SONAL ROPES P. LTD, V. ITO 2(1)(3),

MA 483/MUM/2011

• Counselvise Citation: [2012] 123 COUNSELVISE.COM (IT) 8206 (ITAT-MUMBAI)
• Duration Of Justice: 7 month(s) 6 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 27-04-2012
• Appeal Filed By: Assessee
• Bench Allotted: E
• Assessment Year: misc
• Appeal Filed On: 20-09-2011
• Court: TRIBUNAL
• Department Lawyers: A K NAYAK
• Assessee Lawyers: K R LAKSHMI NARAYANAN
• Keywords: Reasonable cause; Right to appeal

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH E BEFORE SHRI D. MANMOHAN (VP) & SHRI P.M. JAGTAP (AM ) M.A. NO. 483/MUM/2011 IN M.A. NO. 711/MUM/2010 IN I.T.A.NOS. 1212 & 1213/MUM/2008 (ASSESSMENT YEAR : 2003-04 & 2004-05) M.A. NO. 111/MUM/2012 IN I.T.A.NO. 1212/MUM/2008 (ASSESSMENT YEAR : 2003-04) M.A. NO. 112/MUM/2012 IN I.T.A.NO. 1213/MUM/2008 (ASSESSMENT YEAR : 2004-05) M/S. SONAL ROPES PVT. LTD. 2-NE, LAXMI INDUSTRIAL ESTATE NEW LINK ROAD ANDHERI WEST MUMBAI-400 053. VS. ITO 2(1)(2) AAYAKAR BHAVAN M.K. ROAD MUMBAI-400 020. APPELLANT RESPONDENT PAN/GIR NO. : AAACS6292F ASSESSEE BY : SHRI K.R. LAKSHMINARAYANAN DEPARTMENT BY : SHRI A.K. NAYAK DATE OF HEARING : 20.4.2012 DATE OF PRONOUNCEMENT : ORDER PER D.MANMOHAN (VP) :- THESE MISCELLANEOUS APPLICATIONS ARE FILED AT THE INSTANCE OF THE ASSESSEE-COMPANY AND THEY PERTAIN TO A.Y. 2003-04 & 2004-05. 2. BEFORE DEALING WITH THE REASONS GIVEN IN THE IMP UGNED PETITIONS IT MAY BE NECESSARY TO SETOUT THE FACTS AND CIRCUMSTAN CES WHICH NECESSITATED THE ASSESSEE-COMPANY TO PREFER THESE M ISCELLANEOUS APPLICATIONS. THE ASSESSEE PREFERRED TWO APPEALS P ERTAINING TO A.Y. 2003-04 & 2004-05 AND THE SAME WERE NUMBERED AS ITA NO. 1212 & M/S. SONAL ROPES PVT. LTD. 2 1213 OF 2008 RESPECTIVELY. THOUGH APPEALS WERE FILE D ON 18.2.2008, WHEN THE CASES WERE LISTED FOR HEARING NONE-APPEARED ON BEHALF OF THE ASSESSEE. VIDE ORDER DATED 8.7.2009 APPEALS FILED BY THE ASSESSEE WERE DISMISSED AS UN-ADMITTED. DETAILED REASONS CAN BE S EEN IN PARAGRAPH 3 TO 6 OF THE AFOREMENTIONED ORDER. 3. AGGRIEVED BY THE COMMON ORDER PASSED BY THE ITAT , THE ASSESSEE- COMPANY FILED ONE MISCELLANEOUS APPLICATION WHICH W AS NUMBERED AS M.A. NO. 711/MUM/2010. WHEN THE CASE WAS LISTED FOR HEARING THE ITAT E BENCH, MUMBAI ANALYZED THE FACTS AND CIRCUMSTAN CES OF THE CASE, AFTER HEARING BOTH THE PARTIES, TO COME TO A CONCLU SION THAT THE EX-PARTE ORDER PASSED BY THE TRIBUNAL DO NOT DESERVE TO BE R ECALLED SINCE THE ASSESSEE HAS NOT FURNISHED SUFFICIENT REASONS IN SU PPORT OF SUCH A REQUEST. IN THIS REGARD THE BENCH OBSERVED THAT TH E APPEAL PAPERS WERE NOT SIGNED BY THE MANAGING DIRECTOR AND THERE WERE SHORT PAYMENT OF INSTITUTION FEES BUT THE ASSESSEE DID NOT CHOOSE TO RECTIFY THE DEFECTS. THE BENCH ALSO OBSERVED THAT EVEN ON MERITS OF THE CASE , REPRESENTATIVE APPEARING FOR THE ASSESSEE COULD NOT POINT OUT AS T O WHY THE DISALLOWANCES MADE BY THE ASSESSING OFFICER ARE NOT IN ACCORDANCE WITH LAW. THE CASE OF THE LEARNED COUNSEL WAS THAT NO M ANAGING DIRECTOR WAS APPOINTED BY THE ASSESSEE-COMPANY AND HENCE SIGNATU RE OF THE DIRECTOR MEETS REQUIREMENT OF LAW AND IT WAS ALSO SUBMITTED THAT SUBSEQUENT TO THE DISMISSAL OF THE APPEAL, INSTITUTION FEES FOR A .Y. 2003-04 WAS PAID. MEETING THE ABOVE CONTENTIONS THE BENCH OBSERVED TH AT THE EXPLANATION FOR NON-APPEARANCE ON THE DATE FIXED FOR HEARING WA S VAGUE AND MERE PAYMENT OF THE BALANCE INSTITUTION FEES SUBSEQUENT TO DISMISSAL OF THE APPEAL WOULD NOT VALIDATE APPEALS TO MAKE OUT A GOO D CASE FOR RECALL OF THE ORDERS PASSED BY THE TRIBUNAL. THE BENCH ALSO E XPLAINED VAGUENESS OF THE EXPLANATION OF THE ASSESSEE-COMPANY WITH REG ARD TO AVAILABILITY/NON-AVAILABILITY OF THE MANAGING DIREC TOR. ACCORDINGLY, MISCELLANEOUS APPLICATION WAS DISMISSED VIDE ORDER DATED 18.5.2011. THEREUPON THE ASSESSEE FILED A MISCELLANEOUS APPLIC ATION ON 20.9.2011, WHICH WAS NUMBERED AS M.A. NO. 483/MUM/2011. THIS M ISCELLANEOUS APPLICATION WAS FILED AGAINST THE ORDER DATED 18.5. 2011 PASSED IN M.A. NO.711/MUM/2010. THEREFORE IT WAS POINTED OUT TO T HE ASSESSEES M/S. SONAL ROPES PVT. LTD. 3 COUNSEL THAT U/S. 254(2), ONLY AN ORDER PASSED U/S. 254(1) CAN BE CALLED IN QUESTION. APPARENTLY, IN THE INSTANT CASE, M.A. NO. 711/MUM/2010 WAS DISPOSED OF U/S. 254(2) OF THE ACT ON WHICH STA TUTE HAS NOT PROVIDED FOR RIGHT OF APPEAL OR TO FILE A MISCELLANEOUS APPL ICATION. 4. AT THIS JUNCTURE, TWO FRESH MISCELLANEOUS APPLIC ATIONS WERE FILED (ONE FOR EACH YEAR) CHALLENGING THE EX-PARTE ORDER DATED 8.7.2009. IN THE PETITION IT WAS STATED THAT THE APPELLANT-COMPANY H AD SHIFTED THEIR ADDRESS FROM ANDHERI WEST TO KHOPOLI. IT WAS ALSO S UBMITTED THAT THE DEFAULT IN NOT APPEARING BEFORE THE TRIBUNAL ON 6.7 .2009 WAS NOT INTENTIONAL SINCE THE ASSESSEES CONSULTANTS WERE E NGAGED IN BRINGING OUT COMMENTARY ON THE BUDGET PROPOSALS ISSUED ON THE SA ME DATE AND HENCE THEIR FULL TIME ACCOUNTANT WAS ASKED TO SUBMIT A LE TTER TO SEEK AN ADJOURNMENT BUT THE COUNSEL HAVING NOT FILED POWER OF ATTORNEY, THE REQUEST WAS NOT ACCEDED TO. IT WAS ALSO CONTENDED T HAT EVEN ON MERITS THE ASSESSEE HAS AN ARGUABLE CASE AND THEREFORE, TH E EX-PARTE ORDER PASSED BY THE TRIBUNAL DESERVES TO BE RECALLED. 5. ON THE OTHER HAND LEARNED DEPARTMENTAL REPRESENT ATIVE SUBMITTED THAT THE ASSESSEE HAS COMMITTED SERIES OF LAPSES IN THE FORM OF NOT RESPONDING TO THE DEFECT MEMO, NON-PAYMENT OF B ALANCE INSTITUTION FEES AND ALSO MAKING A REQUEST THROUGH COUNSEL WITH OUT GIVING POWER OF ATTORNEY AT THE RELEVANT POINT OF TIME AND HENCE TH E TRIBUNAL DISPOSED OF THE MATTER EX-PARTE AND IT HAS DISMISSED THE MISCEL LANEOUS APPLICATION ON 18.5.2011 BY GIVING THE COGENT REASONS AS TO WHY THE REASONS GIVEN BY THE ASSESSEE FOR RECALL OF THE ORDERS WERE NOT SUFF ICIENT. RULE 24 OF THE APPELLATE TRIBUNAL RULES EMPOWERS THE TRIBUNAL TO R ECALL AN EX-PARTE ORDER IF THE ASSESSEE HAS SUFFICIENT CAUSE FOR NO N-APPEARANCE ON THE DATE FIXED FOR HEARING. THIS EXPRESSION, IN JUXTAP OSITION TO THE EXPRESSION REASONABLE CAUSE, MEANS THAT THERE SHOULD BE A ST RONG FOUNDATION FOR NON-APPEARANCE AND THE GENERAL EXPLANATION, WHICH M AY AMOUNT TO A REASONABLE CAUSE, MAY NOT BE FIT ENOUGH TO BE CONSI DERED AS SUFFICIENT CAUSE. HE ALSO SUBMITTED THAT M.A.NO. 483/MUM/2011 IS AN APPLICATION FILED AGAINST THE ORDER U/S. 254(2) OF THE ACT, WHICH IS NOT MAINTAINABLE. SINCE THE APPEALS OF THE ASSESSEE WER E DISMISSED FOR THE M/S. SONAL ROPES PVT. LTD. 4 DETAILED REASONS GIVEN THEREIN, RECALL OF SUCH AN O RDER WOULD AMOUNT TO REVIEW OF ITS ORDER, WHICH IS NOT PERMISSIBLE IN TH E CIRCUMSTANCES OF THE CASE. 6. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIO NS AND PERUSED THE RECORD. IN OUR CONSIDERED OPINION MISCELLANEOUS APPLICATIONS FILED BY THE ASSESSEE-COMPANY DO NOT DESERVE FAVOURABLE CONS IDERATION. IN SO FAR AS M.A. NO. 483/MUM/2011 IS CONCERNED, IT ARISES OU T OF THE ORDER PASSED U/S. 254(2) OF THE ACT. AN APPLICATION U/S. 254(2) IS MAINTAINABLE ONLY AGAINST AN ORDER PASSED U/S. 254(1) OF THE ACT . IF THE ASSESSEE IS AGGRIEVED BY THE ORDER PASSED U/S. 254(2), THE STAT UTE DOES NOT PROVIDE FOR A REMEDY BEFORE THE APPELLATE TRIBUNAL BY WAY O F APPLICATION BEFORE THE TRIBUNAL. UNDER THE CIRCUMSTANCES, WE REJECT TH E MISCELLANEOUS APPLICATION FILED BY THE ASSESSEE ON 20.9.2011. 7. AS REGARDS OTHER TWO MISCELLANEOUS APPLICATIONS ARE CONCERNED, IT DESERVES TO BE NOTICED THAT M.A. NO. 711/MUM/2010 W AS DISMISSED BY THE ITAT E BENCH, MUMBAI VIDE ORDER DATED 18.5.20 11 WHEREIN, AN IDENTICAL EXPLANATION WAS CONSIDERED IN DETAIL TO H OLD THAT THE ASSESSEE WAS NOT PREVENTED BY SUFFICIENT REASONS FOR NON-APP EARANCE. DETAILED REASONS WERE RECORDED BY THE BENCH WHILE DISPOSING OF THE APPEAL EX- PARTE, QUA THE ASSESSEE; IT CANNOT BE SAID THAT THE TRIBUNAL COMMITTED AN ERROR OF ITS JUDGEMENT. HENCE SEEKING RECALL, ON THE SAME SET OF FACTS, WOULD AMOUNT TO SEEKING REVIEW OF ITS EARLIER ORDER , WHICH IS NOT PERMISSIBLE UNDER SECTION 254(2) OF THE ACT. IN THE CASE OF CIT VS. INCOME TAX APPELLATE TRIBUNAL AND OTHERS (196 ITR 564) (OR ISSA), THE COURT OBSERVED THAT AN ISSUE WHICH REQUIRES A DETAILED AN ALYSIS OF FACTUAL ASPECTS WOULD FALL OUTSIDE THE SCOPE OF AN APPLICAT ION U/S. 254(2) OF THE ACT. SIMILARLY IN THE CASE OF CIT VS. RAMESH ELECTR IC AND TRADING CO. (203 ITR 497), HON'BLE BOMBAY HIGH COURT REITERATED THIS PRINCIPLE BY OBSERVING THAT THE TRIBUNAL CANNOT, IN EXERCISE OF ITS POWER OF RECTIFICATION (OR RECALL), LOOK INTO SOME OTHER CIR CUMSTANCES WHICH WOULD SUPPORT OR NOT SUPPORT ITS CONCLUSION SO ARRIVED AT ; AN ERROR OF JUDGEMENT FALLS OUTSIDE THE SCOPE OF SECTION 254(2) OF THE ACT. IN THE LIGHT OF THE AFOREMENTIONED JUDGEMENTS, WE ARE OF T HE VIEW THAT THE M/S. SONAL ROPES PVT. LTD. 5 MISCELLANEOUS APPLICATIONS FILED BY THE ASSESSEE DE SERVE TO BE DISMISSED. WE HOLD ACCORDINGLY. ORDER HAS BEEN PRONOUNCED ON 27 TH DAY OF APRIL, 2012. SD/- (P.M. JAGTAP) ACCOUNTANT MEMBER SD/- (D. MANMOHAN) VICE-PRESIDENT DATED : 27 TH APRIL, 2012. COPY TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A)-CONCERNED. 4. THE CIT, CONCERNED. 5. THE DR CONCERNED, MUMBAI 6. GUARD FILE BY ORDER TRUE COPY ASSTT. REGISTRAR, ITAT, MUMBAI PS