ACIT - 1(2)(1), MUMBAI V. JASHUBHAI ENGINEERING PVT. LTD., MUMBAI

ITA 6407/MUM/2016

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 6949 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 6 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-05-2018
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: J
• Assessment Year: 2012-2013
• Appeal Filed On: 31-10-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SAURABH DESHPANDE
• Assessee Lawyers: DR K SHIVARAM
• Keywords: Opportunity of being heard

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL 'J' BENCH, MUMBAI BEFORE SHRI SAKTIJIT DEY, JUDICIAL MEMBER AND SHRI N.K. PRADHAN, ACCOUNTANT MEMBER ITA NO.6407/MUM/2016 (ASSESSMENT YEAR:2012-13) A C I T - 1(2)(1) ROOM NO. 535, 5TH FLOOR AAYAKAR BHAVAN, M.K. ROAD MUMBAI 400020 VS. M/S. JASHUBHAI ENGINEERING PVT. LTD. TAJ BUILDING,210, DR. D.N. ROAD FORT, MUMBAI 400001 PAN AAACP2503N APPELLANT RESPONDENT ITA NO. 6408/MUM/2016 (ASSESSMENT YEAR:2012-13) A C I T - 1(2)(1) ROOM NO. 535, 5TH FLOOR AAYAKAR BHAVAN, M.K. ROAD MUMBAI 400020 VS. M/S. JASHUBHAI MEDIA P VT . LTD. TAJ BUILDING, 210, DR. D.N. ROAD FORT, MUMBAI 400001 PAN AAAC J7453P APPELLANT RESPONDENT APPELLANT BY: SHRI SAURABH DESHPANDE RESPONDENT BY: DR. K. SHIVARAM DATE OF HEARING: 10.05.2018 DATE OF PRONOUNCEMENT: 23.05.2018 O R D E R PER SAKTIJIT DEY, JM THE AFORESAID APPEALS BY THE REVENUE IN RESPECT OF TWO DIFFERENT ASSESSEES ARISE OUT OF TWO SEPARATE ORDERS, BOTH DA TED 18.07.2016, OF THE COMMISSIONER OF INCOME TAX (APPEALS)-2, MUMBAI PERT AINING TO AY 2012-13. ITA NO. 6407/MUM/2016 A.Y. 2012-13 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE F ILED ITS RETURN OF INCOME FOR THE ASSESSMENT YEAR UNDER DISPUTE ON 28. 09.2012 DECLARING INCOME OF ` 1,02,59,325/-. DURING THE ASSESSMENT PROCEEDINGS TH E AO ON VERIFYING THE RETURN OF INCOME AS WELL AS THE FINAN CIAL STATEMENTS OF THE ITA NOS. 6407& 6408/MUM/2016 M/S. JASHUBHAI ENGINEERING P. LTD. &M/S. JASHUBHAI MEDIA P. LTD. 2 ASSESSEE ISSUED A QUESTIONNAIRE CALLING UPON THE AS SESSEE TO FURNISH VARIOUS DETAILS IN RELATION TO THE DEDUCTIONS CLAIM ED UNDER DIFFERENT HEADS AND ALSO TO JUSTIFY THEM. AS ALLEGED BY THE AO, IN RESPONSE TO THE SAID QUESTIONNAIRE AND NOTICE ISSUED UNDER SECTION 142(1 ) OF THE INCOME TAX ACT (HEREINAFTER THE ACT) THE ASSESSEE DID NOT FU RNISH THE DETAILS CALLED FOR. AS A RESULT THE AO PROCEEDED TO MAKE VARIOUS A DDITIONS/DISALLOWANCES BY DENYING DEDUCTIONS CLAIMED BY THE ASSESSEE WHICH RESULTED IN DETERMINATION OF TOTAL INCOME AT ` 8,84,40,550/-. BEING AGGRIEVED WITH THE ASSESSMENT ORDER ASSESSEE PREFERRED APPEAL BEFORE T HE CIT(A). 3. IN THE COURSE OF PROCEEDINGS BEFORE THE FIRST APPEL LATE AUTHORITY ASSESSEE PRODUCED NUMBER OF DOCUMENTARY EVIDENCES A S WELL ASAFFIDAVITS IN SUPPORT OF ITS CLAIM OF DEDUCTIONS/EXPENDITURE. ON THE BASIS OF THE EVIDENCES AND AFFIDAVITS FILED BY THE ASSESSEE THE LEARNED CIT(A) GRANTED SUBSTANTIAL RELIEF TO THE ASSESSEE. BEING AGGRIEVED BY THE AFORESAID DECISION OF THE LEARNED CIT(A) REVENUE IS IN APPEAL BEFORE U S. 4. WE HAVE CONSIDERED RIVAL SUBMISSIONS AND PERUSED TH E MATERIAL ON RECORD. THE BASIC GRIEVANCE OF THE REVENUE AS ARTIC ULATED BY THE LEARNED DEPARTMENTAL REPRESENTATIVE BEFORE US IS THAT IN TH E COURSE OF ASSESSMENT PROCEEDINGS ASSESSEE DID NOT PRODUCE ANY DETAILS/DO CUMENTARY EVIDENCES AS CALLED FOR BY THE AO. BEFORE THE CIT(A) ASSESSEE PRODUCED FRESH EVIDENCES AND RELYING UPON SUCH EVIDENCES THE LEARN ED CIT(A) ALLOWED DEDUCTIONS CLAIMED BY THE ASSESSEE. THE LEARNED D.R . SUBMITTED, WITHOUT AFFORDING ANY OPPORTUNITY TO THE AO TO VERIFY THE E VIDENCES SUBMITTED BY THE ASSESSEE AND OFFER HIS COMMENTS, LEARNED CIT(A) HAS DECIDED THE ISSUES, WHICH IS IN GROSS VIOLATION OF RULE 46A OF THE INCOME TAX RULES,1962. THUS, HE SUBMITTED THAT THE ISSUE MAY B E RESTORED BACK TO THE AO FOR DE NOVO ADJUDICATION AFTER CONSIDERING THE E VIDENCES SUBMITTED BY THE ASSESSEE BEFORE THE LEARNED CIT(A). 5. DR. K. SHIVARAM, LEARNED COUNSEL FOR THE ASSESSEE, THOUGH, SUPPORTED THE DECISION OF THE LEARNED CIT(A), HOWEV ER, HE FAIRLY SUBMITTED THAT IN THE COURSE OF PROCEEDINGS BEFORE FIRST APPE LLATE AUTHORITY FRESH ITA NOS. 6407& 6408/MUM/2016 M/S. JASHUBHAI ENGINEERING P. LTD. &M/S. JASHUBHAI MEDIA P. LTD. 3 EVIDENCES WERE PRODUCED BY THE ASSESSEE, RELYING UP ON WHICH THE CIT(A) HAS GRANTED RELIEF TO THE ASSESSEE. HE ALSO FAIRLY SUBMITTED THAT THE CIT(A) HAS NOT REMANDED THE MATTER TO THE AO SEEKING HIS C OMMENTS ON THE EVIDENCES SUBMITTED BY THE ASSESSEE. THUS, HE SUBMI TTED THAT THE ISSUES MAY BE RESTORED BACK TO THE AO FOR DE NOVO ADJUDICA TION. 6. HAVING CONSIDERED THE SUBMISSIONS MADE BEFORE US BY HE LEARNED COUNSELS OF BOTH THE PARTIES WE FOUND THAT BEFORE T HE AO, FOR WHATEVER MAY BE THE REASON, ASSESSEE DID NOT PRODUCE EVIDENCES OR C OMPLIED WITH THE QUERIES MADE BY THE AO, AS A RESULT OF WHICH NUMBER OF ADDI TIONS/ DISALLOWANCES WERE MADE BY THE AO. BEFORE THE FIRST APPELLATE AUTHORIT Y ASSESSEE DID PRODUCE FRESH EVIDENCES IN SUPPORT OF ITS CLAIM OF DEDUCTIO N. FURTHER, AFFIDAVITS OF CONCERNED CHARTERED ACCOUNTANT AND EMPLOYEE OF THE ASSESSEE COMPANY WERE ALSO FILED BEFORE THE CIT(A) STATING CERTAIN FACTS. HOWEVER, IT IS A FACT ON RECORD THAT NEITHER THE EVIDENCES FILED BEFORE THE CIT(A) NOR THE AFFIDAVITS WERE SENT FOR VERIFICATION OF THE AO SEEKING HIS VIEWS/COMMENTS O N ASSESSEES CLAIM. THE LEARNED CIT(A), WITHOUT FOLLOWING THE MANDATE OF RU LE 46A, SUB-RULES (1), (2) AND (3) PROCEEDED TO DECIDE THE APPEAL RELYING UPON THE FRESH EVIDENCES/AFFIDAVITS FILED BY THE ASSESSEE. THUS, P RIMA FACIE THERE IS A CLEAR VIOLATION OF RULE 46A OF THE I.T. RULES AS THE LEAR NED CIT(A) DID NOT AFFORD A FAIR OPPORTUNITY TO THE AO IN TERMS OF THE SAID RULES. T HAT BEING THE CASE, WE ARE INCLINED TO SET ASIDE THE ORDER OF THE LEARNED CIT( A) AND RESTORE THE ISSUES TO THE FILE OF THE AO FOR DE NOVO ADJUDICATION AFTER C ONSIDERING THE EVIDENCES FILED BY THE ASSESSEE OR WHICH MAY BE FILED BY THE ASSESS EE IN THE COURSE OF FRESH PROCEEDINGS. NEEDLESS TO MENTION, THE AO MUST AFFOR D REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE BEFORE DECIDING THE ISSUES. GROUNDS ARE ALLOWED FOR STATISTICAL PURPOSES. 7. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS ALLOWED FOR STATISTICAL PURPOSES. ITA NO. 6408/MUM/2016 A.Y. 2012-13 8. FACTS IN THIS APPEAL BEING IDENTICAL, AFORESAID DEC ISION OF OURS IN ITA NO. 6407/MUM/2016 WILL APPLY MUTATIS MUTANDIS TO TH IS APPEAL AS WELL. ITA NOS. 6407& 6408/MUM/2016 M/S. JASHUBHAI ENGINEERING P. LTD. &M/S. JASHUBHAI MEDIA P. LTD. 4 RESULTANTLY, THE GROUNDS RAISED BY REVENUE ARE ALLO WED FOR STATISTICAL PURPOSES. 9. IN A NUTSHELL, BOTH THE APPEALS FILED BY REVENUE AR E ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 23 RD MAY, 2018. SD / - SD/ - (N.K. PRADHAN) (SAKTIJIT DEY) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 23 RD MAY, 2018 COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) -2, MUMBAI 4. THE CIT- 1, MUMBAI 5. THE DR, J BENCH, ITAT, MUMBAI BY ORDER //TRUE COPY// ASSISTANT REGISTRAR ITAT, MUMBAI BENCHES, MUMBAI N.P.