ARUN JOSHI, THANE V. DCIT CEN CIR 12, MUMBAI

ITA 5396/MUM/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 8460 (ITAT-MUMBAI)
• Duration Of Justice: 5 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-02-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2006-2007
• Appeal Filed On: 01-09-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: BEENA SANTOSH
• Assessee Lawyers: JEETENDRA SINGH
• Keywords: Opportunity of being heard; Principle of natural justice; Reasonable cause

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH SMC, MUMBAI BEFORE SHRI R.P.TOLANI, JUDICIAL MEMBER ITA NO.5396/MUM/2016 (ASSESSMENT YEAR 2006-07) ARUN JOSHI, 101/A, DEVIDARSHAN COMPLEX, TEMBHI NAKA, THANE (WEST)-400 601 PAN: ACOPJ 9865E ...... APPE LLANT VS. THE DCIT, CEN.CIR.12, MUMBAI .... RESPONDENT APPELLANT BY : SHRI JEETENDRA SING H RESPONDENT BY : MS BEENA SANTOSH DATE OF HEARING : 01/02/2016 DATE OF PRONOUNCEMENT : 01/02/2017 ORDER THIS IS ASSESSEES APPEAL CHALLENGING THAT LD. CI T(A) HAS ERRED IN LAW AND ON FACTS IN :- (I) PASSING AN EX-PARTE ORDER WITHOUT GIVING THE ASSESS EE AN ADEQUATE OPPORTUNITY OF BEING HEARD; (II) CONFIRMING AN ADDITION OF RS.20,32,500/-; (III) CONFIRMING AN ADDITION OF RS.1,01,625/- BEING 5% ES TIMATED COMMISSION TO EARN CAPITAL GAIN. 2. THE LD. REPRESENTATIVE FOR THE ASSESSEE CONTENDS THAT THIS IS THE SECOND ROUND OF APPEALATE PROCEEDINGS. VIDE ORDER DATED 2 9/06/2012, IN ITA 2 ITA NO.5396/MUM/2016 (ASSESSMENT YEAR 2006-07) NO.2599/MUM/2010, THE ASSESSMENT WAS SET-ASIDE AND RESTORED BACK TO THE FILE OF ASSESSING OFFICER TO CONDUCT VARIOUS ENQUIR IES AND RECORD CROSS- EXAMINATION OF THE CONCERNED PERSONS OF M/S.DPS SHA RES & SECURITIES PVT. LTD. 3. DURING THE COURSE OF FRESH PROCEEDINGS, THE AS SESSING OFFICER DID NOT GIVE THE CROSS EXAMINATION AS DIRECTED BY ITAT AND CONFIRMED THE ADDITIONS. 4. AGGRIEVED, ASSESSEE PREFERRED THE FIRST APPEAL, WHEREIN NON-ALLOWING OF CROSS EXAMINATION OF WITNESS WAS AGITATED BEFORE LD . CIT(A). HOWEVER IT WAS NOT CONSIDERED AND FURTHER LD. CIT(A) CONFIRMED THE ADDITIONS BY PASSING THE IMPUGNED ORDER ON EX-PARTE BASIS. 5. THE LD. COUNSEL SHRI JEETENDRA SINGH CONTENDS TH AT THE ASSESSEE HAS BEEN RESPONDING IN THE APPELLATE PROCEEDINGS AND A DJOURNMENT LETTERS WERE FILED. BESIDES, LD. CIT(A) DID NOT PROCEED IN THE DIRECTION OF GIVING CROSS EXAMINATION AS DIRECTED BY ITAT AND NOT COMPLIED BY LD. AO. ON THE LAST DATE OF HEARING COUNSEL HAD TO SUDDENLY GO OUT OF STATIO N AND NOBODY COULD ATTEND BEFORE THE CIT(A), CONSEQUENTLY, TAKING AN ADVERSE VIEW, AN EX-PARTE ORDER WAS PASSED. IN THESE FACTS AND CIRCUMSTANCES, COUNSEL APOLOGISED FOR NOT PROPERLY INTIMATING THE LD. CIT(A) FOR NON-APPEARANCE. IT IS A SETTLED LAW THAT FOR THE DEFAULT OF THE COUNSEL, THE ASSESSEE SHOULD NOT S UFFER. IN THIS MATTER IT IS CONTENDED THAT:- (I) A REASONABLE COST MAY BE IMPOSED; (II) THE ITAT GAVE SPECIFIC DIRECTION TO ALLOW CROS S EXAMINATION TO THE ASSESSEE, WHICH WAS NOT GIVEN IN BOTH ORIGINAL AS WELL AS IN THE SECOND ROUND OF PROCEEDINGS. THEREFORE, THE PRINCIPLES OF NATURAL JUSTICE REMAIN UNCOMPLIED WITH. 3 ITA NO.5396/MUM/2016 (ASSESSMENT YEAR 2006-07) 6. THE LD. DEPARTMENTAL REPRESENTATIVE SUPPORTS THE ORDER OF THE AUTHORITIES BELOW AND CONTENDED THAT ASSESSEE HAS B EEN A HABITUAL DEFAULTER IN NOT COMPLYING WITH THE REQUIREMENTS CALLED FOR B Y THE LD./S ASSESSING OFFICER AND CIT(A). THE QUESTION OF CROSS EXAMINATION BECO ME RELEVANT ONLY AFTER THE ASSESSEE FILES RELEVANT INFORMATION AS CALLED FOR. THIS, THIS PLEA IS BEING REPEATEDLY TAKEN TO AVOID SCRUTINY OF THE FACTS. T HEREFORE, THE EX-PARTE ORDER HAS RIGHTLY BEEN PASSED AND THE ADDITION MADE BY THE CIT(A) DESERVE TO BE CONFIRMED. 7. I HAVE CAREFULLY HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. AS THE FACTS EMERGES, THE LD. REPRESENTATI VE FOR THE ASSESSEE HAS APOLOGISED FOR HIS UN-PROFESSIONAL CONDUCT IN NOT I NFORMING THE LD. CIT(A) PROPERLY ABOUT A REASONABLE CAUSE AND FAILED TO REQ UEST THE ADJOURNMENT. IT IS A SETTLED LAW THAT FOR THE DEFAULT OF THE COUNSEL, ASSESSEE SHOULD NOT SUFFER. HOWEVER, DUE TO THESE ISSUES THE PROCEEDINGS ARE BE ING PROLIFERATED. FURTHER, ITAT DIRECTED TO ACCORD CROSS EXAMINATION OF THE WITNESSES AS MENTIONED IN THE ITAT ORDER(SUPRA). THE ASSESSEE H AS BEEN TAKING THE GROUND REPEATEDLY, THEREFORE, TO THIS EXTENT, THE PRINCIPL E OF NATURAL JUSTICE REMAIN TO BE COMPLIED WITH. UNDER THESE FACTS AND CIRCUMSTAN CES, I AM INCLINED TO SET- ASIDE THE EX-PARTE ORDER PASSED BY THE CIT(A) TO HI S FILE WITH FOLLOWING OBSERVATIONS: (I) THE ASSESSEE /COUNSEL SHOULD PAY COST OF RS.5, 000/- (RUPEES FIVE THOUSAND ONLY) AND THE NECESSARY CHALLAN ALONG WITH A COPY O F THIS ORDER SHOULD BE FURNISHED WITH CIT(A) TO INITIATE FRESH HEARING; 4 ITA NO.5396/MUM/2016 (ASSESSMENT YEAR 2006-07) (II) THE ASSESSEE SHOULD WITH FAIL DULY COMPLY WIT H THE DIRECTIONS OF CIT(A), PROVIDE NECESSARY INFORMATION ASKED FOR AND SHOULD NOT INDULGE IN UNNECESSARY ADJOURNMENTS OR DELAYING TACTICS; AND (III) THE CIT(A) SHOULD ENSURE THAT ASSESSEE GETS A CHANCE OF CROSS EXAMINATION IN TERMS OF DIRECTIONS OF ITAT VIDE ORDER DATED 29/ 6/2012(SUPRA). 8. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWE D FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 01/02/2017 SD/- (R.P.TOLANI) JUDICIAL MEMBER MUMBAI, DATED 01/02/2017 VM , SR. PS COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT , 2. THE RESPONDENT. 3. THE CIT(A)- 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. BY ORDER, //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI