M/s Associated Printers, Chandigarh V. ITO, Chandigarh

ITA 895/CHANDI/2015

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 8384 (ITAT-CHANDIGARH)
• Duration Of Justice: 2 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-03-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2007-2008
• Appeal Filed On: 11-12-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K MITTAL
• Assessee Lawyers: S K MUKHI; PRERNA
• Keywords: Rectification of order; Opportunity of being heard
• Section: 143(3); 154; 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH,CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER ITA NO. 895/CHD/2015 ASSESSMENT YEAR: 2007-08 M/S ASSOCIATED PRINTERS, VS THE ITO, PLOT NO. 226, WARD 2(1), INDUSTRIAL AREA-1, CHANDIGARH. CHANDIGARH. PAN: AAGFA1794F (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI S.K. MUKHI & MS. PRERNA RESPONDENT BY : SHRI S.K. MITTAL DATE OF HEARING : 23.02.2016 DATE OF PRONOUNCEMENT : 01.03.2016 O R D E R THIS APPEAL BY ASSESSEE HAS BEEN DIRECTED AGAINST THE ORDER OF LD. CIT(APPEALS)-I CHANDIGARH DATED 28.09.2015 FOR ASSESSMENT YEAR 2007-08. IN THE PRE SENT APPEAL, ASSESSEE CHALLENGED THE ORDER OF LD. CIT(AP PEALS) IN NOT CONDONING THE DELAY OF 61 DAYS IN FILING THE APPEAL. 2. THE BRIEF FACTS OF THE CASE ARE THAT AGAINST THE ORDER UNDER SECTION 143(3) OF THE INCOME TAX ACT DA TED 11.12.2009, ASSESSEE HAD FILED AN APPLICATION UNDER SECTION 154 OF THE ACT. RECTIFICATION WAS SOUGHT F OR WRONG COMPUTATION OF INCOME UNDER THE HEAD HOUSE PROPERTY AND NON CREDIT OF TDS. IN ORDER UNDER SE CTION 2 154, THE CONTENTION OF THE ASSESSEE IN REGARD TO COMPUTATION OF INCOME FROM HOUSE PROPERTY WAS FOUND CORRECT. THE ASSESSING OFFICER HAD NOT ALLOWED TDS OF RS. 19,100/- AS THE SAME WAS NOT CLAIMED IN THE RET URN OF INCOME. IN ORIGINAL ASSESSMENT ORDER, AN ADDITI ON OF RS. 1,21,683/- WAS ALSO MADE ON ACCOUNT OF BAD DEBT S. THE ASSESSEE DID NOT FILE APPEAL AGAINST THE SAID O RDER AND EVEN THE ISSUE OF BAD DEBT WAS NOT RAISED IN TH E APPLICATION UNDER SECTION 154 OF THE ACT. AFTER RE CEIVING RECTIFICATION ORDER UNDER SECTION 154 DATED 18.02.2 010, THE ASSESSEE FILED AN APPEAL ON 22.03.2010 BEFORE T HE LD. CIT(APPEALS) CLAIMING THAT IT WAS A CONSOLIDATE D APPEAL AGAINST THE ASSESSMENT ORDER UNDER SECTION 143(3) AND 154 AS HIS COUNSEL WAS OF THE OPINION TH AT THE ASSESSMENT ORDER MERGED WITH THE ORDER UNDER SECTION 154 OF THE INCOME TAX ACT. 3. THE LD. CIT(APPEALS) DECIDED THE APPEAL VIDE ORD ER DATED 01.03.2012 HOLDING THAT APPEAL WAS FILED ONLY AGAINST THE ORDER UNDER SECTION 154 OF THE INCOME T AX ACT. THE ASSESSEE'S APPEAL BEFORE TRIBUNAL AGAINST ORDER UNDER SECTION 154 WAS ALSO WITHDRAWN WITH LIB ERTY TO FILE APPEAL AGAINST ORDER UNDER SECTION 143(3) O F THE ACT. 4. THE ASSESSEE FILED THE APPEAL BEFORE LD. CIT(APPEALS) AGAINST THE ORDER UNDER SECTION 143(3) WITH APPLICATION FOR CONDONATION OF DELAY. THE ONLY REA SON GIVEN FOR SUCH DELAY IN FILING THE APPEAL WAS WRONG 3 ADVICE GIVEN BY THE COUNSEL. AS PER ASSESSEE, THE ISSUE OF BAD DEBT WAS NOT AGITATED IN APPEAL ON THE ADVIC E OF THE COUNSEL SINCE APPLICATION UNDER SECTION 154 WAS FILED AND ACCORDING TO THE ADVICE, ASSESSMENT ORDER WILL MERGE WITH THE ORDER UNDER SECTION 154 OF THE ACT. THE LD. CIT(APPEALS) FOUND THAT THE APPEAL OF THE ASSES SEE IS TIME BARRED BY 61 DAYS AND DID NOT ACCEPT CONTENTIO N OF THE ASSESSEE AND DID NOT CONDONE THE DELAY IN FILIN G APPEAL AND DISMISSED APPEAL OF THE ASSESSEE IN LIMI NE. 5. I HAVE HEARD LD. REPRESENTATIVES OF BOTH THE PARTIES AND PERUSED THE MATERIAL ON RECORD. THE ON LY QUESTION INVOLVED IN THE PRESENT APPEAL IS WHETHER THE LD. CIT(APPEALS) SHOULD HAVE CONDONED THE DELAY OF 61 DAYS IN FILING THE APPEAL BEFORE HIM AGAINST THE OR DER UNDER SECTION 143(3) OF THE ACT. IT IS ADMITTED FA CT THAT AGAINST THE ASSESSMENT ORDER UNDER SECTION 143(3), ASSESSEE FILED RECTIFICATION APPLICATION UNDER SECT ION 154 OF THE ACT WHICH WAS DISPOSED OF BY THE ASSESSI NG OFFICER VIDE ORDER DATED 18.02.2010. THE ASSESSEE PREFERRED APPEAL BEFORE LD. CIT(APPEALS) WHICH WAS DECIDED VIDE ORDER DATED 01.03.2012 AGAINST WHICH ASSESSEE PREFERRED APPEAL BEFORE ITAT CHANDIGARH BE NCH IN WHICH THE ASSESSEE RAISED THE ISSUE OF BAD DEBT AS WELL BUT THE ASSESSEE'S APPEAL WAS WITHDRAWN WITH LIBERTY TO FILE INDEPENDENT APPEAL AGAINST THE ORDE R UNDER SECTION 143(3). THESE FACTS WOULD SUPPORT TH E CONTENTION OF THE ASSESSEE THAT DUE TO WRONG ADVICE OF 4 THE COUNSEL, THE ASSESSEE COULD NOT FILE APPEAL AGA INST THE MAIN ASSESSMENT ORDER UNDER SECTION 143(3) OF T HE ACT. THE LD. COUNSEL FOR THE ASSESSEE RELIED UPON ORDER OF ITAT CHANDIGARH BENCH IN THE CASE OF M/S SKYTEL COMMUNICATION LTD. VS ACIT IN ITA 112/2010 DATED 20.11.2014 IN WHICH IT WAS HELD THAT, THE ASSESSEE SHOULD NOT SUFFER ON ACCOUNT OF MISTAKE COMMITTED B Y THE COUNSEL FOR ASSESSEE. THE HON'BLE MADHYA PRADESH HIGH COURT IN THE CASE OF MAHAVEER PRASHAD JAIN 172 ITR 331 HELD THAT, ON ACCOUNT OF NEGLIGENCE OF COUNSEL, THE APPLICANT CANNOT BE MADE TO SUFFER. 6. CONSIDERING THE ABOVE FACTS AND DISCUSSION, WE A RE OF THE VIEW THAT ASSESSEE WAS BONAFIDELY PURSUING T HE 154 APPLICATION AND APPEAL AGAINST THE ORDER UNDER SECTION 154 OF THE ACT CONSIDERING THE ASSESSMENT O RDER MERGED WITH THE PROCEEDINGS UNDER SECTION 154 OF TH E ACT AS PER ADVICE GIVEN BY HIS COUNSEL. WHEN ASSES SEE REALIZED THE MISTAKE, APPEAL WAS WITHDRAWN BEFORE T HE TRIBUNAL. THEREFORE, THESE FACTS WOULD CLEARLY PRO VE THAT ASSESSEE WAS BONAFIDELY LITIGATING IN WRONG FO RUM AND AS SUCH, THE DELAY IN FILING THE APPEAL AGAINST ASSESSMENT ORDER SHOULD HAVE BEEN CONDONED BY THE L D. CIT(APPEALS). 7. IN VIEW OF THE ABOVE, I AM OF THE VIEW THE LD. CIT(APPEALS) SHOULD HAVE CONDONED THE DELAY IN FILI NG OF APPEAL BEFORE HIM. I, ACCORDINGLY, SET ASIDE THE O RDER OF THE LD. CIT(APPEALS) AND CONDONE THE DELAY IN FILIN G 5 APPEAL BEFORE LD. CIT(APPEALS). RESULTANTLY, APPEA L OF THE ASSESSEE IS RESTORED TO THE FILE OF LD. CIT(APP EALS) WITH DIRECTION TO DECIDE THE APPEAL OF THE ASSESSEE ON MERITS STRICTLY IN ACCORDANCE WITH LAW BY GIVING REASONABLE SUFFICIENT OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 8. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT. SD/- (BHAVNESH SAINI) JUDICIAL MEMBER DATED: 1 ST MARCH, 2016. POONAM COPY TO: THE APPELLANT, THE RESPONDENT, THE CIT(A), THE CIT, DR ASSISTANT REGISTRAR, ITAT/CHD