M/s. Shivam Marketing, GONDAL V. The Income Tax Officer, Ward-1(2), RAJKOT-GUJARAT

ITA 94/RJT/2013

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 1195 (ITAT-RAJKOT)
• Duration Of Justice: 5 year(s) 7 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-11-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2006-2007
• Appeal Filed On: 12-04-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Principle of natural justice
• Section: 40(a)(ia)

Judgement Text

: : IN THE INCOME TAX APPELLATE TRIBULAL: RAJKOT BENCH: RAJKOT , , BEFORE SHRI C.M.GARG, JUDICIAL MEMBER AND SHRI O.P.MEENA, ACCOUNTANT MEMBER . / ITA NO.94/RJT/2013 / ASSESSMENT YEAR: 2006-07 M/S. SHIVAM MARKETING, GONDAL ROAD, GONDAL. [PAN: ABBFS 8088E] VS. INCOME TAX OFFICER, WARD-1(2), RAJKOT. ( / APPELLANT) ( /RESPONDENT) /ASSESSEE BY : WRITTEN SUBMISSION /REVENUE BY : SHRI PRAVIN VERMA, D.R /DATE OF HEARING : 22-11-2018 / DATE OF PRONOUNCEMENT : 26-11-2018 / ORDER PER C.M. GARG, JUDICIAL MEMBER : THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)-GANDHINAGAR, A HMEDABAD (CIT(A) FOR SHORT) DATED 04.01.2013 FOR THE ASSES SMENT YEAR (A.Y) 2006- 07. 2 ITA NO.94/RJT/2013 (A.Y: 2006-07) M/S. SHIVAM MARKETING 2. THE GROUNDS RAISED BY THE ASSESSEE READ AS FOLLO WS: 1.1. THE LD. CIT(A) HAS ERRED IN LAW AS WELL AS O N FACTS IN CONFIRMING ADDITION OF RS. 6,49,465/- MADE U/S. 40(A)(IA) TRAN SPORTATION CHARGES IN RESPECT OF PAYMENT RELATED TO SANGHI CEMENTS. THE S AME NEEDS DELETION. 1.2. WITHOUT PREJUDICE, THE LD. CIT(A) HAS ERRED IN NOT CONSIDERING THAT LD. A.O. HAS MADE THE ADDITION THOUGH PROVISIO NS OF SECTION 40(A)(IA) IS NOT APPLICABLE TO THE CASE OF THE APPE LLANT. THE ADDITION NEEDS DELETION. 2.1. THE LD. CIT(A) HAS ERRED IN LAW AS WELL AS ON FACTS IN CONFIRMING ADDITION OF RS. 1,03,150/- MADE U/S. 40(A)(IA) TRAN SPORTATION CHARGES IN RESPECT OF PAYMENT RELATED TO GANESH TRANSPORT CO. THE SAME NEEDS DELETION. 2.2. WITHOUT PREJUDICE, THE LD. CIT(A) HAS ERRED IN NOT CONSIDERING THAT LD. A.O. HAS MADE THE ADDITION THOUGH PROVISIO NS OF SECTION 40(A)(IA) IS NOT APPLICABLE TO THE CASE OF THE APPE LLANT. THE ADDITION NEEDS DELETION. 3.1. THE LD. CIT(A) HAS ERRED IN LAW AS WELL AS O N FACTS IN CONFIRMING ADDITION OF RS. 4,63,293/- MADE U/S. 40(A)(IA) TRAN SPORTATION CHARGES IN RESPECT OF PAYMENT RELATED TO J. K LAXMI CEMENT CO. THE SAME NEEDS DELETION. 3.2. WITHOUT PREJUDICE, THE LD. CIT(A) HAS ERRED IN NOT CONSIDERING THAT LD. A.O. HAS MADE THE ADDITION THOUGH PROVISIO NS OF SECTION 40(A)(IA) IS NOT APPLICABLE TO THE CASE OF THE APPE LLANT. THE ADDITION NEEDS DELETION. 4. THE LD. CIT(A) HAS ERRED IN LAW AS WELL AS ON FACTS IN NOT CONSIDERING THAT THE LD. A.O. HAS ERRED IN NOT PROV IDING REASONABLE OPPORTUNITY TO THE APPELLANT. THE ORDER DESERVES AN NULMENT. 5. THE LD. CIT(A) HAS ERRED IN LAW AS WELL AS O N FACTS IN NOT PROVIDING REASONABLE OPPORTUNITY TO THE APPELLANT. THE ORDER DESERVES ANNULMENT. 6. THE ASSESSMENT ORDER PASSED IS BAD IN LAW DESERV ES ANNULMENT. 3 ITA NO.94/RJT/2013 (A.Y: 2006-07) M/S. SHIVAM MARKETING GROUND NO.4 : 3. WHEN THE CASE WAS CALLED FOR HEARING NEITHER THE ASSESSEE NOR ANY AUTHORIZED REPRESENTATIVE APPEARED. HOWEVER, WE FIN D WRITTEN SUBMISSION SUBMITTED ON BEHALF OF THE ASSESSEE, WHE REIN GROUND NO.4 HAS BEEN PRESSED BY STATING THAT THE APPEAL RELATES TO ADDITION MADE U/S. 40(A)(IA) OF THE ACT SINCE AT THE RELEVANT TIME THE AMENDMENTS MADE IN THE LAW TREATED AS RETROSPECTIVE WAS NOT AVAILABLE THE LD. AO WAS NOT CONSIDERED THE SAME WHICH NEEDS CONSIDERATION NOW A ND INTEREST NEEDS TO BE CHARGE IN RESPECT OF RELEVANT AMOUNT UP TO TH E DATE OF DEPOSIT OF TAX BY THE RECIPIENT. THE AR ALSO SUBMITTED THAT THE C ASE MAY KINDLY BE RESTORED TO THE FILE OF AO TO THE ASSESSMENT STAGE ALLOWING THE ASSESSEE TO FILE RELEVANT DOCUMENTARY EVIDENCE AND EXPLANATI ON TO MEET ENDS OF JUSTICE AS THE ASSESSEE WAS NOT PROVIDED DUE OPPORT UNITY OF HEARING DURING ASSESSMENT AND FIRST APPELLATE PROCEEDINGS. 4. REPLYING TO THE ABOVE, THE LD. DEPARTMENTAL REPR ESENTATIVE (DR) SUBMITTED THAT THE SUFFICIENT OPPORTUNITY HAS BEEN GRANTED TO THE ASSESSEE DURING ASSESSMENT AND FIRST APPELLATE PROCEEDINGS T HEREFORE, THE GROUND OF ASSESSEE IS NOT CORRECT AND SUSTAINABLE. HOWEVE R, IN ALL FAIRNESS, THE LD. DR SUBMITTED THAT IF IT IS FOUND JUST AND PROPE R AND NECESSARY THEN, THE DEPARTMENT HAS NO SERIOUS OBJECTION IF THE CASE IS RESTORED TO THE FILE OF AO FOR DENOVO FRAMING OF ASSESSMENT. 4 ITA NO.94/RJT/2013 (A.Y: 2006-07) M/S. SHIVAM MARKETING 5. ON CAREFUL CONSIDERATION OF ABOVE RIVAL SUBMISSI ONS, FROM THE ASSESSMENT ORDER, WE OBSERVE THAT THE AO KEPT ON TH E RECORD REPLY OF THE ASSESSEE ON ONE ISSUE I.E., THE CLAIM OF TRANSPORTA TION OF FREIGHT CHARGES. THEREAFTER, FROM OTHER AND SECOND PART OF ASSESSMEN T ORDER, WE OBSERVE THAT THE AO PROCEEDED TO MAKE DISALLOWANCE/ADDITION S ON THREE COUNTS I.E., TRANSPORTATION EXPENSES, TRANSPORTATION CHARG ES AND TRANSPORT EXPENSES PAID TO M/S. LAXMI CEMENT AND IN OUR HUMBL E OPINION, THE ASSESSEE WAS NOT GRANTED OPPORTUNITY TO EXPLAIN HIS CLAIM BY WAY OF DOCUMENTARY EVIDENCE AND EXPLANATION THEREFORE, WE HAVE NO HESITATION TO HOLD THAT THE ASSESSEE WAS PREVENTED FROM OPPORT UNITY OF BEING HEARD BY THE AO BEFORE MAKING DISALLOWANCES/ADDITIONS, WH ICH IS VIOLATION OF PRINCIPLES OF NATURAL JUSTICE. HENCE, WE DEEM IT A PPROPRIATE, PROPER AND NECESSARY TO RESTORE THE CASE TO THE FILE OF AO TO THE ASSESSMENT STAGE FOR FRAMING DENOVO ASSESSMENT ORDER AFTER ALLOWING DUE OPPORTUNITY OF HEARING TO THE ASSESSEE AND WITHOUT BEING PREJUDICE D FROM THE EARLIER ASSESSMENT AND FIRST APPELLATE ORDER. ACCORDINGLY, GROUND NO.4 OF THE ASSESSEE IS ALLOWED. 6. SINCE, WE HAVE RESTORED THE CASE TO THE FILE OF AO FOR A FRAMING AFRESH ASSESSMENT ORDER THEREFORE, OTHER GROUNDS ON MERITS BECOME IN FRUCTUOUS AND WE ARE NOT ADJUDICATING UPON THEM AS HAVING BECOME IN- FRUCTUOUS. 5 ITA NO.94/RJT/2013 (A.Y: 2006-07) M/S. SHIVAM MARKETING 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THIS DAY OF NOVEMBER, 2018 RAJKOT/ ; & / DATED : 26 TH NOVEMBER, 2018/ EDN, SR. P.S ! #$ %$ / COPY OF THE ORDER IS FORWARDED TO : 1. * / THE APPELLANT ; 2. +,* / THE RESPONDENT ; 3. . ( ) / THE CONCERNED CIT(A); 4.THE CONCERNED PRL. CIT; 5. / + , , / DR, ITAT, / RAJKOT; 6. / GUARD FILE . // BY ORDER // ASSISTANT REGISTRAR, ITAT, RAJKOT BENCH, RAJKOT SD/- SD/- ( . . /O.P.MEENA) / ACCOUNTANT MEMBER ( . . /C.M.GARG) /JUDICIAL MEMBER