SHRI. KETAN J. SHAH, MUMBAI V. DCIT, CENTRAL CIRCLE 5(1), MUMBAI

ITA 6618/MUM/2017

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 6343 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 2 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-01-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: H
• Assessment Year: 2013-2014
• Appeal Filed On: 15-11-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Principle of natural justice; Set aside
• Section: 201

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES H , MUMBAI BEFORE S HRI RAJESH KUMAR (AM) AND SHRI RAM LAL NEGI (JM) ITA NO. 6618/MUM/2017 ASSESSMENT Y EAR: 2013 - 14 SHRI KETAN J. SHAH, A - 201, SHREE RAMKUNJ, HAJIBAPU ROAD, MALAD (EAST), MUMBAI - 40009 7 PAN: AMWPS6223R VS. THE DCIT - CC - 5(1), MUMBAI (APPELLANT) (RESPONDENT) ASSESSEE BY : NONE REVENUE BY : SHRI MANOJ KUMAR SINGH (D R ) DATE OF HEARING: 02/01 /201 9 DATE OF PRONOUNCEMENT: 29 / 0 1 /201 9 O R D E R PER RAM LAL NEGI, JM THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER DATED 26.09.2017 PASSED BY THE COMMISSIONER OF INCOME TAX (APPEALS) - 53 (FOR SHORT THE CIT(A) , MUMBAI, FOR THE ASSESSMENT YEAR 2013 - 14 , WHEREBY THE LD. CIT(A) HAS DISMISSED T HE APPEAL FILED BY THE ASSESSEE AGAINST THE PENALTY ORDER PASSED U/S 271 (1) (C) OF THE INCOME TAX ACT, 1961 (FOR SHORT THE ACT). 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE FILED AN APPEAL AGAINST THE PENALTY ORDER DATED 26.09.2017 PASSED U/S 271 (1) (C) OF THE ACT BEFORE THE LD. CIT (A) ON 24.08.2016. SINCE, THE APPEAL HAD BEEN FILED MANUALLY, VIDE LETTER DATED 17.08.2017 , ATTENTION OF THE APPELLANT WAS DRAWN BY THE LD. CIT(A) TO THE NOTIFICATION DATED 1 ST MARCH, 20 16 ISSUED BY CBDT AMENDING RULE 45 OF THE INCOME TAX RULES, 1962, WHICH MANDATES COMPULSORY E - FILING THE APPEALS BEFORE T HE APPELLATE COMMISSIONER W.E.F. 1 ST MARCH, 2016 IN RESPECT OF ALL PERSONS, WHO ARE REQUIRED TO FURNISH THEIR RETURN OF INCOME ELECTRON ICALLY. THE 2 ITA NO. 66 18 / MUM/2 017 ASSESSMENT YEAR: 2013 - 14 ASSESSEE WAS THEREFORE ASKED TO EXPLAIN AS TO WHY THE AFORESAID APPEAL FILED BY HIM SHOULD NOT BE TREATED AS INVALID. THE ASSESSEE SUBMITTED THAT IT HAD FILED THE APPEAL UNDER A BONA FIDE BELIEF THAT THE APPEALS PERTAINING TO THE ASSESSMENT YEA R PRIOR TO 01.03.2016 ARE REQUIRED TO BE FILED MANUALLY. FURTHER, IT WAS SUBMITTED THAT SINCE THE ASSESSEE HAS FILED E - APPEAL ON 22.09.2017 , THE SAME MAY BE ALLOWED TO ARGUE . THE LD. CIT (A) REJECTING THE CONTENTION OF THE ASSESSEE AND DISMISSED THE APPEAL OF THE ASSESSEE DECLARING THE APPEAL FILED MANUALLY BY THE ASSESSEE AS VOID - AB - INITIO . THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL AGAINST THE SAID ORDER. 3. T HE ASSESSEE HAS CHALLENGED THE IMPUGNED ORDER PASSED BY THE LD. CIT (A ) ON THE FOLLOWING EFFEC TIVE GROUNDS : - 1. LEARNED CIT (A) HAS ERRED IN DISMISSING THE APPEAL FILED MANUALLY FOR AY 2013 - 14 AGAINST THE PRINCIPAL OF EQUITY & NATURAL JUSTICE. 2. LEARNED CIT (A) HAS FAILED TO APPRECIATE THAT THE APPEAL FILED BY APPELLANT WAS IN TIME & RELEVANT FOR THE P ERIOD BEFORE 1/3/2016. 3. LEARNED CIT (A) FAILED TO APPRECIATE THE DEPARTMENT HAS ACCEPTED THE MANUAL APPEAL. 4. LEARNED CIT (A) HAS FAILED TO APPRECIATE THAT SUBSEQUENTLY APPELLANT HAS ALSO FILED E - APPEAL. 5. LOOKING AT ABOVE FACTS YOUR APPELLANT PRAYS YOUR HONOR TO KINDLY DIRECT THE CIT (A) TO HEAR THE APPEAL ON MERITS, CONDONE THE DELAY IN FILLING E - APPEAL . 4. THIS APPEAL WAS FIXED FOR HEARING ON 02.01.2019. HOWEVER, ON THE SAID DATE, WHEN THE CASE WAS CALLED OUT FOR HEARING, NONE APPEARED ON BEHALF OF THE ASSE SSEE. SINCE, WE NOTICED THAT THE LD. CIT (A) HAS DISMISSED THE APPEAL OF THE ASSESSED ON TECHNICAL GROUND, WE DECIDED TO DISPOSE OF THE APPEAL ON THE BASIS OF MATERIAL ON RECORD AFTER HEARING THE LD. DR. ACCORDINGLY, WE ASKED THE LD. DR TO ARGUE THE APPEAL ON BEHALF OF THE REVENUE. 5. BEFORE US, THE LD. DR SUBMITTED THAT SINCE THE ASSESSEE HAS FILED THE APPEAL IN CONTRAVENTION OF NOTIFICATION NO . S.O. 637 (E) DATED 1 ST MARCH, 2016 3 ITA NO. 66 18 / MUM/2 017 ASSESSMENT YEAR: 2013 - 14 ISSUED BY CBDT, NEW DELHI, WHICH MANDATES FOR E - FILING OF APPEAL BEFORE THE APPELLATE COMMISSIONERS W.E.F MARCH 1, 2016 IN RESPECT OF ALL THE PERSONS, WHO ARE REQUIRED TO FURNISH THEIR RETURN OF INCOME ELECTRONICALLY, THE LD. CIT (A) HAS RIGHTLY DISMISSED THE APPEAL OF THE ASSESSEE FILED MANUALLY AGAINST THE PENALTY ORDER PASSED B Y THE AO. 6. WE HAVE PERUSED THE MATERIAL ON RECORD. WE NOTICE THAT THE LD. CIT (A) HAS DISMISSED THE APPEAL ON THE GROUN D THAT THE APPEAL FILED MANUALLY BY THE ASSESSEE IS VOID - AB - INITIO IN THE LIGHT OF THE NOTIFICATION DATED MARCH 1, 2016 ISSUED BY THE CBDT, NEW DELHI . WE NOTICE THAT THE AR HAS CONTENDED BEFORE THE LD. CIT (A) THAT THE ASSESSEE HAD FILED THE APPEAL MANUALLY UNDER THE BONA FIDE BELIEF THAT THE CIRCULAR IS NOT APPLICABLE IN THE CASE OF THE ASSESSEE AS THE ASSESSEES APPEAL PERTAIN S TO THE ASSESSMENT YEAR 2013 - 14 . WE FURTHER NOTICE THAT ASSESSEE HA S ELECTRONICALLY FILED THE APPEAL ON 22.09.2017 . IN THE LIGHT OF THE AFORESAID FACTS, WE ARE OF THE CONSIDERED VIEW THAT THE ASSESSEE S EXPLANATION IS PLAUSIBLE AND THE ASSESSEE HAD FILED THE APPEA L MANUALLY UNDER A BONA FIDE BELIEF AS CONTENDED BEFORE THE LD. CIT(A) . WE , THEREFORE, ALLOW THE APPEAL OF THE ASSESSEE IN THE INTEREST OF JUSTICE AND SET ASIDE THE IMPUGNED ORDER PASSED BY THE LD. CIT(A) , CONDONE THE DELAY IN FILING E - APPEAL AND REMIT THE APPEAL TO THE LD. CIT(A) FOR ADJUDICATING THE SAME ON MERITS AFTER AFFORDING A REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. IN THE RESULT, APPEAL FILED BY THE ASSESSEE FOR ASSESSMENT YEAR 2013 - 2014 IS ALLOWED FOR STATISTICAL PURPOSES . ORDER PRONOUNCED IN THE OPEN COURT ON 29 TH JANUARY , 2019 . SD/ - SD/ - ( RAJESH KUMAR ) ( RAM LAL NEGI ) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI ; DATED: 29 / 01 / 201 9 ALINDRA, PS 4 ITA NO. 66 18 / MUM/2 017 ASSESSMENT YEAR: 2013 - 14 / 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// / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI