AAREY DRUGS AND PHARMACEUTICALS LTD, MUMBAI V. DCIT CEN CIR 6(1), MUMBAI

ITA 7443/MUM/2014

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 9759 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 7 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-07-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 08-03-2017
• Assessment Year: 2004-2005
• Appeal Filed On: 12-12-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJAT MITTAL
• Keywords: Unexplained cash credit; Opportunity of being heard
• Section: 143(3); 147; 148

Judgement Text

1 ITA 7443/MUM/2014 IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH B, MUMBAI BEFORE SHRI MAHAVIR SINGH (JUDICIAL MEMBER) AND SHRI G MANJUNATHA (ACCOUNTANT MEMBER) I.T.A NO. 7443/MUM/2014 (ASSESSMENT YEAR 2004-05) AAREY DRUGS & PHARMACEUTICALS LTD, 107, SAHAKAR BHAVAN, 340/48, NARSI NATHA STREET, MUMBAI-9 PAN : AACA5253A VS DCIT, CIR. 6(1),MUMBAI APPELLANT RESPONDENT APPELLANT BY NONE RESPONDENT BY SHRI RAJAT MITTAL DATE OF HEARING 25 -07-2017 DATE OF PRONOUNCEMENT 28-07-2017 O R D E R PER G MANJUNATHA, AM : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST THE ORDER OF CIT(A)-14, MUMBAI DATED 12-09-2014, CONFIRMING LEVY OF PENALTY U/S 271(1)(C) OF THE INCOME-TAX ACT, 1961 FOR THE ASSESSMENT YEAR 2004-0 5. 2. THE BRIEF FACTS OF THE CASE ARE THAT IN THIS CASE R ETURN FOR THE ASSESSMENT YEAR UNDER CONSIDERATION WAS FILED BY THE ASSESSEE AFTER RECEIPT OF NOTICE U/S 148 OF THE ACT. ACCORDINGLY ASSESSMENT WAS COMPLET ED U/S 147 R.W.S. 143(3) 2 ITA 7443/MUM/2014 ON 26-12-2006 DETERMINING TOTAL INCOME OF RS44,09, 110 AFTER MAKING ADDITIONS TOWARDS DIFFERENCE IN CASH IN HAND, ADMIN ISTRATIVE EXPENSES AND UNEXPLAINED CASH CREDIT. THEREAFTER THE AO INITIAT ED PENALTY PROCEEDINGS U/S 271(1)(C) FOR CONCEALMENT OF INCOME. IN THE MEANTI ME, ASSESSEE PREFERRED APPEAL BEFORE FIRST APPELLATE AUTHORITY AND THE CIT (A), FOR THE REASONS RECORDED IN HIS ORDER, DISMISSED THE APPEAL FILED BY THE ASS ESSEE. FURTHER ON APPEAL BEFORE TRIBUNAL, THE TRIBUNAL HAS PARTLY ALLOWED TH E APPEAL OF THE ASSESSEE, WHEREIN THE TRIBUNAL DELETED ADDITION TOWARDS DIFFE RENCE IN CASH BALANCE AND CONFIRMED ADDITIONS MADE BY THE AO TOWARDS ADMINIST RATIVE EXPENSES AND UNEXPLAINED CASH CREDIT. DURING THE COURSE OF PENA LTY PROCEEDINGS, THE ASSESSEE NEITHER APPEARED BEFORE THE AO NOR HAS FUR NISHED ANY EXPLANATION. THEREFORE, THE AO HAS PASSED PENALTY ORDER LEVYING PENALTY FOR CONCEALMENT OF PARTICULARS OF INCOME AND ACCORDINGLY LEVIED PENALT Y AT 100% OF TAX SOUGHT TO BE EVADED, WHICH WORKED OUT TO RS.13,64,283. AGGRI EVED BY THE PENALTY ORDER, THE ASSSSEE PREFERRED APPEAL BEFORE CIT(A). 3. BEFORE CIT(A), THE ASSESSEE NEITHER APPEARED NOR FU RNISHED ANY DETAILS. THE CIT(A) CONSIDERING THE DETAILS AVAILABLE ON REC ORD UPHELD PENALTY LEVIED BY THE AO AND DISMISSED APPEAL FILED BY THE ASSESSEE. AGGRIEVED BY THE ORDER OF CIT(A), THE ASSESSEE IS IN APPEAL BEFORE US. 3 ITA 7443/MUM/2014 4. NONE APPEARED FOR THE ASSESSEE. WE HAVE HEARD THE LD.DR AND PERUSED THE MATERIALS AVAILABLE ON RECORD. THE CIT(A) HAS PASSED EXPARTE ORDER IN THE ABSENCE OF ASSESSEES PRESENCE. THE ASSESSEE HAS C HALLENGED THE ORDER PASSED BY THE CIT(A) CONFIRMING PENALTY ON THE GROUND THAT THE AUTHORIZED REPRESENTATIVE OF THE ASSESSEE DID APPEAR ON THE DA TE OF HEARING AND SOUGHT ADJOURNMENT. THE AUTHORIZED REPRESENTATIVE WAS INF ORMED THAT FRESH NOTICE WOULD BE SENT FIXING THE APPOINTMENT FOR A FUTURE D ATE. THE LD.CIT(A), WITHOUT VERIFYING THE FACT HAS PASSED EXPARTE ORDER WITHOUT PROVIDING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. WE FIN D THAT THE LD.CIT(A) HAS POSTED THE CASE FOR HEARING ON VARIOUS DATES. THE CIT(A) OBSERVED THAT THE ASSESSEE NEITHER APPEARED NOR FILED ANY DETAILS ON THE DATE OF HEARING. PER CONTRA, ASSESSEE CLAIMS THAT ITS AUTHORIZED REPRESE NTATIVE APPEARED ON THE DATE OF HARING AND SOUGHT ADJOURNMENT WHICH WAS GRA NTED WITH INSTRUCTION TO INTIMATE FUTURE DATE OF HEARING BY ISSUING NOTICE. THE FACTS ARE NOT CLEAR. BOTH THE PARTIES ARE CONTRADICTING EACH OTHER. THEREFORE , TO MEET THE ENDS OF JUSTICE, WE DEEM IT APPROPRIATE TO SET ASIDE THE IS SUE TO THE FILE OF THE CIT(A) TO GIVE ONE MORE OPPORTUNITY TO THE ASSESSEE TO SUBSTA NTIATE ITS CASE. THEREFORE, THE ISSUE IS REMITTED BACK TO THE FILE OF THE CIT(A ) AND DIRECT THE CIT(A) TO PASS FRESH ORDER AFTER GIVING REASONABLE OPPORTUNITY OF HEARING TO THE ASSESSEE. 4 ITA 7443/MUM/2014 5. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS ALLO WED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT ON 28 TH JULY, 2017. SD/- SD/- (MAHAVIR SINGH) (G MANJUNATHA) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DT : 28 TH JULY, 2017 PK/- COPY TO : 1. APPELLANT 2. RESPONDENT 3. CIT(A) 4. CIT 5. DR /TRUE COPY/ BY ORDER ASSTT. REGISTRAR, ITAT, MUMBAI