WEST COAST ENGINEERING WORKS P. LTD., MUMBAI V. ITO WD. 8(3)(4), MUMBAI

ITA 869/MUM/2017

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 9955 (ITAT-MUMBAI)
• Duration Of Justice: 6 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-09-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 11-05-2017
• Assessment Year: 2007-2008
• Appeal Filed On: 07-02-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V JANARDHANAN
• Keywords: Opportunity of being heard; Principle of natural justice; Reasonable cause; Reassessment proceedings
• Section: 143(3); 147

Judgement Text

, SMC , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES SMC, MUMBAI BEFORE SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER ITA NO.869/MUM/2017 : ASST.YEAR 2009-2010 M/S.WEST COAST ENGINEERING WORKS PRIVATE LIMITED 101, 1 ST FLOOR, UDYOG MANDIR NO.2 MOGUL LANE, MAHIM (WEST) MUMBAI 400 016. PAN : AAACW1296M. / VS. THE INCOME TAX OFFICER WARD 8(3)(4) MUMBAI. ( / APPELLANT) ( / RESPONDENT) /APPELLANT BY : SHRI DINKLE HARIYA /RESPONDENT BY : SHRI V.JANARDHANAN / DATE OF HEARING : 06.07.2017 / DATE OF PRONOUNCEMENT : 01.09.2017 / O R D E R THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LEARNED CIT(A) DATED 27.12.2016 PERTAINING TO ASSESSMENT YEAR 2009-2010. 2. THE GROUNDS OF APPEAL READ AS UNDER:- 1. NATURAL JUSTICE 1.1 THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) - 14, MUMBAI, ['LD. CIT (A)'] ERRED IN PASSING THE APPELLATE ORDER IN BREACH OF THE PRINCIPLES OF NATURAL JUSTICE. 1.2 WHILE DOING SO, THE LD. CIT (A) FAILED TO APPRECIATE THAT: (I) THE APPELLANT WAS NOT GIVEN FAIR, REASONABLE AND PROPER OPPORTUNITY OF BEING HEARD; AND (II) IN ANY CASE, THE APPELLANT WAS PREVENTED BY REASONABLE CAUSES BEYOND IT CONTROLS TO MAKE EFFECTIVE AND PROPER REPRESENTATION. ITA NO.869/MUM/2017. M/S.WEST COAST ENGINEERING WORKS PVT.LTD. 2 WITHOUT PREJUDICE TO THE ABOVE 2.1 THE LD. CIT (A) ERRED IN DISMISSING THE APPEAL OF THE APPELLANT BY NOT CONDONING THE DELAY OF 19 DAYS IN FILING THE APPEAL BY THE APPELLANT. 2.2 IT IS SUBMITTED THAT IN THE FACTS AND THE CIRCUMSTANCES OF THE CASE, AND IN LAW, THE DELAY WAS REQUIRED TO BE CONDONED AND THE APPEAL WAS REQUIRED TO BE DECIDED ON MERIT. WITHOUT PREJUDICE TO THE ABOVE 3.1 IN THE FACTS AND THE CIRCUMSTANCES OF THE CASE, AND IN LAW, THE INCOME TAX OFFICER, WARD - 8 (3) (4), MUMBAI ['THE A.O.'], HAD ERRED IN INITIATING REASSESSMENT PROCEEDINGS AND FRAMING THE ASSESSMENT OF THE APPELLANT BY INVOKING THE PROVISIONS OF SECTION 147 R.W.S. 148 OF THE INCOME TAX ACT, 1961 ['THE ACT']. 3.2 WHILE DOING SO, THE A.O. HAD FAILED TO APPRECIATE THAT: (I) THE CASE OF THE APPELLANT DID NOT FALL WITHIN THE PARAMETERS LAID DOWN BY SECTION 147 R.W.S. 148 OF THE ACT; (II) THE NECESSARY PRECONDITIONS FOR INITIATING AND COMPLETION THEREOF WERE NOT SATISFIED. 4.1 IN THE FACTS AND THE CIRCUMSTANCES OF THE CASE, AND IN LAW, THE A.O. HAD ERRED IN MAKING ADDITION OF RS. 7,46,958/-, ON THE GROUND OF ALLEGED UNPROVED PURCHASES. 4.2 WITHOUT PREJUDICE TO THE ABOVE, IN THE ALTERNATIVE, ASSUMING - BUT NOT ADMITTING - THAT SOME ADDITION WAS CALLED FOR, THE CALCULATION OF THE SAME IS NOT IN ACCORDANCE WITH THE LAW, IS ARBITRARY AND EXCESSIVE. 5. THE APPELLANT CRAVES LEAVE TO ADD, ALTER, DELETE OR MODIFY ALL OR ANY THE ABOVE GROUND AT THE TIME OF HEARING. 3. IN THIS CASE, RETURN OF INCOME WAS FILED ON 29.09.2009 DECLARING TOTAL INCOME OF RS.12,85,763. THE RETURN WAS PROCESSED U/S 143(1) OF THE INCOME- ITA NO.869/MUM/2017. M/S.WEST COAST ENGINEERING WORKS PVT.LTD. 3 TAX ACT, 1961. SUBSEQUENTLY ORDER U/S 143(3) R.W.S. 147 OF THE I.T. ACT WAS PASSED ON 28.03.2015 DETERMINING TOTAL INCOME AT RS.20,32,720. 4. AGAINST THE ABOVE ORDER, ASSESSEE FILED APPEAL BEFORE THE LEARNED CIT(A). THERE WAS A DELAY OF 19 DAYS IN FILING THE APPEAL. IN THE REASONABLE CAUSE FOR THE DELAY IT WAS INTER ALIA SUBMITTED THAT ASSESSEES TAXATION MATTERS WERE LOOKED AFTER BY A YOUNG CHARTERED ACCOUNTANT, WHO SUDDENLY EXPIRED. IT WAS ALSO SUBMITTED THAT ASSESSEE WAS HIMSELF SUFFERING FROM VARIOUS AILMENTS INCLUDING CANCER. IT WAS ALSO SUBMITTED THAT THE COMPANY WAS PRACTICALLY DEFUNCT COMPANY AND HAS NO BUSINESS. HOWEVER, THE LEARNED CIT(A) WAS NOT CONVINCED. HE DISMISSED THE APPEAL BY NOT CONDONING THE DELAY AND TREATING THE APPEAL AS NOT MAINTAINABLE. 5. AGAINST THE ABOVE ORDER, THE ASSESSEE IS IN APPEAL BEFORE THE ITAT. 6. I HAVE HEARD BOTH THE COUNSEL AND PERUSED THE RECORDS. I FIND THAT THE DELAY IN THIS CASE IS VERY NOMINAL AND DESERVES TO BE CONDONED ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE REASONABLE CAUSE FOR THE DELAY ATTRIBUTED BY THE ASSESSEE. I FIND THAT HIGHER COURTS HAVE HELD THAT WHEN INTEREST OF SUBSTANTIAL JUSTICE IS PITTED AGAINST MINOR TECHNICAL GLITCHES, THE INTEREST OF SUBSTANTIAL JUSTICE SHOULD PREVAIL. ACCORDINGLY, I CONDONE THE DELAY OF 19 DAYS IN FILING THE APPEAL BEFORE THE LEARNED CIT(A). HENCE THE ISSUE RAISED IN THE APPEAL IS REMITTED TO THE FILE OF THE LEARNED CIT(A). LEARNED CIT(A) IS DIRECTED TO CONSIDER THE ISSUES RAISED AND PASS A SPEAKING ORDER AFTER GIVING THE ASSESSEE AN OPPORTUNITY OF BEING HEARD. ITA NO.869/MUM/2017. M/S.WEST COAST ENGINEERING WORKS PVT.LTD. 4 7. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE STANDS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON THIS 01 ST DAY OF SEPTEMBER, 2017. SD/- ( SHAMIM YAHYA ) ACCOUNTANT MEMBER MUMBAI; DATED : 01 ST SEPTEMBER, 2017. DEVDAS* / COPY OF THE ORDER FORWARDED TO : / BY ORDER, //TRUE COPY// / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT, MUMBAI. 4. / CIT(A), MUMBAI 5. , , / DR, ITAT, MUMBAI 6. [ / GUARD FILE.