BHARATI S. KHANDHAR, V. ACIT 13(3),

MA 91/MUM/2010

• Counselvise Citation: [2011] 123 COUNSELVISE.COM (IT) 6672 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 5 month(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 15-07-2011
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2001-2002
• Appeal Filed On: 15-02-2010
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: MRS VANDANA SAGAR
• Keywords: Principle of natural justice; Additional evidence; Question of law; Condonation of delay
• Section: 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH B BEFORE SHRI. PRAMOD KUMAR (AM) & SMT. ASHA VIJAYARAGHAVAN (JM) M.A. NO. 91/MUM/2010 (ARISING OUT OF I.T.A. NO. 2491/MUM/2008 (ASSESSMENT YEAR: 2001-02) SMT. BHARATI S. KHANDHAR 308, PARSHWA CHAMBERS, 19/21, ISSAJI STREET, VADGADI, MUMBAI 400 003 PAN NO.: ALUPK 7663 G VS. ACIT 13(3), AAYAKAR BHAVAN, MUMBAI 400 020 APP LICANT RESPONDENT A PPLICANT BY : SHRI. BHARAT GANDHI RESPONDENT BY : MRS. VANDANA SAGAR ORDER PER ASHA VIJAYARAGHAVAN (JM) THIS IS A MISCELLANEOUS APPLICATION FILED AGAINST T HE ORDER OF THE ITAT IN ITA NO 2491/MUM/2008 DATED 16.11.2009, DISMISSING THE APPE AL OF THE ASSESSEE ON THE GROUND THAT THE APPEAL WAS BELATED BY 1412 DAYS AND THE ITAT WAS NOT SATISFIED WITH THE REASONS SUBMITTED FOR THE DELAY. THE ITAT IN TH E IMPUGNED ORDER HELD AS UNDER: 4. AN AFFIDAVIT HAVE BEEN FILED BY SMT. BHARATI. S. KHANDHAR PLEADING FOR CONDONATION OF DELAY OF 1412 DAYS FOR FILING TH E APPEAL BEFORE HONBLE 2 M.A. NO. 91/M/2010 SMT. BHARATI S. KHANDHAR (A.Y. 2001-02) ITAT, MUMBAI. THE REASON FOR THE SAID DELAY HAS BEE N STATED IN AS FOLLOWS: - DUE TO THE PAUCITY OF FUNDS, I COULD NOT ENGAGE AN Y CHARTERED ACCOUNTANT OR ADVOCATE TO TAKE UP THE MAT TERS FOR ITAT AND PROCEED WITH THE SAME. IT IS AN ADMITTED POSITION THAT IMPUGNED ORDER WAS SERVED UPON THE ASSESSEE ON 29 TH MARCH, 2004. ACCORDING TO THE ASSESSEE, THE DELAY IN FILING OF APPEAL IS CAUSED DUE TO PAUCITY OF FUN DS AND THE RESULTANT INABILITY TO HIRE COUNSEL. HOWEVER, THE ORDERS DT. 31 ST MARCH, 2004 AND 19 TH JULY, 2004 IN ASSESSEES OWN CASE, WHICH HAVE BEEN FILED BY THE ASSESSEE HERSELF, CLEARLY SH OW THAT EVEN AFTER 29 TH MARCH, 2004, APPEALS FILED BY THE ASSESSEE WERE AT TENDED TO BY HER LEGAL COUNSEL, SHRI VIPUL SHAH , INCIDENTALLY T HE SAME LEARNED COUNSEL WHO HAS APPEARED BEFORE US, TODAY. WHEN TH IS WAS POINTED OUT TO THE LD. COUNSEL, HE DID NOT HAVE ANY COMMENT S TO MAKE. LD. COUNSEL WAS ALSO NOT IN A POSITION TO CONFIRM WHETH ER HE HAD NOT ATTENDED ANY OF THE ASSESSEES CASES BETWEEN THE DU E DATE OF FILING THIS APPEAL AND TILL THE DATE THIS APPEAL IS ACTUAL LY FILED. IN VIEW OF THE ABOVE DISCUSSIONS, WE ARE NOT PERSUA DED TO ACCEPT THE STATED REASON OF DELAY IN FILING OF APPEAL I.E. DU E TO PAUCITY OF FUNDS, I (ASSESSEE) COULD NOT ENGAGE ANY CHARTERED ACCOUNTANT OR ADVOCATE TO TAKE UP THE MATTERS FOR ITAT AND PROCEE D WITH THE SAME. THE FACTS BEFORE US INDICATE THAT THIS EXPL ANATION IS UNACCEPTABLE. WE, ACCORDINGLY, DECLINE TO CONDONE THE DELAY. THE APPEALS ARE, ACCORDINGLY, DISMISSED SUMMARILY AS TI ME BARRED. IN THE RESULT THE APPEAL FILED BY THE APPELLANT IS DISMISSED. 2. AGAINST THIS ORDER, THE ASSESSEE HAS FILED THE P RESENT M.A. THE MAIN CONTENTION OF THE ASSESSEE IS THAT THE SUM OF RS. 11,00,000/- ADDED U/S 68 OF THE I.T ACT IN THE HANDS OF THE ASSESSEE HAS BEEN OFFERED FOR TAX IN T HE HANDS OF SHRI. S.M. KHANDHAR AND THE TRIBUNAL HAVE BEEN CONSISTENTLY IN THE EARLIER YEARS CONFIRMING THE DELETION OF 3 M.A. NO. 91/M/2010 SMT. BHARATI S. KHANDHAR (A.Y. 2001-02) SIMILAR ADDITIONS IN THE HANDS OF THE ASSESSEE, WHI CH HAS BEEN ACCEPTED AND OFFERED BY SHRI. S.M. KHANDHAR. THE ASSESSEE ALSO FILED THE OR DER OF THE JURISDICTIONAL HIGH COURT IN ITA NO 150 OF 200 DATED 5.10.2008, IN ASSESSEES OW N CASE, CONFIRMING THE ORDER OF THE ITAT ON A SIMILAR ISSUE FOR AN EARLIER ASSESSMENT Y EAR. THE ASSESSEE SUBMITS THAT AS THIS IS A SUBSEQUENT EVENT WHICH GOES TO THE ROOT O F THE MATTER, THE ORDER OF THE ITAT SHOULD BE RECTIFIED. 3. WE ARE NOT ABLE TO ACCEPT THE CONTENTION OF THE ASSESSEE. THE ORDER OF THE HIGH COURT IS DATED 5.10.2008, MUCH BEFORE THE IMPUGNED ORDER OF THE TRIBUNAL DATED 16.11.2009 EVEN OTHERWISE WE CANNOT SAY THAT THE OR DER OF THE HIGH COURT CONFIRMING THE ORDER OF THE ITAT CAN BE SAID TO BE A NEW SUBSE QUENT EVENT WHICH GOES INTO THE ROOT OF THE MATTER WHICH WILL AFFECT THE DECISION O F THE TRIBUNAL. THE TRIBUNAL HAS BEEN HOLDING THE ISSUE IN FAVOUR OF THE ASSESSEE IN EARL IER YEARS AND THE HIGH COURT HAS ONLY AFFIRMED THE DECISION OF THE ITAT. BUT THE DECISION OF THE ITAT IN THE IMPUGNED ORDER WAS ON THE MATTER OF LIMITATION AND NOT MERITS. HEN CE IN OUR OPINION THE DECISION OF THE HIGH COURT AFFIRMING THE EARLIER DECISIONS OF THE I TAT DOES NOT IN ANY WAY AFFECT THE DECISION OF THE ITAT ON LIMITATION. 4. THE ASSESSEE HAS FURTHER SUBMITTED IN MA AS UNDE R: 6. . THE APPLICANT STATES THIS CLEARLY ESTABLISHED THA T YOUR APPLICANT HAS GOT STRONG CASE ON MERITS AS THE FACTS IN THE APPEA L FILED BY THE REVENUE AS STATED ABOVE IS SIMILAR TO THE FACTS OF THIS APP EAL AND THE REVENUE APPEAL HAS BEEN DISMISSED BY THE HON'BLE HIGH COURT . 7. THE APPLICANT STATES THAT THE SECTION 5 OF LAW O F LIMITATION CAN BE APPLIED TO THIS PROCEEDINGS AS APPLICABLE TO THE PR INCIPLE OF NATURAL JUSTICE. 8. THE APPLICANT STATES THAT FROM THE NARRATION OF THE ABOVE FACTS IT CLEARLY ESTABLISHED THAT THE APPLICANT HAS GOT THE STRONG CASE OF MERITS AND THE APPEAL HAS BEEN DISMISSED AS THE DELAY WAS NOT CONDONED. 4 M.A. NO. 91/M/2010 SMT. BHARATI S. KHANDHAR (A.Y. 2001-02) 9. THE APPLICANT RELIES UPON THE FOLLOWING CASE LAW S : A) MERIT CANNOT BE IGNORED OR OVER LOOKED ALTOGETHER E SPECIALLY IN CASES WHERE THE AUTHORITY ACTED WITHOUT JURISDICTION AS H ELD IN AIR 2002 HP 50. IN THE INSTANT CASE THE LD. ITO HAS EXCEEDED IT S JURISDICTION BY GOING AGAINST THE CONSTITUTIONAL MANDATE THAT NO IN COME TRANSACTION CAN BE TAXED TWICE INTO TWO DIFFERENT ENTITIES. B) COURTS ARE REQUIRED TO PUT A GLANCE ON MERITS OF TH E APPEAL AS HELD IN AIR 1997 RAJASTHAN 134. C) WHILE CONSIDERING THE QUESTION OF CONDONATION OF DE LAY IN FILING OF REVISION, APPEAL OR REFERENCE BY STATE THE COURT. T RIBUNAL OR AUTHORITY HAS TO FIRST TO CONSIDER MERITS OF THE MATTER AND W HERE THERE IS A GOOD CASE ON MERITS, THE RULE IS TO CONDONE THE DELAY BE CAUSE IF DELAY IS NOT CONDONED IN SUCH CASES, IT WOULD RESULT IN PUBLIC M ISCHIEF IN SKILLFUL MANAGEMENT OF DELAY IN THE PROCESS OF FILING APPEAL , ETC. AND PUBLIC OF AT LARGE WOULD BE SUFFERER AND THAT MAKES A DISTINC TION AND CATEGORY OF LITIGANT STATE AS COMPARED TO ORDINARY LITIGANTS AS HELD IN 2001 (1) RLR 92. D) WHEN A JUSTICE ORIENTED APPROACHES IS TO BE TAKEN W HILE THE CONSIDERING THE APPLICATION TO CONDONE DELAY MERIT SHOULD BE TA KEN AS ONE OF THE RELEVANT CONSIDERATION FOR ALLOWING THE APPLICATION AS HELD IN 1995(2) RLR 593. E) WHEN THE SERIOUS QUESTION OF LAW IS RAISED BY THE A PPELLANT COURT SHOULD TAKE A LIBERAL VIEW ON THE APPLICATION TO CO NDONE DELAY AS HELD IN 2005 (2) SCC 237. IN THE INSTANT CASE THERE IS S ERIOUS QUESTION OF LAW AS THE REVENUE AUTHORITY WANTS TO TAX THE SAME INCO ME TWICE INTO TWO DIFFERENT ENTITIES WHICH DOES NOT HAVE THE CONSTITU TIONAL MANDATE UNDER ARTICLE 265 OF THE CONSTITUTION. HENCE THE DELAY SH OULD BE CONDONED. F) WHILE CONSIDERING THE APPLICATION COURT SHOULD GLAN CE ON MERITS OF THE APPEAL AS HELD IN AIR 1997 RAJASTHAN 134. G) AS HELD IN 2007 (1) SCC 257 APPEAL EVEN BARED BY LI MITATION HEARING OF MERITS BY COMPENSATING BY OPPOSITE PARTY DELAY COND ON BY LEVING THE COST ON APPELLANT. 10. THE APPLICANT STATES THAT FROM THE ABOVE LEGAL SUBMISSIONS THE APPELLANT HAS GOT A STRONG CASE ON MERIT THE DELAY MAY PLEASE BE CONDONED AND THE APPEAL MAY PLEASE BE ALLOWED AND A DDITIONAL EVIDENCE MAY PLEASE BE TAKEN ON RECORD. 11. HENCE IT IS MOST HUMBLY PRAYED AS UNDER :- 5 M.A. NO. 91/M/2010 SMT. BHARATI S. KHANDHAR (A.Y. 2001-02) A) THIS MISC. APPLICATION MAY PLEASE BE ALLOWED AND IM PUGNED ORDER DATED 16.11.2009 MAY PLEASE BE SET ASIDE. B) THE DELAY MAY PLEASE BE CONDONED AFTER CONSIDERING THE MERITS OF THE MATTER. C) THE ADDITIONAL EVIDENCE UNDER RULE 29 TO 31 OF THE INCOME TAX APPELLATE TRIBUNAL RULES MAY PLEASE BE TAKEN ON REC ORD I.E. EXHIBIT B & C. D) ANY OTHER RELIEFS SO AS TO THE FACTS AND CIRCUMSTAN CES OF THE CASE IS CONCERN. 5. THE LD. COUNSEL FOR THE ASSESSEE MADE CERTAIN SU BMISSIONS AT THE TIME OF HEARING AS FOLLOWS: 1. AS HELD BY THE HONBLE BOMBAY TRIBUNAL REPORTED IN 34 SOT 541 JUDGEMENT RENDERED BY THE TRIBUNAL WHICH IS NOT IN CONFORMITY WITH THE JUDICIAL HIGH COURT OR THE HONBLE SUPREME COURT RENDERED BEFORE OR SUBSEQUENT TO THE ORDER PASSED IS THE MISTAKE APPARENT OR RECORD AND CAN BE CORRECTED U/S. 254(2) OF THE I.T. ACT. 2. AN APPLICATION HAS BEEN FILED UNDER RULE 29 TO 31 O F THE I.T. RULES 1963 WHICH IS AT PAGE 11 OF THE APPLICATION AND WHICH IS A SUBSEQUENT EVENT EVIDENCE INCURRED AFTER PASSING THE IMPUGNED ORDER DT. 16.11.2009 AND IN GOES TO THE ROOT OF THE MATTER AND CLEARLY PROVES T HAT THE REVENUE WANT TO TAX RS. 11,00,000/- INTO TWO DIFFERENT ENTITIES AS STATED ABOVE WHICH IS WITHOUT THE AUTHORITY OF THE LAW UNDER ARTICLE 265 OF THE CONSTITUTION OF INDIA. IT IS SETTLED LAW THAT SUBSEQUENT EVENT EVIDENCE SH OULD BE CONSIDERED IF IT GOES TO THE ROOTS OF THE MATTER AS HELD IN 286 ITR 429 BY THE HONBLE BOMBAY HIGH COURT. 3. APPLYING THE RATIO OF THE JUDGMENT OF THE HONBLE S UPREME COURT REPORTED IN 2007 (1) SCC 257 EVEN IF TI IS BARRED BY THE LIMITA TION CAN BE HEARD ON MERITS BY COMPENSATING THE OPPOSITE PARTY BY IMPOSING COST S AND CONDONING THE DELAY. THE HONBLE ITAT, MUMBAI E BENCH HAS ALSO PASSED THE ORDER AND CONDONED THE DELAY BY IMPOSING COST ON THE BASIS OF THE MERITS OF THE CASE IN CASE OF SHRI SURENDRA M. KHANDHAR, COPY OF WHICH EN CLOSE HEREWITH FOR YOUR REFERENCE. 6 M.A. NO. 91/M/2010 SMT. BHARATI S. KHANDHAR (A.Y. 2001-02) 4. IN THE INSTANT CASE THE REVENUE WANT TO TAX U/S. 68 THE SAME INCOME TRANSACTION TWICE AS STATED ABOVE AND WHICH IS CONT RARY TO THE LAW AND CONTRARY TO THE HONBLE BOMBAY HIGH COURT JUDGMENT AS STATED ABOVE AND IT GIVES ARISED TO THE VERY SERIOUS QUESTION OF LAW IN SUCH A SITUATION APPLYING THE RATIO OF THE JUDGMENT REPORTED IN 2005 (2) SCC PAGE 237 A LIBERAL VIEW TO CONDONE THE DELAY SHOULD BE TAKEN AND THE MATTER SH OULD BE CONSIDERED ON MERITS. THE ABOVE CONTENTIONS IS FURTHER SUPPORTED BY THE FOLLOWING JUDGMENTS: 1. AIR 2002 HP 50 2. AIR 1997 RAJASTHAN 134 3. 2001 (1) RLR 92 4. 1995 (2) RLR 593 AND 5. AIR 1997 RAJASTHAN 124 APPLYING THE RATIO DERIVED FROM THE ABOVE JUDGMENTS THE DELAY SHOULD BE CONDONED AND THE MATTERS BE HEARD ON MERITS. 5. IT IS SETTLED LAW AS HELD IN 2002(4)SCC 638 THE SUPREME COURT JUDGMENT CANNOT BE DISTINGUISHED THE FACTS OF THE CASE AND W HAT IS BINDING IS THE RATIO DECEDENT UNDER ARTICLE 141 OF THE CONSTITUTION OF I NDIA. 6. HENCE THE RELIEFS AS PRAYED ON PAGE 4 OF THE APPLIC ATION MAY PLEASE BE ALLOWED. 7. 6. THE LD. COUNSEL FOR THE ASSESSEE SHRI BHARAT GAN DHI RELIED ON THE FOLLOWING CASE LAWS: 1. IMPROVEMENT TRUST, LUDHIANA VS UJAGAR SINGH & ORS. (CIVIL APPEAL NOS. 2395 OF 2008 2. SUSHILA SHANTILAL JHAVERI VS UNION OF INDIA AND ANO THER 286 ITR 428 (BOM) 3. SAYAJI IRON & ENGG. CO. VS CIT 253 ITR 749 (GUJ) 4. DIRECTOR OF SETTLEMENTS A.P. & OTHERS VS M.R. APPAR AO AND ANOTHER (AIR 2002 SUPREME COURT 1598(CIVIL APPEAL NO. 2517 OF 19 99, D/20-3-2002) 7 M.A. NO. 91/M/2010 SMT. BHARATI S. KHANDHAR (A.Y. 2001-02) 7. THE LD. DEPARTMENTAL REPRESENTATIVE MRS. VANDANA SAGAR STATED THAT THE AFFIDAVIT BY SURENDRA M. KHANDHAR WITH REFERENCE T O ASSESSMENT YEAR 1991-92 CANNOT HAVE ANY RELEVANCE FOR THE YEAR BEFORE US NAMELY 20 01-02. FURTHER SHE STATED THAT THE FACTS RELIED ON BY THE ASSESSEE IN THE CASE OF SURE NDRA KHANDHAR IN ITA NOS. 2911 TO 2913/M/08 ARE NOT THE SAME AS IN THE ASSESSEES CAS E. 8. WE HEARD BOTH THE PARTIES. AS POINTED OUT EARLIE R, THE ITAT DISMISSED THE ASSESSEES APPEAL ON THE POINT OF LIMITATION. THE A PPEAL WAS FILED 1412 DAYS BELATEDLY AND THE ASSESSEE HAD NOT GIVEN ANY SATISFACTORY REA SON FOR THE DELAY. NO LEGAL OR FACTUAL ERROR IN THE IMPUGNED ORDER HAS BEEN BROUGH T OUT IN THE M.A OR SUBMITTED AT THE TIME OF HEARING. IN OUR OPINION RELATIVE MERITS OF THE CASE CANNOT BE A REASON FOR RECTIFYING AN ORDER DISMISSING ON THE GROUND OF LIM ITATION. THIS WILL AMOUNT TO A REVIEW OF OUR ORDER WHICH IS NOT PERMITTED U/S 254(2). WE THEREFORE HOLD THAT THE MA FILED BY THE ASSESSEE IS DEVOID OF MERITS AND DISMISS THE SA ME. 9. IN THE RESULT, THE M.A FILED BY THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED ON THIS 15 TH DAY OF JULY,2011. SD/- SD/- (PRAMOD KUMAR) ( ASHA VIJAYARAGHAVAN ) ACCOUNTANT MEMBER JUDICIAL MEMBE R MUMBAI, DATED 15 TH JULY, 2011 RJ COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT (A) CONCERNED 4. THE CIT CONCERNED 5. THE DR B BENCH BY ORDER //TRUE COPY// ASST. REGISTRAR, ITAT, MUMBAI 8 M.A. NO. 91/M/2010 SMT. BHARATI S. KHANDHAR (A.Y. 2001-02) DATE INITIALS 1. DRAFT DICTATED ON: 30.6.2011 SR. PS/PS 2. DRAFT PLACED BEFORE AUTHOR: 1.07.2011 SR. PS/PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER: JM/AM 4. D RAFT DISCUSSED/APPROVED BY SECOND MEMBER: JM/AM 5. APPROVED DRAFT COMES TO THE SR. PS/PS: SR. PS/PS 6. ORDER PRONOUNCED ON: SR. PS/PS 7. ORDER COME BACK TO SR.PS/PS 8. FILE SENT TO THE BENCH CLERK: SR. PS/PS 9. DATE ON WHICH FILE GOES TO TH E HEAD CLERK: 10. DATE OF DISPATCH OF ORDER: