Krishna Rao Madapa , Warangal V. Income Tax Officer, Ward-2, Warangal

ITA 790/Hyd/2018

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 8760 (ITAT-HYDERABAD)
• Duration Of Justice: 1 year(s) 2 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-07-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB-A
• Next Hearing Date: 08-07-2019
• Assessment Year: 2014-2015
• Appeal Filed On: 27-04-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DINESH PADUCHURI
• Assessee Lawyers: S RAMA RAO
• Keywords: Opportunity of being heard; Principle of natural justice
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A ', HYDERABAD BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI S. RIFAUR RAHMAN , ACCOUNTANT MEMBER ITA NO. 790 / HYD/201 8 ASSESSMENT YEAR: 20 1 4 - 1 5 KRISHNA RAO MADAPA, WARANGAL. PAN BWFPM 6904F VS. INCOME - TAX OFFICER, WARD 2 , WARANGAL A PPELLANT RESPONDENT ASSESSEE BY: S H RI S. RAMA RAO REVENUE BY: S HRI DINESH PADUCHURI DATE OF HEARING: 0 8 / 0 7 / 201 9 DATE OF PRONOUNCEMENT: 12 / 0 7 /201 9 O R D E R PER S. RIFAUR RAHMAN , AM: T H IS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF CIT(A) - 3 , HYDERABAD, DATED, 1 2 / 0 2 /201 8 FOR AY 20 1 4 - 1 5 . 2 . BRIEF FACTS OF THE CASE ARE, ASSESSEE , DERIVES INCOME FROM HOUSE PROPERTY, RUNNING A WINE SHOP UNDER NAME AND STYLE OF M/S CHALWAL WINES, FILED HIS RETURN OF INCOME FOR THE AY 201 4 - 1 5 ELECTRONICALLY ADMITTING INCOME OF RS. 6,68,260/ - ON 19/09/2014. THE CA SE WAS SELECTED FOR SCRUTINY UNDER CASS AND NOTICE U/S 143(2) WAS ISSUED AND DULY SERVED ON THE ASSESSEE. IN RESPONSE TO THE SAID NOTICE, THE AR OF THE ASSESSEE APPEARED AND FURNISHED THE INFORMATION AS CALLED FOR. 2.1 DURING THE COURSE OF ASSESSMENT PRO CEEDINGS, THE AO ASKED THE ASSESSEE TO FURNISH THE BOOKS O F ACCOUNT AND THE I.T.A. NO. 790 / HYD/1 8 KRISHNA RAO MADAPA, WARANGAL 2 BILLS/INVOICES IN SUPPORT OF THE SALES RECORDED FROM WINE SH OP AND THE VOUCHERS FOR THE EXPENDITURES CLAIMED. SINCE THE ASSESSEE FAILED TO PRODUCE THE SALE BILLS, THE AO WAS OF THE VIEW THAT IF NO SALE BILLS ARE AVAILABLE IT IS DIFFICULT TO VERIFY THE GENUINENESS OF THE INCOME ADMITTED FROM RUNNING THE WINE SHOP. H E, THEREFORE, ESTIMATED THE INCOME OF THE ASSESSEE AT 5% OF THE PURCHASES AND ACCORDINGLY COMPLETED THE ASSESSMENT U/S 143(3) OF THE ACT BY DETERMINING THE TOTAL INCOME AT RS. 16,82,440/ - . 3. AGGRIEVED BY THE ORDER OF THE AO, THE ASSESSEE PREFERRED AN AP PEAL BEFORE THE CIT(A). 4. THE CIT(A) DISMISSED THE APPEAL OF THE ASSESSEE ON TWO GROUNDS, ONE IS ON THE GROUND OF DELAY IN FILING THE APPEAL BEFORE HIM AND THE ANOTHER IS THAT THE ASSESSEE FAILED TO COMPLY WITH THE MANDATORY REQUIREMENT OF E - FILING OF APPEAL NOR EXPLAINED THE INACT ION FOR NOT FILING THE APPEAL ELECTRONICALLY. 5. AGGRIEVED BY THE ORDER OF CIT(A), THE ASSESSEE IS IN APPEAL BEFORE US RAISING THE FOLLOWING GROUNDS OF APPEAL: 1) THE ORDER OF THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) IS ERRONEOUS BOTH ON FACTS AND IN LAW. 2) THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) ERRED IN DISPOSING THE APPEAL IN - L IMINI WITHOUT ADJUDICATING THE GROUNDS OF APPEAL. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) OUGHT TO HAVE CONDONED THE DELAY IN FILING THE APPEAL. 3) THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) OUGHT TO HAVE PROVIDED OPPORTUNITY BEFORE DECIDING THE APPEAL. 4 ) THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) OUGHT TO HAVE HELD THAT THE PROFIT FROM THE LIQUOR BUSINESS IS 3% OF THE COST OF SALES AND NOT 5% OF THE I.T.A. NO. 790 / HYD/1 8 KRISHNA RAO MADAPA, WARANGAL 3 COST OF PURCHASE AS DETERMINED BY THE ASSESSING OFFICER. 5 ) ANY OTHER GROUND OR GROUNDS THAT MAY BE URGED AT THE TIME OF HEARING. 6. CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. THE MAIN CONTENTION OF THE ASSE SSEE IN THE GROUNDS OF APPEAL IS THAT THE CIT(A) OUGHT TO HAVE CONDONED THE DELAY AND ADJUDICATED THE GROUNDS ON MERITS. CONSIDERING THE PRINCIPLES OF NATURAL JUSTICE, WE REMIT THE APPEAL BACK TO THE CIT(A) WITH A DIRECTION TO CONDONE THE DELAY AS PER LAW AND DECIDE THE APPEAL ON MERITS AFTER PROVIDING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. THE ASSESSEE IS DIRECTED TO FILE THE APPEAL ELECTRONICALLY. 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSE. PRONOUNCED IN THE OPEN COURT ON 12 TH JU LY , 2019. SD/ - ( P. MADHAVI DEVI ) JUDICIAL MEMBER SD/ - ( S. RIFAUR RAHMAN ) ACCOUNTANT MEMBER HYDERABAD, DATED 12 TH JULY , 201 9. KV COPY FORWARDED TO: 1. SRI KRISHNA RAO MADAPA, H.NO. 1 - 8 - 460, BALASAMUDRAM, HANMAKONDA, WARANGAL. 2 . I TO, WARD 2 , AYAKAR BHAVAN, OPP. RAILWAY STATION, WARANGAL. 3 . CIT (A) 3, HYDERABAD 4. PR. CIT 3, HYDERABAD 5. THE DR, ITAT, HYDERABAD 6. GUARD FILE