M/s. Hirise Infracon Limited., Mumbai V. ITO, Ward-7(1), Kolkata, Kolkata

ITA 972/KOL/2017

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 1676 (ITAT-KOLKATA)
• Duration Of Justice: 3 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-08-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 08-05-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ARNIDAM BHATTACHARJEE CIT REV
• Keywords: Opportunity of being heard; Principle of natural justice
• Section: 143(3); 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH (SMC), KOLKATA [BEFORE HONBLE SHRI P.M. JAGTAP] I.T.A. NO. 972/KOL/2017 ASSESSMENT YEAR 2011-12 M/S. HIRISE INFRACON LTD. ..............................APPELLANT SHOP NO. 28, GROUND FLOOR WING D, GAURAV VENUS, GAURAV GALAXY II MIRA ROAD THANE MAHARASHTRA - 401107 [PAN : AACCH 4094 A] CIT (APPEALS) - 17...................RESPONDENT 9 TH FLOOR, BAMBOO VILLA 169, A.J.C. BOSE ROAD KOLKATA - 700014 APPEARANCES BY: NONE APPEARING ON BEHALF OF THE ASSESSEE. SHRI ARNIDAM BHATTACHARJEE, ADDL CIT APPEARING ON BEHALF OF THE REVENUE. DATE OF CONCLUDING THE HEARING : AUGUST 16, 2017 DATE OF PRONOUNCING THE ORDER : AUGUST 16, 2017 ORDER THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF LD. CIT (APPEALS) 17, KOLKATA DATED 05.01.2017 PASSED EX-PARTE. 2. THE ASSESSEE IN THE PRESENT CASE IS AN INVESTMENT COMPANY WHICH FILED ITS RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION ON 10.02.2012 DECLARING A TOTAL INCOME OF RS. 42,753/-. DURING THE COURSE OF ASSESSMENT PROCEEDING, IT WAS NOTICED BY THE AO THAT THE ASSESSEE HAS MADE SOME INVESTMENT IN UNQUOTED SHARES. SINCE THE INCOME FROM SUCH INVESTMENT IN THE FORM OF DIVIDEND, LONG TERM CAPITAL GAIN ETC. WAS ELIGIBLE FOR EXEMPTION FROM TAX, THE AO WAS OF THE VIEW THAT THE EXPENDITURE INCURRED IN RELATION TO THE SAID INVESTMENT WAS LIABLE TO BE DISALLOWED UNDER SECTION 14A OF THE ACT. 2 I.T.A. NO. 972/KOL/2017 HIRISE INFRACON LTD. HE ACCORDINGLY COMPUTED SUCH EXPENDITURE BY APPLYING RULE 8D AT RS. 4,75,127/- AND DISALLOWANCE TO THAT EXTENT WAS MADE BY HIM UNDER SECTION 14A OF THE ACT IN THE ASSESSMENT COMPLETED U/S 143(3) VIDE AN ORDER DATED 29.03.2014. 3. AGAINST THE ORDER PASSED BY THE AO U/S 143(3), AN APPEAL WAS PREFERRED BY THE AO BEFORE THE LD. CIT (A) DISPUTING THEREIN THE DISALLOWANCE MADE BY THE AO UNDER SECTION 14A AND SINCE THERE WAS NO COMPLIANCE ON THE PART OF THE ASSESSEE TO THE NOTICES ISSUED BY HIM FIXING THE SAID APPEAL FOR HEARING, THE LD. CIT (A) CONFIRMED THE DISALLOWANCE MADE BY THE AO AND DISMISSED THE APPEAL OF THE ASSESSEE. AGGRIEVED BY THE ORDER OF THE LD. CIT (A), THE ASSESSEE HAS PREFERRED THIS APPEAL BEFORE THE TRIBUNAL. 4. AT THE TIME OF HEARING FIXED TODAY, NONE HAS APPEARED ON BEHALF OF THE ASSESSEE. THIS APPEAL OF THE ASSESSEE IS THEREFORE BEING DISPOSED OF EX-PARTE AFTER HAVING THE ARGUMENTS OF LD. DR AND PERUSING THE RELEVANT MATERIAL ON RECORD. IT IS OBSERVED THAT THE APPEAL FILED BY THE ASSESSEE BEFORE HIM WAS FIXED FOR HEARINGS BY THE LD. CIT (A) ONLY ON TWO OCCASIONS I.E. 23.12.2016 AND 05.01.2017 AND SINCE NONE APPEARED ON BEHALF OF THE ASSESSEE ON THE SAID TWO DATES GIVEN WITHIN THE SHORT PERIOD OF 15 DAYS, THE LD. CIT (A) DISMISSED THE APPEAL OF THE ASSESSEE VIDE HIS IMPUGNED ORDER PASSED EX-PARTE. KEEPING IN VIEW THESE FACTS AND CIRCUMSTANCES, I AM OF THE VIEW THAT PROPER AND REASONABLE OPPORTUNITY OF BEING HEARD CANNOT BE SAID TO HAVE BEEN GIVEN TO THE ASSESSEE BY THE LD. CIT (A) AND THERE IS A VIOLATION OF PRINCIPLES OF NATURAL JUSTICE AS RIGHTLY CLAIMED BY THE ASSESSEE IN GROUND NO 1 OF THIS APPEAL. EVEN THE LD. DR HAS NOT BEEN 3 I.T.A. NO. 972/KOL/2017 HIRISE INFRACON LTD. ABLE TO REBUT OR CONTROVERT THIS POSITION, WHICH IS CLEARLY EVIDENT FROM THE IMPUGNED ORDER OF THE LD. CIT (A). I, THEREFORE, SET ASIDE THE IMPUGNED ORDER PASSED BY THE LD. CIT (A) AND REMIT THE MATTER BACK TO HIM WITH THE DIRECTION TO DISPOSE OF THE APPEAL ON MERIT AFRESH AFTER GIVING PROPER AND SUFFICIENT OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 16 TH AUGUST, 2017. SD/- (P.M. JAGTAP) ACCOUNTANT MEMBER DATED: 16/08/2017 BISWAJIT, SR. P.S. COPY OF ORDER FORWARDED TO: 1. M/S. HIRISE INFRACON LTD., KOLKATA. 2. CIT (APPEALS) 17, KOLKATA. 3. THE CIT(A) 4. THE CIT 5. DR TRUE COPY, BY ORDER, SR. P.S. / H.O.O. ITAT, KOLKATA