ITO, Ward - 57(2), Kolkata, Kolkata V. Bru Enterprises Pvt. Ltd., Kolkata

ITA 978/KOL/2010

• Counselvise Citation: [2012] 119 COUNSELVISE.COM (IT) 8122 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 3 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-09-2012
• Appeal Filed By: Department
• Bench Allotted: C
• Assessment Year: 2006-2007
• Appeal Filed On: 12-05-2010
• Court: TRIBUNAL
• Department Lawyers: S P LAHIRI
• Assessee Lawyers: V N DUTTA
• Keywords: Opportunity of being heard; Principle of natural justice

Judgement Text

, C , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH: KOL KATA () BEFORE , /AND ! ' ! , ) [BEFORE SHRI PRAMOD KUMAR, AM & SHRI MAHAVIR SINGH, JM] # # # # / I.T.A NOS. 978 TO 980/KOL/2010 '$% &' '$% &' '$% &' '$% &'/ // / ASSESSMENT YEARS: 2006-07 TO 2008-09 INCOME-TAX OFFICER, WD-57(2), KOLKATA VS. BRU ENTE RPRISES PVT. LTD. (PAN: AABCB3277G) ()* /APPELLANT ) (+)*/ RESPONDENT ) DATE OF HEARING: 06.09.2012 DATE OF PRONOUNCEMENT: 06.09.2012 FOR THE APPELLANT: SHRI S. P. LAHIRI FOR THE RESPONDENT: SHRI V. N. DUTTA , / ORDER PER BENCH: ALL THESE APPEALS BY REVENUE ARE ARISING OUT OF COM MON ORDER OF CIT(A)-I, KOLKATA IN APPEAL NOS. 127, 128 & 129/CIT(A)-1/57(2)/09-10 DAT ED 15.03.2010. ASSESSMENTS WERE FRAMED BY ITO(TDS), WD-57(2), KOLKATA U/S. 206C(6) R.W.S. 206C(7) OF THE INCOME-TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) FOR AY 2006-07 TO 2008-09 VIDE HIS SEPARATE ORDERS ALL DATED 27.04.2009. 2. THE ONLY ISSUE IN THESE THREE APPEALS OF REVENUE IS AGAINST THE ORDER OF CIT(A) IN ANNULLING THE AOS ORDER IN TREATING THE ASSESSEE IN DEFAULT BY INVOKING THE PROVISIONS OF SECTION 206C(6) AND 206C(7) OF THE ACT. FOR THIS, REVENUE HAS RAISED COMMON GROUNDS IN ALL THE THREE YEARS AND RELEVANT GROUNDS AS RAISED IN A Y 2006-07 ARE BEING REPRODUCED FOR THE SAKE OF BREVITY, WHICH ARE AS UNDER: (1) THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED IN HOLDING THAT ORDER PASSED WITHOUT ALLOWING PROPER O PPORTUNITY OF BEING HEARD CANNOT BE UPHELD, WHEREAS THE FACT IS THAT HE HAS IRNPLIED PO WER TO DISPOSE OFTHE CASE ON MERIT AFTER ALLOWING THE ASSESSEE SUCH PROPER OPPORTUNITY OF BENG HEARD AS HE THINKS FIT. (2) THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF T HE CASE, THE LD. CIT(A) HAS ERRED IN OBSERVING THAT SECTION 206C(6A) WAS WRONGLY APPLIED BY THE AO TO THIS FINANCIAL YEAR, THOUGH THE ASSESSEE WAS ONLY DEEMD TO BE AN ASSESS EE IN DEFAULT UNDER THAT SECTION, BUT THE TAX LIABILITY WAS CHARGED ON IT UNDER SECTIONS 206C(6) AND 206C(7), WHICHHAVE THEIR EXISTENCE IN THE STATUTE SINCE 01.06.1988. (3) THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF T HE CASE, THE LD. CIT(A) HAS ERRED IN APPLYING THE INTERPRETATION OF THE TERM BUYER AS GI VEN IN THE CBDTS CIRCULAR NO. 660 DATED 15.09.1993 TO THIS FINANCIAL YEAR, ALTHOUGH T HERE HAS BEEN A RADICAL CHANGE IN THE DEFINITION OFTHE SAID TERM SINCE 08.09.2003. 2 ITA 978 TO 980/K/2010 BRU ENTERPRISES PVT. LTD. A.Y. 2006-07 TO 2008-09 (4) THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF T HE CASE, THE LD. CIT(A) HAS ERRED IN NOT GIVING HIS OPINION ON THE DEFECTS CONTAINED IN THE DECLARATIONS IN FORM NO. 27C OBTAINED BY THE ASSESSEE FROM ITS BUYERS, ALTHOUGH THESE DEFECTS ARE THE VERY BASIS OF CHARGING TAX U/S 206C(6) AS WELL AS INTEREST U/S 20 6C(7). 3. THE ORDER UNDER CHALLENGE BEFORE US IS OF CIT(A) . WHEN A QUERY WAS PUT TO LD. COUNSEL FOR THE ASSESSEE THAT THIS IS NOT A SPEAKING ORDER AND CIT(A) HAS MERELY REPRODUCD THE SUBMISSIONS OF THE ASSESSEE AND FINALLY HELD THAT T HE AO HAS PASSED ORDER WITHOUT ALLOWING OPPORTUNITY OF BEING HEARD TO THE ASSESSEE IN VIOLA TION OF PRINCIPLES OF NATURAL JUSTICE AND THUS CANNOT BE UPHELD. SECONDLY, THE CIT(A) NOTED THAT THE PROVISIONS OF SECTION 206C(6A) OF THE ACT APPLIES W.E.F. 01.04.2007 AND NOT EARLIER YEARS AND THE AO HAS WRONGLY APPLIED THE SAME FOR FY 2005-06 AND 2006-07. FURTHER, THE CIT(A) AL SO HELD THAT TCS IS NOT APPLICABLE IN RESPECT OF SECOND OR SUBSEQUENT SALE AND ACCEPTED T HE CLAIM OF THE ASSESSEE THAT IT IS A TRADER AND NOT MANUFACTURER IN VIEW OF CIRCULAR NO. 660 DA TED 15.09.1993 OF CBDT. FOR THIS, THE CIT(A) HAS NOT RECORDED ANY REASON OR NOT PASSED A SPEAKING ORDER. LD. COUNSEL FOR THE ASSESSEE FAIRLY CONCEDED THE POSITION AND STATED TH AT LET THE ISSUE IN ALL THESE THREE YEARS BE SET ASIDE TO THE FILE OF CIT(A) FOR PASSING A SPEAKING ORDER. THE CIT(A) WILL ALSO GIVE FINDING ON THE APPLICABILITY OF SECTION 206C(6) AND 206C(6A) O F THE ACT. ON FURTHER QUERY FROM THE BENCH, THE LD. SR. DR ALSO FAIRLY CONCEDED THAT THI S ISSUE CAN BE SET ASIDE TO THE FILE OF CIT(A) FOR PASSING A FRESH SPEAKING ORDER. WE ARE OF THE VIEW THAT WHERE APPEAL HAS BEEN DISPOSED OF EVEN THOUGH ON MERITS WITHOUT A SPEAKING ORDER, THE ORDER OF CIT(A) CANNOT BE SUSTAINED. THE PROVISIONS OF SECTION 250(6) OF THE ACT ARE IN THE NATURE OF JUDICIAL DISCRETION TO THE APPELLATE AUTHORITY AND EMPHASIZING THAT THE ORDER DISPOSING OF THE APPEAL SHALL BE A SPEAKING ORDER. THE ORDER SHALL NOT CRYPTIC BUT SHALL BE SELF-EXPLA NATORY. IN VIEW OF THE FACTUAL POSITION THAT THE ORDER OF CIT(A) IS A NON-SPEAKING ONE AND ALSO THE CONSENT GIVEN BY BOTH THE PARTIES, WE SET ASIDE THIS ISSUE TO THE FILE OF CIT(A) FOR FRESH AD JUDICATION AFTER PROVIDING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. APPEAL S OF REVENUE ARE ALLOWED FOR STATISTICAL PURPOSES. 4. IN THE RESULT, APPEALS OF REVENUE ARE ALLOWED FO R STATISTICAL PURPOSES 5. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- , ! ! ! ! ' ! ' ! ' ! ' ! , (PRAMOD KUMAR) (MAHAVIR SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER ( - - - -) )) ) DATED : 6 TH SEPTEMBER, 2012 ./ '$01 '2 JD.(SR.P.S.) 3 ITA 978 TO 980/K/2010 BRU ENTERPRISES PVT. LTD. A.Y. 2006-07 TO 2008-09 , 3 ''4 54&6- COPY OF THE ORDER FORWARDED TO: 1 . )* / APPELLANT ITO, WARD-57(2), KOLKATA. . 2 +)* / RESPONDENT BRU ENTERPRISES PVT. LTD., 127/10/1, MANIKTALA MAIN ROAD, KOLKATA-700 054 3 . ',$ ( )/ THE CIT(A), KOLKATA 4. 5. ',$ / CIT KOLKATA 4<'= '$ / DR, KOLKATA BENCHES, KOLKATA +4 '/ TRUE COPY, ,$/ BY ORDER, ! 1 /ASSTT. REGISTRAR .