Shri.Rakesh Mahajan , Bangalore V. Income Tax Officer Ward-8(1), Bangalore

ITA 863/BANG/2018

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 5907 (ITAT-BANGALORE)
• Duration Of Justice: 1 year(s) 1 month(s) 11 day(s)
• Appeal Type: Income Tax (Transfer Pricing) Appeal
• Pronouncement Date: 01-05-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2007-2008
• Appeal Filed On: 20-03-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ABDUL HAKEEM M
• Keywords: Opportunity of being heard; Condonation of delay
• Section: 143(1); 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC-C BENCH : BANGALORE BEFORE SHRI ARUN KUMAR GARODIA, ACCOUNTANT MEMBER ITA NO S . 863 & 864 / BANG/201 8 ASSESSMENT YEAR S : 2007 - 08 & 2009 - 10 SHRI RAKESH MAHAJAN, CPS HOUSE, SECOND FLOOR, NO. 23/2, ULSOOR ROAD, BANGALORE 560 042. PAN: ANRPM0751E VS. THE INCOME TAX OFFICER, WARD 8 (1), BANGALORE. APPELLANT RESPONDENT APPELLANT BY : SHRI SANDEEP .C, CA RESPONDENT BY : SHRI ABDUL HAKEEM .M, JCIT (DR) DATE OF HEARING : 23 . 0 4 .2018 DATE OF PRONOUNCEMENT : 04 . 0 5 .201 8 O R D E R PER SHRI A.K. GARODIA, ACCOUNTANT MEMBER BOTH THESE APPEALS ARE FILED BY THE ASSESSEE WHICH ARE DIRECTED AGAINST TWO SEPARATE ORDERS OF LD. CIT(A)-1, BANGALORE BOTH DAT ED 23.01.2018 FOR ASSESSMENT YEARS 2007-08 AND 2009-10. BOTH THESE A PPEALS WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY WAY OF THIS C OMMON ORDER FOR THE SAKE OF CONVENIENCE. 2. THE GROUNDS RAISED BY THE ASSESSEE FOR ASSESSMEN T YEAR 2007-08 IN ITA NO. 863/BANG/2018 ARE AS UNDER. 1. THAT THE ORDER OF THE LEARNED COMMISSIONER OF IN COME TAX (APPEALS) IS PREJUDICIAL TO THE INTERESTS OF THE AP PELLANT, IS BAD AND ERRONEOUS IN LAW AND AGAINST THE FACTS AND CIRCUMST ANCES OF THE CASE. 2. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APP EALS) OUGHT TO HAVE CONDONED THE DELAY OF 92 DAYS IN FILING THE AP PEAL. 3. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APP EALS) ERRED IN LAW AND ON FACTS IN DISMISSING THE APPELLANT WITHOU T GIVING PROPER OPPORTUNITY TO THE APPELLANT. ITA NOS.863 & 864/BANG/2018 PAGE 2 OF 5 4. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APP EALS) OUGHT TO HAVE GIVEN AN OPPORTUNITY TO AUTHORISED REPRESENTAT IVE BY ISSUING NOTICE BEFORE DISPOSING OFF THE APPEAL. 5. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APP EALS) ERRED IN LAW AND ON FACTS IN NOT COMMUNICATING THE DATE OF H EARING THROUGH E- MAIL EVEN THOUGH THE DETAILS OF APPELLANT'S LEGAL R EPRESENTATIVE WAS AVAILABLE ON RECORD. 6. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APP EALS) ERRED IN LAW AND ON FACTS IN NOT DISPOSING THE APPEAL ON MER ITS. 7. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APP EALS) OUGHT TO HAVE HELD THAT THE ORDER U/S 154 OF THE ACT IS PASS ED AFTER THE END OF 4 YEARS FROM THE END OF THE FINANCIAL YEAR IN WHICH T HE INTIMATION U/S 143(1) OF THE ACT WAS ISSUED AND THEREFORE, THE ORD ER U/S 154 IS TIME BARRED. 8. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APP EALS) OUGHT TO HAVE HELD THAT THE ORDER U/S. 154 IS PASSED WITHOUT GIVING A NOTICE TO THE APPELLANT AND THEREFORE, THE SAID ORDER IS LIAB LE TO BE QUASHED. 9. WITHOUT PREJUDICE TO THE GROUNDS NO. 5 & 6, THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) OUGHT TO HAVE DELETED THE DISALLOWANCE OF INTEREST ON THE GROUND THAT THE MAT TER ISSUE IS DEBATABLE ONE AND IS NOT CAPABLE OF BEING RECTIFIED U/S 154 OF THE ACT. 10. WITHOUT PREJUDICE TO THE ABOVE GROUNDS, THE LEA RNED COMMISSIONER OF INCOME TAX (APPEALS) OUGHT TO HAVE DISAGREED WITH THE FINDING OF THE LEARNED ASSESSING OFFICER THAT T HE INTEREST IS DISALLOWABLE JUST BECAUSE THE OVERDRAFT FACILITY WA S AVAILED AGAINST THE FCNR DEPOSITS WITHOUT APPRECIATING THE FACT THA T THE SAID OVERDRAFT HAS BEEN UTILIZED FOR THE PURPOSE OF ACQU ISITION OF INCOME FROM HOUSE PROPERTY OF THE INCOME WHEREOF IS OFFERE D AS TAX. EACH OF THE ABOVE GROUNDS IS WITHOUT PREJUDICE TO O NE ANOTHER AND THE APPELLANT CRAVES LEAVE OF THE HON'BLE INCOME TAX AP PELLATE TRIBUNAL, BANGALORE TO ADD, DELETE, AMEND OR OTHERWISE MODIFY ONE OR MORE OF THE ABOVE GROUNDS EITHER BEFORE OR AT THE TIME OF H EARING OF THIS APPEAL. 3. THE GROUNDS RAISED BY THE ASSESSEE FOR ASSESSMEN T YEAR 2009-10 IN ITA NO. 864/BANG/2018 ARE AS UNDER. 1. THAT THE ORDER OF THE LEARNED ASSESSING OFFICER IN SO FAR IT IS PREJUDICIAL TO THE INTERESTS OF THE APPELLANT, IS B AD AND ERRONEOUS IN LAW AND AGAINST THE FACTS AND CIRCUMSTANCES OF THE CASE. ITA NOS.863 & 864/BANG/2018 PAGE 3 OF 5 2. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APP EALS) OUGHT TO HAVE CONDONED THE DELAY OF 92 DAYS IN FILING THE AP PEAL. 3. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APP EALS) ERRED IN LAW AND ON FACTS INDISMISSING THE APPELLANT WITHOUT GIVING PROPER OPPORTUNITY TO THE APPELLANT. 4. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APP EALS) OUGHT TO HAVE GIVEN AN OPPORTUNITY TO AUTHORISED REPRESENTAT IVE BY ISSUING NOTICE BEFORE DISPOSING OFF THE APPEAL. 5. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APP EALS) ERRED IN LAW AND ON FACTS IN NOT COMMUNICATING THE DATE OF H EARING THROUGH E- MAIL EVEN THOUGH THE DETAILS OF APPELLANT'S LEGAL R EPRESENTATIVE WAS AVAILABLE ON RECORD. 6. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APP EALS) ERRED IN LAW AND ON FACTS IN NOT DISPOSING THE APPEAL ON MER ITS. 7. THAT THE LEARNED ASSESSING OFFICER ERRED IN LAW AND ON FACTS IN PASSING THE ORDER U/S 154 OF THE ACT WITHOUT GIVING A NOTICE TO THE APPELLANT AND THEREFORE, THE SAID ORDER IS LIABLE T O BE QUASHED. 8. WITHOUT PREJUDICE TO THE GROUNDS NO. 5, THE LEAR NED ASSESSING OFFICER ERRED IN LAW AND ON FACTS IN HOLDING THAT T HE DISALLOWANCE OF INTEREST IS A MATTER WHICH IS CAPABLE OF BEING RECT IFIED U/S 154 OF THE ACT IGNORING THE FACT THAT THE ISSUE IS DEBATABLE. 9. WITHOUT PREJUDICE TO THE ABOVE GROUNDS, THE LEAR NED ASSESSING OFFICER ERRED IN LAW AND ON FACTS IN HOLDING THAT T HE INTEREST IS DISALLOWABLE JUST BECAUSE THE OVERDRAFT FACILITY WA S AVAILED AGAINST THE FCNR DEPOSITS WITHOUT APPRECIATING THE FACT THA T THE SAID OVERDRAFT HAS BEEN UTILIZED FOR THE PURPOSE OF ACQU ISITION OF INCOME FROM HOUSE PROPERTY OF THE INCOME WHEREOF IS OFFERE D AS TAX. EACH OF THE ABOVE GROUNDS IS WITHOUT PREJUDICE TO O NE ANOTHER AND THE APPELLANT CRAVES LEAVE OF THE HON'BLE INCOME TAX AP PELLATE TRIBUNAL, BANGALORE TO ADD, DELETE, AMEND OR OTHERWISE MODIFY ONE OR MORE OF THE ABOVE GROUNDS EITHER BEFORE OR AT THE TIME OF H EARING OF THIS APPEAL. 4. AT THE VERY OUTSET, IT WAS SUBMITTED BY LD. AR O F ASSESSEE THAT BOTH THE ORDERS PASSED BY CIT(A) ARE EX-PARTE QUA THE ASSESSEE. HE FURTHER SUBMITTED THAT IT IS NOTED BY CIT(A) IN PARA 2 OF HIS ORDER IN BOTH YEAR S THAT ONLY ONE OPPORTUNITY WAS PROVIDED BY HIM TO THE ASSESSEE TO APPEAR BEFOR E HIM I.E. ON 23.01.2018 ITA NOS.863 & 864/BANG/2018 PAGE 4 OF 5 AND ON THE SAME DATE, HE PASSED THE ORDERS FOR BOTH THE YEARS. HE FURTHER POINTED OUT THAT IT IS ALSO NOTED BY CIT(A) IN THE SAME PARA THAT NOTICE ISSUED BY HIM TO ASSESSEE HAS COME BACK UNSERVED WITH THE REM ARKS OF POSTAL AUTHORITIES THAT THE ADDRESSEE LEFT AND RETURNED TO THE SENDER . HE SUBMITTED THAT UNDER THESE FACTS AND IN THE INTEREST OF JUSTICE, THE MAT TER SHOULD BE RESTORED BACK TO THE FILE OF CIT(A) FOR FRESH DECISION AFTER PROVIDI NG REASONABLE OPPORTUNITY OF BEING HEARD TO ASSESSEE. THE LD. DR OF REVENUE SUP PORTED THE ORDER OF CIT(A) IN BOTH THE YEARS. 5. I HAVE CONSIDERED THE RIVAL SUBMISSIONS. I FIND THAT IN BOTH THE YEARS, IT IS NOTED BY CIT(A) IN PARA 2 OF HIS ORDER THAT AN OPPORTUNIT Y WAS PROVIDED TO ASSESSEE FOR HEARING ON 23.01.2018 AND NOTICES SENT TO ASSES SEE HAD COME BACK UNSERVED WITH THE REMARKS OF POSTAL AUTHORITIES THA T THE ADDRESSEE LEFT AND RETURNED TO THE SENDER. THIS IS ALSO SEEN THAT IT IS ALSO STATED BY CIT(A) IN SAME PARA OF HIS ORDER THAT APPEAL IS FILED LATE BY 92 DAYS AND THE ASSESSEE HAS NOT MADE ANY REQUEST FOR CONDONATION OF DELAY. BEFORE ME, IT WAS SUBMITTED THAT APPLICATION WAS MADE BEFORE CIT(A) F OR CONDONATION OF DELAY AND THE SAME WAS FILED ALONG WITH THE APPEAL MEMO I TSELF FILED BEFORE CIT(A) IN FORM NO. 35. HE FILED A COPY OF THE SAID REQUEST L ETTER FOR CONDONATION OF DELAY FILED BEFORE CIT (A) IN WHICH IT IS STATED THAT THE ASSESSEE IS NRI AND IS SETTLED IN USA AND HENCE, WAS BUSY AS WELL AS UNAWARE OF TH E REQUIREMENT ABOUT FILING OF APPEAL BEFORE CIT (A). HENCE, I CONDONE THE DELA Y IN FILING THE APPEAL BEFORE CIT (A) IN BOTH YEARS. THIS IS ALSO SEEN THAT THE C IT (A) HAS NOT DECIDED THE ISSUE ON MERIT. HE HAS DISMISSED THE APPEAL OF THE ASSESSEE IN LIMINE BY FOLLOWING THE TRIBUNAL ORDER IN THE CASE OF CIT VS. MULTIPLAN INDIA LTD. AS REPORTED IN 38 ITD 320. IN MY CONSIDERED OPINION, EVEN IF THE APPEAL IS DECIDED EX-PARTE QUA THE ASSESSEE, THE SAME SHOULD BE DECID ED ON MERIT AS PER MATERIAL AVAILABLE ON RECORD. CONSIDERING ALL THES E FACTS, I FEEL IT PROPER TO RESTORE THE MATTER BACK TO THE FILE OF CIT(A) FOR D ECISION ON MERIT AFTER PROVIDING ADEQUATE OPPORTUNITY OF BEING HEARD TO BOTH SIDES. I ORDER ACCORDINGLY. IN VIEW OF THIS DECISION, NO ADJUDICATION IS CALLED FOR REG ARDING THE MERIT OF THE CASE AT THE PRESENT STAGE. ITA NOS.863 & 864/BANG/2018 PAGE 5 OF 5 6. IN THE RESULT, BOTH THE APPEALS FILED BY THE ASS ESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THE DATE MENT IONED ON THE CAPTION PAGE. SD/- (ARUN KUMAR GARODIA) ACCOUNTANT MEMBER BANGALORE, DATED, THE 04 TH MAY, 2018. /MS/ COPY TO: 1. APPELLANT 4. CIT(A) 2. RESPONDENT 5. DR, ITAT, BANGALORE 3. CIT 6. GUARD FILE BY ORDER SENIOR PRIVATE SECRETARY, INCOME TAX APPELLATE TRIBUNAL, BANGALORE.