KRYSTAL COLLOIDS PVT LTD., MUMBAI V. ACIT CIRCLE- 15(2)(1), MUMBAI

ITA 626/MUM/2020

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 6268 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 7 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-09-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Assessment Year: 2014-2015
• Appeal Filed On: 27-01-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Depreciation; Opportunity of being heard; Principle of natural justice; Initiation of penalty proceedings; Set aside
• Section: 201

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL H BENCH, MUMBAI BEFORE SHRI AMARJIT SINGH, JM AND SHRI MANOJ KUMAR AGGARWAL , AM / I.T.A. NO. 626 /MUM/20 20 ( / ASSESSMENT YEAR: 20 1 4 - 15 ) KRYSTAL COLLOIDS PVT. LTD. PURUSHARTH BUILDING, MEZ ANNINE FLOOR, NOWROJI HILL, ROAD NO.2, DONGRI, MUMBAI - 400009 . / VS. ACIT, CIRCLE - 15(2)(1) ROOM NO.357, 3 RD FLOOR, AAYAKAR BHAVAN, MUMBAI - 400020. ./ ./ PAN/GIR NO. : AACCK5409J ( / APPELLANT ) .. ( / RE SPONDENT ) / DATE OF HEARING: 15 / 07 /202 1 /DATE OF PRONOUNCEMENT: 03 /09 /2021 / O R D E R PER AMARJIT SINGH, JM: THE ASSESSEE HAS FILED THE PRESENT APPEAL AGAINST THE ORDER DATED 08 . 11 . 201 9 PASSED BY THE COMMISS IONER OF INCOME TAX (APPEALS) - 24 , MUMBAI (HEREINAFTER REFERRED TO AS THE CIT( A)) RELEVANT TO THE A.Y.20 14 - 1 5 . 2 . THE ASSESS EE HAS RAISED THE FOLLOWING GROUNDS: - THE APPELLANT SUBMITS THE FOLLOWING GROUNDS, WHICH ATE WITHOUT PREJUDICE TO ONE ANOTHER: 1. THE ORDER PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) - 24, MUMBAI (HEREINAFTER) REFERRED TO AS 'THE LEARNED CI T{A)1 IS BAD IN LAW AND ON FACTS. ASSESSEE BY : SHRI GAUTAM MOTA (AR) REVENUE BY: SHRI GURBINDER SINGH ( D R) ITA NO. 626 /M UM /20 20 A.Y.20 1 4 - 15 2 2. RE: EX - PARTE ORDER PASSED BY LEARNED CIT(A) IS BAD IN LAW: 2.1 THE ORDER OF LEARNED CIT(A) IS BAD IN LAW BEING AGAINST (HE PRINCIPLE OF NATURAL JUSTICE AS APPELLANT WAS NOT PROVIDED SUFFICIENT OPP ORTUNITY OF BEING HEARD. 2.2 AS PER LEARNED CIT(A) NOTICE DATED 19 TH NOVEMBER, 2019 WAS SERVED ON THE APPELLANT STATING THAT HEARING WAS FIXED ON 28 TH NOVEMBER. 2019, HOWEVER, THE APPELLANT HAS NEITHER RECEIVED ANY PHYSICAL NOTICE NOR ANY ONLINE NOTI CE WAS SERVED ON THE ITBA TO THE APPELLANT BEFORE PASSING THE ORDER EX - PARTE. 2.3 THE LEARNED CIT(A) GROSSLY ERRED IN PASSING THE ORDER EX - PARTE ON 8 LHL NOVEMBER, 2019 MUCH BEFORE THE DATE OF HEARING SCHEDULED ON 28 TH NOVEMBER, 2019. 3. RE: DISALLOWANCE OF DEPRECIATION ON INTANGIBLE ASSETS AMOUNTING TO RS.9,68,454 / - . 3.1 THE LEARNED CIT(A) GROSSLY ERRED, ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN TAW, IN DISALLOWING DEPRECIATION ON INTANGIBLE ASSETS WITHOUT APPRECIATING THAT THE SAID ISSUE HAS ALREADY BEEN DECIDED IN FAVOUR OF THE APPELLANT BY HON'BLE TRIBUNAL FOR A.Y.2006 - 07. AY.2007 - 08 & AY.2008 - 09 & A.Y.2009 - 10 RESPECTIVELY AND NO APPEAL HAS BEEN FILED BY DEPARTMENT IN HON'BLE HIGH COURT. 3.2 WITHOUT PREJUDICE TO. DIE ABOVE, T HE LEARNED CIT(A) GROSSLY ERRED, ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND M LAW, IN DISALLOWING DEPRECIATION ON INTANGIBLE ASSETS WITHOUT APPRECIATING THAT THE ONCE THE ASSET ENTERS BLOCK OF ASSET THEN THE ISSUE OF DEPRECIATION CANNOT BE AGITATED IN THE SUBSEQUENT ASSESSMENT YEARS. 4. RE: INITIATION OF PENALTY PROCEEDINGS N/S, 271(1) (C) 6.1 THE LEARNED CIT{A) GROSSLY ERRED IN UPHOLDING THE INITIATION OF THE PENALTY PROCEEDINGS U/S 271(L)(C) WITHOUT DISCUSSING THE SAME. 6.2 THE APPELLANT C RAVES LEAVE TO ADD TO, ALTER, AMEND OR WITHDRAW ALL OR ANY OF THE FOREGOING GROUNDS OF APPEAL AT OR BEFORE THE HEARING OF THIS APPEAL. ITA NO. 626 /M UM /20 20 A.Y.20 1 4 - 15 3 3 . WE HAVE HEARD THE ARGUMENT S ADVANCED BY THE LD. REPRESENTATIVE OF THE PARTIES AND PERUSED THE RECORD . IN FACT, THE L D. REPRESENTATIVE OF THE ASSESSEE DID NOT ARGUE THE CASE ON MERITS BUT ARGUED ON THIS POINT THAT THE CIT(A) HAS DECIDED THE MATTER OF CONTROVERSY IN ABSENCE OF THE ASSESSEE AND WITHOUT GIVING AN OPPORTUNITY OF BEING HEARD TO THE ASSESSEE IN ACCORDANCE WITH LAW, T HEREFORE, THE FINDING OF THE CIT(A) IS NOT JUSTIFIABLE, HENCE, IS LIABLE TO BE SET ASIDE IN THE INTEREST OF JUSTICE. HOWEVER, ON THE OTHER HAND, THE LD. REPRESENTATIVE OF THE DEPARTMENT HAS REFUTED THE SAID CONTENTION. ON APPRAISAL OF THE O RDER OF T HE CIT(A) DATED 08 . 11 .201 9 PASSED BY THE CIT(A) , WE FIND THAT THE CIT(A) HAS DECIDED THE MATTER OF CONTROVERSY IN ABSENCE OF THE ASSESSEE /REPRESENTATIVE OF THE A SSESSEE WITHOUT GIVING AN OPPORTUNITY OF BEING HEARD TO THE ASSESSEE IN THE ACCORDANCE WITH LAW . A PROPER AND REASONABLE OPPORTUNITY IS REQUIRED TO BE GIVEN TO THE ASSESSEE BEFORE THE DECIDING THE MATTER OF CONTROVERSY IN ACCORDANCE WITH LAW . 4 . FOR THIS PROPOSITION WE PLACE D RELIANCE UPON THE FOLLOWING CASE LAWS. ( 1 ) CIT VS. PREMKUMAR ARJUNDAS LUTHRA (HUF) (2017) 154 DTR (BOM) 302 ( 2 ) CIT VS. S CHENNIAPPA MUDALIAR (1969) 74 ITR 1 (SC) 5 . ACCORDINGLY IN THE INTEREST OF JUSTICE , WE REMIT THE ISSUE RAISED IN THE APPEAL TO THE FILE OF THE LD. CIT(A). LD. CIT(A) IS DIRECTED TO CONSIDER THE ISSUE AFRESH AND PAS S AN ORDER ON THE MERITS OF THE CASE AFTER GIVING AFTER GIVING A PROPER OPPORTUNITY OF BEING HEARD TO THE ASSESSEE IN ACCORDANCE WITH LAW . THEREFORE, IN THE SAID CIRCUMSTANCES, WE ARE OF THE VIEW THAT THE ORDER OF THE CIT(A) IS NOT LIABLE TO BE SUSTAINABLE IN THE EYES OF LAW, ITA NO. 626 /M UM /20 20 A.Y.20 1 4 - 15 4 THEREFORE, WE SET ASIDE THE FINDING OF THE CIT(A ) ON ALL THE ISSUES AND RESTORE THE MATTER BEFORE THE CIT(A) TO DECIDE THE MATTER AFRESH BY GIVING AN OPPORTUNITY OF BEING HEARD TO THE ASSESSEE IN ACCORDANCE WITH LAW. 6 . IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS HEREBY ALLOWED FOR STATISTICAL PURPOSE S . ORDER PRONOUNCED IN THE OPEN COURT ON 03 / 09 /202 1 SD/ - SD/ - ( MANOJ KUMAR AGGARWAL ) (AMARJIT SINGH) / ACCOUNTANT MEMBER /JUDICIAL MEMBER MUMBAI; DATED : 03 / 09 /202 1 VIJAY PAL SINGH (SR. PS) / 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