Bal Kishan Saraf, Delhi V. ACIT, New Delhi

ITA 654/DEL/2013

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 7950 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 3 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-05-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 31-03-2016
• Assessment Year: 2003-2004
• Appeal Filed On: 04-02-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K K JAISWAL
• Keywords: Search and seizure; Document seized; Principle of natural justice; Documents seized
• Section: 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: A NEW DELHI BEFORE SMT DIVA SINGH, JUDICIAL MEMBER AND SH.PRASHANT MAHARISHI, ACCOUNTANT MEMBER I.T.A .NO.-654 TO 656/DEL/2013 (ASSESSMENT YEAR-2003-04 & 2005-06) BAL KISHAN SARAF, 1290, KATRA DHULLA, CHANDNI CHOWK, DELHI. PAN-AAHPS3659Q (APPELLANT) VS ACIT, CENTRAL CIRCLE-II, (RESPONDENT) APPELLANT BY SH. ASHU GOEL, CA RESPONDENT BY SH. K.K.JAISWAL, DR ORDER PER DIVA SINGH, JM BY THE PRESENT APPEALS, THE ASSESSEE ASSAILS THE CO RRECTNESS OF THE SEPARATE ORDER DATED 10.12.2012, 10.12.2012 AND 11.12.2012 R ESPECTIVELY OF CIT(A)-III, NEW DELHI PERTAINING TO 2003-04 & 2005-06 ASSESSMENT YE ARS. 2. INVITING ATTENTION TO THE COPY OF THE GROUNDS RA ISED IN EACH OF THESE APPEALS. IT WAS HIS SUBMISSION THAT GROUND NO.6 IN ITA NO.65 4 & 656/DEL/2013 RAISED BY THE ASSESSEE IS IDENTICAL TO GROUND NO.9 RAISED IN ITA NO.655/DEL/2013 WHICH READ AS UNDER:- 6. THAT LD.CIT(A) IS NOT JUSTIFIED IN NOT PROVIDIN G OPPORTUNITY TO APPELLANT TO SUBMIT ITS COMMENTS TOWARDS REMAND REP ORT CALLED BY HIM FROM LD.AO AT THE BACK OF APPELLANT. HENCE THE ACT ION OF LD.CIT(A) IS AGAINST THE PRINCIPLE OF NATURAL JUSTICE AND CONTRA RY TO PROVISIONS OF LAW, AS SUCH THE SAME NEEDS TO BE UNDONE AND ANY ADDITIO N CONFIRMED ON THE BASIS OF SAME NEEDS TO BE DELETED. 3. IN SUPPORT OF THE SAID SUBMISSION, ATTENTION WAS INVITED TO PAGE 25 OF THE IMPUGNED ORDER IN 2003-04 AY IN PARA 6.3.1. IT WAS SUBMITTED THAT REFERENCE DATE OF HEARING 31.03.2016 DATE OF PRONOUNCEMENT 12.05.2016 I.T.A .NO.-654 TO 656/DEL/2013 PAGE 2 OF 5 THEREIN HAS BEEN MADE TO THE REMAND REPORT OF THE A O DATED 03.12.2012. INVITING ATTENTION TO THE IMPUGNED ORDER IT WAS SUB MITTED THAT THE CIT(A) STATES THAT OPPORTUNITY WAS GIVEN TO THE ASSESSEE ON 03.12 .2012 ON WHICH DATE THE ASSESSEE DID NOT ATTEND. INVITING ATTENTION TO FIR ST PAGE OF THE IMPUGNED ORDER IT WAS POINTED OUT THAT THE DATE OF THE ORDER IS 10.12 .2012. ACCORDINGLY BASED ON THESE DATES WHICH ARE COMING OUT FROM THE IMPUGNED ORDER ITSELF IT WAS SUBMITTED THAT EVIDENTLY THE REMAND REPORT OBTAINED FROM THE AO DATED 03.12.2012 BY THE CIT(A) WAS NEVER CONFRONTED TO THE ASSESSEE. ACCOR DINGLY IN VIEW OF THESE PECULIAR FACTS AND CIRCUMSTANCES, THE IMPUGNED ORDER BASED O N THE SAME IT WAS SUBMITTED IS BAD IN LAW AND DESERVES TO BE SET ASIDE. IN THE REMAINING YEARS ALSO IT WAS SUBMITTED THE POSITION REMAINED THE SAME AS THE FAC T THAT THE REMAND REPORT HAS BEEN CONSIDERED WITHOUT CONFRONTING TO THE ASSESSEE IS EVIDENT ON THE FACE OF THE RECORD ITSELF. AS AN ILLUSTRATION, ATTENTION WAS I NVITED TO PAGE 23 OF THE IMPUGNED ORDER IN 2004-05 AY WHERE AGAIN REFERENCE IS MADE T O THE REMAND REPORT DATED 03.12.2012. NONE WAS PRESENT ON BEHALF OF THE ASSE SSEE. THE ORDER HAS BEEN PASSED ON 10.12.2012. 3.1. CONSIDERING THESE FACTS AVAILABLE ON RECORD, T HE LD.AR REQUESTED THAT IN ORDER TO CORRECT THE DEFICIENCIES, THE ISSUES MAY B E RESTORED TO THE FILE OF THE CIT(A) WITH THE DIRECTION TO CONFRONT THE EVIDENCES RELIED UPON AND PASS A SPEAKING ORDER THEREAFTER. 4. THE LD. SR. DR CONSIDERING THE MATERIAL AVAILABL E ON RECORD HAD NO OBJECTION IF THE SAID PRAYER OF THE ASSESSEE WAS ACCEPTED. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. IT IS SEEN THAT AS A RESULT OF SEARCH AND SEIZURE ACTION U/S 132 IN THE SH. I.T.A .NO.-654 TO 656/DEL/2013 PAGE 3 OF 5 RAM HARI RAM GROUP OF CASES ON 26.02.2009, THE ASSE SSEE WAS ALSO COVERED UNDER THE SAID SEARCH. THE ADDITIONS MADE BY THE A O WERE CHALLENGED IN APPEAL BEFORE THE CIT(A). FOR THE PURPOSES OF DECIDING TH E PRESENT ISSUE IN THESE APPEALS, IT IS NOT NECESSARY TO REFER TO THE NATURE OF ADDIT IONS MADE SUFFICE IT SAY THAT ON A CHALLENGE POSED TO THEM BY THE ASSESSEE AS FUNDAMEN TAL AS THAT THE SEIZED DOCUMENTS DO NOT PERTAIN TO THE ASSESSEE AMONGST O THER ARGUMENTS, THESE ISSUES IT IS EVIDENT WERE DECIDED RELYING ON THE BASIS OF THE REMAND REPORT FILED BY THE AO AND ADMITTEDLY NOT CONFRONTED TO THE ASSESSEE. ACCORDINGLY IN THE PECULIAR FACTS AND CIRCUMSTANCES OF THE CASE, WE HOLD THAT T HE IMPUGNED ORDER IS VIOLATIVE OF THE RULES OF NATURAL JUSTICE AND THE VIOLATION B EING SO FUNDAMENTAL AND BASIC DESERVES TO BE ADDRESSED. IT CANNOT BE OVER-EMPHAS IZED THAT THE RIGHT TO BE HEARD IS AN IMPORTANT RIGHT TO WHICH A PARTY WHO IS FACED WITH AN ADVERSE VIEW IS ENTITLED TO. AUDI ALTERAM PARTEM IS ONE OF THE MOST FAMOUS AND CELEBRATED RULES OF NATURAL JUSTICE. THE PRINCIPLES OF NATURAL JUST ICE ARE THOSE WHICH HAVE BEEN LAID OUT BY THE COURTS AS BEING THE MINIMUM PROTECT ION OF THE RIGHTS OF AN INDIVIDUAL AGAINST THE ARBITRARY PROCEDURE THAT MAY BE ADOPTED BY A JUDICIAL, QUASI-JUDICIAL AND ADMINISTRATIVE AUTHORITY WHILE M AKING AN ORDER AFFECTING THOSE RIGHTS. A CAREFUL PERUSAL OF THE CONSISTENT JUDGEM ENTS OF THE APEX COURT WOULD SHOW THAT IT HAS CONSISTENTLY BEEN HELD THAT THE RU LES OF NATURAL JUSTICE ARE NOT EMBODIED RULES AND THE SAID PHRASE IS NOT AND CANNO T BE CAPABLE OF A PRECISE DEFINITION. THE UNDERLYING PRINCIPLE OF NATURAL JU STICE EVOLVED UNDER THE COMMON LAW IS TO CHECK ARBITRARY EXERCISE OF POWER BY THE STATE OR ITS FUNCTIONARIES. ACCORDINGLY, THE PRINCIPLE BY ITS VERY NATURE IMPLI ES THE DUTY TO ACT FAIRLY I.E. FAIR PLAY IN ACTION MUST BE EVIDENT AT EVERY STAGE. FAI R PLAY DEMANDS THAT NOBODY I.T.A .NO.-654 TO 656/DEL/2013 PAGE 4 OF 5 SHALL BE CONDEMNED UNHEARD. IN THE CELEBRATED JUDG EMENT OF THE APEX COURT IN THE CASE OF A.K.KRAIPAK VS- UNION OF INDIA (1969) 2 SCC 262, IT IS OBSERVED THAT THE AIM OF RULES OF NATURAL JUSTICE IS TO SECURE JU STICE OR TO PUT IT NEGATIVELY TO PREVENT MISCARRIAGE OF JUSTICE. THE SAID RULES ARE MEANS TO AN END AND NOT AN END IN THEMSELVES AND THOUGH IT IS NOT POSSIBLE TO MAKE AN EXHAUSTIVE CATALOGUE OF SUCH RULES HOWEVER IT CAN BE READILY SAID THAT THER E ARE TWO BASIC MAXIMS OF NATURAL JUSTICE NAMELY AUDI ALTERAM PARTEM AND NEMO JUDEX IN RE SUA. IN THE PRESENT FACTS OF THE CASE WE ARE CONCERNED WITH THE MAXIM AUDI ALTERM PARTEM WHICH AGAIN MAY HAVE MANY FACETS TWO OF THEM (A) NO TICE OF THE CASE TO BE MET; AND (B) OPPORTUNITY TO EXPLAIN. THEIR LORDSHIPS HA VE CAUTIONED THAT THESE RULES CANNOT BE SACRIFICED AT THE ALTAR OF THE ADMINISTRA TIVE CONVENIENCE OR CELEBRITY. THUS, CONSIDERING THE AFORE-MENTIONED STATUTORY PRO VISION AND THE PRINCIPLES OF NATURAL JUSTICE, THE ISSUE IS RESTORED BACK TOT EH FILE OF THE CIT(A). NEEDLESS TO SAY THAT BEFORE PASSING THE ORDER, A REASONABLE OPPORTU NITY SHALL BE PROVIDED TO THE ASSESSEE. WHILE SO DIRECTING IT IS HOPED THAT THE OPPORTUNITY SO PROVIDED IS NOT ABUSED BY THE ASSESSEE AND IS UTILIZED IN GOOD FAIT H AS FAILING WHICH THE LD. CIT(A) WOULD BE AT LIBERTY TO PASS A SPEAKING ORDER IN ACC ORDANCE WITH LAW ON THE BASIS OF MATERIAL AVAILABLE ON RECORD. 5.1. ACCORDINGLY, IN VIEW OF THE ABOVE PATENT AND O BVIOUS LEGAL IMPEDIMENTS, WE DEEM IT APPROPRIATE TO SET ASIDE THE IMPUGNED ORDER IN EACH OF THE THREE YEARS AND RESTORE THE ISSUE BACK TO THE FILE OF THE CIT(A) WI TH THE DIRECTION TO PASS A SPEAKING ORDER IN ACCORDANCE WITH LAW AFTER CONFRONTING TO T HE ASSESSEE THE REMAND REPORT TAKEN ON RECORD. I.T.A .NO.-654 TO 656/DEL/2013 PAGE 5 OF 5 6. IN THE RESULT, THE APPEALS OF THE ASSESSEE ARE A LLOWED FOR STATISTICAL PURPOSES. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 12 MA Y, 2016. SD/- SD/- (PRASHANT MAHARISHI) (DIVA SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 12/05/2016 *AMIT KUMAR* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSI STANT REGISTRAR ITAT NEW DELHI