Sonic Watches Ltd., Dist.Bharuch V. The Dy.CIT.,Bharuch Circle, Bharuch

ITA 593/AHD/2009

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 50685 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 6 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-09-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 01-09-2011
• Assessment Year: 2005-2006
• Appeal Filed On: 23-02-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D C SHARMA SR D R
• Keywords: Reasonable cause

Judgement Text

, , , , IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, AHMEDABAD , .'.#$%, '& ' ' BEFORE SHRI MUKUL KR.SHRAWAT, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER 1. ./ I.T.A. NO.593/AHD/2009 2. ./ I.T.A. NO.594/AHD/2009 ( ) * ) * ) * ) * / / / / ASSESSMENT YEAR : 2005-06) 1.SONIC WATCHES LTD. NATIONAL HIGHWAY#8 VILLAGE VADADALA DIST.BHARUCH PAN NO. :AAFCS3406 A 2. SHRI MAHENDRA MAHJITHIA PROP. OF M/S.SOTEX VILLAGA VADADALA DIST.BHARUCH PAN NO. :ACJPM 5264 H ) ) ) ) / VS. 1. DCIT, BHARUCH CIRCLE BHARUCH 2. ITO, WARD-2 BHARUCH ( +, / // / APPELLANTS ) .. ( -.+,/ RESPONDENTS ) +, / ' / APPELLANTS BY : MS.URVASHI SHODHAN, A.R. -.+, 0 / ' / RESPONDENT BY : SHRI D.C. SHARMA, SR. D.R. )1 0 & / / / / DATE OF HEARING : 01/09/2011 2$* 0 & / DATE OF PRONOUNCEMENT : 09/09/2011 '3 / O R D E R PER SHRI MUKUL KR. SHRAWAT, JUDICIAL MEMBER : THESE TWO APPEALS ARE CONNECTED APPEALS ARISING FR OM THE ORDERS OF THE LEARNED CIT(APPEALS)-VI, BARODA RESPECTIVELY DA TED 17/10/2008 AND 30/10/2008. IN THE CASE OF SONIC WATCHES LTD. VI DE AN ORDER PASSED ITA NO.593/AHD/ 2009 & ITA NO.594/AHD/2009 SONIC WATCHES LTD. VS. DCIT & SH.MAHENDRA MAJITHIA ASST.YEAR - 2005-06 - 2 - U/S.143(3) DATED 17/12/2007, THE ASSESSING OFFICER HAS ASKED TO FURNISH THE DETAILS IN RESPECT OF AN AMOUNT OF UNSECURED L OANS OF RS.15 LACS AS PRESCRIBED U/S.68 OF THE I.T.ACT. HOWEVER, DUE TO NON-COMPLIANCE THE ADDITION WAS MADE. 2. LIKEWISE IN THE CASE OF SHRI MAHENDRA MAJITHIA AN ORDER U/S.144 OF THE I.T.ACT WAS PASSED DATED 27/12/2007. CERTA IN QUERIES WERE RAISED AS PRESCRIBED U/S.68 OF THE I.T.ACT BUT NO COMPLIAN CE WAS MADE, HENCE THE ADDITION WAS MADE. 3. BOTH THE CASES WERE CHALLENGED BEFORE THE LEARNE D CIT(APPEALS), HOWEVER, NO ONE HAD ATTENDED THE APPELLATE PROCEEDI NGS. IN BOTH THE CASES, THE LEARNED CIT(APPEALS) HAS RECORDED THE DA TES ON WHICH THE SAID APPEALS WERE FIXED AND, THEREAFTER, DUE TO NON -COMPLIANCE, HE HAD DECIDED TO PROCEED EX-PARTE . 4. THE BENCH HAS ASKED THE REASON OF NON-APPEARANCE BEFORE THE AUTHORITIES BELOW AND IN COMPLIANCE THE LEARNED AUT HORISED REPRESENTATIVE MS.URVASHI SHODHAN HAS STATED WITH ASSERTION THAT THERE WAS A GENUINE CAUSE DUE TO WHICH BOTH THE CASES REM AINED UNREPRESENTED. SHE HAS INFORMED THAT THE MAIN PERSON MR. MAHENDRA MAHJITHIA WAS SERIOUSLY ILL AND UNDERGONE A CHEMOTHERAPY. THIS FACT WAS ASCERTAINED BY A CERTIFICATE ISSUED BY A DOCTOR OF JASLOK HOSP ITAL DATED 17/08/2007 THAT MR.MAJITHIA MAHENDRA M WAS ADMITTED IN THE HOS PITAL DURING THE PERIOD OF JULY-2007. THE ASSESSEE HAD GONE FOR FUR THER TREATMENT ABROAD ITA NO.593/AHD/ 2009 & ITA NO.594/AHD/2009 SONIC WATCHES LTD. VS. DCIT & SH.MAHENDRA MAJITHIA ASST.YEAR - 2005-06 - 3 - AND UNFORTUNATELY EXPIRED ON 27/04/2008. THE PRO CEEDINGS BEFORE THE ASSESSING OFFICER WERE CONDUCTED DURING THAT PERIOD ONLY. THE LEARNED AUTHORISED REPRESENTATIVE HAS ALSO INFORMED THAT TH E APPEALS WERE FILED BY THE LEGAL HEIRS, HOWEVER, THE SAID LEGAL HEIR HA S NOT BEEN SUBSTITUTED. 5. FROM THE SIDE OF THE REVENUE, THE LEARNED DEP ARTMENTAL REPRESENTATIVE MR. D.C.SHARMA APPEARED AND FIRSTLY ARGUED THAT ANYBODY IN THE FAMILY COULD HAVE REPRESENTED THE CASES OR A TLEAST THE ASSESSEE COULD HAVE AUTHORIZED A LEGAL REPRESENTATIVE TO ATT END THE PROCEEDINGS. HE HAS MENTIONED THAT THOUGH IT WAS UNFORTUNATE TH AT THE APPELLANT HAD EXPIRED BUT THE ASSESSING OFFICER WAS UNDER STATUTO RY OBLIGATION TO COMPLETE THE ASSESSMENT WITHIN A PRESCRIBED TIME FR AME. HE HAS ALSO PLEADED THAT THE ASSESSEE HAS NOT DEMONSTRATED THAT NOW ATLEAST HE HAD SUFFICIENT EVIDENCE IN HIS POSSESSION FOR THE NECES SARY COMPLIANCE OF THE LEGAL REQUIREMENT. 6. WE HAVE HEARD BOTH THE SIDES. WE HAVE ALSO PERU SED THE ORDERS OF THE AUTHORITIES BELOW. THE ASSESSMENT PROCEEDINGS, IN RESPECT OF BOTH THE CASES WERE DURING THE PERIOD OF JUNE, JULY AND AUGU ST-2007. SHOW- CAUSE NOTICES HAVE ALSO BEEN ISSUED LATER ON IN THE MONTH OF NOVERMBER- 2007. AS CERTIFIED BY A DOCTOR OF JASLOK HOSPITAL, THE MAIN PERSON NAMELY LATE MR. MAHENDRA MAHJITHIA HAD UNDERGONE A CHEMOTHERAPY TREATMENT IN THE MONTH OF JULY-2007. AS THE BAD LU CK WOULD HAVE IT, HE ITA NO.593/AHD/ 2009 & ITA NO.594/AHD/2009 SONIC WATCHES LTD. VS. DCIT & SH.MAHENDRA MAJITHIA ASST.YEAR - 2005-06 - 4 - EXPIRED ON 27/04/2008. ON ACCOUNT OF THESE REASONS , WE HEREBY HOLD THAT THERE WAS A SUFFICIENT REASON FOR NON-ATTENDANCE O F THE PROCEEDINGS. UNDISPUTEDLY DUE TO ILL-HEALTH THE ASSESSEE WAS PRE VENTED BY A SUFFICIENT AND REASONABLE CAUSE NOT TO MAKE NECESSA RY ARRANGEMENT FOR THE REQUISITE COMPLIANCE. THE LEARNED AUTHORISED REPRESENTATIVE HAS STATED WITH FULL SENSE OF RESPONSIBILITY THAT THE D ESIRED DETAILS ARE VERY MUCH IN THE POSSESSION OF THE LEGAL HEIRS AND THOS E CAN BE FURNISHED ANY TIME IF REQUIRED SUBJECT TO AN OPPORTUNITY BE GRANT ED. CONSIDERING THE TOTALITY OF THE CIRCUMSTANCES OF THE CASE, WE DEEM IT PROPER TO REVERT THE GROUNDS BACK TO THE STAGE OF THE ASSESSING OFFICER BECAUSE CERTAIN EVIDENCES IN SUPPORT OF THE GENUINENESS OF THE CASH CREDITORS ARE REQUIRED TO BE INVESTIGATED, WHICH CAN ONLY BE DONE BY THE A SSESSING OFFICER. BY REVERTING BACK TO THE STAGE OF THE ASSESSING OFFICE R FOR VERIFICATION, IN OUR OPINION , NEITHER THE APPELLANT(S) NOR THE REVE NUE, BOTH WILL NOT LOOSE ANYTHING , RATHER BOTH THE PARTIES SHALL HAVE ENOUGH OPPORTUNITY TO GET THE ASSESSMENT(S) FINALIZED AS PER LAW. HOWEV ER, WE HEREBY INSTRUCT THE APPELLANTS TO SUO MOTU APPROACH THE ASSESSING OFFICER WITHIN 60 DAYS ON RECEIPT OF THIS ORDER INSTEAD OF WAITING FO R THE NOTICE OF HEARING AND, THEREAFTER, FURNISH ALL THE DETAILS AS EARLY AS POSSIBLE WITHOUT SEEKING FRIVOLOUS ADJOURNMENT. HOWEVER, THE ASSESSING OFFI CER IS AT LIBERTY TO ISSUE NECESSARY NOTICES, SO THAT THE INVESTIGATION IN RESPECT OF THE CASH CREDITORS AS ALSO IN RESPECT OF ANY OTHER ISSUE , A S DEEM FIT, CAN BE COMPLETED AT AN EARLY DATE, SO THAT THE ASSESSMEN T SHOULD GET FINALIZED ITA NO.593/AHD/ 2009 & ITA NO.594/AHD/2009 SONIC WATCHES LTD. VS. DCIT & SH.MAHENDRA MAJITHIA ASST.YEAR - 2005-06 - 5 - DENOVO AFRESH AS PER LAW. SINCE THE MATTER HAS BEEN REMAN DED BACK, THEREFORE, GROUNDS RAISED IN THESE TWO APPEALS MAY BE TREATED AS ALLOWED BUT FOR STATISTICAL PURPOSES ONLY. 7. IN THE RESULT, BOTH THE APPEALS OF THE ASSESS EE(S) ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER SIGNED, DATED AND PRONOUNCED IN THE COURT ON 9/ 9 /2011. SD/- SD/- ( A.K. GARODIA ) ( MUKUL KR. SHRAWAT ) ACCOUNTANT MEMBER JUDICIAL MEM BER AHMEDABAD; DATED 09/ 09 /2011 4..), .)../ T.C. NAIR, SR. PS '3 '3 '3 '3 0 00 0 -5 -5 -5 -5 6'5* 6'5* 6'5* 6'5* / COPY OF ORDER FORWARDED TO:- 1. +, / APPELLANT 2. -.+, / RESPONDENT 3. : / CONCERNED CIT 4. :- / CIT (A)-VI, BARODA 5. 5># -) , , / DR, ITAT, AHMEDABAD 6. # @A / GUARD FILE. BY ORDER/ '3 ', .5 - //TRUE COPY// B/ C ,