BEAR STEARNS & CO. INC., V. ASST CIT (IT) RG 3(2),

MA 774/MUM/2012

• Counselvise Citation: [2013] 124 COUNSELVISE.COM (IT) 0603 (ITAT-MUMBAI)
• Duration Of Justice: 6 month(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 28-06-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2007-2008
• Appeal Filed On: 28-12-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 154

Judgement Text

, , , , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, MUMBAI , ,, , , ! ! ! ! '# $% '# $% '# $% '# $% , ,, , & & & & ' ' ' ' BEFORE SHRI SANJAY ARORA, ACCOUNTANT MEMBER AND SHRI AMIT SHUKLA, JUDICIAL MEMBER (!(! !) . / M.A. NO.774/MUM./2012 . / ITA NO. 6148/MUM./2010 +,# - ( &) . !/. / ASSESSMENT YEAR : 200708 ) BEAR STEARNS & CO. INC. C/O CITI BANK N.A. TRENT HOUSE, 3 RD FLOOR GBLOCK, PLOT NO.60 BANDRA KURLA COMPLEX BANDRA (E), MUMBAI 400 054 .. 01 / APPLICANT ) V/S ASSTT. COMMISSIONER OF INCOME TAX (IT) RANGE3(2), MUMBAI .... 2301 / RESPONDENT 0 ./ PERMANENT ACCOUNT NUMBER AABCB9869J &) .5# 6 7 / ASSESSEE BY : MR. NISHANT THAKKAR ! 6 7 / REVENUE BY : MR. MOHIT JAIN )! 6 # / DATE OF HEARING 21.06.2013 $ 8/ 6 # / DATE OF ORDER 28.06.2013 $ $ $ $ / ORDER '# $% '# $% '# $% '# $% , ,, , & & & & 9 9 9 9 / PER AMIT SHUKLA, J.M. THE ASSESSEE, BY WAY OF THIS MISCELLANEOUS APPLICAT ION, SEEKS RECALL OF THE IMPUGNED ORDER DATED 18 TH APRIL 2012, PASSED BY THE TRIBUNAL IN ITA NO.6148/ MUM./2010, FOR THE ASSESSMENT YEAR 200708. BEAR STEARNS & CO. INC. 2 2. BEFORE US, THE LEARNED COUNSEL, MR. NISHANT THAKKAR , ON BEHALF OF THE ASSESSEE, SUBMITTED THAT, THE ASSESSEE HAD FILED A LETTER BEFORE THE TRIBUNAL AT THE TIME OF HEARING THAT THE ISSUE OF LEVY OF IN TEREST UNDER SECTION 234D WHICH WAS SUBJECT MATTER OF THE APPEAL HAS BEEN RES OLVED BY THE ASSESSING OFFICER VIDE HIS ORDER DATED 25 TH MAY 2010, PASSED UNDER SECTION 154 AND, THEREFORE, THE ASSESSEE HAS NO GRIEVANCE. TAKING CO GNIZANCE OF THE SAID LETTER, THE TRIBUNAL HAS TREATED THE APPEAL AS INFR UCTUOUS. BEFORE THE TRIBUNAL, THE MAIN ISSUE INVOLVED AS RAISED IN THE GROUNDS OF APPEAL WAS THAT NO INTEREST UNDER SECTION 234D CAN BE LEVIED, SINCE THE ASSESSEE WAS NEVER GRANTED REFUND IN PURSUANCE OF INTIMATION UNDER SEC TION 143(1) OR ACKNOWLEDGMENT OF THE RETURN OF INCOME AND, THEREFO RE, NO INTEREST COULD HAVE BEEN LEVIED UNDER SECTION 234D. THIS APPEAL WA S FILED AGAINST THE ORDER DATED 10 TH JUNE 2010 PASSED BY THE LEARNED COMMISSIONER (APPE ALS)X, MUMBAI, WHEREIN THE LEARNED COMMISSIONER (APPEALS) HAS DISMISSED THE ASSESSEES CONTENTIONS REGARDING CHARGING OF INTERE ST UNDER SECTION 234D. HE SUBMITTED THAT AFTER PASSING OF THE THE TRIBUNALS ORDER, THE EFFECT OF COMMISSIONER (APPEALS)S ORDER WAS GIVEN BY THE ASS ESSING OFFICER, WHEREIN THE INTEREST UNDER SECTION 234D WAS AGAIN LEVIED, D ESPITE THE FACT THAT THE ASSESSING OFFICER HIMSELF VIDE ORDER DATED 25 TH MAY 2010, HAS DROPPED THE LEVY OF INTEREST UNDER SECTION 234D. IN THESE CIRCU MSTANCES, THE ASSESSEE HAS LEFT WITH NO LEGAL REMEDY AS THE ASSESSEE CANNO T FILE ANY APPEAL AGAINST THE ORDER DATED 29 TH MARCH 2012, PASSED BY THE ASSESSING OFFICER GIVING EFFECT TO THE LEARNED COMMISSIONER (APPEALS)S ORDE R AS THE ASSESSEE HAS ALREADY WITHDRAWN THE APPEAL FROM THE TRIBUNAL AGAI NST THE SAID COMMISSIONER (APPEALS)S ORDER ON THE GROUND THAT T HE ASSESSING OFFICER HIMSELF HAS GIVEN THE RELIEF IN PROCEEDINGS UNDER S ECTION 154. HE, THUS, SUBMITTED THAT THE ORDER OF THE TRIBUNAL SHOULD BE RECALLED, OTHERWISE THE ASSESSEE WILL SUFFER GRAVE INJUSTICE AS ALL THE DOO RS OF LEGAL REMEDY WILL SHUT DOWN. 3. ON THE OTHER HAND, THE LEARNED DEPARTMENTAL REPRESE NTATIVE SUBMITTED THAT THE SCOPE OF SECTION 254(2) IS RECTI FICATION OF MISTAKE APPARENT FROM RECORD AND THERE IS NO MISTAKE IN THE ORDER OF THE TRIBUNAL BECAUSE THE TRIBUNAL HAS ACTED UPON THE LETTER FURN ISHED BY THE ASSESSEE FOR BEAR STEARNS & CO. INC. 3 WITHDRAWING THE APPEAL AND TREATING IT TO BE INFRUC TUOUS. SUCH AN ORDER CANNOT BE RECALLED. THUS, HE STRONGLY OPPOSED THE R ECALLING OF THE ORDER. 4. WE HAVE CAREFULLY CONSIDERED THE RIVAL CONTENTIONS, PERUSED THE RELEVANT ORDERS PLACED BEFORE US AND THE MATERIAL O N RECORD. IN THIS CASE, THE ASSESSEE HAS MADE A CLAIM OF REFUND IN THE RETURN O F INCOME. HOWEVER, THE ASSESSEE RECEIVED REFUND OF ` 2,72,02,160, THROUGH ECS CREDIT WHICH WAS NOT THE AMOUNT OF REFUND CLAIMED IN THE RETURN OF INCOM E AND WAS WITHOUT ANY INTIMATION UNDER SECTION 143(1). THEREAFTER, THE AS SESSEE FILED A LETTER BEFORE THE ASSESSING OFFICER STATING THAT NO DETAIL S HAVE BEEN FURNISHED WITH REGARD TO THE WORKING OF THE REFUND AS NEITHER THE ASSESSMENT YEAR FOR WHICH THE SAID REFUND PERTAINED TO WAS MENTIONED NOR ANY WORKING WAS GIVEN. AFTER PASSING OF THE REGULAR ASSESSMENT ORDER UNDER SECTI ON 143(3), A DEMAND NOTICE WAS ISSUED ON NIL INCOME. THEREAFTER, THE ASSESSING OFFICER ISSUED NOTICE UNDER SECTION 154 PROPOSING TO RECTIFY THE M ISTAKE OF GRANT OF ECS REFUND OF ` 2,72,02,160, AND ACCORDINGLY THE REFUND AMOUNT WAS WITHDRAWN. HOWEVER, IN THE COMPUTATION ASSESSED WITH THE ORDER , THE ASSESSING OFFICER LEVIED INTEREST UNDER SECTION 234D IN RESPECT OF SU CH REFUND AMOUNT. AGGRIEVED BY THIS, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE FIRST APPELLATE AUTHORITY. THE LEARNED COMMISSIONER (APPEALS) DISMI SSED THE ASSESSEES APPEAL ON MERITS HOLDING THAT LEVY OF INTEREST IS J USTIFIED. AGAINST THIS ORDER, THE ASSESSEE CAME IN SECOND APPEAL BEFORE THE TRIBU NAL. IN THE MEAN TIME, THE ASSESSING OFFICER RECTIFIED HIS OWN ORDER AND T HEREBY WITHDREW THE INTEREST CHARGED UNDER SECTION 234D ON THE GROUND T HAT IT WAS A MISTAKE APPARENT FROM RECORD, VIDE ORDER DATED 25 TH MAY 2010. IN THIS BACKGROUND, THE ASSESSEE FILED A LETTER BEFORE THE TRIBUNAL TO WITHDRAW ITS APPEAL AS THERE WAS NO GRIEVANCE LEFT WITH THE ASSESSEE. ACCORDINGL Y, THE TRIBUNAL TREATED THE APPEAL AS INFRUCTUOUS AND DISMISSED THE ASSESSE ES APPEAL WITHOUT DECIDING THE CASE ON MERITS. AFTER THE PASSING OF T HE TRIBUNAL ORDER, THE ASSESSING OFFICER HAS GIVEN EFFECT TO THE LEARNED C OMMISSIONER (APPEALS)S ORDER AND IN THIS ORDER HE HAS AGAIN CHARGED INTERE ST UNDER SECTION 234D. BEAR STEARNS & CO. INC. 4 5. NOW IN THE WAKE OF THIS EVENT, THE ASSESSEE CANNOT PREFER ANY APPEAL BEFORE THE LEARNED COMMISSIONER (APPEALS), BECAUSE THE EARLIER ORDER OF THE LEARNED COMMISSIONER (APPEALS) HAS NOT BEEN SET ASI DE BY THE TRIBUNAL ON MERITS. UNDER THESE CIRCUMSTANCES, THE DOORS OF LEG AL REMEDY HAVE BEEN COMPLETELY SHUT DOWN. THEREFORE, IN THE INTEREST OF SUBSTANTIAL JUSTICE, WE ARE OF THE CONSIDERED OPINION THAT THE ORDER DATED 18 TH APRIL 2012, PASSED BY THE TRIBUNAL SHOULD BE RECALLED FOR HEARING THE ISS UE ON MERITS, OTHERWISE IT WILL LEAD TO GREAT HARDSHIP TO THE ASSESSEE BECAUSE THE ASSESSEE WOULD BE LEFT WITH NO LEGAL REMEDY. IT IS A TRITE LAW OF NAT URAL JUSTICE THAT A LEGAL REMEDY CANNOT BE SHUT DOWN TO A PARTY WHO IS AGGRIE VED BY ANY ORDER PASSED BY THE APPELLATE COURT FOR WHICH RIGHT OF AP PEAL HAS BEEN PROVIDED UNDER THE STATUTE. SINCE IN THIS CASE, THE ASSESSEE S APPEAL WAS NOT HEARD ON MERITS AND WAS TREATED AS INFRUCTUOUS DUE TO THE AF ORESAID REASONS, THEREFORE, TECHNICALITY SHOULD NOT BE AN IMPEDIMENT IN THE WAY OF DISPENSING JUSTICE, THAT IS, HEARING THE PARTIES IN LIS ON MER ITS. THUS, THE IMPUGNED ORDER DATED 18 TH APRIL 2012, IS HEREBY RECALLED AND THE REGISTRY IS DIRECTED TO FIX THE APPEAL IN DUE COURSE. 6. 5 #= &) .5# 6 (!(! !) !# > ) # ?@ A 6. IN THE RESULT, ASSESSEES MISC. APPLICATION IS T REATED AS ALLOWED. $ 6 / B C)= 28 TH JUNE 2013 6 D A ORDER PRONOUNCED IN THE OPEN COURT ON 28 TH JUNE 2013 SD/- SANJAY ARORA ACCOUNTANT MEMBER SD/- '# '# '# '# $% $% $% $% & & & & AMIT SHUKLA JUDICIAL MEMBER MUMBAI, C) C) C) C) DATED: 28 TH JUNE 2013 BEAR STEARNS & CO. INC. 5 $ 6 2&#'( E(/# / COPY OF THE ORDER FORWARDED TO : (1) &) .5# / THE ASSESSEE; (2) ! / THE REVENUE; (3) F () / THE CIT(A); (4) F / THE CIT, MUMBAI CITY CONCERNED; (5) (!ID 2&#&) , , / THE DR, ITAT, MUMBAI; (6) DJ. K / GUARD FILE. 3(# 2&# / TRUE COPY $) / BY ORDER 2 . LM / PRADEEP J. CHOWDHURY !5N &) L! / SR. PRIVATE SECRETARY + / ? / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI BEAR STEARNS & CO. INC. 6 DATE INITIAL DICTATION PAD IS ENCLOSED WITH THE FILE 1. DRAFT DICTATED ON 21.6.2013 SR.PS 2. DRAFT PLACED BEFORE AUTHOR 26.6.2013 SR.PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER 27.6.2013 JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER 27.6.2013 JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS 27.6.2013 SR.PS 6. DATE OF PRONOUNCEMENT 27.6.2013 SR.PS 7. FILE SENT TO THE BENCH CLERK 28.6.2013 SR.PS 8. DATE ON WHICH FILE GOES TO THE HEAD CLERK 9. DATE OF DISPATCH OF ORDER