY ASSESSEE, PERTAINING TO ASSESSMENT YEAR 2009-10 IS DIRECTED AGAINST THE ORDER PASSED BY THE LD.COMMISSIONER OF INCOME TAX(APPEALS)- 2, SURAT [LD.CIT(A)], DATED 20.06.2018. 2. AT THE OUTSET ITSELF, SHRI RAJESH UPADHYAY, LD. COUNSEL FOR THE ASSESSEE ASSAILED THE IMPUGNED ORDER BY CONTENDING THAT THE ASSESSEE COULD NOT REPRESENT HIS CASE BEFORE LD. CIT(A) AND THE ORDER BEING AN EX-PARTE ORDER, STOOD VITIATED ON ACCOUNT OF VIOLATION OF PRINCIPLE OF NATURAL JUSTICE. THE LD. COUNSEL FOR THE ASSESSEE CONTENDED THAT IN THE INTEREST OF JUSTICE, ANOTHER OPPORTUNITY TO CONTEST THE APPEAL BEFORE THE LD. FIRST APPELLATE AUTHORITY MAY BE GRANTED TO THE ASSESSEE. THE LD.COUNSEL PLEADS BEFORE THE BENCH THAT KNOWN APPEARANCE BY THE ASSESSEE, BEFORE THE LD.CIT(A) WAS NEITHER INTENTIONAL NOR DELIBERATE. THE LD COUNSEL CONTENDS THAT ASSESSEE HAS GOOD CASE ON MERIT, THAT IS, SUBSTANTIAL ADDITIONS ON THE BASIS OF WHICH PENALTY UNDER SECTION 271(1) (C) WERE LEVIED BY ASSESSING OFFICER, HAVE ALREADY BEEN DELETED EITHER BY THE LD.CIT(A) OR BY TRIBUNAL. THE LD.COUNSEL FURTHER SUBMITS PAGE | 2 ITA NO.537/SRT/2018 FOR A.Y. 2009-10 PARULBEN JAYKANTBHAI SHAH THAT IT IS THE FIT CASE TO DELETE PENALTY BY THE TRIBUNAL. THE LD.COUNSEL WAS CONFRONTED WITH THE FACTS THAT THESE FACTS WERE NOT BROUGHT TO THE NOTICE OF THE LD.CIT(A) DURING THE APPELLATE PROCEEDINGS. 3.IN RESPONSE TO CONFRONTING THE FACTS, THE LD COUNSEL SUBMITS THAT IN CASE THE APPEAL IS RESTORED TO THE FILE OF LD.CIT(A), HE MAY BE LIBERTY TO RAISE FACTUAL AND LEGAL SUBMISSIONS BEFORE THE LD.CIT(A). 4. ON THE OTHER HAND, THE LD.DEPARTMENTAL REPRESENTATIVE SUBMITS THAT NO DOUBT, ASSESSEE IS HAVING GOOD CASE BUT HAS NOT EXPLAINED AS TO WHY HE HAS NOT APPEARED BEFORE THE FIRST APPELLATE AUTHORITY [CIT(A)] AND WHY HE HAS NOT EXPLAINED TO LD CIT(A) THAT QUANTUM ADDITIONS WERE DELETED SO PENALTY UNDER SECTION 271(1) (C) SHOULD NOT BE LEVIED. HENCE, MATTER MAY BE REMITTED BACK TO THE FILE OF LD CIT(A). 5.WE HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE NOTE THAT ORDER PASSED BY THE LD.CIT(A) IS AN EX-PARTE ORDER. WE NOTE THAT LD.CIT(A) HAS NOT PASSED THE ORDER AS PER THE MANDATE OF SECTION 250(6) OF THE INCOME TAX ACT. SECTION 250(6) OF THE ACT PROVIDES AS FOLLOWS: 250(6) THE ORDER OF THE COMMISSIONER (APPEALS) DISPOSING OF THE APPEAL SHALL BE IN WRITING AND SHALL STATE THE POINTS FOR DETERMINATION, THE DECISION THEREON AND THE REASON FOR THE DECISION THUS, AS PER SECTION 250(6) OF THE ACT, THE LD. CIT(A), WHILE DECIDING THE APPEAL IS REQUIRED TO PASS ORDER ON MERITS, HOWEVER, IN THE ASSESSEE`S CASE UNDER CONSIDERATION, LD CIT(A) HAS FAILED TO PASS ORDER ON MERITS. 6. THE LD.COUNSEL SUBMITS BEFORE US THAT SOME QUANTUM ADDITIONS WERE DELETED BY LD CIT(A) AND SOME QUANTUM ADDITIONS WERE DELETED BY TRIBUNAL. THEREFORE, PENALTY UNDER SECTION 271(1)(C) OF THE ACT SHOULD BE DELETED IN RESPECT OF THOSE QUANTUM ADDITIONS WHICH WERE DELETED. PAGE | 3 ITA NO.537/SRT/2018 FOR A.Y. 2009-10 PARULBEN JAYKANTBHAI SHAH 7. CONSIDERING THE ABOVE FACTS, WE NOTE THAT ASSESSEE HAS NOT GIVEN SUFFICIENT OPPORTUNITY OF BEING HEARD AND COULD NOT PLEAD HIS CASE SUCCESSFULLY BEFORE THE LD. CIT(A). WE NOTE THAT THE LD. CIT(A) DID NOT DISCUSS THE ASSESSEES CASE ON MERITS BASED ON THE MATERIAL AVAILABLE BEFORE HIM HENCE IT IS A VIOLATION OF PRINCIPLE OF NATURAL JUSTICE. WE NOTE THAT IT IS SETTLED LAW THAT PRINCIPLES OF NATURAL JUSTICE AND FAIR PLAY REQUIRE THAT THE AFFECTED PARTY IS GRANTED SUFFICIENT OPPORTUNITY OF BEING HEARD TO CONTEST HIS CASE. IF THE QUANTUM IS DELETED, THE PENALTY WOULD NOT SURVIVE. THEREFORE, LD CIT(A) IS DIRECTED TO EXAMINE THE QUANTUM ADDITIONS DELETED BY FIRST APPELLATE AUTHORITY AND BY TRIBUNAL AND THEN QUASH THE PENALTY UNDER SECTION 271(1) (C) OF THE ACT IN RESPECT OF THOSE ADDITIONS WHICH WERE DELETED BY LD CIT(A)/TRIBUNAL. HENCE, WE DEEM IT FIT AND PROPER TO SET ASIDE THE ORDER OF THE LD. CIT(A) AND REMIT THE MATTER BACK TO THE FILE OF THE LD. CIT(A) TO ADJUDICATE THE ISSUE AFRESH ON MERITS. FOR STATISTICAL PURPOSES, THE APPEAL OF THE ASSESSEE IS TREATED AS ALLOWED. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER IS PRONOUNCED AT THE TIME OF HEARING OF APPEAL ON 06/07/2021 IN THE VIRTUAL COURT OF HEARING. SD/- SS S- SD/- S (PAWAN SINGH) (DR. A.L. SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER SURAT / / DATE: 06/07/2021 / SGR COPY OF THE ORDER FORWARDED TO 1. THE ASSESSEE 2. THE RESPONDENT 3. THE CIT(A) 4. PR.CIT 5. DR/AR, ITAT, SURAT 6. GUARD FILE BY ORDER / / TRUE COPY / / ASSISTANT REGISTRAR/SR. PS/PS ITAT, SURAT