Anuj Gupta, New Delhi V. JCIT Special Range-17, New Delhi

ITA 6215/DEL/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 0831 (ITAT-DELHI)
• Duration Of Justice: 10 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-06-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2015-2016
• Appeal Filed On: 22-07-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Set aside
• Section: 40A(3); 143(3); 234B; 43

Judgement Text

PAGE | 1 INCOME TAX APPELLATE TRIBUNAL DELHI BENCH SMC-2: NEW DELHI BEFORE SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER ITA NO. 6215/DEL/2019 (ASSESSMENT YEAR: 2015-16) ANUJ GUPTA, K-094, DLF CAPITAL GREENS KARAMPURA, NEW DELHI PAN: AEUPG4450J VS. JCIT, SPECIAL RANGE-7, NEW DELHI (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI GAUTAM JAIN, ADV REVENUE BY: SHRI M. BARNWAL, SR. DR DATE OF HEARING 08/06/2020 DATE OF PRONOUNCEMENT 09/06/2020 O R D E R PER PRASHANT MAHARISHI, A. M. 1. THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE OR DER OF THE LD CIT (A)-17, NEW DELHI DATED 29/05/2019 FOR THE AY 2015-16, WHEREIN, THE L D CIT (A) DISMISSED FOR NON PROSECUTION APPEAL OF THE ASSESSEE FILED AGAINST TH E ORDER PASSED U/S 143(3) OF THE INCOME TAX ACT, 1961 BY THE JOINT COMMISSIONER OF I NCOME TAX, SPECIAL RANGE- 17, NEW DELHI DATED 27.12.2017. 2. ASSESSEE HAS CHALLENGED THE ORDER AS PER FOLLOWING SEVEN GROUNDS OF APPEAL:- 1. THAT THE LEARNED COMMISSIONER OF INCOME TAX (AP PEALS)-17, NEW DELHI HAS ERRED BOTH IN LAW AND, ON FACTS IN UPHOLDING THE DE TERMINATION OF INCOME MADE BY THE LEARNED JOINT COMMISSIONER OF INCOME TAX, SP ECIAL RANGE-17, NEW DELHI OF THE APPELLANT AT RS. 47,13,570/- AS AGAINS T DECLARED INCOME OF RS. 31,92,700/- BY THE APPELLANT IN AN ORDER OF ASSESSM ENT DATED 27.12.2017 U/S 143(3) OF THE ACT. 2. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APP EALS) HAS FURTHER ERRED BOTH IN LAW AND ON FACTS IN PROCEEDINGS TO DISPOSE OF TH E APPEAL EXPARTEE WITHOUT GRANTING ANY FAIR AND PROPER OPPORTUNITY OF BEING H EARD TO THE APPELLANT. 2.1. THAT THE LEARNED COMMISSIONER OF INCOME TAX (A PPEALS) HAS FAILED TO APPRECIATE THAT NON APPEARANCE OF THE APPELLANT ON THE DATE OF HEARING WAS NEITHER INTENTIONAL NOR DELIBERATE AND IS NOT A CAS E WHERE APPELLANT IS NOT INTERESTED IN PROSECUTING ITS APPEAL. 2.2. THAT EVEN OTHERWISE, AN ORDER PASSED IN LIMINI WITHOUT EFFECTIVELY DISPOSING OF THE GROUNDS RAISED BY THE APPELLANT IS IN INFRACTIO N OF SECTION 250(6) OF THE ACT AND AS SUCH, ORDER SO MADE IS OTHERWISE TOO ILLEGAL , INVALID AND A VITIATED ORDER. 3. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APP EALS) HAS FURTHER ERRED BOTH IN LAW AND ON FACTS IN UPHOLDING A DISALLOWANCE OF SUM OF RS. 10,19,555/- PAGE | 2 REPRESENTING BILL DISCOUNTING CHARGED INCURRED IN T HE COURSE OF BUSINESS BY THE APPELLANT 4. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APP EALS) HAS ALSO ERRED BOTH IN LAW AND ON FACTS IN CONFIRMING AN ADDITION OF RS. 4 ,21,718/- IN AN ARBITRARY ADHOC MANNER OUT OF THE EXPENDITURE INCURRED ON INT EREST IN THE COURSE OF BUSINESS BY THE APPELLANT. 5. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APP EALS) HAS ALSO ERRED BOTH IN LAW AND ON FACTS IN UPHOLDING A DISALLOWANCE OF RS. 49,600/- BY INVOKING SECTION 40A(3) OF THE ACT. 6. THAT BOTH THE AUTHORITIES BELOW HAVE FRAMED THE IMPUGNED ORDER WITHOUT GRANTING SUFFICIENT PROPER OPPORTUNITY TO THE APPEL LANT COMPANY AND THEREFORE THE SAME ARE CONTRARY TO PRINCIPLE OF NATURAL JUSTI CE AND HENCE VITIATED. 7. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APP EALS) HAS FURTHER ERRED BOTH IN LAW AND ON FACTS IN UPHOLDING THE LEVY OF INTERE ST OF RS. 1,96,908/- UNDER SECTION 234B OF THE ACT, AND INTEREST OF RS. 95,950 /- U/S 234B OF THE ACT WHICH ARE NOT LEVIABLE ON THE FACTS AND CIRCUMSTANC ES OF THE CASE OF THE APPELLANT. 3. THE ASSESSEE IS AN INDIVIDUAL WHO FILED HIS RETURN OF INCOME ON RS. 3192700/- ON 30.10.2015. THE ASSESSMENT U/S 143(3) OF THE ACT WA S PASSED AT RS. 4713570/-. THE LD AO MADE THE ADDITION OF A. RS. 1019555/- ON ACCOUNT OF DISALLOWANCE OF INTERES T EXPENDITURE, B. RS. 421718/- ALSO ON ACCOUNT OF DISALLOWANCE OF INT EREST, C. ADDITION OF RS. 30,000/- INCOME NOT SHOWN BY THE ASSESSEE AND D. RS. 49600/- DISALLOWED U/S 40A (3) OF THE ACT. THE ASSESSEE PREFERRED APPEAL BEFORE THE LD CIT (A) . THE LD CIT (A) SENT FIVE NOTICES OF HEARING TO THE ASSESSEE AND NONE OF THEM WERE CO MPLIED WITH. THEREFORE, HE DISMISSED THE APPEAL FOR NON PROSECUTION. 4. THE LD AR SUBMITTED THAT THE LD CIT (A) HAS NOT GRA NTED FAIR OPPORTUNITY OF HEARING TO THE ASSESSEE. HE FURTHER SUBMITTED THAT EVEN OTH ERWISE THE APPEAL HAS NOT BEEN DECIDED ON THE MERITS AND THEREFORE, THE ORDER OF T HE LD CIT (A) CANNOT BE SUSTAINED. HE SUBMITTED THAT THE ASSESSEE FILED AN ADJOURNMENT PETITION ON 28.05.2019, WHEREIN, THE DATE OF HEARING WAS GIVEN ON 31.05.2019; HOWEVER, THE LD CIT (A) PASSED AN ORDER ON 29.05.2019, THUS, THE ASSESSEE DID NOT GET ANY OPPORTUNITY. HE FURTHER SUBMITTED THAT ON 31.05.201 9 THE ASSESSEE HAS SUBMITTED A SUBMISSION CONTAINING 43 PAGES BUT PRIOR TO THAT ORDER WAS PASSED. 5. THE LD DR VEHEMENTLY OBJECTED THE ARGUMENT OF THE A SSESSEE THAT THE LD CIT (A) ADJOURNED THE CASE ON 31.05.2019. 6. WE HAVE CAREFULLY CONSIDERED THE RIVAL CONTENTIONS AND FIND THAT ON FIVE DIFFERENT OCCASIONS THE LD CIT (A) ISSUED NOTICES TO THE ASSE SSEE. ASSESSEE DID NOT EVEN CARE TO RESPOND EITHER REQUESTING ADJOURNMENT OR SUB MITTING ANY DETAILS. EVEN THE PAGE | 3 NOTICE DATED 10/5/2019 ASKING ASSESSEE TO REMAIN PR ESENT OR MAKE SUBMISSION TITLED AS FINAL OPPORTUNITY ON 21/5/2019 EVEN THAT TOO IS NOT RESPONDED TO. LD DR COULD SHOW US ONLY ONE ADJOURNMENT APPLICATION THAT TOO FILED ON 28.05.2019 IN RESPONSE TO NOTICE DATED 24/5/2019 FIXING THE DATE OF HEARING ON 28/45/2019 I.E. LAST DATE OF LAST HEARING. THAT TOO WAS AN ADJOURN MENT APPLICATION BY THE ADVOCATE OF THE ASSESSEE WHICH SAYS THAT STILL ADVO CATE HAS NOT RECEIVED THE DOCUMENTS FROM THE ASSESSEE. ADJOURNMENT APPLICATI ON SUBMITTED IS ALSO SO BALD THAT IT DID NOT SAY BY WHICH TIME ASSESSEE WOULD BE FILING THE DETAILS/SUBMISSION. EVEN BEFORE US THERE IS NO EXPLANATION WHY ASSESSEE DID NOT RESPOND TO THE NOTICES. THUS THE CONDUCT OF THE ASSESSEE IS THE M OST DEPLORABLE WHICH CLEARLY SHOW UTTER DEFIANCE TO THE STATUTORY NOTICES AND RE MORSELESSLY SEEKING ADJOURNMENT ON THE LAST DATE. EVEN OTHERWISE, THE L D CIT (A) IS A STATUTORY POST WHICH IS CREATED FOR THE SERVICES OF THE TAX PAYER TO RESOLVE THEIR GRIEVANCE ARISISNG OUT OF THE ASSESSMENT ORDER. IF THE ASSESSEE DOES NOT AVAIL THAT OPPORTUNITY DESPITE 5 OPPORTUNITIES INTIMATING HIM OF THE APPOI NTED DATES BY SPEED POST, ONE CAN ESTIMATE HOW MUCH LOSS EXCHEQUER INCURRED BY THE NEGLIGENT CONDUCT OF THE ASSESSEE. IN FACT IT IS MONEY OF DILIGENT AND CAREF UL TAX PAYERS THAT IS WASTED ON SUCH A CARELESS ASSESSEE. THUS, WE FIND THAT CON DUCT OF THE ASSESSEE DOES NOT DESERVE ANY LENIENCY AT THIS STAGE. THEREFORE LOOK ING TO THE FACTS AND CIRCUMSTANCES OF THE CASE, WE DIRECT THE ASSESSEE TO DEPOSIT OF RS. 5000/- TOWARDS CONTRIBUTION TO PRIME MINISTERS NATIONAL R ELIEF FUND ON OR BEFORE 30.06.2020 TOWARDS HIS GROSS NEGLIGENCE OF NONE APPEARANCE BE FORE THE LD CIT(A). 7. HOWEVER LD CIT (A) HAS DISMISSED THE APPEAL OF THE ASSESSEE FOR NON PROSECUTION, BUT NOT DECIDED THE ISSUE ON THE MERITS OF THE CASE , WITHOUT ANY REASONED ORDER ON THE MERIT. THE IMPUGNED ORDER PASSED BY THE CIT( A) IS IN VIOLATION PROVISIONS OF S. 250(6), WHICH PROVIDES THAT (6) THE ORDER OF THE 5592 [***] 5593 [COMMISSIONER (APPEALS)] DISPOSING OF THE APPEAL SHALL BE IN WRITING AND SHALL STATE POIN TS FOR DETERMINATION, THE DECISION THEREON AND THE REASON FOR THE DECISIO N. THUS THE APPELLATE ORDERS OF THE CIT (A) ARE TO STA TE THE POINTS ARISING IN THE APPEAL, THE DECISION OF THE AUTHORITY THEREON AND T HE REASONS FOR SUCH DECISION. THIS ORDER IS SUBJECT TO APPEAL BEFORE ITAT AND THE REFORE THE APPELLANT MUST KNOW PRECISE POINTS DECIDED IN HIS FAVOUR OR AGAINST HIM . THUS IMPUGNED ORDER PASSED BY THE CIT (A) IN VIOLATION OF THE PROVISIONS OF S. 250(6) CANNOT, THEREFORE, BE SUSTAINED. THEREFORE, RELIANCE PLACED BY THE CIT (A ) ON MULTIPLAN INDIA LTD. [38 ITD 320] IS ENTIRELY MISPLACED. SIMILARLY, THE CASE O F VIPUL LOGISTICS AND WAREHOUSING LTD V ITO CITED BY THE LEARNED CIT (A) IS DISTINGUISHABLE AND DOES NOT SUPPORT THE VIEW TAKEN BY THE CIT (A). THEREFORE WE DO NOT HAVE ANY OTHER OPTION PAGE | 4 BUT TO SET ASIDE THE ISSUE BACK TO THE FILE OF THE LD CIT (A) TO DECIDE THE ISSUE ON MERITS. THEREFORE , WE DIRECT THE ASSESSEE TO APPEAR BEFORE LD CIT (A) ON 06.07.2020 ( ASSESSEE MUST SEEK THE TIME OF CIT (A ) BEFORE THAT DATE FOR HEARING ON 6/7/2020) AND SUBMIT ALL THE NECESSARY DOCUMENTS ALONG WITH PROOF OF DEPOSIT OF RS. 5000/- TO PRIME MINISTERS NATIONAL RELIEF F UND. THE LD CIT (A) MAY DECIDE THE ISSUE ON THE MERITS OF THE CASE AFTER CONSIDERI NG THE SUBMISSION OF THE ASSESSEE. OPPORTUNITY OF HEARING TO THE ASSESSEE S HALL ALSO BE GIVEN ON THAT DATE ONLY. IF ON THE APPOINTED DATE, ASSESSEE DOES NOT APPEAR BEFORE HIM, OR APPEAR WITHOUT SHOWING PROOF OF CONTRIBUTION TOWARDS PRIME MINISTERS NATIONAL RELIEF FUND AS DIRECTED ABOVE, LD CIT (A) MAY DECIDE THE I SSUE ON THE MERITS AS HE DEEMS FIT AS PER INFORMATION AVAILABLE BEFORE HIM. IN VIE W OF THIS GROUND NO. 2 OF THE APPEAL IS ALLOWED WITH ABOVE DIRECTION. 8. ALL OTHER GROUNDS OF APPEAL ARE NOT REQUIRED TO ADJ UDICATE AT THIS POINT OF TIME. 9. IN THE RESULT APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 09/06/2020. SD/- -SSSSSS /- SD/- (SUDHANSHU SRIVASTAVA) (PRAS HANT MAHARISHI) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 09/06/2020 A K KEOT COPY FORWARDED TO 1. APPLICANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR:ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI