Supra Craft Packaging (P) Ltd., Alwar V. Assistant Commissioner Of Income Tax, Circle-2, Alwar

ITA 942/JPR/2018

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 6014 (ITAT-JAIPUR)
• Duration Of Justice: 5 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-01-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2014-2015
• Appeal Filed On: 07-08-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANURADHA JCIT DHK
• Keywords: Reasonable cause
• Section: 68; 144

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCH B, JAIPUR JH FOT; IKY JKWO] U;KF;D LNL; ,OA JH FOE FLAG ;K NO ] YS[KK LNL; DS LE{K BEFORE: SHRI VIJAY PAL RAO, JM AND SHRI VIKRAM SING H YADAV, AM VK;DJ VIHY LA-@ ITA NO. 942/JP/2018 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2014-15. M/S. SUPRA CRAFT PACKAGING (P) LTD., E-94, PHASE-I, INDUSTRIAL AREA, BHIWADI, ALWAR. CUKE VS. THE ACIT CIRCLE-2, ALWAR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN NO. AACCS 7209 N VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI P.C. PARWAL (CA) JKTLO DH VKSJ LS@ REVENUE BY : SMT. ANURADHA (JCIT) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 22.01.2019. ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 23/01/2019. VKNS'K@ ORDER PER VIJAY PAL RAO, JM : THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 29 TH MAY, 2018 OF LD. CIT (A), ALWAR FOR THE ASSESSMENT YEAR 2014-15. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS :- 1. THAT THE LD. ASSESSING OFFICER HAS ERRED IN LA W AS WELL AS ON THE FACTS AND CIRCUMSTANCES OF THE CASE IN MAKING ADDIT ION BY INVOKING THE PROVISION OF SECTION 144 OF THE INCOME TAX ACT, 1961 AND LD. COMMISSIONER OF INCOME-TAX (APPEALS), ALWAR HAS ERRED IN SUSTAINING THE SAME BY NOT DECIDING THE IS SUE ON MERIT. 2. THAT THE LD. ASSESSING OFFICER HAS ERRED IN LAW AS WELL AS ON THE FACTS AND CIRCUMSTANCES OF THE CASE IN MAKING ADDIT ION OF RS.40,00,000/- BY INVOKING THE PROVISION OF SECTION 68 OF THE INCOME TAX ACT, 1961 ON THE BASIS THAT THE ASSESSEE COMPANY FAILED TO OFFER ANY EXPLANATION WITH REGARD TO THE AMOUNT RECEIVED ON ACCOUNT OF SHARE PREMIUM AND THE LD. CO MMISSIONER 2 ITA NO. 942/JP/2018 M/S. SUPRA CRAFT PACKAGING PVT. LTD., BHIWADI, ALWA R. OF INCOME TAX (APPEALS), ALWAR HAS ERRED IN SUSTAIN ING THE SAME BY NOT DECIDING THE ISSUE ON MERIT. 3. THAT THE LD. ASSESSING OFFICER HAS ERRED IN LAW AS WELL AS ON THE FACTS AND CIRCUMSTANCES OF THE CASE IN MAKING ADDIT ION OF RS. 20,940/- BY INVOKING THE PROVISION OF SECTION 36(1) (VA) R.W.S. 2(24)(X) ON THE BASIS THAT THE ASSESSEE COMPANY DEP OSITED THE CONCERNED AMOUNT AFTER THE DUE DATES MENTIONED IN T HE RESPECTIVE ACTS OF THE RELEVANT STATUTE AND THE LD. COMMISSIONER OF INCOME-TAX (APPEALS, ALWAR HAS ERRED IN SUSTAINI NG THE SAME BY NOT DECIDING THE ISSUE ON MERIT. 4. THE ASSESSEE RESERVES THE RIGHT TO ADD, ALTER, M ODIFY, DELETE OR AMEND ALL OR ANY OF THE GROUNDS OF APPEAL BEFORE OR AT THE TIME OF HEARING OF APPEAL. 2. THE ASSESSEE IS A PRIVATE LIMITED COMPANY AND EN GAGED IN THE BUSINESS OF MANUFACTURING OF CORRUGATED BOXES. THE ASSESSEE FIL ED ITS RETURN OF INCOME ON 1 ST DECEMBER, 2014 DECLARING LOSS OF RS. 90,44,446/-. DURING THE SCRUTINY ASSESSMENT, THE LD. A/R OF THE ASSESSEE SHRI V.K. DUTTA, CA APP EARED BEFORE THE AO AT THE INITIAL STAGE AND FILED THE REQUISITE DETAILS. HOWEVER, SUB SEQUENTLY HE DID NOT APPEAR BEFORE THE AO AND THE ASSESSMENT ORDER WAS PASSED U NDER SECTION 144 OF THE IT ACT AT A LOSS OF RS. 50,23,510/-. SINCE THE AO HAS MAD E CERTAIN DISALLOWANCES UNDER SECTION 68 AS WELL AS UNDER SECTION 36(1)(VA) OF TH E IT ACT, THEREFORE, THE ASSESSEE CHALLENGED THE ACTION OF THE AO BEFORE THE LD. CIT (A). HOWEVER, SINCE NOBODY APPEARED ON BEHALF OF THE ASSESSEE BEFORE THE LD. C IT (A), THEREFORE, THE APPEAL OF THE ASSESSEE WAS DISMISSED EX PARTE. 3. BEFORE US THE LD. A/R OF THE ASSESSEE HAS SUBMIT TED THAT DUE TO SOME CONFUSION BETWEEN THE ASSESSEE COMPANY AND ITS AUTH ORIZED REPRESENTATIVE, HE COULD NOT APPEAR BEFORE THE AO AS WELL AS BEFORE TH E LD. CIT (A) AND CONSEQUENTLY THE ASSESSMENT ORDER WAS PASSED EX PARTE AND APPEAL FILED BY THE ASSESSEE WAS ALSO 3 ITA NO. 942/JP/2018 M/S. SUPRA CRAFT PACKAGING PVT. LTD., BHIWADI, ALWA R. DISMISSED BY THE LD. CIT (A) EX PARTE. HE HAS FILE D AN AFFIDAVIT OF THE DIRECTOR OF THE ASSESSEE COMPANY AND EXPLAINED THE REASONS FOR NON APPEARANCE BEFORE THE LD. CIT (A). THE LD. A/R HAS EXPLAINED THAT ONE SHRI APOOR V MAHESHWARI WORKING AS CHIEF ACCOUNTS OFFICER OF THE ASSESSEE WAS NOT KEEPING GO OD HEALTH DURING THE PERIOD DECEMBER, 2017 TO MARCH, 2018. SINCE HE WAS LOOKING AFTER THE TAX MATTERS AND ALSO IN TOUCH WITH THE AUTHORIZED REPRESENTATIVE TO FOLL OW UP THE APPEALS AND TAX MATTERS, HOWEVER, DUE TO HIS ILL HEALTH AND IRREGUL AR ATTENDANCE IN THE OFFICE, THE AUTHORIZED REPRESENTATIVE WAS NOT PROVIDED WITH THE REQUISITE INFORMATION AND DETAILS AND CONSEQUENTLY THE ASSESSEE LOST THE TRAC K OF THE MATTER AND NOBODY ATTENDED BEFORE THE LD. CIT (A). THEREFORE, THE LD . A/R HAS SUBMITTED THAT SINCE THE ASSESSMENT ORDER WAS ALSO PASSED EX PARTE AND APPEA L OF THE ASSESSEE WAS DISMISSED BY THE LD. CIT (A) IN LIMINE WITHOUT DECI DING ON MERIT, THE MATTER MAY BE REMITTED TO THE RECORD OF THE AO FOR DECIDING AFRES H AFTER GIVING AN OPPORTUNITY OF HEARING TO THE ASSESSEE. 4. ON THE OTHER HAND, THE LD. D/R HAS VEHEMENTLY OP POSED TO THE REQUEST OF THE ASSESSEE AND CONTENDED THAT IT IS NOT A MATTER OF B ONAFIDE MISTAKE OR REASONABLE EXPLANATION BUT IT IS A CASE OF GROSS NEGLIGENCE ON THE PART OF THE ASSESSEE NOT APPEARING EITHER BEFORE THE AO OR BEFORE THE LD. CI T (A). THE ASSESSEE BEING A COMPANY CANNOT TAKE A PLEA THAT DUE TO IRREGULAR AT TENDANCE OF ONE OF ITS EMPLOYEES NOBODY HAS APPEARED IN THE PROCEEDINGS BEFORE THE A O AS WELL AS BEFORE THE LD. CIT (A) WHEN THEY HAVE AUTHORIZED THE REPRESENTATIVE TO APPEAR BEFORE THE AO AS WELL AS BEFORE THE LD. CIT (A). 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WELL AS THE RELEVANT MATERIAL ON RECORD. WE NOTE THAT AFTER GIVING THE SEVERAL OPPO RTUNITIES OF HEARING, THE LD. CIT 4 ITA NO. 942/JP/2018 M/S. SUPRA CRAFT PACKAGING PVT. LTD., BHIWADI, ALWA R. (A) FINALLY DISMISSED THE APPEAL OF THE ASSESSEE IN LIMINE WITHOUT GOING INTO THE MERITS OF THE GROUNDS RAISED BY THE ASSESSEE. THE ORDER OF THE LD. CIT (A) IN PARA 3.1 TO 3.3 ARE AS UNDER :- 3.1. IN THIS CASE, NOTICES U/S 250 WAS ISSUED TO THE APPELLANT ON SEVERAL OCCASIONS FIXING THE HEARING ON 02.01.2018, 01.02.2018, 21.02.2018, 16.03.2018 AND 18.04.2018. NO ONE ATTEN DED. THEREFORE, I AM CONSTRAINED TO DECIDE THE APPEAL ON THE BASIS OF EVIDENCES ON RECORD. 3.2. I HAVE FURTHER NOTED THAT NO STATEMENT OF FACT S WAS FILED ALONG WITH FORM NO. 35. THE APPEAL HAS ALSO BEEN FILED L ATE BY 08 DAYS. 3.3. IN ABSENCE OF ANY SUBMISSIONS BY THE APPELLANT IN SUPPORT OF ITS CLAIMS, I HAVE RELIED UPON THE FACTS MENTIONED IN T HE ASSESSMENT ORDER. AFTER CONSIDERING THE SAME, I SEE NO REASON TO INTERFERE WITH THE ASSESSMENT ORDER PASSED BY THE AO. ACCORDINGLY, TH E APPELLANTS GROUNDS OF APPEAL ARE DISMISSED. THUS IT IS CLEAR THAT THE LD. CIT (A) HAS NOT DECID ED THE APPEAL OF THE ASSESSEE ON MERIT BUT IT WAS DISMISSED IN LIMINE. THE ASSESSEE HAS EXPLAINED THE REASONS FOR NOT ATTENDING THE PROCEEDINGS BEFORE THE LD. CIT (A) IN THE AFFIDAVIT OF ONE SHRI KARN BHUGRA, DIRECTOR OF THE ASSESSEE COMPANY IN PARA 5 AS UNDER :- 5. THAT MR. APOORV MAHESHWARI WAS WORKING IN OUR COMPANY ON THE POST OF CHIEF ACCOUNTS OFFICER. HE HAD JOINED O UR COMPANY ON SAID POSITION W.E.F. 01.07.2017. THAT DURING THE PERIOD OF DEC 2017 TO MAR 2018 MR. APOORV MAHESHWARI WAS VERY IRREGULAR IN AT TENDING OFFICE DUE TO SERIOUS HEALTH ISSUES. DURING THE SAME PERIOD OU R AUTHORISED 5 ITA NO. 942/JP/2018 M/S. SUPRA CRAFT PACKAGING PVT. LTD., BHIWADI, ALWA R. REPRESENTATIVE IN THE ABOVE MENTIONED APPEAL HAD BE EN FOLLOWING UP FROM HIM TO ARRANGE THE INFORMATION/DOCUMENTS REQUI RED TO BE FURNISHED IN THE HEARINGS BEFORE THE HONBLE CIT (A PPEALS). HOWEVER, MR. APOORV KEPT ON ASSURING HIM THAT HE WILL PROVID E THE REQUIRED INFORMATION TO THE AUTHORISED REPRESENTATIVE BUT TH E DETAILS WERE NOT PROVIDED BY HIM. UNFORTUNATELY, THIS DID NOT COME T O THE KNOWLEDGE OF THE MANAGEMENT. FOR THESE REASONS HEARING BEFORE LD . CIT (A) COULD NOT BE ATTENDED. HAVING CONSIDERED THE REASONS EXPLAINED BY THE ASSE SSEE AS WELL AS IN THE FACTS AND CIRCUMSTANCES OF THE CASE THAT THE ASSESSEE HAS NEI THER ATTENDED THE PROCEEDINGS BEFORE THE AO NOR BEFORE THE LD. CIT (A), WE FIND T HAT IT IS NOT A SIMPLE CASE OF REASONABLE CAUSE FOR NOT ATTENDING THE MATTERS BEFO RE THE AO AS WELL AS BEFORE THE LD. CIT (A) BUT THE ASSESSEE WAS NEGLIGENT IN ATTEN DING THE TAX MATTERS. HOWEVER, SINCE THE LD. CIT (A) HAS NOT DECIDED THE APPEAL ON MERITS AND THE AO HAS ALSO PASSED THE ASSESSMENT ORDER EX PARTE UNDER SECTION 144 OF THE ACT, THEREFORE, SUBJECT TO THE COST OF RS. 5,000/-, WE SET ASIDE TH E MATTER TO THE RECORD OF THE AO FOR DECIDING THE SAME AFRESH AFTER GIVING AN OPPORT UNITY OF HEARING TO THE ASSESSEE. 5. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER IS PRONOUNCED IN THE OPEN COURT ON 23/01/201 9. SD/- SD/- ( FOE FLAG ;KNO ) ( FOT; IKY JKWO (VIKRAM SINGH YADAV ) (VIJAY PAL RAO) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER JAIPUR DATED:- 23/01/2019. DAS/ 6 ITA NO. 942/JP/2018 M/S. SUPRA CRAFT PACKAGING PVT. LTD., BHIWADI, ALWA R. VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT- M/S. SUPER CRAFT PACKAGING PVT. L TD., ALWAR. 2. THE RESPONDENT THE ACIT, CIRCLE-2, ALWAR. 3. THE CIT(A). 4. THE CIT, 5. THE DR, ITAT, JAIPUR 6. GUARD FILE (ITA NO. 942/JP/2018) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR 7 ITA NO. 942/JP/2018 M/S. SUPRA CRAFT PACKAGING PVT. LTD., BHIWADI, ALWA R.