Indianroots Retail Private Limited, New Delhi V. DCIT Circle- 12(1), New Delhi

ITA 77/DEL/2021

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 2745 (ITAT-DELHI)
• Duration Of Justice: 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-02-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2015-2016
• Appeal Filed On: 04-02-2021
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: S. K.M. GUPTA
• Keywords: Condonation of delay; Set aside
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLAT E TRIBUNAL DELHI BENCH: C NEW DELHI BEFORE SHRI O.P. KANT, ACCOUNTANT MEMBER AND SHRI K.N. CHARY, JUDICIAL MEMBER ITA NO. 77/DEL/2021 ( A.Y 2015-16) (THROUGH VIDEO CONFEREN CING) INDIANROOTS RETAIL PRIVATE LTD. BUILDING NO. 55, FF, PUNCHKUIAN MARG, NEAR RAMAKRISHNA ASHRAM METRO STATION, CONNAUGHT PLACE, NEW DELHI. PAN NO. AADCJ2494H (APPELLANT) VS DCIT CIRCLE 12(1) NEW DELHI. (RESPONDENT) APPELLANT BY S/SH. K.M. GUPTA & ROHIT TIWARI, ADV. SANJEEV GUPTA, AR RESPONDENT BY MS. SUNITA SINGH, CIT DR ORDER PER K. NARASIMHA CHARY, JM AGGRIEVED BY THE ORDER DATED 27/6/2019, IN APPEAL N O. 178/18-19/CIT (A)-22, NEW DELHI PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) (LD. CIT(A)), IN THE CASE OF M/S INDIAN ROOTS PRIVATE LIMITED (THE DATE OF HEARING 18.02.2021 DATE OF PRONOUNCEMENT 18 .02.2021 2 ITA NO. 77/DEL/2021 ASSESSEE) FOR THE ASSESSMENT YEAR 2015-16 WHICH DIS POSED OF THE APPEAL EX PARTE AND DISMISSED THE SAME IN LIMINE, ASSESSEE PR EFERRED THIS APPEAL. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS A WHOLLY-OWNED SUBSIDIARY OF INDIANROOTS SHIPPING LTD AND WAS A PA RT OF NDTV GROUP DURING THE ASSESSMENT YEAR 2015-16. THEY HAVE FILED THEIR R ETURN OF INCOME FOR THE ASSESSMENT YEAR 2015-16 SHOWING A LOSS OF RS. 10, 86 , 33, 547/-. SUBSEQUENTLY ONE NAMEH HOTELS AND RESORTS PRIVATE L IMITED ACQUIRED THE OWNERSHIP OF THE ASSESSEE ON 5/5/2017 FROM THE ATV GROUP, RESULTING IN THE HANDING OVER OF ASSETS/DOCUMENTS/FILES/SOFT DATA BE TWEEN THE PARTIES. ASSESSMENT UNDER SECTION 143(3) OF THE INCOME TAX A CT, 1961 (FOR SHORT THE ACT) WAS MADE ON 29/12/2017 BY MAKING CERTAIN ADDIT IONS AND DATA LOSS OF RS. 8, 76, 19, 009/-. AGGRIEVED BY SUCH AN ASSESSMEN T ASSESSEE APPEAL PREFERRED BEFORE THE LD. CIT(A) . 3. AT THIS STAGE, PURSUANT TO SUCH CHANGE OF CONTR OL, THE EXISTING DIRECTORS OF THE ASSESSEE RESIGNED FROM THE BOARD O F DIRECTORS BY 7/3/2018 AND 29/3/2018 RESPECTIVELY BUT NO NEW DIRECTORS WER E APPOINTED IN THEIR PLACE. FURTHER DURING THE COURSE OF THE PROCEEDINGS BEFORE THE LD. CIT(A), AN APPLICATION AGAINST THE INDIANROOTS SHIPPING WAS FI LED BY THE OPERATIONAL CREDITOR UNDER SECTION 9 OF THE INSOLVENCY AND THE BANKRUPTCY CODE, 2016 AND BY ORDER DATED 13(3) OF THE ACT 2019 THE NCLT, DELHI APPOINTED MR ASHOK KUMAR AS THE INTERIOR RESOLUTION PROFESSIONAL AND THE BOARD OF THE INDIAN ROOTS THE SHIPPING WAS SUSPENDED, THEREBY TH E PROCESS OF APPOINTING 3 ITA NO. 77/DEL/2021 THE NEW DIRECTORS TO THE ASSESSEE COMPANY WAS VESTE D IN THE RP OF THE INDIAN ROOTS SHIPPING. 4. ACCORDING TO THE ASSESSEE, IN SUCH CIRCUMSTANCE S THE APPEAL BEFORE THE LD. CIT(A) COULD NOT BE PROPERLY PROSECUTED AND IT RESULTED IN THE DISMISSAL OF THE SAME ON THE PRESUMPTION THAT THE A SSESSEE DID NOT WANT TO PURSUE THE APPEAL AND THAT IS THE REASON WHY THERE WAS NO EFFECTIVE PROSECUTION OF THE SAME. 5. SUBSEQUENTLY, THE RP WAS REQUESTED AND ALSO AN APPLICATION WAS FILED BEFORE THE NCLT SEEKING DIRECTIONS TO THE RP PER TAKI NG APPROPRIATE STEPS FOR APPOINTMENT OF THE DIRECTORS. PURSUANT TO THE ORDER DATED 1/12/2020, PASSED BY THE NCLT, DIRECTORS WERE APPOINTED AND EX PEDITIOUS STEPS HAVE BEEN TAKEN FOR FILING OF THE APPEAL, WITH A PETITION TO CONDONE THE DELAY THAT OCCURRED IN THE ABOVE CIRCUMSTANCES AND ALSO DUE TO THE PANDEMIC. 6. LD. AR SUBMITTED THAT THE FACTS STATED ABOVE RES ULTED IN THE FILING OF THE DELAY WITH 522 DAYS AND SUCH DELAYS NOT FOR WAN T OF ANY DILIGENCE ON THE PART OF THE ASSESSEE BUT DUE TO THE CIRCUMSTANCES B EYOND THEIR CONTROL. HE SUBMITTED THAT THE REASONS PLEADED FOR CONDONATION OF DELAY ARE EQUALLY APPLICABLE TO THE REASON FOR NON-PROSECUTION OF THE APPEAL BEFORE THE LD. CIT(A). HE PRAYED THAT THE DELAY MAY BE CONDONE AND THE APPEAL MAY BE REMANDED TO THE FILE OF THE LD. CIT(A) FOR DISPOSAL AFRESH AFTER GIVING AN OPPORTUNITY TO THE ASSESSEE. 4 ITA NO. 77/DEL/2021 7. LD. DR SUBMITTED THAT ALL THE FACTS PLEADED BY T HE LD. AR ARE A MATTER OF RECORD AND THAT SINCE THE APPEAL WAS NOT DISPOSE D OF ON MERITS, IT MAY BE REMANDED TO THE FILE OF THE LD. CIT(A) IT DIRECTION TO THE ASSESSEE TO COOPERATE WITH THE LD. CIT(A) FOR DISPOSAL OF THE M ATTER ON MERITS. 8. WE HAVE GONE THROUGH THE RECORD IN THE LIGHT OF THE SUBMISSIONS MADE ON EITHER SIDE. THE UNCONTROVERTED FACTS PLEAD ED ON BEHALF OF THE ASSESSEE AS TO THE ACQUISITION OF THE HOLDING COMPA NY BY NAMEH HOTELS, RESIGNATION OF THE EXISTING DIRECTIVES AND THE DELA Y OCCURRED IN APPOINTING A NEW DIRECTORS BY THE PROCESS OF LAW - ACCORDING TO U S, DO CONSTITUTE SUFFICIENT CAUSE FOR FILING THE APPEAL WITH A DELAY . IN THE CIRCUMSTANCES WE ARE INCLINED TO ALLOW THE PLEA TAKEN BY THE ASSESSEE AND TO CONDONE THE DELAY. SINCE BOTH THE PARTIES SUBMITTED THAT THE AP PEAL BY THE LD. CIT(A) WAS NOT DISPOSED OF ON MERITS, AND THE REASONS APPLICA BLE TO CONDONE THE DELAY ARE EQUALLY APPLICABLE TO SET ASIDE THE IMPUGNED OR DER AND TO REMAND THE APPEAL TO THE FILE OF THE LD. CIT(A) FOR FRESH DISP OSAL AFTER GIVING AN OPPORTUNITY TO THE ASSESSEE OF BEING HEARD, WE ARE INCLINED TO SET ASIDE THE IMPUGNED ORDER AND RESTORE THE APPEAL TO THE FILE O F THE LD. CIT(A) FOR FRESH DISPOSAL ACCORDING TO LAW AFTER AFFORDING AN OPPORT UNITY TO THE ASSESSEE OF BEING HEARD. 5 ITA NO. 77/DEL/2021 9. IN THE RESULT APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT ON THIS THE 18 TH DAY OF FEBRUARY, 2021 ON CONCLUSION OF THE HEARING IN VIRTUAL MODE. SD/- SD/- (O.P. KANT) (K.N. CHARY) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED:18/02/2021 *KAVITA ARORA