Escorts Heart Institute & Research Centre Ltd., New Delhi V. DCIT, New Delhi

ITA 935/DEL/2013

• Counselvise Citation: 93520114 RSA 2013
• Duration Of Justice: 6 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-08-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2006-2007
• Appeal Filed On: 14-02-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR SUDHA KUMARI
• Assessee Lawyers: R M MEHTA
• Keywords: Opportunity of being heard; Principle of natural justice
• Section: 143(3); 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: B NEW DELHI BEFORE SMT. DIVA SINGH, JUDICIAL MEMBER AND SHRI T.S.KAPOOR, ACCOUNTANT MEMBER I.T.A .NOS.-933 TO 937/DEL/2013 (ASSESSMENT YEARS-2004-05, 2005-06, 2006-07, 2007-08 & 2009-10) ESCORTS HEART INSTITUTE & VS ACIT, RESEARCH CENTRE LTD., CIRCLE-2(1), OKHLA ROAD, NEW DELHI CHANDIGARH. P AN-AAACE8731F (APPELLANT) (RESPONDENT) APPELLANT BY: SH.R.M.MEHTA, ADV. RESPONDENT BY: DR. SUDHA KUMARI & SH. VIVEK KUMAR, SR. DR ORDER PER BENCH THESE FIVE APPEALS FILED BY THE ASSESSEE AGAINST TH E SEPARATE ORDERS DATED 12.11.2012 OF CIT(A), CHANDIGARH PERTAINING TO 2004 -05, 2005-06, 2006-07, 2007-08 & 2009-10 ASSESSMENT YEARS ARE BEING DECIDE D BY A COMMON ORDER. 2. AT THE TIME OF HEARING IT WAS NOTICED THAT THE R EGISTRY HAD ISSUED DEFECT MEMO TO THE ASSESSEE IN EACH OF THESE APPEALS. IT WAS ALSO NOTICED THAT THE ASSESSEES LETTER STATING THAT THE DEFECTS HAVE BEE N CURED WAS FOUND PLACED ON THE FILES. MR. R.M.MEHTA, ADVOCATE, APPEARING ON BEHAL F OF THE ASSESSEE SUBMITTED THAT THESE ARE EX-PARTE ORDERS PASSED BY THE CIT(A) AS SUCH THE ASSESSEE WOULD BE ARGUING THAT THE SAME MAY BE RESTORED TO THE CIT(A ) BASED ON GROUND NOS.-1-3 REQUESTING FOR AN OPPORTUNITY OF HEARING ON MERIT A S THE ACTION OF DISPOSING THE APPEAL WITHOUT AFFORDING THE ASSESSEE AN OPPORTUNIT Y OF BEING HEARD WAS IN VIOLATION OF THE PRINCIPLES OF NATURAL JUSTICE. H OWEVER IN VIEW OF THE FACT THAT THE REGISTRY HAD POINTED OUT CERTAIN DEFECTS IN EACH OF THE APPEALS, THE APPEALS WERE ADJOURNED WITH THE DIRECTION TO THE REGISTRY TO SCR UTINIZE THE DOCUMENTATION AND I.T.A .NOS.-933-937/DEL/2013 2 APPEND APPROPRIATE NOTIFICATION STATING WHETHER THE DEFECTS HAVE BEEN CURED OR NOT. 2.1. ON THE NEXT DATE OF HEARING IN VIEW OF THE FAC T THAT THE REGISTRY ON SCRUTINY APPENDED THAT THE ASSESSEE HAD CURED THE DEFECTS, T HE APPEALS CAME UP FOR HEARING. IT WAS A COMMON STAND OF BOTH THE PARTIES THAT ARGUMENTS ADVANCED IN ITA NO-933/DEL/2013 WOULD APPLY TO THE REMAINING 4 APPEALS AS FACTS AND CIRCUMSTANCES QUA GROUND NO-1 TO 3 REMAIN THE SAME. 2.2. MR. R.M.MEHTA INVITED ATTENTION TO THE IMPUGNE D ORDER IN THE LIGHT OF THE GROUNDS 1-3 IN EACH OF THESE APPEALS REQUESTED THAT THE ISSUE MAY BE RESTORED TO THE CIT(A) IN ORDER TO GRANT THE ASSESSEE AN OPPORT UNITY OF BEING HEARD WHICH ON FACTS WAS DENIED. 3. DR. SUDHA KUMARI, CIT DR APPEARING ON BEHALF OF THE REVENUE REFERRING TO THE IMPUGNED ORDER STATED THAT THE ASSESSEE BEFO RE THE CIT(A) HAD SOUGHT ADJOURNMENT ON THE GROUND THAT THE COUNSEL HAD BEEN OPERATED AND THE RECORD WOULD SHOW IT WAS ARGUED THAT THE ASSESSEE HAD SOUG HT AN ADJOURNMENT FROM 19.09.2012 TO 05.12.2012 AND THE ASSESSEE WAS REQUI RED TO BE PRESENT ON 18.11.2012. ACCORDINGLY IT WAS HER ARGUMENT THAT D ESPITE THIS FACT THE ASSESSEE REMAINED UNPRESENTED. ACCORDINGLY IT WAS HER ARGU MENT THAT NO DOUBT THE IMPUGNED ORDER WAS AN EX-PARTE ORDER AS IT WAS PASS ED WITHOUT HEARING THE ASSESSEE. HOWEVER THE FACT REMAINS THAT DESPITE BE ING GIVEN AN OPPORTUNITY THE ASSESSEE REMAINED UNREPRESENTED. IT WAS ALSO HER S UBMISSION THAT THE ASSESSEE HAD CHALLENGED THE JURISDICTION OF THE CIT(A) WHO H AD PASSED THE ORDER ACCORDINGLY IT WAS HER SUBMISSION THAT THE IMPUGNED ORDER BE UPHELD. 3.1. IN REPLY THE LD. AR SUBMITTED THAT ADJOURNMENT ON HEALTH GROUNDS WAS SOUGHT AND GRANTED AND THE FACT REMAINS THAT EX-PAR TE ORDER WAS PASSED CONFIRMING THE ADDITION MADE IN THE ASSESSMENT ORDE R AS SUCH THE OPPORTUNITY OF BEING HEARD MAY BE GRANTED. INVITING ATTENTION TO PAPER BOOK PAGE 24 IT WAS FURTHER SUBMITTED THAT THIS IS A LETTER DATED 17.12 .2012 ADDRESSED TO CCIT, I.T.A .NOS.-933-937/DEL/2013 3 CHANDIGARH BY OSD, ITJ-II ON BEHALF OF THE CBDT APP RISING THE SAID OFFICER THAT ON ASSESSEES REQUEST THE ASSESSEES CASE WAS TRANS FERRED TO CIT(A)-XIII, DELHI BY VIRTUE OF ORDER PASSED U/S 127. ACCORDINGLY IT WAS HIS PRAYER THAT THE EX-PARTE ORDERS MAY BE SET ASIDE AND THE ISSUE IN THE INTERE ST OF SUBSTANTIAL JUSTICE MAY BE RESTORED TO THE CIT(A)-XIII, DELHI WHO HOLDS JURISD ICTION. THE LD. CIT DR WAS CONFRONTED WITH THE SAID LETTER WHO STATED THAT IT IS A MATTER OF RECORD AS SUCH SHE WOULD HAVE NO SUBMISSIONS THEREON. 4. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. IT IS SEEN THAT AGGRIEVED BY THE ACTION OF THE AO IN 2004-05 IN ASSESSMENT YEAR WHEREIN AS AGAINST THE RETURNED INC OME OF RS23,65,10,551/- WHICH WAS ASSESSED U/S 143(3) AT RS.32,22,03,200/- THE ASSESSMENT WAS RE- OPENED BY ISSUANCE OF NOTICE U/S 148 AND THE INCOME WAS ASSESSED U/S 143(3)/147 AT RS.35,85,18,143/- RESULTING IN AN ADDITION OF RS .3,63,15,143/-. 4.1. THIS WAS CHALLENGED IN APPEAL BEFORE THE CIT(A ), CHANDIGARH. THE ASSESSEE WAS REPRESENTED BEFORE THE SAID AUTHORITY BY SH.N.L.GANDHI, SENIOR TAXATION OFFICER WHO SOUGHT ADJOURNMENTS WHICH WERE GRANTED. HOWEVER ON 08.10.2012, IT WAS INDICATED BY THE FIRST APPELLATE AUTHORITY THAT NO FURTHER ADJOURNMENT WOULD BE GRANTED AND SINCE ON THE NEXT DATE, THE ASSESSEE WAS NOT PRESENT, THE EX-PARTE ORDER DATED 12.11.2012 WAS PA SSED HOLDING THAT THE ASSESSEE HAS NOTHING FURTHER TO SUBMIT AND THE ADDITIONS MAD E BY THE AO WERE CONFIRMED. AGGRIEVED BY THESE ACTIONS, THE ASSESSEE IS IN APPE AL BEFORE THE TRIBUNAL. IN THIS BACKGROUND CONSIDERING THE ARGUMENTS ADVANCED BY TH E CIT DR AND LD. AR IT IS SEEN THAT THE ADJOURNMENT REQUEST MOVED ON BEHALF O F THE ASSESSEE REPRODUCED IN THE IMPUGNED ORDER SHOWS THAT THE ASSESSEE HAD CONT ENDED THAT THE ASSESSEES COUNSEL HAD UNDERGONE CORONARY ANGIOPLASTY ON 19.09 .2012 AND 05.10.2012 AND WAS ADVISED REST FOR FOUR WEEKS AND MEDICAL CERTIFI CATE IN SUPPORT THEREOF WERE FILED BEFORE THE FIRST APPELLATE AUTHORITY. THESE FACTS ARE FOUND RECORDED IN PAGE 2 OF THE IMPUGNED ORDER. IN THE CONTEXT OF TH ESE FACTS, THE ARGUMENTS I.T.A .NOS.-933-937/DEL/2013 4 ADVANCED ON BEHALF OF THE REVENUE THAT THE LD. AR W AS IN A POSITION TO ARGUE ON 08.11.2012 CANNOT BE ACCEPTED. EVEN OTHERWISE, THE RIGHT TO BE HEARD IS AN IMPORTANT RIGHT TO WHICH AN ASSESSEE IS ENTITLED. AUDI ALTERAM PARTEM IS ONE OF THE MOST FAMOUS AND CELEBRATED RULE OF NATURAL JUST ICE. THE PRINCIPLES OF NATURAL JUSTICE ARE THOSE WHICH HAVE BEEN LAID OUT BY THE C OURTS AS BEING THE MINIMUM PROTECTION OF THE RIGHTS OF AN INDIVIDUAL AGAINST T HE ARBITRARY PROCEDURE THAT MAY BE ADOPTED BY A JUDICIAL, QUASI-JUDICIAL AND ADMINI STRATIVE AUTHORITY WHILE MAKING AN ORDER AFFECTING THOSE RIGHTS. A CAREFUL PERUSAL OF THE CONSISTENT JUDGEMENTS OF THE APEX COURT WOULD SHOW THAT IT HAS CONSISTENTLY BEEN HELD THAT THE RULES OF NATURAL JUSTICE ARE NOT EMBODIED RULES AND THE SAID PHRASE IS NOT AND CANNOT BE CAPABLE OF A PRECISE DEFINITION. THE UNDERLYING PR INCIPLE OF NATURAL JUSTICE EVOLVED UNDER THE COMMON LAW IS TO CHECK ARBITRARY EXERCISE OF POWER BY THE STATE OR ITS FUNCTIONARIES. ACCORDINGLY, THE PRINC IPLE BY ITS VERY NATURE IMPLIES THE DUTY TO ACT FAIRLY I.E. FAIR PLAY IN ACTION MUS T BE EVIDENT AT EVERY STAGE. FAIR PLAY DEMANDS THAT NOBODY SHALL BE CONDEMNED UNHEARD . 4.2. IN THE CELEBRATED JUDGEMENT OF THE APEX COURT IN THE CASE OF A.K.KRAIPAK VS- UNION OF INDIA (1969) 2 SCC 262, IT IS OBSERVE D THAT THE AIM OF RULES OF NATURAL JUSTICE IS TO SECURE JUSTICE OR TO PUT IT N EGATIVELY TO PREVENT MISCARRIAGE OF JUSTICE. THE SAID RULES ARE MEANS TO AN END AND NO T AN END IN THEMSELVES AND THOUGH IT IS NOT POSSIBLE TO MAKE AN EXHAUSTIVE CAT ALOGUE OF SUCH RULES HOWEVER IT CAN BE READILY SAID THAT THERE ARE TWO BASIC MAXIMS OF NATURAL JUSTICE NAMELY AUDI ALTERAM PARTEM AND NEMO JUDEX IN RE SUA. IN THE PRESENT FACTS OF THE CASE WE ARE CONCERNED WITH THE MAXIM AUDI ALTERM P ARTEM WHICH AGAIN MAY HAVE MANY FACETS TWO OF THEM (A) NOTICE OF THE CASE TO B E MET; AND (B) OPPORTUNITY TO EXPLAIN. THEIR LORDSHIPS HAVE CAUTIONED THAT THESE RULES CANNOT BE SACRIFICED AT THE ALTAR OF THE ADMINISTRATIVE CONVENIENCE OR CELE BRITY. THE ASSESSEE HAS RAISED GROUND NO.-1-3 IN REGARD TO THE OPPORTUNITY OF BEIN G HEARD AGITATED BEFORE US AND CONSIDERING THE SUBMISSIONS OF EITHER SIDE WHERE IN THE SOLE ISSUE AGITATED BEFORE I.T.A .NOS.-933-937/DEL/2013 5 US IS PERTAINING TO GRANTING OF OPPORTUNITY OF BEIN G HEARD WHICH ADMITTEDLY HAS NOT BEEN MADE AVAILABLE TO THE ASSESSEE WE ARE INCL INED TO ACCEPT THE PRAYER OF THE ASSESSEE ON A CAREFUL CONSIDERATION OF THE LEGA L POSITION THEREON. ACCORDINGLY GROUND NO.-1-3 RAISED BY THE ASSESSEE DESERVE TO BE ALLOWED. A PERUSAL OF PAGE-24 OF THE PAPER BOOK SHOWS THAT THE FOLLOWING LETTER DATED 17.12.2012 WAS ISSUED ON BEHALF OF THE CBDT TO THE CCIT, CHANDIGAR H:- NEW DELHI, 17 TH DECEMBER, 2012 TO, THE CCIT(CCA), CHANDIGARH. SIR, SUBJECT: TRANSFER OF APPEALS IN THE CASE OF M/S ESC ORTS HEART INSTITUTE & RESEARCH CENTRE LTD. TO CIT (A)-XIII, DELHI -REGD. KINDLY REFER TO THE ABOVE. 2. IN THIS REGARD, I AM DIRECTED TO SUBMIT AS UNDER : IN PURSUANCE OF THE ORDERS PASSED U/S 127 BY THE COMMISSIONER OF INCOME-TAX- 1, CHANDIGARH , TRANSFERRING THE CAS E OF M/S ESCORTS HEART INSTITUTE & RESEARCH CENTRE LIMITED FROM THE CHARGE OF ACIT, CIRCLE-2(I), CHANDIGARH TO DCIT, CIRCLE 11 (1), N. DELHI , THE ASSESSEE HAS REQUESTED TO THE BOARD THAT ALL ITS APPEAL MATT ERS BE TRANSFERRED TO CIT(A)-XIII, DELHI, BEING THE CONCERNED JURISDICTIO NAL AUTHORITY . ACCORDINGLY, I AM DIRECTED TO REQUEST THAT ALL-THE APPEAL MATTERS OF THE ABOVE MENTIONED ASSESSEE BE TRANSFERRED TO THE CONC ERNED JURISDICTIONAL CIT(A) IN DELHI IN VIEW OF THE INSTRUCTION ISSUED V IDE LETTER NO.F.NO.I87/L/2002-ITA-I DT. 2I/03/2002.(COPY ENCLO SED) YOURS FAITHFULLY SD/- ANCHAL KHANDELWAL OSD, ITJ-II, CBDT ENCLS-A.A. COPY TO:-M/S ESCORTS HEART INSTITUTE & RESEARCH CEN TRE LTD., NEW DELHI. 4.3. ACCORDINGLY IN THE LIGHT OF THESE PECULIAR FAC TS AND CIRCUMSTANCES WE DEEM IT APPROPRIATE TO SET ASIDE THE IMPUGNED ORDER AND RESTORE THE ISSUE TO THE FILE OF THE CCIT-XIII, NEW DELHI WITH THE DIRECTION TO DECI DE THE APPEALS OF THE ASSESSEE IN ACCORDANCE WITH LAW BY WAY OF SPEAKING ORDER AFT ER AFFORDING THE ASSESSEE A REASONABLE OPPORTUNITY OF BEING HEARD. I.T.A .NOS.-933-937/DEL/2013 6 5. IN THE RESULT, THE APPEALS OF THE ASSESSEE ARE A LLOWED FOR STATISTICAL PURPOSES AS PER THE PRONOUNCEMENT MADE IN THE OPEN COURT AT THE TIME OF HEARING ITSELF. THE ORDER WAS PRONOUNCED IN THE OPEN COURT ON 23 RD OF AUGUST 2013. SD/- SD/- (T.S.KAPOOR) (DIVA SINGH) ACCOUNTANT MEMBER JUDI CIAL MEMBER DATED: 23/08/2013 *AMIT KUMAR* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI