SPUN COMMUNICATION INFRA P.LTD, MUMBAI V. ITO 13(2)(2), MUMBAI

ITA 6276/MUM/2016

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 8476 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-11-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2009-2010
• Appeal Filed On: 24-10-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ARJU GARODIA
• Assessee Lawyers: PRAKASH K JOTWANI
• Keywords: Bogus purchase; Opportunity of being heard

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH J MUMBAI BEFORE SHRI MAHAVIR SINGH (JUDICIAL MEMBER) AND SHRI N.K. PRADHAN (ACCOUNTANT MEMBER) ITA NO. 6276/MUM/2016 ASSESSMENT YEAR: 2009 - 10 & ITA NO. 6277/MUM/2016 ASSESSMENT YEAR: 2009 - 10 & ITA NO. 6278/MUM/2016 ASSESSMENT YEAR: 2010 - 11 & ITA NO. 6279/MUM/2016 ASSESSMENT YEAR: 2010 - 11 & ITA NO. 6280/MUM/2016 ASSESSMENT YEAR: 2011 - 12 M/S SPUN COMMUNICATION INFRA PVT. LTD. 105/2, 1 ST FLOOR, NEW SONAL ESTATE LINK ROAD, MALAD(W), MUMBAI - 400064. VS. ITO - 13(2)(2) MUMBAI. PAN NO. AAFCS4144R APPELLANT RESPONDENT ASSESSEE BY : MR. PRAKASH K. JOTWANI, AR REVENUE BY : MS. ARJU GARODIA, SR. DR DATE OF HEARING : 08/11/2017 DATE OF PRONOUNCEMENT : 15/11/2017 M/S SPUN COMMUNICATION INFRA LTD. ITA NO. 6276, 6277, 6278, 6279 & 6280/MUM/2016 2 ORDER PER N.K. PRADHAN, A.M. THE CAPTIONED APPEALS FILED BY THE ASSESSEE ARE DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) - 21, MUMBAI. AS COMMON ISSUES ARE INVOLVED, WE ARE PROCEEDING TO DISPOSE THEM OFF THROUGH A CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE . ITA NO. 6276/MUM/2016 ASSESSMENT YEAR: 2009 - 10 & ITA NO. 6277/MUM/2016 ASSESSMENT YEAR: 2009 - 10 2. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT THE ASSESSEE FILED ITS RETURN OF INCOME FOR THE AY 2009 - 10 ON 27.09.2009 DECLARING TOT AL INC OME AT RS.28,16,100/ - . THE ASSESSING OFFICER (AO) ESTIMATED PROFIT @ 12% ON THE ALLEGED BOGUS PURCHASES OF RS.3,19,76,934/ - . THUS HE MADE AN ADDITION OF RS.38,37,232/ - . AGGRIEVED BY THE ORDER OF THE AO, THE ASSESSEE FILED AN APPEAL BEFORE THE LD. CIT (A). THOUGH THE CASE WAS FIXED FOR HEARING BEFORE THE LD. CIT(A), NEITHER THE ASSESSEE NOR HIS AUTHORIZED REPRESENTATIVE APPEARED BEFORE HIM. THE LD. CIT(A) ALSO OBSERVED THAT THERE HAS BEEN A DELAY OF FOUR MONTHS BY THE ASSESSEE IN FILING THE APPEAL. HE H ELD THAT THERE WAS NO REASON FOR FILING THE APPEAL AFTER FOUR MONTHS AND THEREFORE, DISMISSED THE PLEA OF THE ASSESSEE TO CONDONE THE ABOVE DELAY. A S THERE WAS NO COMPLIANCE BY THE ASSESSEE, THE LD. CIT(A) DISMISSED THE APPEAL FILED BY THE ASSESSEE. 2.1 ALSO THE AO IMPOSED A PENALTY OF RS.15,00,000/ - U/S 271(1)(C) ON THE TAX SOUGHT TO BE EVADED OF RS.37,98,859/ - . IN APPEAL, NEITHER THE M/S SPUN COMMUNICATION INFRA LTD. ITA NO. 6276, 6277, 6278, 6279 & 6280/MUM/2016 3 ASSESSEE NOR ITS AUTHORIZED REPRESENTATIVE APPEARED BEFORE THE LD. CIT(A). CONSIDERING THE NON - COMPLIANCE BY THE ASSESSEE AND ALSO THE FACTS OF THE CASE, THE LD. CIT(A) CONFIRMED THE PENALTY OF RS.15,00,000/ - IMPOSED BY THE AO U/S 271(1)(C). ITA NO. 6278/MUM/2016 ASSESSMENT YEAR: 2010 - 11 & ITA NO. 6279/MUM/2016 ASSESSMENT YEAR: 2010 - 11 3. THE ASSESSEE FILED ITS RETURN OF IN COME FOR THE AY 2010 - 11 ON 07.10.2010 DECLARING TOTAL LOSS AT RS.31,38,517/ - . THE AO ESTIMATED PROFIT @ 12% ON THE ALLEGED BOGUS PURCHASES OF RS. 10,42, 12, 519 / - . THUS HE MADE AN ADDITION OF RS. 1,25,05,502 / - . AGGRIEVED BY THE ORDER OF THE AO, THE ASSESSEE FI LED AN APPEAL BEFORE THE LD. CIT(A). THOUGH THE CASE WAS FIXED FOR HEARING BEFORE THE LD. CIT(A), NEITHER THE ASSESSEE NOR ITS AUTHORIZED REPRESENTATIVE APPEARED BEFORE HIM. THE LD. CIT(A) ALSO OBSERVED THAT THERE HAS BEEN A DELAY OF FOUR MONTHS BY THE ASS ESSEE IN FILING THE APPEAL. HE HELD THAT THERE WAS NO REASON FOR FILING THE APPEAL AFTER FOUR MONTHS AND THEREFORE, DISMISSED THE PLEA OF THE ASSESSEE TO CONDONE THE ABOVE DELAY. A S THERE WAS NO COMPLIANCE, THE LD. CIT(A) DISMISSED THE APPEAL FILED BY THE ASSESSEE. 3 .1 ALSO THE AO IMPOSED A PENALTY OF RS. 42,00,000 / - U/S 271(1)(C) ON THE TAX SOUGHT TO BE EVADED OF RS. 1,23,80,446 / - . IN APPEAL, NEITHER THE ASSESSEE NOR ITS AUTHORIZED REPRESENTATIVE APPEARED BEFORE THE LD. CIT(A). CONSIDERING THE NON - COMPLIANCE BY THE ASSESSEE AND ALSO THE M/S SPUN COMMUNICATION INFRA LTD. ITA NO. 6276, 6277, 6278, 6279 & 6280/MUM/2016 4 FACTS OF THE CASE, THE LD. CIT(A) CONFIRMED THE PENALTY OF RS. 42, 00,000/ - IMPOSED BY THE AO U/S 271(1)(C). ITA NO. 6280/MUM/2016 ASSESSMENT YEAR: 2011 - 12 4. THE ASSESSEE FILED ITS RETURN OF INCOME FOR THE AY 2011 - 12 ON 07.01.2011 DECLARING TOTAL INCOME AT RS. NIL. THE AO ESTIMATED THE PROFIT EMBEDDED IN THE ALLEGED BOGUS PURCHASE OF RS.29,05,147/ - AND THUS MADE AN ADDITION OF RS.3,48,618/ - . THEN HE IMPOSED PENALTY OF RS.1,07,723/ - U/S 271(1)(C). IN APPEAL BEFORE THE LD. CIT(A), NEITHER THE ASSESSEE NOR ITS AUTHORIZED REPRESENTATIVE APPEARED. TAKING INTO ACCOUNT THE NON - COMPLIANCE BY THE ASSESSEE AND ALSO THE FACTS OF THE CASE, THE LD. CIT(A) DISMISSE D THE APPEAL FILED BY THE ASSESSEE. 5. BEFORE US, THE LD. COUNSEL OF THE ASSESSEE SUBMITS THAT A REASONABLE OPPORTUNITY MAY BE GIVEN TO THE ASSESSEE TO REPRESENT ITS CASE BEFORE THE LD. CIT(A). 6. ON THE OTHER HAND, THE LD. DR SUBMITS THAT REASONABLE OPP ORTUNITY HAS ALREADY BEEN GIVEN BY THE LD. CIT(A) AS IS EVIDENT FROM THE APPELLATE ORDER. 7. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIALS ON RECORD. THE FACT REMAINS THAT NEITHER THE ASSESSEE NOR HIS AUTHORIZED REPRESENTATIVE APP EARED BEFORE THE LD. CIT(A) IN THE CAPTIONED APPEALS. THERE IS NO DENYING THE FACT THAT A RIGHT ORDER WOULD EMERGE AFTER HEARING THE ASSESSEE BY THE LD. CIT(A). MORE SO , WHEN IT IS A CASE OF ALLEGED BOGUS PURCHASE. M/S SPUN COMMUNICATION INFRA LTD. ITA NO. 6276, 6277, 6278, 6279 & 6280/MUM/2016 5 IN VIEW OF THE ABOVE, WE SET ASIDE THE ORDER OF THE LD. CIT(A) AND RESTORE THE MATTER TO HIS FILE TO PASS AN ORDER AFTER GIVING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. WE CONDONE THE DELAY ON THE PART OF THE ASSESSEE TO FILE THE APPEAL. WE DIRECT THE ASSESSEE TO APPEAR BEFORE THE LD. CIT(A) AND PRESENT ITS CASE WITH RELEVANT DOCUMENTS/EVIDENCE. 8. IN THE RESULT, THE ABOVE APPEALS ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 15/11/2017. SD/ - SD/ - (MAHAVIR SINGH ) (N.K. PRADHAN) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; DATED: 15/11/2017 RAHUL SHARMA, SR. P.S. 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