M/s. M.M. Industries, New Delhi V. ITO (OSD), Faridabad

ITA 5668/DEL/2015

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 6866 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-10-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC 3
• Next Hearing Date: 10-08-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 07-10-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B RAMANA JANEYULU
• Assessee Lawyers: ABHISHEK ANAND
• Keywords: Opportunity of being heard; Principle of natural justice

Judgement Text

PAGE 1 OF 4 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: SMC-3 NEW DELHI BEFORE SMT DIVA SINGH, JUDICIAL MEMBER I.T.A .NO.-566 8/DEL/2015 (ASSESSMENT YEAR- 2009-10) M.M. INDUSTRIES , C/O-M/S.RRA TAXINDIA, D-28, SOUTH EXTENSION, PART-I, NEW DELHI-110049. PAN-AALFM2320G (APPELLANT) VS ITO (OSD) , RANGE-II, FARIDABAD. (RESPONDENT) APPELLANT BY SH. S OMIL AGARWAL, ADV. & SH.ABHISHEK ANAND, ADV. RESPONDENT BY SH.B.RAMANA JANEYULU, SR.DR ORDER THE PRESENT APPEAL HAS BEEN FILED BY THE ASSESSEE A SSAILING THE CORRECTNESS OF THE ORDER DATED 30.10.2014 OF CIT(A)-2, FARIDABA D PERTAINING TO 2009-10 ASSESSMENT YEAR ON VARIOUS GROUNDS INCLUDING GROUND NO.7 WHICH READS AS UNDER:- 7. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANC ES OF THE CASE, LD.CIT(A) HAS ERRED IN LAW AND ON FACTS IN UPHOLDIN G THE ACTION OF THE LD. A.O. IN PASSING THE IMPUGNED ORDER WITHOUT GIVING A DEQUATE OPPORTUNITY OF BEING HEARD. 2. ADDRESSING THE REASONS FOR NON-APPEARANCE BEFORE THE CIT(A),IT WAS SUBMITTED BY THE LD.AR THAT THE ASSESSEE HAD ENGAGE D A COUNSEL WHO FOR REASONS BEST KNOWN TO HIM DID NOT INFORM THE ASSESSEE THAT HE WAS NOT APPEARING. THUS, ON ACCOUNT OF SOME FRICTION WITH THE COUNSEL, THE A SSESSEE REMAINED UNREPRESENTED. ACCORDINGLY, THE LIMITED PRAYER OF T HE LD.AR WAS THAT THE IMPUGNED ORDER BE SET ASIDE AND THE ASSESSEE BE GIVEN AN OPP ORTUNITY OF BEING HEARD AS DATE OF HEARING 10.08.2016 DATE OF PRONOUNCEMENT 17.10.2016 I.T.A .NO.-5668/DEL/2015 PAGE 2 OF 4 SOLELY ON ACCOUNT OF THE FAULT OF THE COUNSEL, THE ASSESSEE REMAINED UNREPRESENTED AND THE ADDITION MADE BY THE AO WHICH HAD BEEN CHAL LENGED IN APPEAL BEFORE THE CIT(A) WERE SUSTAINED INTOTO DISMISSING THE APPEAL OF THE ASSESSEE. 3. LD. SR. DR OPPOSED THE PRAYER OF THE ASSESSEE AN D IT WAS HIS SUBMISSION THAT THE ADDITIONS MADE BY THE AO WHICH HAVE BEEN SUSTAI NED BY THE CIT(A) DESERVE TO BE UPHELD. 4. I HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED T HE MATERIAL AVAILABLE ON RECORD. IT IS SEEN THAT THE ASSESSEE RETURNED AN I NCOME OF RS.2,02,981/-. AS A RESULT OF THE ADDITIONS MADE BY THE AO THE ASSESSME NT WAS CONCLUDED AT AN INCOME OF RS.10,47,527/-, THESE ADDITIONS WERE CHA LLENGED IN APPEAL BY THE ASSESSEE. AS PER THE RECORDING MADE IN THE IMPUGNE D ORDER THE ASSESSEE WAS REPRESENTED BY MR.SANJEEV BANSAL, CA WHO INITIALLY SOUGHT SOME TIME AND THEREAFTER STOPPED APPEARING. ACCORDINGLY, IN THE ABSENCE OF ANY ARGUMENT ON FACTS OR LAW THE FINDING OF THE ASSESSING OFFICER W AS CONSIDERED TO BE CORRECT. IN THE AFORE-MENTIONED PECULIAR FACTS AND CIRCUMSTANC ES, CONSIDERING THE LIMITED PRAYER OF THE ASSESSEE THAT AN EFFECTIVE OPPORTUNIT Y OF BEING HEARD MAY BE PROVIDED. I FIND THAT IN THE PECULIAR FACTS OF THE PRESENT CASE AND IN THE INTERESTS OF SUBSTANTIAL JUSTICE, IT DESERVES TO BE ALLOWED. RI GHT TO BE HEARD IS AN IMPORTANT RIGHT TO WHICH A PARTY WHO IS FACED WITH AN ADVERSE VIEW IS ENTITLED TO AUDI ALTERAM PARTEM IS ONE OF THE MOST FAMOUS AND CELEBRATED RULE OF N ATURAL JUSTICE. THE PRINCIPLES OF NATURAL JUSTICE ARE THOSE WHICH H AVE BEEN LAID OUT BY THE COURTS AS BEING THE MINIMUM PROTECTION OF THE RIGHTS OF AN INDIVIDUAL AGAINST THE ARBITRARY PROCEDURE THAT MAY BE ADOPTED BY A JUDICI AL, QUASI-JUDICIAL AND ADMINISTRATIVE AUTHORITY WHILE MAKING AN ORDER AFFE CTING THOSE RIGHTS. A CAREFUL I.T.A .NO.-5668/DEL/2015 PAGE 3 OF 4 PERUSAL OF THE CONSISTENT JUDGEMENTS OF THE APEX CO URT WOULD SHOW THAT IT HAS CONSISTENTLY BEEN HELD THAT THE RULES OF NATURAL JU STICE ARE NOT EMBODIED RULES AND THE SAID PHRASE IS NOT AND CANNOT BE CAPABLE OF A P RECISE DEFINITION. THE UNDERLYING PRINCIPLE OF NATURAL JUSTICE EVOLVED UND ER THE COMMON LAW IS TO CHECK ARBITRARY EXERCISE OF POWER BY THE STATE OR ITS FUN CTIONARIES. ACCORDINGLY, THE PRINCIPLE BY ITS VERY NATURE IMPLIES THE DUTY TO AC T FAIRLY I.E. FAIR PLAY IN ACTION MUST BE EVIDENT AT EVERY STAGE. FAIR PLAY DEMANDS THAT NOBODY SHALL BE CONDEMNED UNHEARD. 4.1. IN THE CELEBRATED JUDGEMENT OF THE APEX COURT IN THE CASE OF A.K.KRAIPAK VS- UNION OF INDIA (1969) 2 SCC 262, IT IS OBSERVED THAT THE AIM OF RULES OF NATURAL JUSTICE IS TO SECURE JUSTICE OR TO PUT IT NEGATIVEL Y TO PREVENT MISCARRIAGE OF JUSTICE. THE SAID RULES ARE MEANS TO AN END AND NOT AN END I N THEMSELVES AND THOUGH IT IS NOT POSSIBLE TO MAKE AN EXHAUSTIVE CATALOGUE OF SUC H RULES HOWEVER IT CAN BE READILY SAID THAT THERE ARE TWO BASIC MAXIMS OF NAT URAL JUSTICE NAMELY AUDI ALTERAM PARTEM AND NEMO JUDEX IN RE SUA. IN THE PRESENT FACTS OF THE CASE WE ARE CONCERNED WITH THE MAXIM AUDI ALTERM PARTEM WHICH AGAIN MAY HAVE MANY FACETS TWO OF THEM (A) NOTICE OF THE CASE TO BE MET ; AND (B) OPPORTUNITY TO EXPLAIN. THEIR LORDSHIPS HAVE CAUTIONED THAT THESE RULES CAN NOT BE SACRIFICED AT THE ALTAR OF THE ADMINISTRATIVE CONVENIENCE OR CELEBRITY. ACCOR DINGLY IN VIEW OF THE ABOVE, THE IMPUGNED ORDER IS SET ASIDE AND FOR THE PURPOSES OF GRANTING AN EFFECTIVE OPPORTUNITY OF BEING HEARD, THE ISSUES ARE RESTORED TO THE FILE OF THE CIT(A) WITH A DIRECTION TO PASS A SPEAKING ORDER IN ACCORDANCE WI TH LAW AFTER GIVING THE ASSESSEE A REASONABLE OPPORTUNITY OF BEING HEARD. WHILE SO DIRECTING, IT IS MADE CLEAR THAT THE OPPORTUNITY SO PROVIDED IT IS HOPED IS UTILIZED BY THE ASSESSEE IN GOOD FAITH AS I.T.A .NO.-5668/DEL/2015 PAGE 4 OF 4 FAILING WHICH THE LD.CIT(A) WOULD BE JUSTIFIED TO PASS A SPEAKING ORDER ON THE BASIS OF MATERIAL AVAILABLE ON RECORD. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 17 TH OCTOBER, 2016. SD/- (DIVA SINGH) JUDICIAL MEMBER *AMIT KUMAR* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSI STANT REGISTRAR ITAT NEW DELHI