M/s Kudos Chemie Ltd., Chandigarh V. ACIT, CC-II, Chandigarh

ITA 864/CHANDI/2018

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 4389 (ITAT-CHANDIGARH)
• Duration Of Justice: 9 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-03-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2014-2015
• Appeal Filed On: 06-06-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ASHISH GUPTA
• Keywords: Document seized; Principle of natural justice; Documents seized
• Section: 250; 144

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BENCH A CHANDIGARH !, ' # . %.. . & , '( # BEFORE: SMT. DIVA SINGH, JM & DR. B.R.R.KUMAR, AM ./ ITA NO. 864/CHD/2018 / ASSESSMENT YEAR : 2014-15 M/S KUDOS CHEMIE LTD., # 1620, SECTOR 18-D, CHANDIGARH. VS THE ACIT, CENTRAL CIRCLE-II, CHANDIGARH. ./ PAN NO: AAACK6650K / APPELLANT / RESPONDENT / ASSESSEE BY : SHRI TEJ MOHAN SINGH / REVENUE BY : SHRI ASHISH GUPTA, CIT-DR ! ' # / DATE OF HEARING : 12.03.2019 $%&' # / DATE OF PRONOUNCEMENT : 18.03.2019 ')/ ORDER PER DIVA SINGH THE PRESENT APPEAL HAS BEEN FILED BY THE ASSESSEE ASSA ILING THE CORRECTNESS OF THE ORDER DATED 23.03.2018 OF CIT(A)-2 GU RGAON PERTAINING TO 2014-15 ASSESSMENT YEAR ON VARIOUS GROUN DS INCLUDING GROUND NO. 1 WHICH READ AS UNDER : THAT THE LD. CIT(A) HAS ERRED IN LAW IN DISMISSING THE APPEAL EX-PARTE WITHOUT AFFORDING AN OPPORTUNITY OF HEARING WHICH I S AGAINST THE PRINCIPLES OF NATURAL JUSTICE AND AS SUCH THE ORDER PASSED IS ILLEGAL, ARBITRARY AND UNJUSTIFIED. 2. IT IS PERTINENT TO REFER THAT AT THE TIME OF HEARING, A N ADJOURNMENT APPLICATION WAS MOVED ON BEHALF OF THE ASSESSEE, HOWEVER, C ONSIDERING THE ABOVE MENTIONED GROUND, IT WAS DEEMED APPROPRIATE T O PASS OVER THE REQUEST FOR TIME SO AS TO ENABLE THE PARTIES TO CO NSIDER THE ALLOWABILITY IF ANY OF THE ABOVE MENTIONED GROUND. AFTER THE PASS OVER, THE LD. AR REFERRING TO THE IMPUGNED ORDER SUBMITTED THAT THREE SPECIFIC DATES OF ISSUANCE OF NOTICE TO THE ASSESSEE DATED 10.01.2 018, 07.02.2018 AND 05.03.2017 HAVE BEEN MENTIONED IN THE IMPUG NED ORDER, HOWEVER, IN REGARD TO THE FACT WHETHER THESE WER E SERVED OR NOT UPON THE ASSESSEE, THE ORDER ITSELF RECORDS SERVED/NO T RECEIVED BACK. ITA 864/CHD//2018 A.Y. 2014-15 PAGE 2 OF 3 ADDRESSING THE SAME, IT WAS HIS SUBMISSION THAT HE HAS BE EN INFORMED BY THE ASSESSEE THAT NO NOTICE WAS SERVED IN REGARD T O THE DATE OF HEARING IN THE PRESENT APPEAL. ACCORDINGLY, IT WAS HIS SU BMISSION THAT THE APPEAL OF THE ASSESSEE HAS BEEN DISMISSED FOR NON RE PRESENTATION IN TERMS OF THE DECISION OF THE APEX COURT IN THE CASE OF B .N. BHATTACHARGEE 118 ITR 461 (S.C). IT WAS HIS SUBMISSION T HAT THE DISPOSAL OF THE ASSESSEE'S APPEAL IN THE AFOREMENTIONED MA NNER WAS CONTRARY TO THE STATUTORY PROVISIONS OF SUB-SECTION (6) O F SECTION 250 OF THE INCOME TAX ACT,1961. FURTHER REFERRING TO THE RECO RD, IT WAS HIS REQUEST THAT THE ASSESSEE PRAYS FOR A REMAND OF THE IS SUES TO THE AO IN VIEW OF THE FACT THAT THE ASSESSMENT ORDER PASSED U/S 144, THUS, NECESSARY FACTS AND EVIDENCES COULD NOT BE PLACED ON RECORD. 3. THE LD. CIT-DR CONSIDERING THE RECORD STATED THAT IN THE PECULIAR FACTS, HE WOULD HAVE NO OBJECTION TO THE REMAND TO THE AO, HOWEVER, THE ASSESSEE SHOULD ENSURE FULL AND PROPER PARTICIPATION. IN RE SPONSE THERETO, THE LD. AR GAVE HIS ORAL UNDERTAKING IN THE COURT STATING THAT ASSESSEE SHALL PARTICIPATE FULLY AND FAIRLY BEFORE THE AO. 4. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. IT IS SEEN THAT THE AO PUT THE ASS ESSEE TO NOTICE IN REGARD TO THE ADDITIONS PROPOSED TO BE MADE IN THE AS SESSMENT ORDER. IN THE FACTS OF THE PRESENT CASE, SEARCH PROCEEDINGS WE RE CONDUCTED IN THE CASE OF KUDOS GROUP OF DERABASSI, MOHALI ON 21.02.2014. TAKING NOTE OF THE FACT THAT THE MANUFACTURING ACTIVITIES WERE CA RRIED OUT IN THE CASE OF M/S KUDOS CHEMIE LTD. AND THAT THERE WAS NO MANUFACTUR ING OR TRADING ACTIVITY CARRIED ON IN THE CASE OF M/S KUDOS AG ROHOLS LTD. AND M/S KUDOS HOLDINGS PVT. LTD. THE ADDITIONS WERE PROPOSED ON THE BASIS OF DISCREPANCY BETWEEN THE PHYSICAL INVENTORIZATION AND AS PER BOOKS OF ACCOUNT ETC. APART FROM THAT, VARIOUS OTHER ADDITIONS BA SED ON SEIZED DOCUMENTS ETC. WERE ALSO PROPOSED. SINCE IN RESPONSE TO THE QUERIES RAISED, THE ASSESSEE FAILED TO MAKE ANY SUBMISSIONS, ADDITION S WERE MADE BY AN ORDER U/S 144 OF THE INCOME TAX ACT, 1961 BY THE AO. THESE WERE CHALLENGED IN APPEAL BEFORE THE CIT(A) WHERE ALS O THE ASSESSEE FAILED TO PARTICIPATE. ACCEPTING THE STATEMENT A T BAR MADE BY THE LD. AR THAT THE NOTICES WERE NOT RECEIVED BY THE AS SESSEE AND ALSO ACCEPTING THE ORAL UNDERTAKING GIVEN BY THE LD. AR THAT T HE ASSESSEE SHALL PARTICIPATE FAIRLY AND FULLY BEFORE THE AO. CONSIDERING T HE SUBMISSIONS OF THE PARTIES, THE ISSUES ARE REMANDED TO TH E AO. THE ITA 864/CHD//2018 A.Y. 2014-15 PAGE 3 OF 3 ASSESSEE IS DIRECTED TO PARTICIPATE FULLY AND FAIRLY IN THE PROCEEDINGS BEFORE THE AO. WHILE SO DIRECTING, IT IS CAUTIONED THAT IN THE EVENTUALITY OF ABUSE OF THE TRUST REPOSED UPON THE ASSESSEE, THE A O SHALL BE AT LIBERTY TO PASS AN ORDER ON THE BASIS OF THE MATERIAL AVA ILABLE ON RECORD. SAID ORDER WAS PRONOUNCED IN THE OPEN COURT AT THE TIM E OF HEARING ITSELF. 5. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STA TISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 18.03. 2019. SD/- SD/- ( . % . . . & ) ( ! ) (DR. B.R.R. KUMAR) (DIVA SINGH ) '( # / ACCOUNTANT MEMBER ' # / JUDICIAL MEMBER + , %( )* +* / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. ! , / CIT 4. ! , ( )/ THE CIT(A) 5. *-. / , # / , 012.3 / DR, ITAT, CHANDIGARH 6. .2 4' / GUARD FILE %( ! / BY ORDER, 5 / ASSISTANT REGISTRAR