SWAPNALI LAHU GHADGE , MUMBAI V. DEPUTY COMMISSIONER OF INCOME TAX 24(3), MUMBAI

ITA 5525/MUM/2017

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 6630 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 5 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-02-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Assessment Year: 2011-2012
• Appeal Filed On: 31-08-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: CIR CUMSTANCES OF S CASE
• Keywords: Opportunity of being heard; Condonation of delay
• Section: 271(1)(c); 142(1); 201; 143(2)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL G BENCH, MUMBAI BEFORE SHRI SHAMIM YAHYA, AM AND SHRI AMARJIT SINGH, JM / I.T.A. NO. 5525 / MUM/ 2017 ( / ASSESSMENT YEAR: 201 1 - 1 2 ) SWAPNALI LAHU GHADGE SS - II - A - 50, SECTOR - 5, KOPARKHAIRANE, NAVI MUMBAI - 400709 . / VS. DCIT - 24(3) 7 TH FLOOR, C - 11, PRATYAKSHAKAR BHAVAN, BKC, BANDRA (E), MUMBAI - 400051. ./ ./ PAN/GIR NO. : ARYPG 9601 J ( / APPELLANT ) .. ( / RESPONDENT ) / DATE OF HEARING: 08 .01.2019 / DATE OF PRONOUNCEMENT: 27. 02 .2019 / O R D E R PER AMARJIT SINGH, JM: THE ASSESSEE HAS FILED THE PRESENT A PPEAL AGAINST THE ORDER DATED 05 . 12.2016 PASSED BY THE COMMISSI ONER OF INCOME TAX (APPEALS) - 42 , MUMBAI [HEREINAFTER REFERRED TO AS THE CIT(A)] RELEVANT TO THE A.Y.2011 - 1 2 . 2 . THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS: - I. ON THE FACTS AND CIRCUMSTANCES OF THE APPELLANT'S CASE AND IN LAW, THE LD. COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN NOT ACCEPTING THE REVENUE BY : SHRI CHAUDHARY ARUN KUMAR ASSESSEE BY: NONE ITA. NO. 5525 /M/201 7 A.Y. 2011 - 12 2 APPLICATION FOR CONDONATION OF DELAY FILED BY THE APPELLANT AND NOT ADMITTING THE APPEAL FILED THERETO. 2. ON THE FACTS AND CIRCUMSTANCES OF THE AP PELLANT'S CASE AND IN LAW, THE LD. COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN PASSING THE IMPUGNED ORDER WITHOUT AFFORDING ADEQUATE OPPORTUNITY OF BEING HEARD. 3. ON THE FACTS AND CIRCUMSTANCES OF THE APPELLANT'S CASE AND IN LAW ID. COMMISSIONER OF INCO ME TAX (APPEALS) ERRED IN CONFIRMING THE ACTION OF LD AO IN HOLDING THE COMMISSION RECEIPT AS INCOME FROM BUSINESS & PROFESSION AS PER THE GROUNDS STATED IN THE ORDER OR OTHERWISE. 4. ON THE FACTS AND CIRCUMSTANCES OF THE APPELLANT'S CASE AND IN LAW ID. CO MMISSIONER OF INCOME TAX (APPEALS) ERRED IN CONFIRMING THE ACTION OF LD. AO IN DISALLOWING AN AD - HOC SUM OF RS.57,37,082/ - BEING 70% OF COMMISSION EXPENSES AS PER THE GROUNDS STATED IN THE ORDER OR OTHERWISE. 5. ON THE FACTS AND CIRCUMSTANCES OF THE APPEL LANT'S CASE AND IN LAW ID. COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN CONFIRMING THE ACTION OF LD. AO IN DISALLOWING AN AD - HOC SUM OF RS.16,20,853/ - BEING 30% OF OTHER EXPENSES AS PER THE GROUNDS STATED IN THE ORDER OR OTHERWISE. 6. ON THE FACTS AND CIR CUMSTANCES OF THE APPELLANT'S CASE AND IN LAW ID. COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN CONFIRMING THE ACTION OF LD. AO IN ADDITION OF RS.40,000/ - BEING RENTAL INCOME AS PER THE GROUNDS STATED IN THE ORDER OR OTHERWISE. 7. ON THE FACTS AND CIRCUMST ANCES OF THE APPELLANT'S CASE AND IN LAW ID. COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN CONFIRMING THE ACTION OF LD. AO IN MAKING, ADDITION OF RS.21,388/ - BEING INCOME FROM OTHER SOURCES AS PER THE GROUNDS STATED IN THE ORDER OR OTHERWISE. 8. THE LD. CO MMISSIONER OF INCOME TAX (A) ERRED IN CONFIRMING THE ACTION OF LD. AO IN INITIATING PENALTY PROCEEDINGS U/S 271B OF THE I.T. ACT, 1961. 9. THE LD. COMMISSIONER OF INCOME TAX (A) ERRED IN CONFIRMING THE ACTION OF LD. AO IN INITIATING PENALTY PROCEEDINGS U/S 271(1)(C) OF THE I.T. ACT, 1961. 10. THE APPELLANT CRAVES LEAVES TO ADD, TO AMEND, ALTER, MODIFY AND/OR WITHDRAW ANY OR ALL OF THE ABOVE GROUNDS OF APPEAL, EACH OF WHICH ARE WITHOUT PREJUDICE TO ONE ANOTHER. ITA. NO. 5525 /M/201 7 A.Y. 2011 - 12 3 THE APPELLANT PRAYS THIS HONBLE TRIBUNAL TO DELETE THE ADDITIONS/ DISALLOWANCE BY THE LD. AO AND CONFIRMED BY THE LD. CIT(A). 3 . THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE FILED HER RETURN OF INCOME ON 04 .0 8 .201 1 FOR THE A.Y. 2011 - 12 DECLARING TOTAL INCO ME TO THE TUNE OF RS.25,22,410 / - . THE CASE WA S SELECTED FOR SCRUTINY. NOTICES U/S 143(2) & 142(1) OF THE ACT WERE ISSUED AND SERVED UPON THE ASSESSEE. THE ASSESSEE IS AN INDIVIDUAL AND EARNED COMMISSION INCOME FROM ROYAL TWINKLE STAR CLUB LIMITED (RTSC) AMOUNTING TO THE TUNE OF RS.1,62,21,080/ - AND CLAIMED COMMISSION PAID OF RS.81,95,832/ - AND BU SINESS SALES & PROMOTION EXPENSES OF AN AMOUNT OF RS.41,29,717/ - . DURING THE YEAR, THE ASSESSEE OFFERED OF THE NET PROFIT OF RS.26,22,404/ - . THE ASSESSEE WAS ASKED TO ADDUCE THE EVIDENCE IN SUPPORT OF C LAIM OF COMMISSION PAID OF RS.81,95,832/ - AND CLAIMED OF DEDUCTION OTHER EXPENSES AMOUNTING OF RS. 54,02,844/ - WHICH INCLUDE D MAJOR EXPENSES AS BUSINESS SALE AND PROMOTION EXPENSES OF RS.41,29,717/ - , CONFERENCE EXPENSES OF RS.1,54,754/ - , HOTEL EXPENSES OF R S.1,10,621/ - , OFFICE EXPENSES OF RS.3,59,139/ - , SEMINAR & MEETING EXPENSES OF RS.2,96,430/ - AND TRAVELLING EXPENSES OF RS.1,45,710/ - . THE ASSESSEE FAILED TO ESTABLISH THE CLAIM AS EXPENSES IN SUM OF RS.54,02,844/ - WAS PAID IN CASH AGAINST WITHDRAWAL OF RS. 35,45,000/ - , THEREFORE, 70% OF THE COMMISSION PAYMENT OF RS.81,95,832/ - AND 30% OF THE OTHER EXPENSES RS.54,02,844/ - I.E. RS.16,20,853/ - WAS DISALLOWED AND ADDED TO THE INCOME OF THE ASSESSEE. RENTAL INCOME 40,000/ - WAS ALSO ADDED TO THE INCOME OF THE ASSE SSEE AND INTEREST INCOME WHICH HAS NOT BEEN SHOWED BY THE ASSESSEE IN SUM OF RS.27,472/ - WAS ALSO ADDED TO THE INCOME OF THE ASSESSEE. THE TOTAL INCOME OF THE ASSESSEE WAS ASSESSED TO THE TUNE OF RS.99,26,493/ - . FEELING ITA. NO. 5525 /M/201 7 A.Y. 2011 - 12 4 AGGRIEVED, THE ASSESSEE FILED AN APP EAL BEFORE THE CIT(A) WHO DISMISSED THE APPEAL OF THE ASSESSEE BY NOT CONDONING THE DELAY OF 132 DAYS , THEREFORE, THE ASSESSEE HAS FILED THE PRESENT APPEAL BEFORE US. 4. WE HAVE HEARD THE ARGUMENT AND ADVANCED BY THE LD. REPRESENTATIVE OF THE DEPARTMENT HAS GONE THROUGH THE RECORD CAREFULLY. WE NOTICED THAT THE CIT(A) HAS NOT DECIDED THE CASE ON MERITS BECAUSE THE CIT(A) DID NOT CONDONE THE DELAY OF 132 DAYS, THEREFORE, TH E APPEAL OF THE ASSESSEE WAS DISMISSED. THE APPEAL HAS BEEN FILED 132 DAYS DELAYED BEFORE THE CIT(A). THE REASON HAS BEEN GIVEN THAT THE ASSESSEE HAS KEPT THE ASSESSMENT ORDER IN THE CUP - BOARD AND FORGOT TO SEE TILL AUGUST, 2014, THEREAFTER, SHE HANDED - OVE R THE ORDER TO HER CHARTERED ACCOUNTANT FOR FILING THE APPEAL. SHE ALSO CLAIMED THAT SHE WAS NOT AWARE OF TAX LAW, THEREF ORE, THE REQUESTED TO CONDONE THE DELAY. THE CIT(A) DENIED THE CONDONATION OF DELAY FINDING NO JUSTIFIABLE EXPLANATION AND ALSO BY RELY ING UPON THE LAW MENTIONED IN THE ORDER. ON APPRAISAL OF THE ASSESSMENT ORDER, WE OBSERVED THAT THE MATTER OF CONTROVERSY IS REQUIRED TO BE ADJUDICATED ON MERITS. IF THE DELAY BE NOT CONDONED, THEN UNDOUBTEDLY THE ASSESSEE WOULD SUFFER THE HARDSHIP. TAKING INTO CONSIDERATION OF ALL THE FACTS AND CIRCUMSTANCES AND CONSIDERING THIS FACT SPECIFICALLY THAT THE CASE OF THE ASSESSEE IS REQUIRED TO BE ADJUDICATED ON MERITS, THEREFORE, WE CONDONE THE DELAY AND RESTORED THE APPEAL BEFORE THE CIT(A) TO DECIDE THE MAT TER OF CONTROVERSY AFRESH BY GIVING AN OPPORTUNITY OF BEING HEARD TO THE ASSESSEE IN ACCORDANCE WITH LAW. ITA. NO. 5525 /M/201 7 A.Y. 2011 - 12 5 5 . IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS HEREBY ORDERED TO BE ALLOWED FOR STATISTICAL PURPOSES . ORDER PRONOUNCED IN THE OPEN COURT ON 27. 02 .2019 SD/ - SD/ - ( SHAMIM YAHYA ) (AMARJIT SINGH) / ACCOUNTANT MEMBER / JUDICIAL MEMBER MUMBAI; DATED : 27. 02 .2019 VIJAY / 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