Egwood Boards and Panels Pvt Ltd., Hyderabad V. DCIT,Central Circle - 3, Hyderabad

ITA 645/HYD/2014

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 7738 (ITAT-HYDERABAD)
• Duration Of Justice: 8 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-12-2014
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2010-2011
• Appeal Filed On: 07-04-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RAMAKRISHNA B
• Assessee Lawyers: SANJAY KUMAR SHARDA
• Keywords: Search and seizure

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A', HYDERABAD BEFORE SHRI P.M.JAGTAP, ACCOUNTANT MEMBER AND SMT.ASHA VIJAYARAGHAVAN, JUDICIAL MEMBER ITA NO.644/HYD/14 : ASSESSMENT YEAR 2009 - 10 ITA NO.645/HYD/14 : ASSESSMENT YEAR 2010 - 11 M/S. EGWOOD BOARDS & PANELS LTD., HYDERABAD (PAN AAACE 4481 C ) V/S. DY. COMMISSIONER OF INCOME - TAX CENTRAL CIRCLE 3, HYDERABAD (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI SANJAY KUMAR SHARDA RESPONDENT BY : S HRI RAMAKRISHNA B., DR DATE OF HEARING 9.12.2014 DATE OF PRONOUNCEMENT 10.12.2014 O R D E R PER BENCH : THESE TWO APPEALS FILED BY THE ASSESSEE ARE DIRECTED AGAINST TWO SEPARATE ORDERS PASSED BY THE LEARNED COMMISSIONER OF INCOME - TAX(APPEALS) VII HYDERABAD ON 29.1.2014, WHEREBY HE DISMISSED THE APPEALS OF THE ASSESSEE IN LIMINE, HOLDING THE SAME TO BE NOT MA INTAINABLE AS PER THE PROVISIONS OF S.249(4)(A) ON ACCOUNT OF NON - PAYMENT OF ADMITTED TAXES BY THE ASSESSEE. 2. THE ASSESSEE IN THE PRESENT CASE IS A COMPANY WHICH IS ENGAGED IN THE BUSINESS OF MANUFACTURE OF PLY - WOOD AND OTHER MATERIALS. A SEARCH AND SEIZURE ACTION UNDER S.132 WAS CONDUCTED I TA NO. 644 & 645 /H YD/20 14 M/S. EGWOOD BOARDS & PANELS P. LTD., HYDERABAD 2 IN THE CASE OF THE ASSESSEE ON 11.3.2010. PURSUANT TO THE SAID ACTION, NOTICES UNDER S.1 5 3A WERE ISSUED BY THE ASSESSING OFFICER IN RESPONSE TO WHICH THE ASSESSEE FILED ITS RETURNS OF INCOME FOR THE ASSESSMENT YEA RS 2009 - 10 AND 2010 - 11 DECLARING TOTAL INCOMES OF RS.90,12,492 AND RS.42,91,268 RESPECTIVELY. IN THE ASSESSMENTS COMPLETED UNDER S.143(3) READ WITH S.153A BY THE ORDERS DATED 16.8.2012, THE TOTAL INCOME OF THE ASSESSEE WAS COMP UTED BY THE ASSESSING OFFIC ER AT RS.95,95,212 AND RS.60,62,977 FOR ASSESSMENT YEARS 2009 - 10 AND 2010 - 11 RESPECTIVELY, AFTER MAKING CERTAIN ADDITIONS ON ACCOUNT OF DISALLOWANCE UNDER S.40A(3) AND UNEXPLAINED CASH FOUND DURING THE COURSE OF SEARCH. 3. AGAINST THE ORDERS PASSED B Y THE ASSESSING OFFICER UNDER S.143(3) READ WITH S.153A FOR BOTH THE YEARS UNDER CONSIDERATION, APPEALS WERE PREFERRED BY THE ASSESSEE BEFORE THE LEARNED CIT(A). DURING THE COURSE OF APPELLATE PROCEEDINGS, IT WAS NOTICED BY THE COMMISSIONER OF INCOME - TAX( APPEALS) THAT THE ASSESSEE HAS NOT PAID THE TAX DUE ON THE INCOME DECLARED IN THE RETURNS OF INCOME FOR BOTH THE YEARS UNDER CONSIDERATION. ACCORDING TO THE LEARNED CIT(A), THE APPEALS PREFERRED BY THE ASSESSEE BEFORE HIM IN THE ABSENCE OF PAYMENT OF ADMIT TED TAX WERE NOT MAINTAINABLE AS PER THE PROVISIONS OF S.249(4) AND HE THEREFORE, CALLED UPON THE ASSESSEE TO EXPLAIN WHY THE SAID APPEALS SHOULD NOT BE DISMISSED TREATING THE SAME TO BE NOT MAINTAINABLE. IN REPLY, THE FOLLOWING EXPLANATION WAS OFFERED B Y THE ASSESSEE VIDE LETTER DATED 27.1.2012 - I TA NO. 644 & 645 /H YD/20 14 M/S. EGWOOD BOARDS & PANELS P. LTD., HYDERABAD 3 4. THE LEARNED CIT(A), HOWEVER, FOUND THAT THE SEIZED CASH WAS NOT ADJUSTED BY THE ASSESSING OFFICER AGAINST THE OUTSTANDING DEMAND FOR THE YEARS UNDER CONSIDERATION, AND THE PAYMENT OF ADMITTED TAXES TH US WAS NOT MADE BY THE ASSESSEE. HE, THEREFORE, DISMISSED THE APPEALS OF THE ASSESSEE IN LIMINE IN TERMS OF S.249(4) FOR WANT OF PAYMENT OF ADMITTED TAXES, TREATING THE SAME AS NOT MAINTAINABLE. AGGRIEVED BY THE ORDERS OF THE LEARNED CIT(A), ASSESSEE HAS PREFERRED THESE APPEALS BEFORE THE TRIBUNAL. 5. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AND ALSO PERUSED THE RELEVANT MATERIAL ON RECORD. AS SUBMITTED BY THE LEARNED COUNSEL FOR THE ASSESSEE, THE ASSESSEE COMPANY HAS ALREADY PAID THE ENTIRE TAXES DUE ON THE INCOMES DECLARED IN THE RETURNS OF INCOME FILED FOR THE YEARS UNDER CONSIDERATION, WITHOUT WAITING FOR THE ADJUSTMENT OF SEIZED CASH WHICH HAS NOT BEEN ALLOWED BY THE ASSESSING OFFICER. HE HAS ALSO FURNISHED THE DETAILS OF ADMITTED TAXES PAID BY THE ASSESSEE FOR BOTH THE YEARS UNDER CONSIDERATION AS UNDER - I TA NO. 644 & 645 /H YD/20 14 M/S. EGWOOD BOARDS & PANELS P. LTD., HYDERABAD 4 A PERUSAL OF THE DETAILS FURNISHED BY THE ASSESSEE AS ABOVE, WHICH ARE DULY SUPPORTED BY THE COPIES OF THE RELEVANT CHALLANS EVIDENCING THE PAYMENT CLEARLY SHOWS THAT THE ADMITTED TAXES O N INCOMES RETURNED FOR BOTH THE YEARS UNDER CONSIDERATION HAVE BEEN PAID BY THE ASSESSEE AND THIS POSITION IS NOT DISPUTED EVEN BY THE LEARNED DEPARTMENTAL REPRESENTATIVE. 6. AS HELD BY THE MUMBAI BENCH OF THE TRIBUNAL IN THE CASE OF BHUMIRAJ CONSTRUC TIONS V/S. ADDL. CIT (131 ITD 406), AN APPEAL FILED BY THE ASSESSEE WITHOUT PAYING TAX DUE ON THE RETURNED INCOME IS ONLY DEFECTIVE AND IF THE REQUIRED AMOUNT OF TAX IS PAID SUBSEQUENTLY BY THE ASSESSEE, THE APPEAL SHOULD BE ADMITTED ON SUCH PAYMENT AND SHOULD BE TAKEN UP FOR HEARING BY THE LEARNED CIT(A). SIMILAR VIEW HAS ALSO BEEN EXPRESSED BY THE AHMEDABAD BENCH OF THE TRIBUNAL IN THE CASE OF J.K.CHATURVEDI V/S. ASST. COMMISSIONER OF INCOME - TAX (82 TTJ(AHD) 284), WHEREIN IT WAS HELD THAT THE DEFECT AR ISING DUE TO NON - COMPLIANCE OF S.249(4) IS A CURABLE ONE AND IN THE GIVEN CASE, IF THE TRIBUNAL IS SATISFIED THAT THERE EXISTS SUFFICIENT REASON FOR CURING SUCH DEFECT, AFTER THE EXPIRY OF THE LIMITATION, IT WOULD BE IN THE REALM OF TRIBUNALS DISCRETION TO RESTORE SUCH MATTER TO THE CIT(A) FOR DECIDING THE CONTROVERSY ON MERITS. IN THE PRESENT CASE, WE ARE SATISFIED THAT THERE EXISTED SUFFICIENT CAUSE FOR NON - PAYMENT OF ADMITTED TAX BY I TA NO. 644 & 645 /H YD/20 14 M/S. EGWOOD BOARDS & PANELS P. LTD., HYDERABAD 5 THE ASSESSEE EARLIER, INASMUCH AS THE ASSESSEE WAS EXPECTING THE A DJUSTMENT OF SEIZED CASH AGAINST THE TAXES AND AFTER HAVING BEEN GIVEN TO UNDERSTAND THAT SUCH ADJUSTMENT WAS NOT BEING ALLOWED BY THE DEPARTMENT, THE ASSESSEE HAS, HOWEVER, PAID THE ENTIRE ADMITTED TAXES. KEEPING IN VIEW THESE FACTS OF THE CASE AND FOL LOWING THE RATIO LAID DOWN BY THE COORDINATE BENCHES OF THIS TRIBUNAL IN THE CASES OF BHUMIRAJ CONSTRUCTIONS (SUPRA) AND J.K.CHATURVEDI (SUPRA), WE SET ASIDE THE IMPUGNED ORDERS OF THE LEARNED CIT(A) AND RESTORING THESE MATTERS TO HIS FILE OF THE LEARNED C IT(A), DIRECT HIM TO ADMIT THE APPEALS OF THE ASSESSEE AND DISPOSE OF THE SAME ON MERITS, IN ACCORDANCE WITH LAW AND AFTER GIVING SUFFICIENT OPPORTUNITY OF HEARING TO THE ASSESSEE. 7. IN THE RESULT, BOTH THE APPEALS OF THE ASSESSEE ARE ALLOWED FOR STA TISTICAL PURPOSES. ORDER PRONOUNCED IN THE COURT ON 10TH DECEMBER, 2014 SD/ - SD/ - ( ASHA VIJAYARAGHAVAN ) ( P.M.JAGTAP ) JUDICIAL MEMBER ACCOUNTANT MEMBER DT/ - 10 TH DECEMBER, 2014 COPY FORWARDED TO: 1. M/S. EGWOOD BOARDS & PANELS LTD., HYDERABAD 6 - 3 - 679,ELITE PLAZA, PANJAGUTTA, HYDERABAD 2 . DY. COMMISSIONER OF INCOME - TAX , CENTRAL CIRCLE 3, HYDERABAD 3. COMMISSIONER OF INCOME - TAX(APPEALS) V II HYDERABAD 4. COMMISSIONER OF INCOME - TAX CENTRAL , HYDERABAD 5. DEPARTMENTAL REPRESENTATIVE, ITAT, HYDERABAD. B.V.S