Shree Ganpati Gold Projects P.Ltd, New Delhi V. ITO, Ward-23(1), New Delhi

ITA 989/DEL/2020

AI Insights

The case involves Shree Ganpati Gold Projects Pvt. Ltd., which appealed against the orders of the Commissioner of Income Tax (Appeals) - VIII, New Delhi, concerning assessment years 2015-16 and 2016-17. The primary contention was the treatment of losses incurred on the sale of property. The assessee argued that these should be considered as business losses, not capital losses, given the nature of their business in real estate. The Commissioner had dismissed the appeals, citing non-compliance with procedural notices, which the assessee contested, claiming that adjournment requests were duly filed. The Tribunal found merit in the assessee's arguments and remanded the case for a fresh hearing.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 121647 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 6 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-09-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 17-09-2023
• Assessment Year: 2016-2017
• Appeal Filed On: 04-03-2020
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 143(3); 48; 20

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “G” DELHI BEFORE SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER & SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER I.T.As. No.2804/DEL/2019 & 989/DEL/2020 Assessment Years 2015-16 & 2016-17 Shree Ganpati Gold Projects Pvt. Ltd. 2633-2634, Plot No.249-250, Bank Street, Karol Bagh, New Delhi. v. ITO Ward-23(3) New Delhi. TAN/PAN: AAMCS4797D (Appellant) (Respondent) Appellant by: Shri Nirbhay Mehta, CA Respondent by: Shri Anuj Garg, Sr.DR Date of hearing: 18 09 2023 Date of pronouncement: 18 09 2023 O R D E R PER PRADIP KUMAR KEDIA, A.M.: T he c apti oned appea ls hav e b ee n file d by the Ass essee agains t t he or de rs of t he Co mmi ss ioner o f Income T ax (A ppea ls )- V III, N ew Delhi [ ‘C IT (A )’ in s hort ] both da ted 15. 02 . 2019 a nd 20. 01.2020 a risin g from the ass ess ment orde rs both date d 26. 12.2017 an d 21. 12. 2018 passed by the A ssessing Offic er (A O ) under Se ct ion 143(3) of t he Inc ome T ax A ct, 1961 (the A ct ) conce rn ing AY 2015-16 & 2016-17 respect ivel y. 2. T he grou nds of a ppe als raised by the assess ee i n both the assess me nt yea rs r ead as u nde r: I TA N o. 2 80 4 /D e l / 2 0 19 A s s e s s m e n t Ye a r 20 15 - 1 6 I.T.A. No.2804/Del/2019 & 989/Del/2020 2 “1 . Th at on t h e f a c t s an d c i r c u m s t a nc e s o f t h e c a s e a nd i n l a w t he o r d e r p a s s e d b y C I T (A ) - 8 N e w D e l h i ( he r e in a f te r r ef e r r e d t o a s A O ) i s c o nt r a r y t o t h e f a c t s a n d ba d in l a w . 2 . Th at o n t he f a c ts an d c i r c um s t an c e o f th e c a s e an d i n l a w , t he C I T ( A ) w as n o t j u s t i f i e d i n c o n f ir m i n g a d di t i o n m a de b y A O o f R s . 2 , 28 , 6 5 , 6 8 7 / - b y t r e a ti n g th e l os s i nc u r r e d o n s a l e of p r o p e r t y a s c a pi t a l l o s s w i t h ou t c on s i d e r i ng t h e f a c t t ha t t h e b u s i ne s s o f t he a s s e s s e e c om p a n y i s t o de a l i n th e s al e , pu r c h as e , l e a s e a n d d e v e l o p m e nt o f i m m ov a bl e p r o pe r t i e s a n d t h u s a ny l os s o n s a l e of p r o pe r t y s h ou l d b e c on s i d e r e d a s b u s i n e s s l os s an d n o t a c ap i t al l o s s . 3 . Th at o n t h e f a c ts an d c i r c um s t an c e o f th e c a s e an d i n l a w , t he C I T ( A ) h a s e r r e d i n n ot c o ns i de r i n g t h e s ub m i s s i on of t h e ap pe l l a nt c o m p a n y f i le d v i d e l e tt e r da t e d 27 . 12 . 2 01 7 be f o r e the as s e s s i n g o f fi c e r . 4 . Th a t t h e C I T (A ) h as e r r e d i n l a w i n i g n o r i n g the f a c t t ha t A O h ad pa s s e d t he a l l e g e d a s s e s s m e n t or d e r b y e r r on e o us l y c o ns i d e r i n g t h e r e pl y f i l e d b y t he a pp e l l a n t o n 2 7 . 1 2 . 20 17 a s fi l e d o n 1 4. 1 2 . 20 1 7 i n t he a s s e s s m e n t or de r a n d p a s s e d t h e as s e s s m e n t or d e r o n 2 6. 1 2 . 2 0 17 w i t ho ut c o n s i de r i n g t he r e pl y b y t h e a ppe l l a n t on 2 7. 1 2 . 2 0 17 . 5 . T h at t h e C I T ( A ) h as e r r e d i n d r a w i n g a c o nc l u s i on t ha t o n 0 8. 0 1 . 2 0 19 n o ne at t e n de d th e he a r i ng h o w e v e r t h e AR a tt e n de d t he h e ar i n g a n d f i l e d l e t t e r f o r a d j o u r n m e nt dr aw i n g a n o bs e r v a t i o n t h at n o n o n c o m p l ia n c e w a s m a d e o n t he s a i d d a t e . ” I TA N o. 9 89 / D e l / 2 0 2 0 A s s e s s m e n t Ye a r 2 01 6 - 1 7 “1 . T ha t o n t h e f a c t s an d c i r c u m s t a nc e s o f t h e c a s e a n d i n l aw , t he o r d e r p a s s e d by C I T (A ) - 8 , N e w D e l h i (h e r e i n a f t e r re f e r r e d t o a s C I T (A ) ), i s c o n t r ar y to t h e f ac t s a n d b ad i n l a w . 2 . T h a t on t h e f ac t s an d c i r c u m s t a nc e s of t h e c a s e a nd i n l a w , t he C I T ( A ) w a s no t j u s t i f i e d i n d i s m is s i ng t he a pp e al si n c e s uf f i c i e nt a nd pr o p e r o pp or tu n it y w as no t pr o v i d e d t o t h e ap pel l a nt d ur i ng t he c o ur s e of a p p e l l at e p r o c e e d i ng s . 3 . T h a t on t h e f ac t s an d c i r c u m s t a nc e s of t h e c a s e a nd i n l a w , t he a c ti o n o f t h e C I T -A i s no t ju s t i f i e d i n u p h o ld i n g the ac t i o n o f t h e A i n t r e a t i n g t he bu s i n e s s l os s c l ai m e d b y t he a pp e l la n t o n s al e of p r o pe r t y a m o u nt i n g t o R s . 4 , 48 , 5 2, 0 3 0/ - a s c a p i ta l lo s s w i th o ut c o ns i d e r i n g th e f a c t t ha t t h e b u s in e s s of t he a s s e ss e c o m p an y i s t o d e al i n t h e s a l e , p ur c ha s e , le a s e a n d de v e l op m e n t of i m m ov a bl e p r o pe r t i e s . I.T.A. No.2804/Del/2019 & 989/Del/2020 3 Th a t o n t he f a c t s a nd c i r c u m s t a n c e s of t he c as e a n d i n l a w , t he a c ti o n of t h e C I T ( A ) i s n o t j u s t i f i e d i n up h ol d i ng t he a c t i o n of A O by c o ns i d e r i n g t h e e x pe n s e s c l ai m e d o n ac c o un t of MC D p r o pe r ty t ax a m o un t i n g t o R s . 9, 8 5, 4 1 3/ - a s c a p i ta l e x p e ns e s i g nor i n g t h e f ac t t h at t he b u s i n e s s o f t h e as s e s s e e c om p a ny i s t o d e al i n t h e s al e , p ur c h a s e , l e as e an d d e v e l op m e n t of i m m o v a bl e p r o pe rt i e s . ” IT A N o. 2804/D el /2019 A ssess me nt Y ear 2015-16 3. When t he ma tter was ca lle d for hea ri ng, t he l d. counsel f or the assess ee submitted a t t he outset that the ad ditions ma de b y the A ssessi ng O fficer a mou nti ng t o Rs. 2, 28, 65, 687/- b y t reat ing the loss inc ur red on sale of prope rt y as c apita l l oss. 4. A ggrie ve d, the ass essee preferred appea l befo re t he CIT (A ). The C IT(A ) how eve r pass ed an e x- part e orde r wit hout disc ussi ng the merits of the case s ole ly for the reason t ha t the as sessee has fa il ed t o fi le r espons es to notices i s sue d on several o ccasi on s as tabu lat ed i n t he f ir st appel la te or der. 5. T o rebut the obs er vati ons of the CIT (A ), the l d. cou nsel adverted ou r at tention t o the adj ournme nt let te rs fi led a gains t eac h noti ces so i ssued. It w as conte nded tha t CIT (A ) has omitted t o take n ote of the re que st for adj ou rnm ent and it is not a case of no re pl y per se as alleged b y the C IT (A ). T he l d. counse l thus pleaded violation of pri nc iples of n atural j us tice and ur ge d f or re mi t ti ng the matter bac k for logica l conclus io n in t he matt er afte r consi derin g the re pl y of t he assess ee on merits. 6. In the l ight of the sub mi ss io ns mad e on behalf of the a ssessee and on pe rus al of t he case rec ords, w e find jus tific at ion in the plea advan ced on beha lf of the ass essee. It is no ticed that t he C IT (A ) has iss ued n ot ice s for heari ng on seve ral occ asi ons and the assessee has dul y re pl ie d on all occas ions and sought I.T.A. No.2804/Del/2019 & 989/Del/2020 4 adjo urnment. T o ou r mind, the C IT(A) a ct ed hur riedly wi thout gi vi ng prope r opp ort unit y. T here can be a variet y of reas ons f or non compl iance in such a s hort period. Havi ng re gard to t he fact that ass essee has dul y at tended be for e the A ssessi ng Offi ce r, it canno t be o rdi naril y pres umed t hat assess ee has w ill ful l y dis obe ye d the no ti ce of hea ring t o its ow n det ri me nt. C ouple d wit h these, the C IT (A ) has o ught to be adj udica ted t he appea l on mer its af te r e xa mi ning t he materi al on re co rd. H ence, g uided by the pri nci ples of obj ectivit y, fai rness a nd j us tice, we cons ide r i t j ust and prope r t o r emit t he matte r bac k t o t he fi le of t he C IT (A ) for fres h a dju dication i n accordance w ith law a fter gi vi ng pr ope r opportunit y to the assesse e. 7. T he fa cts in iss ue in ITA N o. 989/D el /2020 are s imi lar t o ITA N o. 2804 /D el/2019. T hus, t he observ at ions given s hall a ppl y m utatis m utandis. 8. In t he r esul t, b oth the ca pt ion ed appeals are all ow ed f or sta tis ti ca l purpos es . Order pronounced in the open Court on 18/09/2023. Sd/- Sd/- [CHALLA NAGENDRA PRASAD] [PRADIP KUMAR KEDIA] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 18/09/2023 Prabhat