Subhkaran Sampatlal (HUF), Kolkata V. ITO, WD-45(2), KOLKATA, Kolkata

ITA 637/KOL/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 4345 (ITAT-KOLKATA)
• Duration Of Justice: 6 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-10-2016
• Appeal Filed By: Assessee
• Bench Allotted: SMC
• Assessment Year: 2007-2008
• Appeal Filed On: 08-04-2016
• Court: TRIBUNAL
• Department Lawyers: S M S T AUHEED
• Assessee Lawyers: KOMAL AGARWAL
• Keywords: Opportunity of being heard; Principle of natural justice; Reasonable cause; Onus to prove
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, BENCH C KOL KATA [BEFORE HONBLE SHRI N.V.VASUDEVAN, JM & DR.ARJUN LAL SAINI, AM ] ITA NO.637/KOL/2016 ASSESSMENT YEAR : 2007-08 SUBHKARAN SAMPATLAL (HUF) -VERSUS- I.T.O., WARD-45 (2), KOLKATA KOLKATA [PAN: AALHS 7096 B] (APPELLANT) (RESPONDENT) FOR THE APPELLANT : MISS KOMAL AGARWAL, ADVOCATE FOR THE RESPONDENT : S.M.S.TAUHEED, JCIT DATE OF HEA RING : 21.09.2016 DATE OF PRONOUNCEMENT : 19.10.2016. ORDER PER DR.ARJUN LAL SAINI, AM THE CAPTIONED APPEAL FILED BY THE ASSESSE E PERTAINING TO A.Y.2007-08, IS DIRECTED AGAINST THE ORDER PASSED BY THE COMMISSION ER OF INCOME TAX (A)-21, KOLKATA IN APPEAL NO.1311/ITO, WD-45(2)/CIT(A)-21/K OL/14-15, DATED 25.01.2016, WHICH IN TURN ARISES OUT OF AN ORDER PASSED BY THE LD. ASSESSING OFFICER U/S 143(3) OF INCOME TAX ACT, 1961 (IN SHORT, THE ACT) DATED 16. 12.2009. 2. THE FACTS OF THE CASE ARE AS STATED IN BRIEF. THE ASSESSEE FILED ITS RETURN OF INCOME FOR A.Y.2007-08 ON DATED 26.10.2007, DECLARING A TOTAL INCOME OF RS.1,11,010/-. THE NATURE OF THE ASSESSEES BUSINESS IS TRADING OF GWA R, REFINED DAL. THE CASE WAS SELECTED FOR SCRUTINY U/S 143(3) OF THE ACT AND THE AO HAS COMPLETED THE ASSESSMENT BY MAKING VARIOUS ADDITIONS ON DATED 16.12.2009. 3. AGGRIEVED FROM THE ORDER OF THE LD. AO, THE AS SESSEE HAS FILED AN APPEAL BEFORE THE LD. CIT(A), WHO HAS ALSO CONFIRMED THE ACTION OF T HE AO BY OBSERVING THE FOLLOWINGS :- THE RELEVANT RECORDS SHOW THAT AFTER THE FILING OF THE INSTANT APPEAL, THE APPELLANT HAS NEVER MADE ANY EFFORT TO PURSUE THE APPEAL. IT IS S EEN THAT NOTICES, FIXING HEARING OF THE APPEAL ON DIFFERENT DATES, HAVE BEEN ISSUED BUT AS DISCUSSED THE APPELLANT HAS NEVER ITA NO .637/KOL/2016 SUBHKARAN SAMPATLAL HUF A..Y.2007-08 2 APPEARED. THE APPELLANT HAS NEITHER APPEARED/AUTHOR IZED ANY REPRESENTATIVE TO APPEAR NOR FILED ANY WRITTEN SUBMISSION TO SUBSTANTIATE TH E CLAIMS AS MADE IN THE GROUNDS OF APPEAL. THE APPELLANT IS REQUIRED TO RESPOND TO THE NOTICES, ISSUED ON DIFFERENT DATES AS PER RECORD, AND EXPLAIN THE MATTER BECAUSE ONUS TO PROVE THE CLAIMS, AS MADE IN THE GROUNDS OF APPEAL, IS ON THE APPELLANT. THE INSTANT APPEAL IS PENDING FOR A LONG TIME AND IT IS APPARENT THAT THE APPELLANT IS NOT INTERESTED IN PURSUING THE APPEAL. WHILE FILING THE APPEAL, THE APPELLANT HAS CLAIMED THAT THE ASSESSIN G OFFICER HAS ERRED BUT INSTEAD OF SUBSTANTIATING THOSE CLAIMS, THE APPELLANT HAS BEE N KEEPING QUIET AND NOT PURSUING THE APPEAL IN ANY MANNER. AS PER PRACTICE THE APPEAL SH OULD BE DISPOSED ON MERITS INSTEAD OF BEING DISMISSED IN LIMINE BUT IN THE GIVEN FACTS AN D CIRCUMSTANCES OF THE INSTANT APPEAL, IT IS APPARENT THAT THE APPELLANT IS NOT INTERESTED IN PURSUING THE APPEAL AND THEREFORE THE INSTANT APPEAL IS DISMISSED. 4. NOT BEING SATISFIED WITH THE ORDER OF THE LD. CIT(A), THE ASSESSEE IS IN FURTHER APPEAL BEFORE US AND HAS TAKEN THE FOLLOWING GROUND S OF APPEAL. 1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(APPEALS) DISPOSED OF THE APPEAL FOR NONAPPEARANCES BUT THE DELAY WAS ON ACCO UNT OF THE AUTHORISED REPRESENTATIVE ON WHOM THE ASSESSEE WAS ABSOLUTELY RELIANT ON HIM, THE APPELLANT WAS NOT AWARE OF THE DEFAULT OF THE REPRESENTATIVE. 2. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE THE AFFIRMATION OF THE ADDITION OF RS.96,000/- FOR ALLEGED INSUFFICIENT DRAWING WIT HOUT AT ALL GOING INTO THE MERITS OF THE DISALLOWANCE MADE BY THE AO. 3. THAT THE DISALLOWANCES OF VARIOUS INTEREST TOTAL ING RS.4,45,861/- BY THE AO WERE ARBITRARY AND WITHOUT ANY REASONABLE CAUSE AND SUCH DISALLOWANCES COULD NOT BE CONFIRMED IN THE ABSENCE OF DULY VALID REASONS. 4. THAT THE PRINCIPLES OF NATURAL JUSTICE HAVE BEEN VIOLATED AS THE DISALLOWANCES AND THE CONFIRMATION THEREOF ARE MADE MERELY FOR NONAPPEARA NCE WITHOUT GOING INTO THE MERITS AND WITHOUT A SPEAKING ORDER. 5. THAT THE ORDER IS LEAD IN LOW AND THE DISALLOWAN CES AS CONFIRMED ARE NOT SUSTAINABLE IN LAW. 5. ALTHOUGH THE ASSESSEE HAS TAKEN MULTIPLE GROU NDS OF APPEAL, BUT AT THE TIME OF HEARING, THE GRIEVANCE OF THE ASSESSE HAS BEEN CO NFINED TO ONLY ONE ISSUE I.E. NON APPEARANCE BY THE AUTHORISED REPRESENTATIVE ON WHOM THE ASSESSEE WAS ABSOLUTELY RELIED, THE ASSESSEE WAS NOT AWARE OF TH E DEFAULT OF THE AUTHORIZED REPRESENTATIVE I..E THE LD. AUTHORIZED REPRESNTATIVE (AR) OF THE ASSESSEE HAD NOT ATTENDED THE HEARING DURING THE APPELLATE PROCEEDIN GS BEFORE THE LD. CIT(A). THE ASSESSEE RELIED ON THE AR BUT HE NEVER ATTENDED THE OFFICE OF THE LD. CIT(A) AND THEREFORE THIS HAS RESULTED INTO A GRAVE PAIN TO TH E ASSESEE UNDER CONSIDERATION. THE ASSESSEE HAS SUBMITTED BEFORE US THAT THE ASSESEE S HOULD NOT BE PENALIZED BECAUSE OF GROSS NEGLIGENCE OF THE AR AND THE DEFAULT COMMITTE D BY THE AR OF THE ASSESSEE. THE ITA NO .637/KOL/2016 SUBHKARAN SAMPATLAL HUF A..Y.2007-08 3 ASSESSEE FULLY RELIED ON HIS AR BUT HE NEITHER SUBM ITTED ANY WRITTEN SUBMISSION BEFORE THE LD. CIT(A) NOT HE APPEARED PERSONALLY BEFORE TH E LD. CIT(A) AND THIS HAS RESULTED INTO A GREAT LOSS IN THE HANDS OF THE ASSESSEE, AN D CONSEQUENT RESULT WAS THE LD. CIT(A) PASSED AN EXPARTE ORDER AGAINST THE ASSESSEE . THE ASSESSEE SUBMITTED BEFORE US THAT AN OPPORTUNITY SHOULD BE GIVEN TO HIM TO PR ESENT BEFORE THE LD. CIT(A) AND HE REQUESTED TO REMIT THE CASE BACK TO THE FILE OF LD. CIT(A). 6. ON THE OTHER HAND, THE LD. DEPARTMENTAL REPRE SENTATIVE FOR THE REVENUE HAS PRIMARILY REITERATED THE STAND TAKEN BY THE AO AND THE LD. CIT(A) WHICH WE HAVE ALREADY NOTED IN OUR EARLIER PARA, AND IS NOT BEIN G REPEATED FOR THE SAKE OF BREVITY. 7. HAVING HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATERIALS AVAILABLE ON RECORD, WE ARE OF THE VIEW THAT THERE IS MERIT IN THE SUBMI SSIONS OF THE ASSESSEE AS THE PROPOSITIONS CANVASSED BY THE THE ASSESSEE ARE SUPP ORTED BY THE FACTS NARRATED BY HIM ABOVE. THE ASSESSEE HAS BEEN CHEATED BY THE LD. CO UNSEL/LD. AR AND THEREFORE THE ASSESSEE HAS SUBMITTED THAT THE ASSESSEE IN THE INS TANT CASE HAS NOT GOT THE NATURAL JUSTICE AND THEREFORE WE ARE OF THE VIEW THAT THE A SSESSEE SHOULD NOT SUFFER BECAUSE OF GROSS NEGLIGENCE OF THE LD. AR. THEREFORE WE REMIT THE CASE BACK TO THE FILE OF THE LD. CIT(A) TO DECIDE THE APPEAL AFRESH AFTER GIVING AN OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 8. IN THE RESULT, THE APPEAL FILED BY THE ASSE SSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE COURT ON 19.10.2016. SD/- SD/- [N.V.VASUDEVAN] [DR.ARJUN LAL SAINI] JUDICIAL MEMBER ACCOUNTANT MEMBER DATE: 19.10.2016. R.G.(.P.S.) ITA NO .637/KOL/2016 SUBHKARAN SAMPATLAL HUF A..Y.2007-08 4 COPY OF THE ORDER FORWARDED TO: 1 . SUBHKARAN SAMPATLAL(HUF), 207, M.D.ROAD, ROOM NO.74 , KOLKATA- 700007. 2 I.T.O., WD-45(2), KOLKATA. 3 . CIT(A)-21, KOLKATA 4. CIT-15, KOLKATA. 5. CIT(DR), KOLKATA BENCHES, KOLKATA. TRUE COPY, BY ORDER, DEPUTY /ASST. REGISTRAR , ITAT, KOLKATA BENCHES