Dr.Lalitbhai Omprakash Arya, Baroda V. The Income tax Officer,Ward-3(1), Baroda

ITA 879/AHD/2011

• Counselvise Citation: [2015] 121 COUNSELVISE.COM (IT) 1303 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 year(s) 7 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-10-2015
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 26-10-2015
• Assessment Year: 2006-2007
• Appeal Filed On: 23-03-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: NARENDRA SINGH
• Keywords: Invalid notice; Condonation of delay
• Section: 234B; 147; 148; 139

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, AHMEDABAD - , , BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER ./ I.T.A. NO.879/AHD/2011 ( / ASSESSMENT YEAR : 2001-02) DR.LALIT OMPRAKASH ARYA C/O.PRAKASH POLYCLINIC & HOSPITAL B/H. NEW BUS DEPOT PADRA, DIST:BARODA / VS. THE INCOME TAX OFFICER WARD-3(1) BARODA $ ./ ./ PAN/GIR NO. : ACCPA 7958 F ( $' / APPELLANT ) .. ( ()$' / RESPONDENT ) $' * / APPELLANT BY : -NONE- ()$' + * / RESPONDENT BY : SHRI NARENDRA SINGH, SR.DR ,- + . / DATE OF HEARING 26/10/2015 /0 + . / DATE OF PRONOUNCEMENT 27/10/2015 / O R D E R PER SHRI KUL BHARAT, JUDICIAL MEMBER : THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LD.COMMISSIONER OF INCOME TAX(APPEALS)-II, BARODA [CIT(A) IN SHORT] DATED 11/08/2010 PERTAINING TO ASSESSMENT Y EAR (AY) 2001-02. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF A PPEAL:- 1. LD.CIT(A) ERRED ON FACTS AND IN LAW IN CONFIRMING ADDITION ON ACCOUNT OF INVOKING PROVISIONS OF SECTION 147 OF TH E ACT. ITA NO.879/AHD/ 2011 DR. LALIT OMPRAKASH ARYA VS. ITO ASST.YEAR 2001-02 - 2 - 2. THE LD.CIT(A) ERRED ON FACTS AND IN LAW IN CONFIRMI NG ADDITION TO THE EXTENT OF RS.95,00,000/- U/S.68 OF THE ACT. 3. THE LD.CIT(A) ERRED ON FACTS AND IN LAW IN CONFIRMI NG CHARGING OF INTEREST U/.234A AND 234B OF THE INCOME-TAX ACT. 4. THE LD.CIT(A) ERRED ON FACTS AND IN LAW IN CONFIRMI NG INITIATION F PENALTY U/S.271(1)(C) OF THE INCOME-TAX ACT. 2. AT THE TIME OF HEARING, NONE APPEARED ON BEHALF OF ASSESSEE NOR ANY APPLICATION FOR SEEKING ADJOURNMENT IS FILED. IT IS STATED BY THE LD.SR.DR THAT NOTICE OF HEARING HAS BEEN DULY SERVE D UPON THE ASSESSEE. IT IS FURTHER STATED BY THE LD.SR.DR THAT THE APP EAL IS BARRED BY 94 DAYS. THERE IS NO APPLICATION FOR SEEKING CONDONATION OF DELAY. HE SUBMITTED THAT IN THE EARLIER OCCASION THIS APPEAL WAS DISMIS SED FOR WANT OF PROSECUTION AND DESPITE SERVICE OF NOTICE, NONE APP EARED ON BEHALF OF ASSESSEE. THEREFORE, IT CAN BE INFERRED THAT THE A SSESSEE IS NOT SERIOUS IN PROSECUTING HIS APPEAL. 3. WE HAVE HEARD THE LD.SR.DR, PERUSED THE MATERIAL AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITI ES BELOW. THE APPEAL WAS DISMISSED VIDE TRIBUNALS (ITAT B BENCH AHMED ABAD) ORDER DATED 03/02/2014, HOWEVER THE ORDER DATED 03/02/201 4 WAS RECALLED ON APPLICATION MADE BY THE ASSESSEE VIDE TRIBUNALS OR DER DATED 05/09/2014. NONE APPEARED ON BEHALF OF THE ASSESSEE ON THE DATE FIXED FOR HEARING ON 23/09/2014, HOWEVER WRITTEN SUBMISSION WAS FILED AN D THE APPEAL WAS FURTHER ADJOURNED TO 05/11/2014. ON THAT DATE ALSO , NONE APPEARED ON BEHALF OF THE ASSESSEE AND THE APPEAL WAS FIXED FOR HEARING ON ITA NO.879/AHD/ 2011 DR. LALIT OMPRAKASH ARYA VS. ITO ASST.YEAR 2001-02 - 3 - 31/12/2014. THEREFORE, NOTICE OF HEARING WAS ISSUE D TO THE ASSESSEE. HOWEVER, DESPITE SERVICE OF NOTICE, NONE APPEARED O N BEHALF OF THE ASSESSEE ON VARIOUS DATES. ACCORDINGLY, NOTICE OF HEARING WAS DIRECTED TO BE SERVED THROUGH DEPARTMENTAL REPRESENTATIVE. THE NOTICE WAS SERVED BY THE REVENUE WHICH WAS DULY RECEIVED BY THE ASSES SEE ON 14/09/2015 AND THE ACKNOWLEDGEMENT TO THIS EFFECT IS PLACED ON RECORD. DESPITE SERVICE OF NOTICE OF HEARING, NONE APPEARED ON BEHA LF OF ASSESSEE. THEREFORE, WE PROCEED TO DECIDE THE APPEAL ON THE B ASIS OF MATERIAL AVAILABLE ON RECORD. WRITTEN SUBMISSION ON BEHALF OF ASSESSEE IS ON RECORD THAT READS AS UNDER:- HEARING FIXED ON 06-07-2015 HON'ABLE SIR; THE FIR COMPLIANT FILED BY M/S. DODSAL LTD ON 05-05 -2005 RELATING TO THE OFFENCE OCCURRING U/S 379, 114 OF IPC (ATTACHED IN PAGE NO. 8 TO 14 OF THE PAPER BOOK) IN WHICH THE DEFENDANT OWNER M/S . M STEEL CORPORATION PROP. AHMED HUSSAIN ALIES BALUBHAI MOGA LGARA, RESIDING AT A/1 BINANAGAR, VASNA ROAD, VADODARA HAS LOADED M ACHINERY (WRECKAGE MATERIAL) OF THE COMPANY AMOUNTING TO RS. 1,00,00,000/- AND THE MATERIAL WORTH RS. 60,00,000/- (BIG MACHINE RIES AND PIPES AND SPARE PARTS ETC) THE SAID MATERIAL WAS STOLEN DURIN G 1-5-2005 HOURS 20.00 TO 5-5-2005 HOURS 20.00 FROM BHANIYARA DODSAL COMPANY WITHOUT THE CONSENT. ON THE BASIS OF WHICH NOTICE U/S 148 WAS ISSUED FOR A Y 2001-2002. SINCE THE PERIOD PERTAINS TO ASSESSMENT YEAR 2006-0 7 THE NOTICE IS INVALID AND BAD IN LAW. THE ASSESSMENT ORDER PASSED IN PURSUANT TO INVALID NOTICE IS REQUIRED TO BE QUASHED. THE FIR ISSUED ITA NO.879/AHD/ 2011 DR. LALIT OMPRAKASH ARYA VS. ITO ASST.YEAR 2001-02 - 4 - 1. AHMED HUSSAIN ALIES BALUBHAI MOGALGARA RESIDING AT A/1 BINANAGAR, VASNA ROAD, VADODARA. 2. LALITKISHOR OMPRAKASH ARYA REISIDNG AT PLOT NO. 756 GIDC, MAKARPURA VADODARA, HOWEVER THE NOTICE HAS BEEN ISSUED TO THE SECOND OF FENDER ONLY. BUT THE FIRST OFFENDER TAKEN AWAY THE MACHINERY WORTH RS. 1 CRORES AND STOLEN AWAY MACHINERY AND PIPES WORTH RS. 60 LAKHS AND PRE SENTLY ABSCONDING. THE LEARNED INCOME TAX OFFICER FAILED TO ISSUED NOT ICE TO THE DEFENDANT AHMED HUSSAIN ALIES BALUBHAI MOGALGARA WHOSE LIABIL ITY TO PAY TAX MAY ARISE. HE HAS NOT FILED THE TAX AUDIT REPORT AN D RETURN OF INCOME WHO MAY BE LIABLE TO PENALTY AND TAX ON WHATEVER PR OFIT HE HAS MADE, WHO HAS RESIDENTIAL PROPERTY IN VADODARA. THE ASSESSMENT HAS BEEN MADE FOR A Y 2001-2002 WHIC H HAS NO CONCERN WITH THE FACTS OF THE CASE AND THEREFORE IS BAD IN LAW, AS THE INFORMATION RECEIVED ON 05-05-2005 I.E. A Y 2006-07 AS THE INCIDENT OCCURRED IN A Y 2006-2007 WHICH IS BEYOND FOUR YEAR S. NO NOTICE WAS SERVED BUT IT WAS SERVED BY AFFIXATIO N AT THE PREMISES OF THE ASSESSEE ON 13-10-2005 AFTER THE EXPIRY OF FOUR YEARS FROM THE RELEVANT ASSESSMENT YEAR. NO SUCH NOTICE SHALL BE I SSUED UNLESS THE CHIEF COMMISSIONER OR THE COMMISSIONER IS SATISFIED ON THE REASONS RECORDED BY THE ASSESSING OFFICER AFORESAID THAT IT IS THE FIT CASE FOR SUCH NOTICE. AFFIXATION OF NOTICE WITHOUT REFUSING ASSES SEE OR AGENT COULD BE TREATED PROCEEDINGS BAD IN LAW. THE NOTICE WOULD BE INVALID IF IT DOES NOT SPECIFY THE CORRECT ASSESSMENT YEAR, THIS PRINCIPAL HAS ALREADY BEEN SETTLED IN TH E COURT IN SEVERAL JUDGEMENTS NO VALID NOTICE WAS ISSUED IN ACCORDANCE TO THE PROVISIONS OF THE SAID ACT. IF THE NOTICE IS INVALID ENTIRE PR OCEEDINGS ARE VITIATED EVEN-THOUGH ASSESSMENT WAS RESPONDED TO SUCH NOTICE . PRAYER ITA NO.879/AHD/ 2011 DR. LALIT OMPRAKASH ARYA VS. ITO ASST.YEAR 2001-02 - 5 - I THEREFORE, URGE YOUR MAJESTY TO ORDER THE ENTIRE PROCEEDINGS BY THE LEARNED ASSESSING OFFICER AS BAD AT LAW AND AB INIT IO VOID. SD/- (DR ARYA LALIT OMPRAKASH) 3.1. FURTHER, IN RESPECT OF CONDONATION, APPLICATIO N FROM AUTHORIZED REPRESENTATIVE OF THE ASSESSEE HAS BEEN SUBMITTED, WHICH READS AS UNDER:- REG : CONDONATION APPLICATION NOT FILED BY THE AS SESSEE. THE ASSESSEE HAS FILED THE MISCELLENOUS APPLICATION AND THE DATE OF HEARING WAS FIXED ON 5-9-2014 BEFORE INCOME TAX APP ELLATE TRIBUNAL 'B' BENCH AHMEDABAD MA NO. 81/AHD/2014 FOR A Y 2006 -2007 AND IN THE PRESENCE OF BOTH THE PARTIES, THE MISCELLANEOUS APPLICATION FILED BY THE ASSESSEE WAS ALLOWED. THE COPY OF THE SAME IS A TTACHED FOR YOUR READY REFERENCE. WE ALSO ENCLOSE HEREWITH THE COPY OUR SUBMISSION MA DE BY US FOR HEARING FIXED ON 05-11-2014 SUBMITTED BY US TO THE DESPATCH SECTION ITAT, AHMEDABAD. HOPE YOU WILL FIND THE ABOVE IN ORDER. SD/- ( . G. SHAH ) AR 3.2. FROM THE ABOVE, THE CONTENTION OF THE ASSESSEE APPEARS TO BE THAT SINCE THE ORDER OF THE TRIBUNAL DATED 03/02/2014 WA S RECALLED FOR HEARING AND THE APPEAL WAS FIXED FOR HEARING ON MERIT, THER EFORE THE ISSUE OF CONDONATION OF DELAY DOES NOT SURVIVE. THIS REASON ING OF THE ASSESSEE IS BASELESS AS NOWHERE ELSE THE TRIBUNAL HAS RECORDED THE CONDONATION OF DELAY IN THE ORDER DATED 05/09/2014. THE ONLY AR GUMENT OF THE ASSESSEE ITA NO.879/AHD/ 2011 DR. LALIT OMPRAKASH ARYA VS. ITO ASST.YEAR 2001-02 - 6 - WITH REGARD TO THE ASSESSMENT BEING BAD IN LAW IS T HAT T HE ASSESSMENT HAS BEEN MADE FOR A Y 2001-2002 WHICH HAS NO CONCERN WI TH THE FACTS OF THE CASE AND THEREFORE IS BAD IN LAW, AS THE INFORMATIO N RECEIVED ON 05-05-2005 I.E. A Y 2006-07 AND INCIDENT OCCURRED I N A Y 2006-2007 WHICH IS BEYOND FOUR YEARS. IT WAS FURTHER STATED THAT NO NOTICE WAS SERVED, BUT IT WAS SERVED BY AFFIXATION AT THE PREM ISES OF THE ASSESSEE ON 13-10-2005 AFTER THE EXPIRY OF FOUR YEARS FROM THE RELEVANT ASSESSMENT YEAR. IT IS CONTENDED THAT NO SUCH NOTICE SHALL BE ISSUED UNLESS THE CHIEF COMMISSIONER OR THE COMMISSIONER IS SATISFIED ON TH E REASONS RECORDED BY THE ASSESSING OFFICER. IT IS FURTHER STATED THA T AFFIXATION OF NOTICE WITHOUT REFUSING ASSESSEE OR AGENT COULD BE TREATED PROCEEDINGS BAD IN LAW. IT IS ALSO STATED THAT THE NOTICE WOULD BE IN VALID IF IT DOES NOT SPECIFY THE CORRECT ASSESSMENT YEAR. IT IS FURTHER STATED THAT THIS PRINCIPLE HAS ALREADY BEEN SETTLED IN THE COURT IN SEVERAL JUDGEM ENTS NO VALID NOTICE WAS ISSUED IN ACCORDANCE TO THE PROVISIONS OF THE S AID ACT. IF THE NOTICE IS INVALID, ENTIRE PROCEEDINGS ARE VITIATED EVEN-THOUG H ASSESSMENT WAS RESPONDED TO SUCH NOTICE. THE CONTENTION OF THE AS SESSEE IS THAT THE ASSESSMENT WAS REOPENED BEYOND FOUR YEARS AND NOT I N ACCORDANCE WITH THE PROVISIONS OF LAW. AS PER PROVISO TO SECTION 147 OF THE ACT, WHERE AN ASSESSMENT UNDER SUB-SECTION(3) OF SECTION 143 O R THIS SECTION HAS BEEN MADE FOR THE RELEVANT ASSESSMENT YEAR, NO ACTI ON SHALL BE TAKEN UNDER THIS SECTION AFTER THE EXPIRY OF FOUR YEARS F ROM THE END OF THE RELEVANT ASSESSMENT YEAR, UNLESS ANY INCOME CHARGEA BLE TO TAX HAS ITA NO.879/AHD/ 2011 DR. LALIT OMPRAKASH ARYA VS. ITO ASST.YEAR 2001-02 - 7 - ESCAPED ASSESSMENT FOR SUCH ASSESSMENT YEAR BY REAS ON OF THE FAILURE ON THE PART OF THE ASSESSEE TO MAKE A RETURN UNDER SEC TION 139 OR IN RESPONSE TO A NOTICE ISSUED UNDER SUB-SECTION (1) OF SECTION 142 OR SECTION 148 OR TO DISCLOSE FULLY AND TRULY ALL MATERIAL FACTS NECE SSARY FOR HIS ASSESSMENT, FOR THAT ASSESSMENT YEAR. 3.3. A BARE READING OF SECTION 147 OF THE ACT MAKES IT CLEAR THAT THE ASSESSMENT CAN BE REOPENED AFTER THE EXPIRY OF FOUR YEARS, IN CASE, ANY INCOME IS ESCAPED DUE TO FAILURE OF THE ASSESSEE TO DISCLOSE THE SAME IN HIS RETURN OF INCOME. IN THE CASE IN HAND, THE ASS ESSEE HAS NOT DEMONSTRATED THAT THIS INFORMATION RECEIVED BY THE ASSESSING OFFICER (AO) THROUGH POLICE AUTHORITIES WITH REGARD TO PAYM ENT OF RS.1.11 CRORES TO M/S.STEEL CORPORATION OUT OF WHICH PAYMENT OF RS .1.05 CRORES WAS MADE DURING THE PREVIOUS YEAR RELEVANT TO THE ASSES SMENT YEAR UNDER APPEAL IS NOT CORRECT. THEREFORE, WE DO NOT SEE AN Y MERIT INTO THE CONTENTION OF THE ASSESSEE. THUS, GROUND NO.1 OF ASSESSEES APPEAL IS REJECTED. 4. GROUND NO.2 IS AGAINST CONFIRMING THE ADDITION T O THE EXTENT OF RS.95,00,000/- U/S.68 OF THE ACT. THE ASSESSEE HA S NOT PLACED ANY MATERIAL TO REBUT THE FINDING OF ASSESSING OFFICER. THEREFORE, THIS GROUND IS REJECTED. 5. GROUND NO.3 IS AGAINST CHARGING OF INTEREST U/S .234A & 234B OF THE IT ACT. THE SAME IS CONSEQUENTIAL IN NATURE, HELD ACCORDINGLY. ITA NO.879/AHD/ 2011 DR. LALIT OMPRAKASH ARYA VS. ITO ASST.YEAR 2001-02 - 8 - 6. GROUND NO.4 IS AGAINST INITIATION OF PENALTY U /S.271(1)(C) OF THE IT ACT. THIS GROUND IS PREMATURE AND THE SAME IS REJE CTED AS SUCH. 7. BEFORE PARTING WITH THE MATTER, WE WANT TO CLAR IFY THAT THE TRIBUNALS ORDERS DATED 03/02/2014 & 05/09/2014 PASSED IN THE ITA NO.879/AHD/2011 & MA NO.81/AHD/2014 RESPECTIVELY TH E ASSESSMENT YEAR WAS INADVERTENTLY MENTIONED AS AY 2006-07 INST EAD OF ASSESSMENT YEAR 2001-02 AND IT MAY BE READ ACCORDINGLY. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DIS MISSED. ORDER PRONOUNCED IN THE COURT ON TUESDAY, THE 27 TH DAY OF OCTOBER, 2015 AT AHMEDABAD. SD/- SD/- ( ) ( ) ( MANISH BORAD ) ( KUL BHARAT ) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED 27/ 10 /2015 4..., ,.../ T.C. NAIR, SR. PS !'#$%&%# / COPY OF THE ORDER FORWARDED TO : 1. $' / THE APPELLANT 2. ()$' / THE RESPONDENT. 3. 56 7 / CONCERNED CIT 4. 7 ( ) / THE CIT(A)-II, BARODA 5. 8,9 (56 , . 560 , / DR, ITAT, AHMEDABAD 6. 9;< =- / GUARD FILE. / BY ORDER, 8 ( //TRUE COPY// / ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD