Dr. Vinay Tilokchand Karnawat, Aurangabad V. ITO Wd-1[2] Aurangabad, Aurangabad

MA 30/PUN/2012

• Counselvise Citation: [2013] 124 COUNSELVISE.COM (IT) 1287 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 9 month(s) 13 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 11-12-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: misc
• Appeal Filed On: 27-02-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MRS SHAILAJA RAI
• Assessee Lawyers: DR VINAY KARNAWAT
• Section: 147; 27; 148; 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES B, PUNE BEFORE SHRI G.S. PANNU, ACCOUNTANT MEMBER AND SHRI R.S. PADVEKAR, JUDICIAL MEMBER MA NO. 30/PN/2012 (ARISING OUT OF ITA NOS. 104 TO 110/PN/2011) (ASSESSMENT YEARS : 1997-98 TO 2003-04) DR. VINAY TRILOKCHAND KARNAWAT, ANAND HOSPITAL, BHOKARDAN ROAD, SILLOD, DIST.- AURANGABAD PAN : ABGPK0213L . APPELLANT VS. INCOME TAX OFFICER, WARD 1(2), AURANGABAD. . RESPONDENT APPELLANT BY : MR. (DR.) VINAY KARNAWAT RESPONDENT BY : MRS. SHAILAJA RAI ORDER PER G. S. PANNU, AM THE PRESENT MISCELLANEOUS APPLICATION HAS BEEN PREF ERRED BY THE ASSESSEE IN RESPECT OF A CONSOLIDATED ORDER DATED 3 0.03.2011 PASSED BY THE TRIBUNAL IN THE CAPTIONED APPEALS PREFERRED BY THE ASSESSEE FOR ASSESSMENT YEARS 1997-98 TO 2003-04. 2. THE PLEA OF THE PETITIONER IS THAT CERTAIN MISTA KES APPARENT WITHIN THE MEANING OF SECTION 254(2) OF THE INCOME TAX ACT, 19 61 (IN SHORT THE ACT) HAS CREPT-IN THE ORDER OF THE TRIBUNAL DATED 30.03.2011 (SUPRA) WHEREBY THE APPEALS OF THE ASSESSEE HAVE BEEN DISMISSED ON A MI SCONCEPTION AND NON- CONSIDERATION OF CERTAIN GROUNDS AND FACTS ON RECOR D. IN SUPPORT OF THE MISCELLANEOUS APPLICATION, THE PETITIONER HAS APPEA RED IN PERSON ON VARIOUS DATES OF HEARING AND HAS FILED WRITTEN SUBMISSIONS AND ALSO AN AFFIDAVIT. THE LEARNED DEPARTMENTAL REPRESENTATIVE, ON THE OTHER H AND, HAS RELIED UPON THE ORDER OF THE TRIBUNAL TO POINT OUT THAT THERE ARE N O MISTAKES SO AS TO BE RECTIFIED U/S 254(2) OF THE ACT. MA NO. 30/PN/2012 3. THE RIVAL PARTIES HAVE MADE THEIR SUBMISSIONS IN THE ABOVE BACKGROUND AND THE RELEVANT MATERIAL ON RECORD HAS BEEN PERUSE D. THE FIRST POINT MADE OUT BY THE ASSESSEE IS IN RELATION TO THE FOLLOWING GROUND OF APPEAL NO.1 RELATING TO THE ASSESSMENT YEARS 1997-98 TO 2002-03 :- ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A), AURANGABAD WAS NOT JUSTIFIED IN HOLDING THAT THE AC TION TAKEN BY THE AO U/S 147 FOR REOPENING AND REASSESSMENT WAS JUSTIFIED. THE ACTION TAKEN U/S 147 WAS NOT JUSTIFIED AND IS BAD IN LAW. IN VIEW OF TH IS THE ASSESSMENTS COMPLETED BY THE AO ARE ILLEGAL AND WITHOUT JURISDICTION. 4. THE AFORESAID GROUND OF APPEAL NO.1 CHALLENGING THE INITIATION OF PROCEEDINGS U/S 147/148 FOR ASSESSMENT YEARS 1997-9 8 TO 2002-03 HAS BEEN ADJUDICATED BY THE TRIBUNAL BY WAY OF PARA 7 OF ITS ORDER DATED 30.03.2011 (SUPRA). THE TRIBUNAL DISMISSED THE SAID GROUND FO R THE REASON THAT THE SAME WAS NOT PRESSED BY LEARNED COUNSEL DURING THE COURS E OF HEARING. 5. BEFORE US, THE APPELLANT, APPEARING IN PERSON HA S POINTED OUT THAT HE HAD NOT WITHDRAWN THE SAID GROUND AND NOT EVEN ACCO RDED PERMISSION TO HIS THE THEN COUNSEL TO WITHDRAW THE SAME AS THE SAME W AS NEVER ASKED FOR FROM HIM. IN THIS CONNECTION, THE PETITIONER FURTHER SU BMITTED THAT HE HAD BEEN ALL ALONG PRESSING HIS OBJECTIONS TO THE INITIATION OF PROCEEDINGS BY ISSUANCE OF NOTICE U/S 147/148 OF THE ACT EVEN BEFORE THE CIT(A ) AND THEREFORE, THE DISMISSAL OF THE GROUND BY THE TRIBUNAL IS ON A MIS CONCEPTION ATTRIBUTABLE TO THE COUNSEL, WHICH CONSTITUTES A MISTAKE WITHIN THE MEANING OF SECTION 254(2) OF THE ACT. IN THE COURSE OF HEARING, THE APPELLAN T HAS ALSO FURNISHED A DULY SWORN AFFIDAVIT AVERRING THAT HE HAD NOT GIVEN PERM ISSION TO HIS AUTHORISED REPRESENTATIVE TO WITHDRAW THE SAID GROUND AND THAT HIS AUTHORIZED REPRESENTATIVE NEVER SOUGHT HIS INSTRUCTIONS TO WIT HDRAW SAID IMPORTANT GROUND. THE APPELLANT PETITIONER ALSO SUBMITTED THA T THE DISMISSAL OF THE GROUND HAS RESULTED IN MISCARRIAGE OF JUSTICE AND T HE ORDER OF THE TRIBUNAL DATED 30.03.2011 (SUPRA) DESERVES TO BE RECALLED AN D GROUND CHALLENGING ISSUE OF NOTICE U/S 148 MAY BE ADJUDICATED ON MERIT S. THE PETITIONER VEHEMENTLY POINTED OUT THAT THE PROCEEDINGS WERE IN ITIATED U/S 147/148 OF THE MA NO. 30/PN/2012 ACT ON THE BASIS OF STATEMENT OBTAINED DURING THE S URVEY WHICH WAS RETRACTED LATER AND THEREFORE SAME IS INVALID. 6. THE LEARNED DEPARTMENTAL REPRESENTATIVE HAS MERE LY STATED THAT THE ORDER OF THE TRIBUNAL DOES NOT REQUIRE ANY ALTERATI ON IN TERMS OF SECTION 254(2) OF THE ACT ON THIS ASPECT, SO HOWEVER, THE BONAFIDE S OF THE AVERMENTS MADE BY THE APPELLANT PETITIONER HAVE NOT BEEN ASSAILED. 7. HAVING CONSIDERED THE ENTIRE CONSPECTUS OF FACTS , IT IS QUITE APPARENT THAT THE CASE OF THE ASSESSEE CHALLENGING THE INITI ATION OF PROCEEDINGS U/S 147/148 OF THE ACT HAS BEEN DEALT WITH BY THE TRIBU NAL ON A MISCONCEPTION, AS EMERGING FROM THE AFFIDAVIT FILED BY THE APPELLANT PETITIONER IN THE COURSE OF HEARING BEFORE US. IT IS A TRITE LAW THAT DISPENSA TION OF JUSTICE SHOULD NOT SUFFER ON ACCOUNT OF A FAULT WHICH IS NOT ATTRIBUTABLE TO AN ASSESSEE-SUBJECT. THE BONAFIDES OF THE AVERMENT MADE BY THE APPELLANT PET ITIONER ARE NOT ASSAILED BEFORE US. CONSIDERING SUCH PECULIAR CIRCUMSTANCES OF THE CASE, IN OUR CONSIDERED OPINION, IT WOULD MERIT INDULGENCE U/S 2 54(2) OF THE ACT TO HOLD THAT THE GROUND OF APPEAL NO.1 WAS DISMISSED BY THE TRIB UNAL ON THE BASIS OF A WRONG PLEA MADE ON BEHALF OF THE ASSESSEE AND THERE FORE IT CONSTITUTES AN ERROR WITHIN THE MEANING OF SECTION 254(2) OF THE A CT. AS A RESULT, WE HOLD THAT THE ORDER OF THE TRIBUNAL QUA THE ADJUDICATION ON G ROUND OF APPEAL NO. 1 RELATING TO INITIATION OF PROCEEDINGS U/S 147/148 O F THE ACT IS HEREBY RECALLED AND THE APPEALS ARE REINSTITUTED FOR ADJUDICATION A FRESH. 8. ANOTHER ISSUE RAISED BY THE ASSESSEE IS WITH REG ARD TO THE GROUND OF APPEAL NO. 2, WHICH IS REPRODUCED HEREUNDER :- ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) WAS NOT JUSTIFIED IN ESTIMATING THE ADDITION @ 7.5% OF THE GROSS RECEIPTS DISCLOSED BY THE ASSESSEE AS AGAINST ESTIMATED BY T HE AO @ 50%. IN VIEW OF THE BOOKS HAVING MAINTAINED AND CONFIRMED BY THE HO NBLE HIGH COURT IN TAX APPEAL NOS. 62 TO 70 OF 2005, THE RESULTS DISCLOSED ACCEPTED AND ADDITIONS BE DELETED. MA NO. 30/PN/2012 9. ON THIS ASPECT, THE APPELLANT/PETITIONER SUBMIT TED IN THE COURSE OF HEARING THAT THE TRIBUNAL WHILE ADJUDICATING THE AF ORESAID GROUND DID NOT NOTICE THAT THE POINTS RAISED BY THE REVENUE WERE S IMILAR TO THOSE RAISED WHILE LEVYING PENALTY FOR NON-MAINTENANCE OF BOOKS U/S 27 1A OF THE ACT AND THE SAME HAVE BEEN ADJUDICATED IN FAVOUR OF THE ASSESSE E BY THE PUNE BENCH OF THE TRIBUNAL IN THE ASSESSEES OWN CASE IN ITA NOS. 729 TO 734/PN/2005 DATED 31.05.2005 AND THE SAME HAVE BEEN UPHELD BY T HE HONBLE BOMBAY HIGH COURT VIDE ORDER DATED 26.02.2009. THE APPELL ANT SUBMITTED THAT NON- CONSIDERATION OF THE AFORESAID ASPECT CONSTITUTES A MISTAKE APPARENT FROM RECORD. EVEN WITH REGARD TO UPHOLDING THE ESTIMATI ON OF INCOME, THE ASSESSEE POINTED OUT THAT TRIBUNAL AFFIRMED THE OBSERVATIONS OF THE CIT(A) WHICH WERE FACTUALLY WRONG. IN THIS CONNECTION, REFERENCE WAS MADE TO PARA 5 (XI) OF THE ORDER OF CIT(A) WHEREIN REFERENCE WAS MADE TO ANNEX URE- A OF THE ASSESSMENT ORDER STATING THAT THE IMPOUNDED BILL BO OK NO. 10 SHOWED TOTAL RECEIPTS OF RS.1,70,619/- AS AGAINST RECEIPTS RECOR DED IN THE CASH BOOK OF RS.51,505/- ONLY. IN THIS CONNECTION, IT WAS POINT OUT WITH REFERENCE TO THE ANNEXURE- A OF THE ASSESSMENT ORDER THAT THE TOTAL RECEIPTS OF IMPOUNDED BILL BOOK NO.10 MENTIONED THEREIN IS RS.89,245/- AND NOT RS.1,70,619/-. THEREFORE, ACCORDING TO HIM THE ESTIMATION MADE BY THE CIT(A) AND WHICH HAS BEEN AFFIRMED BY THE TRIBUNAL IS ON A WRONG BASIS A ND THEREFORE THE SAME CONSTITUTES A MISTAKE APPARENT FROM RECORD. IT IS SUBMITTED THAT ON ACCOUNT OF THE AFORESAID ERRORS, THE ORDER OF THE TRIBUNAL BE RECALLED AND MATTER MAY BE HEARD AFRESH ON MERITS. 10. THE LEARNED DEPARTMENTAL REPRESENTATIVE WHILE N OT CONTROVERTING FACTUAL MISTAKES POINTED OUT BY THE ASSESSEE, SUBMI TTED THAT THE TRIBUNAL HAS NOT COMMITTED ANY ERROR IN THE ORDERS WITHIN THE ME ANING OF SECTION 254(2) OF THE ACT. 11. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSI ONS. ON THIS ASPECT, WE FIND THAT THE TRIBUNAL PROCEEDED TO AFFIRM THE CONC LUSION OF THE ASSESSING MA NO. 30/PN/2012 OFFICER AS WELL AS THE CIT(A) THAT THE BOOKS OF ACC OUNT WERE NOT RELIABLE AND THEREFORE THE INCOME WAS REQUIRED TO BE ESTIMATED. FURTHER, THE ESTIMATION AS MADE BY THE CIT(A) WAS AFFIRMED BY THE TRIBUNAL. N OW, BY WAY OF THE PRESENT PETITION IT IS SOUGHT TO BE MADE OUT THAT A PLEA HA S BEEN RAISED IN THE GROUND OF APPEAL ITSELF THAT BOOKS HAVING BEEN MAINTAINED AND CONFIRMED BY THE HONBLE HIGH COURT IN TAX APPEAL NOS. 62 TO 70 OF 2 005, THE BOOK RESULTS BE ACCEPTED. THE SAID ASPECT HAS NOT BEEN ADJUDICATED . WE FIND THAT THE SAID PLEA DOES APPEAR IN THE GROUND OF APPEAL RAISED BY THE ASSESSEE AND THE NON-CONSIDERATION OF THE SAME, IN OUR VIEW, CONSTIT UTES A MISTAKE APPARENT FROM RECORD WITHIN THE MEANING OF SECTION 254(2) OF THE ACT. HAVING REGARD TO THE JUDGMENTS OF THE HONBLE ALLAHABAD HIGH COURT I N THE CASE OF CIT VS. K. M. SUGAR MILLS (P.) LTD., 275 ITR 247 AND THAT OF THE HONBLE RAJASTHAN HIGH COURT IN THE CASE OF CIT VS. RAMESH CHAND MODI, 249 ITR 323, AN OMISSION TO CONSIDER THE SAID GROUND, WHICH APPEARS IN THE M EMORANDUM OF APPEAL FILED BY THE ASSESSEE, IS A MISTAKE APPARENT FROM R ECORD WITHIN THE MEANING OF SECTION 254(2) OF THE ACT AND THEREFORE WE DEEM IT APPROPRIATE TO RECALL THE ORDER OF THE TRIBUNAL DATED 30.03.2011 (SUPRA). 12. IN VIEW OF THE AFORESAID DISCUSSION, THE ORDER OF THE TRIBUNAL DATED 30.03.2011 (SUPRA) IS RECALLED AND THE CAPTIONED AP PEALS OF THE ASSESSEE ARE RE-INSTITUTED FOR ADJUDICATION AFRESH ON MERITS. A CCORDINGLY, THE REGISTRY IS DIRECTED TO POST THE CAPTIONED APPEALS OF THE ASSES SEE IN DUE COURSE BEFORE THE REGULAR BENCH AFTER ISSUANCE OF NOTICE OF HEARI NG TO BOTH THE PARTIES. 13. IN THE RESULT, THE MISCELLANEOUS APPLICATION OF THE ASSESSEE IS ALLOWED, AS ABOVE. ORDER PRONOUNCED IN THE OPEN COURT ON 11 TH DECEMBER, 2013. SD/- SD/- (R.S. PADVEKAR) (G.S. PANNU) JUDICIAL MEMBER ACCOUNTANT MEMBER PUNE, DATED: 11 TH DECEMBER, 2013 SUJEET MA NO. 30/PN/2012 COPY OF THE ORDER IS FORWARDED TO : - 1) THE ASSESSEE; 2) THE DEPARTMENT; 3) THE CIT(A), AURANGABAD; 4) THE CIT, AURANGABAD; 5) THE DR, B BENCH, I.T.A.T., PUNE; 6) GUARD FILE. BY ORDER //TRUE COPY// SR. PRIVATE SECRETARY I.T.A.T., PUNE