SRIRAM KAPUR, MUMBAI V. ACIT 17 (3), MUMBAI

ITA 7031/MUM/2018

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 8331 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 1 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-01-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Assessment Year: 2013-2014
• Appeal Filed On: 07-12-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V VINOD KUMAR
• Keywords: Business income; Principle of natural justice
• Section: 143(3)

Judgement Text

IN THE INCOME-TAX APPELLATE TRIBUNAL G BENCH MUMB AI BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER AND SHRI S. RIFAUR REHMAN, ACCOUNTANT MEMBER ITA NO. 7031/MUM/2018 (ASSESSMENT YEAR 2013-14 ) SRIRAM KAPUR, 199, CHURCHGATE RECLAMATION, MUMBAI- 20. PAN: AAIPK3526B VS. ACIT 17(3) 1 ST FLOOR, AAYAKAR BHAVAN, M.K. ROAD, MUMBAI- 400020. APPELLANT RESPONDE NT APPELLANT BY : NONE RESPONDENT BY : SHRI V. VINOD KUMAR (SR. DR) DATE OF HEARING : 16.01.2020 DATE OF PRONOUNCEMEN T : 16.01.2020 ORDERUNDER SECTION 254(1)OF INCOME TAX ACT PER PAWAN SINGH, JUDICIAL MEMBER; 1. THIS APPEAL BY ASSESSEE IS DIRECTED AGAINST THE ORD ER OF LEARNED COMMISSIONER OF INCOME TAX (APPEALS) [LD. CIT(A)]-2 8, MUMBAI DATED 20.11.2018 FOR ASSESSMENT YEAR 2013-14. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE FILED RETURN OF INCOME FOR ASSESSMENT YEAR 2013-14 ON 30.07.2013 DECLARING INC OME OF RS. 66,83,900/-. THE CASE WAS SELECTED FOR SCRUTINY. I N THE COMPUTATION OF INCOME THE ASSESSEE DECLARED SHORT TERM CAPITAL GAI N OF RS. 11,12,216/- . THE ASSESSING OFFICER AFTER AFFORDING OPPORTUNITY TO THE ASSESSEE COMPLETED UNDER SECTION 143(3) ON 19.03.2016. THE A SSESSING OFFICER TREATED THE SHORT TERM CAPITAL GAIN (STCG) AS BUSIN ESS INCOME. AGGRIEVED BY THE ADDITION/TREATMENT OF STCG AS BUSI NESS INCOME, THE ASSESSEE FILED APPEAL BEFORE THE LD. CIT(A) ON 12.0 4.2016. THE ASSESSEE ITA NO. 7031 MUM 2018-SRIRAM KAPUR 2 FILED APPEAL MANUALLY/PAPER APPEAL. THE APPEAL OF A SSESSEE WAS NOT ADMITTED BY LD. CIT(A) BY TAKING VIEW THAT CENTRAL BOARD OF DIRECT TAXES (CBDT)VIDE ITS NOTIFICATION NO. SO 637(E) [11 /16 (F. NO. 149/150/2015-TPL] MANDATORY MADE THE FILING OF APPE AL ELECTRONICALLY FOR CERTAIN SPECIFIC CATEGORY OF ASSESSES. THE ASSE SSEE FALLS WITHIN THOSE SPECIFIED CATEGORY. SINCE, APPEAL OF ASSESSEE WAS N OT ADMITTED AND TREATED AS DISMISSED VIDE ORDER DATED 20.11.2018. F URTHER, AGGRIEVED THE ASSESSEE HAS FILED THE APPEAL BEFORE US. THE ASSESS EE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: 1. THE LD. COMMISSIONER OF INCOME (A) [CIT(A)] HAS ERRED IN LAW AND IN FACTS IN DISMISSING THE APPEAL ON TECHNICAL GROUND OF NOT FILING ELECTRONICALLY WITHOUT CONDONING THE DELAY IN E-FIL ING THE APPEAL. 2. THE LD. CIT(A) HAS ERRED IN LAW AND IN FACTS IN CONFIRMING THE ASSESSMENT ORDER AND ADDITIONS WITHOUT GIVING EFFEC TIVE OPPORTUNITY OF HEARING TO THE APPELLANT. THE ORDER HAS BEEN PASSED WITHOUT OBSERVING PRINCIPLES OF NATURAL JUSTICE. 3. THE LD. CIT(A) HAS ERRED IN LAW AND IN FACTS IN CONFIRMING THE ASSESSMENT OF SHORT TERM CAPITAL GAIN INCOME AMOUNT ING TO RS. 11,12,216/- UNDER THE HEAD 'INCOME FROM BUSINESS'. 4. THE LD. CIT(A) HAS ERRED IN LAW AND IN FACTS IN NOT EXPRESSLY ALLOWING THE LONG TERM CAPITAL LOSS U/S 74 OF THE ACT AMOUNT ING TO RS. 4,64,460/- TO BE CARRIED FORWARD FOR SET OFF. 5. THE LD. CIT(A) HAS ERRED IN LAW AND IN FACTS IN NOT APPRECIATING THAT THE EXPENSES INCURRED IN RELATION TO INCOME ASSESSED AS BUSINESS INCOME BE ALLOWED AS DEDUCTION. 3. NONE APPEARED ON BEHALF OF ASSESSEE. THE ASSESSEE F ILED AN APPLICATION DATED 09.01.2020 FOR SEEKING ADJOURNMENT ON THE GRO UND THAT HE IS NOT KEEPING WELL. KEEPING IN VIEW THE SMALLNESS OF THE MATTER, THE ITA NO. 7031 MUM 2018-SRIRAM KAPUR 3 APPLICATION FOR ADJOURNMENT BY OF ASSESSEE WAS REJE CTED AND IT WAS DECIDED TO ADJUDICATE THE APPEAL ON THE BASIS OF MA TERIAL ON RECORD. ACCORDINGLY, THE LD. DR WAS ASKED TO MAKE HIS SUBMI SSION. 4. THE LD. DR RELIED UPON THE ORDER OF LD. CIT(A). 5. WE HAVE CONSIDERED THE SUBMISSION OF LD. DR FOR THE REVENUE AND PERUSED THE ORDER OF LOWER AUTHORITIES. THOUGH THE ASSESSEE HAS RAISED AS MANY AS 5/6 GROUNDS OF APPEAL, HOWEVER, IN OUR CONS IDERED VIEW, THE SHORT QUESTION FOR OUR CONSIDERATION IS IF THE ASSE SSEE DESERVE HEARING ON MERIT BEFORE THE LD. CIT(A)/FIRST APPELLATE AUTHORI TY, WHEN THE ASSESSEE FILED APPEAL MANUALLY INSTEAD OF ELECTRONICALLY. WE ARE CONSCIOUS OF THE FACT THAT IF THE NOTIFICATION NO. SO 637(E) [11/16 (F. NO. 149/150/2015- TPL], THE APEX BODY OF REVENUE I.E. CBDT PRESCRIBED MANDATORY E- FILING OF APPEAL OF SPECIFIC CATEGORY OF ASSESSEE. THE ASSESSEE IS ONE OF SUCH PERSON FALL IN SUCH SPECIFIED CATEGORY OF ASSE SSEE. HOWEVER, THE ASSESSEE FILED APPEAL MANUALLY. PERUSAL OF PARA-5.1 OF THE IMPUGNED ORDER REVEALS THAT THE ASSESSEE HAS ALSO FILED APPE AL ELECTRONICALLY ON 15.11.2018 VIDE ACKNOWLEDGEMENT NO. 37596591151118 WHICH HAS BEEN TREATED AS SEPARATE APPEAL FOR CONSIDERATION I N DUE COURSE. 6. FILING OF APPEAL BEFORE THE FIRST APPELLATE AUTHORI TY/CIT(A) IS PRESCRIBED UNDER SECTION 249 OF INCOME TAX ACT. THE RE IS NO MANDATE IN SECTION 249 TO FILE ELECTRONICALLY; HOWEVER, THE RE VENUE HAS AMENDED THE CORRESPONDING RULE 45 FOR MAKING MANDATORY E-FILING OF APPEAL FOR ITA NO. 7031 MUM 2018-SRIRAM KAPUR 4 SPECIFIED CATEGORY OF ASSESSES. THE FILING OF APPEA L IS MADE MANDATORY ONLY FROM 01.03.2016. THERE IS NO EXPRESS MANDATE U NDER RULE 45 TO FIRST APPELLATE AUTHORITY TO DISMISS THE APPEAL IN CASE THE APPEAL IS NOT FILED ELECTRONICALLY. 7. IN OUR VIEW, THE RULES ARE ENACTED TO FACILITATE TH E ASSESSEE AND THE SAME SHOULD NOT BE USED AS A TOOL AND TECHNIQUES TO DEP RIVE THE ASSESSES FROM THEIR RIGHT OF HEARING. CONSIDERING THE FACT THAT A PPEAL OF ASSESSEE WAS REJECTED DUE TO TECHNICAL REASON AND WITHOUT CONSID ERING THE MERIT OF THE CASE. THEREFORE, THE ORDER PASSED BY LD. CIT(A) DAT ED 20.11.2018 IS SET- ASIDE AND ALL THE GROUNDS OF APPEAL RAISED BY ASSES SEE ARE RESTORED TO THE FILE OF LD. CIT(A) TO DECIDE ALL THE GROUNDS OF APP EAL RAISED BY ASSESSEE AFRESH ON MERIT. NEEDLESS TO ORDER THAT BEFORE DECI DING THE APPEAL ON MERIT THE LD CIT(A) SHALL GRANT OPPORTUNITY OF HEAR ING TO THE ASSESSEE. WE MAY MADE IT CLEAR THAT IN CASE APPEAL FILED ELEC TRONICALLY VIDE ACKNOWLEDGEMENT DATED 15.11.2018 HAS NOT BEEN DECID ED, THE SAME SHALL BE DECIDE AFTER TREATING THE DATE OF INSTITU TION AS ON 12.04.2016 IN PLACED OF 15.11.2018. 8. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FO R STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT ON 16/01/2020. SD/- SD/- S.RIFAUR RAHMAN PAWAN SINGH ACCOUNTANT MEMBER J UDICIAL MEMBER MUMBAI, DATE: 16.01.2020 SK ITA NO. 7031 MUM 2018-SRIRAM KAPUR 5 COPY OF THE ORDER FORWARDED TO : 1. ASSESSEE 2. RESPONDENT 3. THE CONCERNED CIT(A) 4. THE CONCERNED CIT 5. DR G BENCH, ITAT, MUMBAI 6. GUARD FILE BY ORDER, DY./ASST. REGISTRAR ITAT, MUMBAI