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ITA 5905/DEL/2015

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 5905 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 6 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-05-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2007-2008
• Appeal Filed On: 02-11-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAVIKANT GUPTA
• Keywords: Opportunity of being heard; Principle of natural justice

Judgement Text

ITA NO . 5905 /DEL/201 5 ASSESSMENT YEAR: 2007 - 08 PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI A BENCH, NEW DELHI [CORAM : PRAMOD KUMAR AM AND SUDHANSHU SRIVASTAVA JM ] ITA NO . 5905/DEL/2015 ASSESSMENT YEAR : 2007 - 08 M/S BITS INFORMATION TECHNOLOGY SOLUTIONS PRIVATE LIMITED ..............................APPLICANT R - 65, GREATER KAILASH - I NEW DELHI - 110048 [PAN: AACCB7269F ] VS ITO WARD - 3(1) NEW DELHI . ......RESPONDENT APPEARANCES BY RAJIV SAXENA A LONG - WIT H AJIT K. JHA AND SHYAM SUNDAR FOR THE APP ELLANT RAVI KANT GUPTA, FOR THE RESPONDENT DATE OF CONCLUDING THE HEARING : MAY 2 8 , 201 8 DATE OF PRONOUNC ING THE ORDER : MAY 30 , 201 8 O R D E R PER PRAMOD KUMAR, AM: 1. BY WAY OF THIS APPEAL, T HE ASSESSEE APPELLANT HAS CHALLENGED CORRECTNESS OF LEARNED CIT(A) S EX PARTE ORDER DATED 31 ST AUGUST, 2015 PASSED BY THE CIT(A) IN THE MATTER OF PENALTY UNDER SECTION 271(1)(C) OF THE INCOME TAX ACT, 1961 FOR THE ASSESSMENT YEAR 2007 - 08. 2. GRIEVANCES O F THE ASSESSEE ARE AS FOLLOWS: - I . THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS GROSSLY ERRED BOTH IN LAW AND ON FACTS IN DISMISSING THE APPEAL AND HOLDING JUSTIFIED AO IN IMPOSING PENALTY OF RS. 8,87,136/ - U/S 271(1)(C) BECAUSE O F GROUNDS AMON GST THE FOLLOWING: ( A ) MERELY BECAUSE ADDITIONS/DISALLOWANCES WERE CONFIRMED /DISALLOWED PENALTY CANNOT BE LEVIED WHICH ARE SEPARATE AND INDEPENDENT PROCEEDINGS. ITA NO . 5905 /DEL/201 5 ASSESSMENT YEAR: 2007 - 08 PAGE 2 OF 3 ( B ) AO DID NOT ENQUIRE AND MAKE PROPER APPRECIATION OF FACTS OF THE PRESENT CASE DUE TO WHICH ADDITION S WERE CONFIRMED IN THE ASSESSMENT/APPEALS AND DURING PENALTY PROCEEDING DID NOT MAKE ANY EFFORTS TO RE - APPRAISE THEM. ( C ) EVEN AFTER SEVERAL REMAND REPORTS AO DID NOT PROPERLY ENQUIRE FROM BANKS WHO LATER ON CONFIRMED VARIOUS AMOUNTS OF THE SHARE APPLICANTS. ( D ) NEITHER THERE WAS CONCEALMENT NOR FILING ANY INACCURATE PARTICULARS OF INCOME WHILE AO HIMSELF IS NOT SURE THE REASON FOR LEVYING PENALTY U/S 271(1)(C) . II . THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS FAILED TO APPRECIATE THAT PENALTY WAS LE VIED DUE TO ADDITIONS/DISALLOWANCES AGAINST WHICH SECOND APPEAL WAS NOT FILED THOUGH CONFIRMED BY THE CIT(A) BECAUSE AFTER APPEAL EFFECT TO THE CIT(A) S ORDER INCOME WAS COMPUTED WITH NO TAX LIABILITY. III . THAT THE ORDER OF THE LD. CIT(A) IS BAD IN LAW AS HE HAS FAILED TO PROVIDE PROPER OPPORTUNITY OF BEING HEARD TO THE ASSESSEE VIOLATING THE PRINCIPLES OF NATURAL JUSTICE. 3. WHEN LEARNED COUNSEL FOR THE ASSESSEE WAS ASKED AS TO WHY DID THE ASSESSEE DID NOT APPEAR BEFORE THE CIT(A), RESULTING IN IMPUGNED E X PARTE ORDER BEFORE US, IT WAS EXPLAINED TO US THAT THE ASSESSEE WAS NOT SERVED ANY NOTICES. LEARNED COUNSEL POINTS OUT THAT, AS LEARNED CIT(A) HIMSELF HAS NOTED IN PARAGRAPH 3.0 OF THE IMPUGNED ORDER, THE NOTICES WERE RETURNED BY THE POSTAL AUTHORITIES U NSERVED. IT WAS ALSO POINTED OUT THAT THE ASSESSEE HAD CLOSED THE BUSINESS AT THAT ADDRESS AND THAT WAS THE REASON THAT NOTICES COULD NOT BE SERVED. HE SUBMITS THAT THE ASSESSEE TO NON APPEARANCE BEFORE THE CIT(A) WAS BONAFIDE AND FOR THE REASONS BEYOND T HE CONTROL OF THE ASSESSEE. HE, NEVERTHELESS, URGES U S TO ADJUDICATE THE MATTER ON MERITS. LEARNED DEPARTMENTAL REPRESENTATIVE ON THE OTHER HAND, URGES U S TO AT BEST REMIT THE MATTER TO THE FILE OF THE CIT(A) FOR FRESH ADJUDICATE ON MERITS. HE SUBMITS THAT THERE IS NO POINT IN ADJUDICATION ON MERITS AT THIS STAGE, AS THE ASSESSEE HAS NOT APPEARED AT ALL BEFORE THE CIT(A) AND THE ASSESSEE HAS NOT EVEN PROPERLY AVAILED THE OPPORTUNITY BEFORE THE ASSESSING OFFICER. 4. HAVING HEARD THE RIVAL CONTENTIONS AND H AVING PERUSED THE MATERIAL ON RECORD, WE ARE OF THE CONSIDERED VIEW THAT THE MATTER SHOULD BE RESTORED TO THE FILE OF THE CIT(A) FOR FRESH ADJUDICATION ON MERITS PARTICULARLY AS THE LEARNED CIT(A) HAS SUMMARILY DISMISSED THE APPEAL WITHOUT ADDRESSING THE MERITS AT ALL. SUCH A SUMMARY DISMISSAL OF APPEAL BY THE CIT(A) MERELY ON ACCOUNT OF NON APPEARANCE BY THE ASSESSEE AND WITHOUT ADDRESSING HIMSELF TO THE MERITS OF THE CASE IS NOT PERMISSIBLE IN LAW. HE HAS TO DECIDE THE MATTER, EVEN IN THE ABSENCE OF ANY ASSISTANCE FROM THE ASSESSEE, ON MERITS AND IN ACCORDANCE WITH THE SCHEME OF THE ACT. WE, THEREFORE, DIRECT THE CIT(A) TO DECIDE THE MATTER ON MERITS. WHILE SO DECIDING THE MATTER AFRESH ON MERITS, LEARNED CIT(A) WILL GIVE YET ANOTHER OPPORTUNITY OF HEARI NG TO THE ASSESSEE , AND DECIDE THE MATTER IN ACCORDANCE WITH LAW AND BY WAY OF A SPEAKING ORDER. ORDERED , ACCORDINGLY. ITA NO . 5905 /DEL/201 5 ASSESSMENT YEAR: 2007 - 08 PAGE 3 OF 3 5. IN THE RESULT, THE APPEAL IS ALLOWED FOR STATISTICAL PURPOSES IN THE TERMS INDICATED ABOVE. ORDER PRONOUNCED IN THE OPEN COURT O N 30 .5.2018. SD/ - SD/ - SUDHANSHU SRIVASTAVA PRAMOD KUMAR (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) NEW DELHI , DATED THE 30 DAY OF MAY , 2018 COPIES TO : (1) THE APPELLANT (2) THE RE SPONDENT (3) CIT (4) CIT(A) (5) DR (6) GUARD FILE BY ORDER ETC ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES, NEW DELHI