Aayush Hospital, Vapi V. The Income Tax Officer, Ward-1, Vapi

ITA 653/SRT/2018

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 1208 (ITAT-SURAT)
• Duration Of Justice: 2 year(s) 9 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-07-2021
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Assessment Year: 2011-2012
• Appeal Filed On: 27-09-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: ANUPAMA SINGLA SRDR
• Assessee Lawyers: P M JAGASHETH
• Keywords: Income from undisclosed sources; Rectification of order; Set aside
• Section: 271(1)(c); 143(3); 133A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, SURAT BENCH, SURAT BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER AND DR. ARJUN LAL SAINI, ACCOUNTANT MEMBER ITA NO.653/SRT/2018 (AY 2011-12) ITA NO.654/SRT/2018 (AY 2012-13) ITA NO.655/SRT/2018 (AY 2013-14) ITA NO.656/SRT/2018 (AY 2015-16) ITA NO.657/SRT/2018 (AY 2014-15) ITA NO.658/SRT/2018 (AY 2014-15) (H EARING IN VIRTUAL COURT) AAYUSH HOSPITAL, NO.2, ATUL SOCIETY, N.H. ROAD-8, VAPI-396191. PAN: AAOFA 9654 J VS. INCOME TAX OFFICER, WARD-1, ROOM NO. 708, 7 TH FLOOR, FORTUNE SQUARE-II, CHALA VAPI ROAD, VAPI-396191 APPLICANT RESPONDENT ASSESSEE BY MR. P.M. JAGASHETH, AR REVENUE BY MS. ANUPAMA SINGLA, SR-DR DATE OF HEARING 08/07/2021 DATE OF PRONOUNCEMENT 08/07/2021 ORDER UNDER SECTION 254(1) OF INCOME TAX ACT PER BENCH : 1. THIS GROUP OF SIX APPEALS BY ASSESSEE ARE DIRECTED AGAINST THE SEPARATE ORDERS OF LD. COMMISSIONER OF INCOME TAX (APPEALS), VALSAD, SURAT ALL DATED 27.08.2018 FOR THE ASSESSMENT YEAR (AY) 2011-12 TO 2014-15. THE APPEAL IN ITA NO. 653 TO 655/SRT/2018 RELATES TO QUANTUM ASSESSMENT FOR AY 2011-12 TO 2013-14, ITA NO. 656/SRT/2018 RELATES TO QUANTUM ASSESSMENT FOR 2015- 16. ITA NO. 657/SRT/2018 RELATES TO RECTIFICATION ORDER PASSED UNDER SECTION ITA NOS. 653 TO 658/SRT/2018 AAYUSH HOSPTIAL 2 154 FOR AY 2014-15 AND ITA NO. 658/ SRT/ 2018 RELATES TO PENALTY LEVIED UNDER SECTION 271(1)((C). IN APPEALS, THE ASSESSEE HAS RAISED CERTAIN COMMON GROUND OF APPEAL AGAINST DISMISSING ALL THE APPEAL IN EX-PARTE ORDER AND IN ABSENCE OF REASONABLE OPPORTUNITY. THUS, ALL THE APPEALS WERE CLUBBED HEARD TOGETHER AND ARE DECIDED BY COMMON ORDER TO AVOID THE CONFLICTING DECISION. FOR APPRECIATION OF FACTS, THE FACT IN QUANTUM ASSESSMENT APPEAL FOR AY 2011- 12 IS TREATED AS LEAD CASE. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS A FIRM AND ENGAGED IN THE BUSINESS OF MEDICAL PROFESSION. A SURVEY ACTION UNDER SECTION 133A WAS CARRIED OUT ON 08.12.2014 ON THE BUSINESS PREMISES OF THE ASSESSEE. IN THE SURVEY CERTAIN INCRIMINATING MATERIAL WAS FOUND. ON THE BASIS OF SURVEY CASE FOR ASSESSMENT YEAR 2011-12 TO 2013-14 WAS REOPENED. THE ASSESSING OFFICER WHILE PASSING ASSESSMENT ORDER MADE CERTAIN ADDITION, CONSISTING OF ADDITION ON ACCOUNT OF UNEXPLAINED INCOME, UNEXPLAINED UNACCOUNTED INCOME, AND DISALLOWANCE OF VARIOUS EXPENSES BEING PERSONAL IN NATURE. THE ASSESSMENT WAS COMPLETED ON 27.12.2017 UNDER SECTION 143(3) READ WITH SECTION 147. 3. AGGRIEVED BY THE ADDITION IN THE ASSESSMENT ORDER AS WELL AS AGAINST THE REOPENING THE ASSESSEE FILED APPEAL BEFORE LD CIT(A). THE LD CIT(A) CONFIRMED THE ORDER OF ASSESSING OFFICER IN EX-PARTE ORDER BY TAKING VIEW THAT DESPITE GRANTING A NUMBER OF OPPORTUNITY THE ASSESSEE FAILED TO COMPLY THE ITA NOS. 653 TO 658/SRT/2018 AAYUSH HOSPTIAL 3 NOTICES. IT WAS ALSO HELD THAT THE ASSESSEE IS SEEKING REPEATED ADJOURNMENT FOR PREPARATION OF CASE. THE LD. CIT(A) DISMISSED THE APPEAL WITHOUT CONSIDERING AND DISCUSSING THE MERITS OF VARIOUS GROUNDS OF APPEAL. SIMILARLY, APPEALS AGAINST THE ORDER OF UNDER SECTION 154 DATED 23.10.2017 AND I THE PENALTY LEVIED FOR 2014-15 UNDER SECTION 271(1)(C) FOR ASSESSMENT YEAR 2014-15 WAS ALSO DISMISSED WITH SIMILAR OBSERVATION. FURTHER AGGRIEVED, THE ASSESSEE HAS FILED ALL APPEALS BEFORE THIS TRIBUNAL. 4. WE HAVE HEARD THE SUBMISSIONS OF THE LEARNED COUNSEL/ AUTHORISED REPRESENTATIVE (AR/ COUNSEL) FOR THE ASSESSEE AND THE LEARNED SENIOR DEPARTMENTAL REPRESENTATIVE (SR DR) FOR THE REVENUE. THE LD COUNSEL FOR THE ASSESSEE SUBMITS THAT IN COMPLIANCE OF VARIOUS NOTICES ISSUED BY LD. CIT(A) FOR FIXING THE DATE OF HEARING, THE ASSESSEE SOUGHT ADJOURNMENT FOR PREPARATION OF THE CASE. THE APPEAL WAS FILED IN JUNE 2016. THE HEARING OF APPEAL WAS TAKEN UP IN MAY 2018. THE ASSESSEE- FIRM IS MANAGING THE HOSPITAL IN VAPI, THE OFFICE OF LD. CIT(A) IS SITUATED AT VALSAD AND THE COUNSEL FOR ASSESSEE USED TO ATTEND THE HEARING FROM SURAT. THE ASSESSEE SOUGHT ADJOURNMENT THROUGH HIS COUNSEL FOR VALID REASON FOR PREPARATION OF CASE. THE LD. CIT(A) DECLINED TO ADJOURN THE CASE ON 21.08.2018 AND ULTIMATELY PASSED THE ORDER ON 23.08.2018. ITA NOS. 653 TO 658/SRT/2018 AAYUSH HOSPTIAL 4 5. THE LD. COUNSEL FOR THE ASSESSEE SUBMITS THAT THE ASSESSEE HAS GOOD CASE ON MERIT IN ALL APPEALS AND IS LIKELY TO SUCCEED, IF THE ASSESSEE IS HEARD ON MERIT. THE LD COUNSEL FOR THE ASSESSEE PRAYED TO RESTORE ALL THE APPEALS TO THE FILES OF LEARNED CIT(A), WITH THE DIRECTION TO PROVIDE REASONABLE OPPORTUNITY OF HEARING TO THE ASSESSEE. THE LD. COUNSEL UNDERTAKE ON BEHALF OF THE ASSESSEE TO BE MORE VIGILANT AND TO FURNISH ALL DOCUMENTARY EVIDENCE AND SUBMISSION TO SUBSTANTIATE VARIOUS GROUND OF APPEAL IN ALL THE APPEALS. THE LEARNED COUNSEL ALSO ASSURED THE BENCH TO FURNISH HIS EMAIL ADDRESS AS WELL AS TELEPHONE NUMBER FOR COMMUNICATION OF THE HEARING BEFORE LD. CIT(A). 6. IN ALTERNATIVE SUBMISSION THE LD. COUNSEL FOR THE ASSESSEE SUBMITS THAT IN ALL CASES THE ORDER PASSED BY LD CIT(A) IS NOT IN ACCORDANCE WITH THE PROVISIONS OF SECTION 250(6) OF THE ACT AND THE ORDER IS LIABLE TO BE SET ASIDE ON THIS GROUND ALONE. 7. ON THE OTHER HAND THE LD. SR. DR FOR THE REVENUE SUBMITS THAT THE ASSESSEE WAS GIVEN SUFFICIENT OPPORTUNITY AS RECORDED IN PARA 3 OF THE ORDER PASSED BY THE LD. CIT(A). THE ASSESSEE FAILED TO COMPLY WITH THE NOTICE ISSUED BY THE LD. CIT(A). THE ASSESSEE REPEATEDLY SOUGHT ADJOURNMENT INSTEAD OF MAKING PROPER COMPLIANCE. THE ASSESSEE GIVEN LAST OPPORTUNITY AS RECORDED IN PARA 3.3 OF THE IMPUGNED ORDER. WHEN THE ASSESSEE FAILED TO PROVIDE ANY SUBMISSION OR EVIDENCE, THE LD. CIT(A) LEFT WITH NO OPTION, EXCEPT TO PROCEED TO DECIDE THE ITA NOS. 653 TO 658/SRT/2018 AAYUSH HOSPTIAL 5 ISSUE AND IN ABSENCE OF ANY EVIDENCE OR EXPLANATION AFFIRM THE ACTION OF AO. THE LEARNED SR DR FOR THE REVENUE PRAYED FOR DISMISSAL OF THE APPEAL. 8. IN ALTERNATIVE SUBMISSION, THE LD. SR. DR FOR THE REVENUE SUBMITS THAT IN CASE THE HONBLE BENCH DEEMS IT APPROPRIATE TO RESTORE THE GROUNDS OF APPEAL TO THE FILE OF LD. CIT(A), THE ASSESSEE BE DIRECTED TO BE VIGILANT AND NOT TO DEFAULT IN FUTURE IN ATTENDING THE PROCEEDINGS AND TO WASTE THE TIME OF PUBLIC AUTHORITIES/LD.CIT(A). THE ASSESSEE SHOULD NOT TAKE THE PROCEEDING BEFORE THE FIRST APPELLATE AUTHORITY IN CASUAL MANNER. 9. WE HAVE CONSIDERED THE RIVAL SUBMISSION OF LD. AR FOR THE ASSESSEE AND THE DR FOR THE REVENUE AND HAVE GONE THROUGH THE ORDERS OF LOWER AUTHORITIES. WE FIND THAT THE LD. CIT(A) FIXED THE HEARING ON THREE OCCASIONS AS MENTIONED IN PARA 3 OF THE IMPUGNED ORDER. IT IS RECORDED BY LD. CIT(A) THAT THE ASSESSEE WAS GRANTED AMPLE OPPORTUNITY BUT THE ASSESSEE FAILED TO FILE WRITTEN SUBMISSION. WE FIND THAT IT IS NOT THE CASE, WHERE THE ASSESSEE WAS NOT RESPONDING TO THE NOTICES ISSUED FOR FIXING HEARING, HOWEVER, THE ASSESSEE SOUGHT ADJOURNMENT. THE LD. CIT(A) DECLINED THE ADJOURNMENT AND DISMISSED THE APPEAL IN LIMINE . THE LD. CIT(A) HAS NOT RECORDED THE GROUNDS OF ADJOURNMENT AND THE REASONS OF REJECTION. 10. FURTHER WE FIND THAT ORDER PASSED BY LD. CIT(A) IS NOT IN ACCORDANCE WITH MANDATE OF SECTION 250(6) OF THE INCOME TAX ACT. SECTION 250(6) OF THE ACT ITA NOS. 653 TO 658/SRT/2018 AAYUSH HOSPTIAL 6 MANDATES THAT THE LD. CIT(A) WHILE DECIDING THE APPEAL IS REQUIRED TO PASS ORDER ON POINTS OF DETERMINATION, DECISION THEREIN ON AND REASONS FOR SUCH DECISION. THEREFORE, CONSIDERING OVERALL FACTS AND THE CIRCUMSTANCES OF THE CASE, WE FIND THAT SUBSTANTIAL RIGHTS OF ASSESSEE ARE INVOLVED AND ALL THE APPEALS OF ASSESSEE WAS DISMISSED IN LIMINE, WITHOUT DISCUSSING THE MERITS OF THE CASES. THUS, WE ARE OF THE VIEW THAT THE ASSESSEE DESERVE ONE MORE OPPORTUNITY OF HEARING AT THE STAGE OF FIRST APPELLATE STAGE, ACCORDINGLY THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE ARE RESTORED TO THE FILE OF LEARNED CIT(A) TO DECIDE ALL THE GROUNDS OF APPEAL AFRESH IN ACCORDANCE WITH LAW. 11. NEEDLESS TO ORDER THAT BEFORE PASSING THE ORDER THE LD. CIT(A) SHALL GRANT FAIR OPPORTUNITY OF HEARING TO THE ASSESSEE. THE ASSESSEE IS ALSO DIRECTED TO APPEAR BEFORE THE LD. CIT(A) AS AND WHEN THE DATE OF HEARING IS FIXED AND TO PROVIDE ALL NECESSARY EVIDENCE AND INFORMATION WITHOUT ANY FURTHER DELAY AND NOT TO SEEK THE ADJOURNMENT WITHOUT ANY VALID REASONS. THE ASSESSEE IS FURTHER DIRECTED TO PROVIDE HIS E-MAIL ADDRESS AND TELEPHONE NUMBER TO MAKE COMMUNICATION WITH HIM OR HIS REPRESENTATIVE. ACCORDINGLY THE GROUNDS OF APPEAL BY ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSE. 12. AS NOTED ABOVE, THE LD. CIT(A) DISMISSED ALL THE APPEALS BY TAKING THE SIMILAR VIEW, WHICH WE HAVE NOT APPROVED AND RESTORED THE APPEAL BACK TO THE FILE OF ITA NOS. 653 TO 658/SRT/2018 AAYUSH HOSPTIAL 7 THE LD. CIT(A) THEREFORE, ALL THE APPEALS ARE RESTORED BACK TO THE FILE OF LD. CIT(A) WITH SIMILAR DIRECTION. 13. IN THE RESULT, ALL SIX APPEALS OF THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSE. ORDER ANNOUNCED ON 08 TH JULY 2021 AT THE TIME OF HEARING IN VIRTUAL COURT HEARING. SD/- SD/- (DR ARJUN LAL SAINI) (PAWAN SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER SURAT, DATED: 08/07/2021 RAHUL SHARMA SR. P.S. (ON TOUR) COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT(A) 4. CIT 5. DR 6. GUARD FILE BY ORDER / / TRUE COPY / / ASSISTANT REGISTRAR, ITAT, SURAT