ANAGJEE INVESTMENTS & LEASING P. LTD, V. ITO - 1(2)(3),

MA 188/MUM/2011

• Counselvise Citation: [2012] 123 COUNSELVISE.COM (IT) 9158 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 6 month(s) 1 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 26-09-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2003-2004
• Appeal Filed On: 25-03-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: SATENDRA PANDEY

Judgement Text

MA NOS 188 & 189 OF 2011 NAGJEE INVESTMENTS & LEASI NG PVT LTD MUMBAI PAGE 1 OF 5 IN THE INCOME TAX APPELLATE TRIBUNAL 'B' BENCH, MUMBAI BEFORE SHRI D. MANMOHAN, VICE PRESIDENT AND SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER M.A.NO. 188/MUM/2011 (ARISING OUT OF ITA NO.342/MUM/2007) (ASSESSMENT YEAR: 2003-04) M/S NAGJEE INVESTMENT & LEASING PVT. LTD, WADALA ROAD, DWARKA CIRCLE, NASHIK PAN: AAACN 5523 C VS. INCOME TAX OFFICER 1(2)3 MUMBAI (APPELLANT) (RESPONDENT) M.A.NO. 189/MUM/2011 (ARISING OUT OF ITA NO.341/MUM/2007) (ASSESSMENT YEAR: 2003-04) M/S NAGJEE HOTELS PVT. LTD, WADALA ROAD, DWARKA CIRCLE, NASHIK PAN: AAACN 5523 C VS. INCOME TAX OFFICER 1(2)3 MUMBAI (APPELLANT) (RESPONDENT ASSESSEE BY: SHRI K.GOPAL & SHRI SATENDRA PANDEY DEPARTMENT BY: MS. NEERAJA PRADHAN, DR DATE OF HEARING: 31/08/2012 DATE OF PRONOUNCEMENT: 26/09/2012 O R D E R PER B. RAMAKOTAIAH, A.M. THESE TWO MISCALLENEOUS APPLICATIONS BY THE SAME DI RECTOR, DR. VIJAY S. GHATGE ON BEHALF OF THE TWO COMPANIES WERE HEARD TOGETHER FOR THE SAKE OF CONVENIENCE. THE APPEALS F ILED BY THE RESPECTIVE ASSESSEES WERE DISMISSED ON 8 TH NOVEMBER, 2008 FOR WANT OF PROSECUTION BY ASSESSEE. IT IS ALSO STATED THAT THE ORIGINAL CHALLAN FOR PAYMENT OF TRIBUNAL FEES WAS NOT ENCLOS ED AND THE LETTER MA NOS 188 & 189 OF 2011 NAGJEE INVESTMENTS & LEASI NG PVT LTD MUMBAI PAGE 2 OF 5 ISSUED TO ASSESSEE TO FILE ORIGINAL CHALLAN WAS ALS O NOT COMPLIED WITH. FOR THE REASONS STATED THEREIN, BOTH THE APPE ALS WERE DISMISSED AS UNADMITTED. 2. ASSESSEE DIRECTOR PREFERRED PRESENT APPLICATIONS SE EKING TO RECALL THE ORDERS. IN THIS REGARD THE DIRECTOR HAS FILED AN AFFIDAVIT STATING THE FOLLOWING EXPLAINING THE REASONS WHY AS SESSEE COULD NOT APPEAR WHEN THE CASES WERE TAKEN. FOR THE SAKE OF R ECORD, THE AFFIDAVIT FILED IN THE CASE OF NAGJEE INVESTMENTS A ND LEASING PRIVATE LIMITED IS EXTRACTED AS UNDER: A. I AM A DIRECTOR OF NAGJEE INVESTMENTS & LEASING PVT. LTD (COMPANY) WHICH WAS CARRYING ON THE BUSINESS AT WADALA ROAD, DWARKA CIRCLE, NASHIK. B. THE COMPANY HAD FILED APPEAL UNDER SECTION 253 T O THE INCOME-TAX APPELLATE TRIBUNAL, MUMBAI (ITA NO.342/MUM/2007) AGAINST ORDER OF THE CIT (APPEALS) -I MUMBAI CONFIRMING PENALTY OF ` .10,38,232/- UNDER SECTION 271(1(C) LEVIED ON IT FOR ASSESSMENT YEAR 2003-04. C. THE ITAT DISMISSED THE SAID APPEAL BY ITS ORDER DATED 28 TH NOVEMBER, 2008 AS NO ONE, ON BEHALF OF THE COMPANY APPEARED BEFORE IT FOR HEARING. D. THE NON-APPEARANCE WAS DUE TO SUFFICIENT CAUSES BEYOND ITS CONTROL AS DETAILED HEREUNDER: 1. ON ACCOUNT OF DEFAULT IN PAYING EMIS AGAINST LOA N FROM THE C.K.P. COOPERATIVE BANK LTD, THE SAID BANK FORC IBLY OCCUPIED THE COMPANYS PREMISES AND TOOK OVER THE COMPANYS DAY-TO-DAY ADMINISTRATION AND DENIED TO T HE DIRECTORS ENTRY TO THE COMPANYS PREMISES AND ACCES S TO ITS RECORDS. THE NOTICES, LETTERS AND ORDERS UNDER THE I.T. ACT RECEIVED AT NASHIK BY THE BANKS OFFICIALS FROM TIME TO TIME, IN MOST CASES WERE EITHER NOT PASSED ON AT AL L TO THE COMPANYS DIRECTORS OR HANDED OVER TO THEM AFTER INORDINATE DELAY. 2. HOWEVER, THE BANKS OFFICIALS, AS AND WHEN THEY DESIRED, GOT CERTAIN APPEAL FORMS SIGNED BY ONE OR OTHER DIRECTOR OF THE COMPANY. BUT THEY FAILED TO FURNISH THE DIRECTORS WITH THE APPELLATE ORDERS AS AND WHEN REC EIVED AT THE NASHIK ADDRESS OF THE COMPANY. MA NOS 188 & 189 OF 2011 NAGJEE INVESTMENTS & LEASI NG PVT LTD MUMBAI PAGE 3 OF 5 3. IT WAS IN SUCH CIRCUMSTANCES THAT THE COMPANY AN D ITS DIRECTORS NEVER RECEIVED FROM THE BANKS OFFICIALS THE NOTICE FOR HEARING OF THE SUBJECT APPEAL BY THE ITA T AND ALSO THE TRIBUNAL ORDER DATED 28 TH NOVEMBER, 2008 DISMISSING THE APPEAL. 4. THE C.K.P. COOPERATIVE BANK LTD SOLD THE COMPANY S PREMISES AND ASSETS IN FEBRUARY, 2009 TO SAHYADRI HOSPITALS LTD AND APPROPRIATED THE ENTIRE SALE PROC EEDS TOWARDS LOANS OUTSTANDING AND DUE BY THE COMPANY. 5. AFTER SPENDING LOT OF TIME AND PERSONAL EFFORTS, THE DIRECTORS MANAGED TO GET FROM SAHYADRI HOSPITALS LT D COPIES OF SOME OF THE ASSESSMENT AND APPELLATE ORDE RS RELATING TO THE COMPANY INCLUDING THE TRIBUNAL ORDE R IN ITA NO.342/MUM/2007 LEFT BY THE C.K.P. BANK IN THE PREMISES AT NASHIK. 6. THE DIRECTORS, BEING WHOLE-TIME MEDICAL PRACTITI ONERS, HAVING LOST ALL THE ASSETS OF THE COMPANY AND LEFT WITHOUT ANY OFFICE FACILITIES AND PROFESSIONAL CONSULTANTS WERE NOT AWARE AS TO WHAT STEPS NEEDED TO BE TAKEN WITH REGA RD TO THE TRIBUNALS ORDER. 7. THE DIRECTORS, IN FACT, WERE APPRISED OF THE REC OVERY PROCEEDINGS INITIATED AGAINST THE COMPANY AND THE PUNITIVE MEASURES CONTEMPLATED AGAINST THEM ONLY IN DECEMBER, 2010 AFTER THEY WERE FURNISHED WITH COPIE S OF ITO'S RECOVERY NOTICES (DATED 8.2.2010). 8. IT TOOK MORE THAN TWO MONTHS TO COLLECT AND COMP ILE WHATEVER COPIES OF RECORDS AND DOCUMENTS WERE AVAIL ABLE WITH DIRECTORS REQUIRED FOR SEEKING LEGAL ADVICE AN D TO DRAFT THE MISCELLANEOUS APPLICATION. 9. IT IS IN THE ADVERSE CIRCUMSTANCES AND FOR REASO NS BEYOND THE CONTROL OF THE DIRECTORS EXPLAINED HEREI NABOVE THAT THE LAPSES/DEFAULTS SUCH AS NON-COMPLIANCE WIT H NOTICES AND NON-APPEARANCE AT THE HEARINGS BEFORE A O, THE FIRST/SECOND APPELLATE AUTHORITIES OCCURRED. 3. SUBSEQUENTLY IN THE COURSE OF HEARING THE DIRECTOR ALSO FILED THE FOLLOWING AFFIDAVIT CONFIRMING THE ADDRESS TO W HICH THE NOTICES ARE TO BE SENT: I, DR. VIJAY SHRIKANT GHATGE, AGED ABOUT 57 YEARS, RESIDING AT NIRAMAY, PLOT NO.5 & 6, MATOSHREE NAGAR , MA NOS 188 & 189 OF 2011 NAGJEE INVESTMENTS & LEASI NG PVT LTD MUMBAI PAGE 4 OF 5 TIDKEY COLONY, NASHIK 422002 DO HEREBY ON SOLEMN AFFIRMATION WANT TO STATE AS UNDER: 1. THAT I AM THE DIRECTOR OF NAGJEE HOTELS PRIVATE LIMITED AND THE FOLLOWING ADDRESS MAY BE TREATED AS ADDRESS OF THE COMPANY: NIRAMAY, PLOT NOS.5 & 6 MATOSHREE NAGAR, TIDKEY COLONY, NASHIK 422 002 2. THAT DUE TO UNFORTUNATE CIRCUMSTANCES MENTIONED IN THE MISCELLANEOUS APPLICATION, HON'BLE APPELLATE TRIBUNAL HAS PASSED THE ORDER EX-PARTE. 3. THAT WE HAVE APPOINTED N.J. NATHAN & CO. CHARTER ED ACCOUNTANTS FRO TAKING CARE OF ALL THE TAX PROCEEDI NGS AND TO RECEIVE NOTICES ISSUED BY ANY AUTHORITY INCL UDING THE INCOME TAX APPELLATE TRIBUNAL. 4. THAT I UNDERTAKE TO ATTEND WITH DILIGENCE THE PROCEEDINGS, IF ANY, INITIATED AGAINST THE COMPANY UNDER THE INCOME TAX ACT, 1961. 5. THAT WHATEVER STATED HEREINABOVE IS TRUE TO THE BEST OF MY KNOWLEDGE. 4. AFTER HEARING THE LEARNED COUNSEL AND THE LEARNED D R, WE ARE OF THE OPINION THAT ASSESSEE HAS BONAFIDE REASONS F OR NOT APPEARING ON THE DAY OF POSTING AND THEREFORE, THE ORDERS PAS SED DISMISSING THE APPEALS AS UN-ADMITTED ARE RECALLED TO HEAR THE M ON MERITS, SUBJECT TO PROVIDING PROOF OF PAYMENT OF FEE. 5. ASSESSEES COUNSEL HOWEVER, IN THE COURSE OF THE AR GUMENTS SUBMITTED THAT THE CHALLANS FOR PAYMENT OF APPEAL F EES COULD NOT BE LOCATED YET AND IN CASE THEY ARE NOT LOCATED, THEY WOULD UNDERTAKE TO PAY THE FEES AGAIN. THEREFORE, ASSESSEE IS DIREC TED TO FURNISH THE ORIGINAL CHALLAN AS PROOF OF PAYMENT OF TRIBUNAL FE ES AND IN THE ABSENCE THERE OF, TO REMIT THE FEES AS PER RULES SO THAT THE APPEALS CAN BE TAKEN UP ON MERITS. MA NOS 188 & 189 OF 2011 NAGJEE INVESTMENTS & LEASI NG PVT LTD MUMBAI PAGE 5 OF 5 6. SUBJECT TO PRODUCTION OF EVIDENCE FOR PAYMENT OF FE ES AS STATED ABOVE, THE REGISTRY IS DIRECTED TO POST THE CASE IN DUE COURSE AFTER SERVING NOTICES TO THE PARTIES. 7. IN THE RESULT, MISCELLANEOUS APPLICATIONS FILED BY ASSESSEE ARE TREATED AS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 26 TH SEPTEMBER, 2012. SD/- SD/- (D. MANMOHAN) (B. RAMAKOTAIAH) VICE-PRESIDENT ACCOUNTANT MEMBER MUMBAI, DATED 26 TH SEPTEMBER, 2012. VNODAN/SPS COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CONCERNED CIT(A) 4. THE CONCERNED CIT 5. THE DR, B BENCH, ITAT, MUMBAI BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCHES, MUMBAI