ARTSON ENGINEERING LTD, MUMBAI V. ITO 10(2)-1, MUMBAI

ITA 6582/MUM/2010

• Counselvise Citation: 658219914 RSA 2010
• Duration Of Justice: 4 year(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-09-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 09-09-2014
• Assessment Year: 2007-2008
• Appeal Filed On: 09-09-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S PADMAJA
• Assessee Lawyers: K S CHOKSI
• Keywords: Condonation of delay
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, MUMBAI BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI RAJENDRA, ACCOUNTANT MEMBER I.T.A. NO.6582/MUM/2010 AND I.T.A. NO.8860/MUM/2010 (ASSESSMENT YEAR : 2007-08 ) ARTSON ENGINEERING LTD. HIRANANDANI KNOWLEDGE PARK, 11 TH FLOOR, TECHNOLOGY STREET, POWAI, MUMBAI-400 076. VS. INCOME TAX OFFICER-10(2)- 1, AAYAKAR BHAVAN, 4 TH FLOOR, M.K. ROAD, MUMBAI-20. PAN/GIR NO. AAACA 5921 H (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI K.S. CHOKSI DEPARTMENT BY : MS. S. PADMAJA DATE OF HEARING : 09.9.2014 DATE OF PRONOUNCEMENT : 09.9.2014 O R D E R PER JOGINDER SINGH, JM : BOTH THESE APPEALS ARE BY THE ASSESSEE CHALLENGING THE IMPUGNED ORDERS DATED 17/6/2010 AND 26/20/2010 RESPECTIVELY OF THE LD. FIRST APPELLATE AUTHORITY O N GROUNDS AS DETAILED IN THE RESPECTIVE GROUNDS OF APPEAL. ITA NO.6582 & 8860/M/10 AY:07-08 2 2. DURING HEARING OF THESE APPEALS BROADLY THE LD. COUNSEL FOR THE ASSESSEE SHRI K.S. CHOKSI CONTENDED THAT REASONABLE OPPORTUNITY TO RECTIFY THE DEFECT/HEARIN G WAS NOT PROVIDED TO THE ASSESSEE FOR WHICH OUR ATTENTI ON WAS INVITED TO VARIOUS PAGES OF THE IMPUGNED ORDERS. ON THE OTHER HAND THE LD. MS. S. PADMAJA LD. CIT-DR DEFEND ED THE CONCLUSION DRAWN IN THE IMPUGNED ORDERS. 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE FACTS IN BRIEF ARE THAT THE ASSESSEE COMPANY WAS DECLARED SICK VID E ORDER DATED 17/5/2006 AND WAS REQUIRED TO FILE A REHABILI TATION SCHEME. AS PER BIFR, REHABILITATION SCHEME WAS TO B E FILED, THE ASSESSEE WAS TO SETTLE ALL CREDITORS/DEBTORS AN D TO WRITE OFF ALL ADVANCES NOT RECOVERABLE. AS A PART OF THIS EXERCISE THE ASSESSEE COMPANY WAS TO GIVE FINAL LIST OF ALL DEBTORS, CREDITORS AND CREDIT BALANCES ARISING OUT OF PREVIO US YEARS TRADE TRANSACTIONS. LATER THE ASSESSEE COMPANY PREF ERRED APPEAL AND AS PER ORDER DATED 1/1/2009 OF THE APPEL LATE AUTHORITY FOR INDUSTRIAL AND FINANCIAL RECONSTRUCTI ON, NEW DELHI, AGAINST BIFR ORDER DATED 18/12/2007, THE ASS ESSEE ITA NO.6582 & 8860/M/10 AY:07-08 3 WAS GRANTED ADDITIONAL RELIEF, INCLUDING RELIEF FRO M ADDITIONS CAUSED TO THE RETURNED INCOME DUE TO WRITE-BACK OF LIABILITIES, NO LONGER CONSIDERED PAYABLE. 3.1 THE APPEAL WAS INSTITUTED BEFORE THE LD. FIRST APPELLATE AUTHORITY ON 27/1/2010 AGAINST THE ADDITIONS OF DISALLOWANCES MADE IN ORDER PASSED U/S. 143(3) OF T HE ACT DATED 17/12/2009. DURING FIRST APPELLATE STAGE THE AR WAS ASKED AS TO WHY THE APPEAL SHOULD NOT BE TREATE D AS NON-MAINTAINABLE AS THE APPEAL MEMO WAS NOT SIGNED BY MANAGING DIRECTOR/DIRECTOR OF THE COMPANY. IT WAS EXPLAINED BY THE ASSESSEE THAT ASSESSMENT ORDER WAS RECEIVED ON 5/1/2010 AND THE DIRECTOR OF THE ASSESS EE COMPANY HAD UNDERGONE A BY-PASS SURGERY DURING MID MAY OF 2009 AND WAS NOT ABLE TO ATTEND OFFICE FROM JUNE 2009 TO AUGUST 31 ST , 2009. IT WAS ALSO EXPLAINED THAT THE DIRECTOR TRAVELLED FROM 5 TH JAN., 2010 TO 22 ND JAN., 2010 TO NASIK, DELHI AND JAMNAGAR AND THUS THE POWERS OF PUTTING SIGNATURE WERE GIVEN TO THE CHIEF FINANCIAL OFFICER AND FURTHER TATA PROJECTS LTD. INVESTED 75% AS A STRATE GIC INVESTOR IN THE ASSESSEE COMPANY. THUS THE MANAGEME NT ITA NO.6582 & 8860/M/10 AY:07-08 4 PUT UP AN INDEPENDENT PERSON FOR ADMINISTRATION. IT WAS ALSO CLAIMED THAT SINCE THE DIRECTOR BELONGED TO OL D MANAGEMENT, REMAINED RESPONSIBLE ONLY FOR TECHNICAL PARTS AND SINCE THE COMPANY WAS NOT HAVING ANY MANAGING DIRECTOR THE APPEAL COULD NOT BE SIGNED BY THE DIRE CTOR. AGAIN APPEAL WAS FILED AND REQUEST WAS MADE TO COND ONE THE DELAY. IT WAS PLEADED THAT THE LD. FIRST APPELL ATE AUTHORITY DID NOT CONDONE THE DELAY. THE LD. COUNSE L PRAYED THAT PROPER OPPORTUNITY OF HEARING MAY BE GRANTED. 3.2 IF THE TOTALITY OF FACTS AVAILABLE ON RECORD, O BSERVATION MADE IN THE ASSESSMENT ORDER, CONCLUSION DRAWN IN T HE IMPUGNED ORDERS AND THE ASSERTIONS MADE BY THE LD. RESPECTIVE COUNSEL ARE KEPT IN JUXTAPOSITION WE ARE OF THE CONSIDERED OPINION THAT THE ASSESSEE IS HAVING A CA SE IN HIS FAVOUR SO FAR AS CONDONATION OF DELAY IS CONCERNED. WE ARE NOT EXPRESSING ANY OPINION, AT THIS STAGE, SO FAR A S MERITS ARE CONCERNED. THEREFORE, THE DELAY IS CONDONED AND BOTH THESE FILES ARE REMANDED BACK TO THE FILE OF THE LD . CIT(A) FOR ADJUDICATION IN ACCORDANCE WITH LAW FOR WHICH DUE OPPORTUNITY OF HEARING BE PROVIDED TO THE ASSESSEE . THE ITA NO.6582 & 8860/M/10 AY:07-08 5 ASSESSEE IS ALSO AT LIBERTY TO FURNISH EVIDENCE, IF ANY, TO SUBSTANTIATE ITS CLAIM. BOTH THESE APPEALS ARE ALLO WED FOR STATISTICAL PURPOSES ONLY. 4. FINALLY BOTH THE APPEALS ARE ALLOWED FOR STATIST ICAL PURPOSES ONLY. ORDER WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF BOTH THE LD. REPRESENTATIVES AT THE CONCLUSION OF THE HEARING ON THIS 9 TH DAY OF SEPTEMBER, 2014 . SD/- ( RAJENDRA ) ACCOUNTANT MEMBER SD/- ( JOGINDER SINGH ) JUDICIAL MEMBER MUMBAI; DATED : 09/09/2014 JV. COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A) 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. BY ORDER, //TRUE COPY// (ASSTT. REGISTRAR) ITAT, MUMBAI