M/s Nanobi Data and Analytics Pvt Ltd , Bangalore V. Income Tax Officer Ward-5(1)(1), Bangalore

ITA 996/BANG/2018

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 5888 (ITAT-BANGALORE)
• Duration Of Justice: 1 year(s) 29 day(s)
• Appeal Type: Income Tax (Transfer Pricing) Appeal
• Pronouncement Date: 01-05-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2014-2015
• Appeal Filed On: 02-04-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ABDUL HAKEEM M
• Assessee Lawyers: G S PRASHANTH
• Keywords: Opportunity of being heard; Principle of natural justice; Bad and doubtful debts; Set aside

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC-A BENCH : BANGALORE BEFORESHRI ARUN KUMAR GARODIA, ACCOUNTANT MEMBER ITA NO. 996 / BANG/201 8 ASSESSMENT YEAR : 20 1 4 - 15 M/S. NANOBI DATA AND ANALYTICS PVT. LTD., NO. 259, 2 ND FLOOR, 2 ND MAIN, 6 TH CROSS, INDIRANAGAR STAGE 1, BANGALORE 560 038. PAN: AADCN8822F VS. THE INCOME TAX OFFICER, WARD 5 [1] [1], BANGALORE. APPELLANT RESPONDENT APPELLANT BY : SHRI G.S. PRASHANTH, CA RESPONDENT BY : SHRI ABDUL HAKEEM .M, JCIT (DR) DATE OF HEARING : 2 5 . 0 4 .2018 DATE OF PRONOUNCEMENT : 04 . 0 5 .201 8 O R D E R PER SHRI A.K. GARODIA, ACCOUNTANT MEMBER THIS APPEAL IS FILED BY THE ASSESSEE WHICH IS DIREC TED AGAINST THE ORDER OF LD. CIT(A)-5, BANGALORE DATED 27.02.2018FOR ASSESSMENT YEAR 2014-15. 2. THE GROUNDS RAISED BY THE ASSESSEE ARE AS UNDER. 1. THE ORDER OF THE LEARNED COMMISSIONER OF INCOME- TAX [APPEALS] - 5, BENGALURU IN SO FAR IT IS AGAINST THE APPELLANT IS OPPOSED TO LAW, WEIGHT OF EVIDENCE, FACTS AND CIRCUMSTANCES OF THE APPELLANT'S CASE. 2. THE APPELLANT DENIES ITSELF LIABLE TO BE ASSESSE D ON A TOTAL INCOME OF RS. 23,89,605/-DETERMINED BY THE LEARNED ASSESSING OFFICER AND CONFIRMED BY THE LEARNED COMMISSIONER OF INCOME-TAX [APPEALS], AS AGAINST THE TOTAL LOSS DECLARED BY THE APPELLANT OF RS. 1,20,24,171/- ON THE FACTS AND CIRCUMSTANCES OF THE CASE. 3. THE EX-PARTE ORDER PASSED BY THE LEARNED COMMISS IONER OF INCOME- TAX [APPEALS] IS BAD IN LAW AS THE APPELLANT WAS NO T AFFORDED A REASONABLE OPPORTUNITY OF HEARING, WHICH IS IN GRAV E VIOLATION OF PRINCIPLES OF NATURAL JUSTICE SINCE THE APPELLANT R ECEIVED A NOTICE DATED 15/02/2018, FIXING THE DATE OF HEARING ON 08/ 03/2018, TO THE ITA NO.996/BANG/2018 PAGE 2 OF 3 SHOCK OF THE APPELLANT WHEN THE APPELLANT WENT FOR THE HEARING POSTED ON 08/03/2018 IT WAS INFORMED THAT AN EX-PARTE ORDE R HAS BEEN PASSED BEFORE THE ASSIGNED DATE FIXED FOR HEARING OF THE A PPEAL ON THE FACTS AND CIRCUMSTANCES OF THE CASE. 4. THE LEARNED COMMISSIONER OF INCOME-TAX [APPEALS] IS NOT JUSTIFIED IN CONFIRMING THE ADDITIONS MADE BY THE LEARNED ASS ESSING OFFICER AMOUNTING TO RS. 23,89,605/- BEING THE SALES RETURN CREDITED TO THE RESPECTIVE CUSTOMERS ACCOUNT WAS TREATED AS INCOME BY THE LEARNED ASSESSING OFFICER, ON THE FACTS AND CIRCUMSTANCES O F THE CASE. 5. THE LEARNED AUTHORITIES BELOW FAILED TO APPRECIA TE THAT THE SALES RETURN CREDITED TO THE RESPECTIVE CUSTOMERS ACCOUNT IS ON ACCOUNT OF THE REJECTION OF INVOICE AND THE PRODUCT BY THE CUS TOMERS AND CONSEQUENTLY THE SAME IS IN THE NATURE OF BAD DEBTS AS PRE THE PROVISIONS OF THE ACT, ON THE FACTS AND CIRCUMSTANC ES OF THE CASE. 6. THE LEARNED AUTHORITIES BELOW WERE NOT JUSTIFIED IN NOT TAKING INTO ACCOUNT OR CONSIDERING THE LOSS RETURNED BY THE APP ELLANT AMOUNTING TO RS. 1,20,24,171/ - ON THE FACTS AND CIRCUMSTANCE S OF THE CASE. THE LEARNED AUTHORITIES BELOW FAILED TO APPRECIATE THAT THE BOOKS OF THE APPELLANT HAS BEEN COMPULSORY AUDITED AND THE LEARN ED ASSESSING OFFICER AFTER HAVING ACCEPTED THE BOOKS AND OUGHT T O HAVE CONSIDERED AND ALLOWED THE LOSS DECLARED BY THE APPELLANT OF R S. 1,20,24,171/- ON THE FACTS AND CIRCUMSTANCES OF THE CASE. 7. THE APPELLANT DENIES ITSELF LIABLE TO BE CHARGED TO INTEREST UNDER SECTION 234 & 244 A OF THE INCOME TAX ACT UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE. FURTHER THE LEVY OF INTE REST UNDER SECTION 234 D & 244 A OF THE ACT IS ALSO BAD IN LAW AS THE PERIOD, RATE, QUANTUM AND METHOD OF CALCULATION ADOPTED ON WHICH INTEREST IS LEVIED ARE ALL NOT DISCERNIBLE AND ARE WRONG ON THE FACTS OF THE CASE. 8. THE APPELLANT CRAVES LEAVE TO ADD, ALTER, SUBSTI TUTE AND DELETE ANY OR ALL OF THE GROUNDS OF APPEAL URGED ABOVE. 9. FOR THE ABOVE AND OTHER GROUNDS TO BE URGED DURI NG THE HEARING OF THE APPEAL THE APPELLANT PRAYS THAT THE APPEAL BE A LLOWED IN THE INTEREST OF EQUITY AND JUSTICE. 3. AT THE VERY OUTSET, THE LD. AR OF ASSESSEE SUBMI TTED A COPY OF NOTICE OF HEARING DATED 15.02.2018 ISSUED BY THE LD. CIT(A) FIXING TH E DATE OF HEARING FOR THE PRESENT YEAR ON 08.03.2018. HE SUBMITTED THAT IN S PITE OF FIXING THE DATE OF HEARING ON 08.03.2018, CIT (A) HAS PASSED THE IMPUG NED ORDER ON 27.02.2018 AND HENCE, IT IS APPARENT THAT PROPER OPPORTUNITY O F HEARING WAS NOT PROVIDED BY CIT (A) AND THEREFORE, THE MATTER SHOULD BE RESTORE D BACK TO HIS FILE FOR FRESH ITA NO.996/BANG/2018 PAGE 3 OF 3 DECISION AFTER PROVIDING ADEQUATE OPPORTUNITY OF BE ING HEARD TO ASSESSEE. THE LD. DR OF REVENUE SUPPORTED THE ORDER OF CIT(A). 4. I HAVE CONSIDERED THE RIVAL SUBMISSIONS AND I FI ND FORCE IN THE SUBMISSIONS OF LD. AR OF ASSESSEE BECAUSE THE LD. CIT(A) HAS ISSUE D A NOTICE OF HEARING TO ASSESSEE FIXING THE DATE OF HEARING AS 08.03.2018 B UT THE IMPUGNED ORDER WAS PASSED BY HIM ON 27.02.2018. HENCE, THIS ORDER IS W ITHOUT PROVIDING ADEQUATE OPPORTUNITY OF BEING HEARD TO ASSESSEE AND THEREFOR E, I SET ASIDE THE ORDER OF CIT(A) AND RESTORE THE MATTER BACK TO HIS FILE FOR FRESH DECISION AFTER PROVIDING REASONABLE OPPORTUNITY OF BEING HEARD TO BOTH SIDES . IN VIEW OF THIS, NO ADJUDICATION IS CALLED FOR REGARDING THE MERIT OF T HE CASE AT THE PRESENT STAGE. 5. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THE DATE MENT IONED ON THE CAPTION PAGE. SD/- (ARUN KUMAR GARODIA) ACCOUNTANT MEMBER BANGALORE, DATED, THE 04 TH MAY, 2018. /MS/ COPY TO: 1. APPELLANT 4. CIT(A) 2. RESPONDENT 5. DR, ITAT, BANGALORE 3. CIT 6. GUARD FILE BY ORDER SENIOR PRIVATE SECRETARY, INCOME TAX APPELLATE TRIBUNAL, BANGALORE.