Income Tax Appellate Tribunal - Ahmedabad
Hl Equipmnet, Surat vs Assessee on 24 April, 2015
IN THE INCOME TAX APPELLATE TRIBUNAL
AHMEDABAD "A" BENCH
Before: Shri Rajpal Yadav, Judicial Member
and Shri Anil Chaturvedi, Accountant Member
Stay Petition No. 35/Ahd/2015
(In ITA No. 1301/Ahd/2013)
Assessment Year 2009-10
Yashshavi Rasayan P. Joint Commissioner of
Limited, S.Y. No. 60/1, Income Tax, Navsari Range,
Ground Floor, Plot No. 1 Vs Navsari
& 2 Nr. Shukan Bunglows, (Respondent)
Opp. Maheshwari Bhavan
City Light, Surat-395007
PAN: AAACY1854F
(Appellant)
Stay Petition No. 36/Ahd/2015
(In ITA No. 1303/Ahd/2013)
Assessment Year 2009-10
H.L. Equipments, S.Y. No. Joint Commissioner of
60/1, Ground Floor, Plot Income Tax, Navsari Range,
No. 1 & 2 Nr. Shukan Vs Navsari
Bunglows, Opp. (Respondent)
Maheshwari Bhavan City
Light, Surat-395007
PAN: AADFH2629H
(Appellant)
ITA No. 1301/Ahd/2013
Assessment Year 2009-10
SP Nos. 35 & 36/Ahd/2015 & I.T.A Nos. 1301 & 1303 /Ahd/2011 A.Y. 2009-10 Page No. 2
Yashashavi Rasayan Pvt. Ltd vs. JCIT & HL Equipments vs. JCIT respectively
Yashshavi Rasayan P. Joint Commissioner of
Limited, S.Y. No. 60/1, Income Tax, Navsari Range,
Ground Floor, Plot No. 1 Vs Navsari
& 2 Nr. Shukan Bunglows, (Respondent)
Opp. Maheshwari Bhavan
City Light, Surat-395007
PAN: AAACY1854F
(Appellant)
ITA No. 1303/Ahd/2013
Assessment Year 2009-10
H.L. Equipments, S.Y. No. Joint Commissioner of
60/1, Ground Floor, Plot Income Tax, Navsari Range,
No. 1 & 2 Nr. Shukan Vs Navsari
Bunglows, Opp. (Respondent)
Maheshwari Bhavan City
Light, Surat-395007
PAN: AADFH2629H
(Appellant)
Assessee by: Shri S.N. Soparkar, A.R.
Revenue by: Shri Subhash Bains, CIT-D.R.
Date of hearing : 31-03-2015
Date of pronouncement : 24-04-2015
आदे श/ORDER
PER: RAJPAL YADAV, JUDICIAL MEMBER Both the assessee belong to a common group. Their appeals for 2009-10 have been decided by the Ld. First Appellate Authority on 22nd SP Nos. 35 & 36/Ahd/2015 & I.T.A Nos. 1301 & 1303 /Ahd/2011 A.Y. 2009-10 Page No. 3 Yashashavi Rasayan Pvt. Ltd vs. JCIT & HL Equipments vs. JCIT respectively February, 2013 by way of separate orders. The assessees have filed stay applications with a prayer for stay of outstanding demand amounting to Rs. 1,18,32,705/- in the case of Yashshvi Rasayan Pvt Ltd and Rs. 1,16,25,982/- in the case of H.L. Equipments. These stay applications were listed for hearing on 27th of March, 2015. The Bench has directed to list the appeals for hearing on 31st March, 2015. In this way, we have heard the appeals on merit. The stay application would become infructuous and accordingly dismissed.
First we take up ITA No. 1301/Ahd/2013
2. The assessee has taken 21 grounds of appeal. However learned counsel at the very outset submitted that Ld. First Appellate Authority has decided the appeal ex-parte without affording proper opportunity of hearing to the assessee. Similarly, in the case of HC Equipments assessee has taken 10 grounds of appeal but in ground no. 1 it has pleaded that its appeal has been dismissed by the First Appellate Authority ex-parte without giving proper opportunity of hearing.
3. With the assistance of Ld. representatives, we have gone through the record carefully. It emerges out from the record that the assessee M/s Yashshvi Rasayan Pvt Ltd has filed its return of income electronically on 30th September,2009 declaring total loss of Rs. 25,92,89,127/-. The case of the assessee was selected for scrutiny assessment and a notice u/s. 143(2) was issued and served on 25th August, 2010. Ld. AO has passed the assessment order on 30th December, 2011. Ld. AO has determined the taxable income of the assessee at Rs. 4,86,40,934/- as against the loss declared by assessee at Rs. 2,92,89,127/-
SP Nos. 35 & 36/Ahd/2015 & I.T.A Nos. 1301 & 1303 /Ahd/2011 A.Y. 2009-10 Page No. 4Yashashavi Rasayan Pvt. Ltd vs. JCIT & HL Equipments vs. JCIT respectively
4. In the case of M/s H.L. Equipments, the assessee has filed the return electronically on 29th September, 2009 declaring total income of Rs. 75,69,646/-. The case was selected for scrutiny assessment and a notice u/s. 143(2) was issued on 25th August, 2010. Ld. AO has passed the assessment order on 29-12-2011. He determined the taxable of the assessee at Rs. 6,36,45,138/-. The Ld. AO has made two additions namely (a) GP addition and (b) addition on account of unaccounted purchases. In the case of Yashshvi Rasayan Pvt Ltd Ld. also, AO has made addition mainly on account of suppression of unaccounted purchases, disallowance of deprecation and unaccounted job work receipt. These additions have been challenged before Ld. First Appellate Authority by both the assessees. However Ld. Commissioner concurred with the finding of AO without making any elaborate discussion on each issue.
5. Ld. Counsel of the assessee at the very outset submitted that assessee has applied for adjournment but Ld. Commissioner rejected the application for adjournment and decided the appeals on merit. He prayed that impugned order be set aside and the issues be restored to the file of Ld. CIT(A) for re-adjudication after providing appropriate opportunity of hearing to the assessee.
6. Ld. DR on the other hand took us through the observations of Ld. Commissioner in para 2 on page 2. He pointed out that Ld. Commissioner has provided due opportunity of hearing to the assessee. The representative of the assessee, Shri Hiren Diwan sought adjournment. Ld. CIT(A) has observed that representative of the assessee is a habitual absentee. Merely by filing adjournment application does not mean that hearing will be automatically adjourned on the asking of the assessee.
SP Nos. 35 & 36/Ahd/2015 & I.T.A Nos. 1301 & 1303 /Ahd/2011 A.Y. 2009-10 Page No. 5Yashashavi Rasayan Pvt. Ltd vs. JCIT & HL Equipments vs. JCIT respectively According to the DR, there is no justification in setting aside the order of the Ld. CIT(A) in both the appeals.
7. We have duly considered the rival contention and gone through the record carefully. Before we embark upon an inquiry, whether proper opportunity of hearing was granted or not, and order of CIT(A) on this issue could be upheld or not. We deem it proper to take note of the provisions contemplating the manner, an appeal is to be disposed of by the Ld. CIT(A). In this respect, it is pertinent to take note of section 250 sub- section 6 which reads as under:-
"(1) The Commissioner (Appeals) shall fix a day and place for the hearing of the appeal, and shall give notice of the same to the appellant and to the Assessing Officer against whose order the appeal is preferred.
(2) xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx (3)xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx (4)xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx (5)xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx (6) The order of the Commissioner (Appeals) disposing of the appeal shall be in writing and shall state the points for determination, the decision thereon and the reason for the decision. (6A)xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
8. A bare perusal of this section would indicate that Ld. Commissioner has to state the points for determination in an appeal and thereafter he has to assign the reasons in support of his conclusion. We find that on every issue the finding of the Ld. First Appellate Authority is verbatim. For example, in ground no. 1 in the case of H.L. Equipment, Assessee has SP Nos. 35 & 36/Ahd/2015 & I.T.A Nos. 1301 & 1303 /Ahd/2011 A.Y. 2009-10 Page No. 6 Yashashavi Rasayan Pvt. Ltd vs. JCIT & HL Equipments vs. JCIT respectively challenged rejection of books of accounts by the AO u/s. 145(3) of the Income Tax Act.
9. In the case of Yashshvi Rasayan Pvt Ltd verbatim similar observation has been made. In the first ground of appeal, assessee has challenged rejection of books of accounts u/s. 145(3) and the Ld. Commissioner has recorded the finding in para 5.2. The finding recorded by Ld. CIT(A) reads as under:-
"5.2 Decision:- I have spared my thoughtful consideration to the observation of the AO in the assessment order. No submission was made before me inspite of several opportunities given to the appellant. In the absence of any rebuttal from the appellant in this matter, I am constrained to agree with the finding of the AO. This ground is accordingly dismissed."
It is to be noted that the returns were filed in September, 2009. Notice u/s. 143(2) was issued on 25th August, 2010. The proceeding appears to have remained dormant. The notice u/s. 142(1) requiring the assessee to submit detail was issued on 09-11-2011 fixing the hearing on 22nd November, 2011. The case was re-fixed on 29-11-2011. It appears that there was a survey in the case of Yashshvi Rasayan Pvt Ltd on 29-09- 2008 and the AO confronted the assessee with the outcome of the survey material. But he has granted less than one month time to collect the information and produce them before him. Effectively, he has started the assessment proceedings at the end of November, 2011 and passed the assessment order at the end of December, 2011 in both the cases. The setting of all these factors as a whole goad us to observe that proper and effective opportunity of hearing has not been granted to the assessee. Ld First Appellate Authority has not re-appreciated the material already available on record. In an appellate proceeding, it is not the case that something new is to be produced. Because without leave of the appellate SP Nos. 35 & 36/Ahd/2015 & I.T.A Nos. 1301 & 1303 /Ahd/2011 A.Y. 2009-10 Page No. 7 Yashashavi Rasayan Pvt. Ltd vs. JCIT & HL Equipments vs. JCIT respectively authority, no additional evidence can be found. The material already available on record has to be re-appreciated, from the finding of CIT(A) extracted (supra), it is not discernable that he has appreciated the material. To some extent, we agree with Ld. DR also that assessee failed to properly take care of its income tax proceeding. The adjournment cannot be granted merely at the asking of the assessee but when we weigh the alleged negligent conduct of the assessee vis-à-vis punishment in the shape of tax liability then the scale would tilt in favour of the assessee because the negligence at the end of assessee is not of that magnitude which would entail the tax liability of this magnitude. Therefore, taking into consideration overall facts and circumstances, we deem it appropriate to set aside the impugned orders of the Ld. CIT(A) in both the appeals and restore all these issues to the file of First Appellate Authority for re- adjudication. We direct the assessee also to co-operate with the Ld. CIT(A) and not to seek unwarranted adjournments. It is needless to say that observation made by us will not impair or injure the case and AO will not cause any prejudice to the explanation of the assessee. Ld. First Appellate Authority shall provide due opportunity of hearing to the assessee.
10. In the result, the appeals of the assessee are allowed for statistical purposes. The stay applications are dismissed being infructuous.
Order pronounced in the open court on 24-04-2015 Sd/- Sd/-
(ANIL CHATURVEDI) (RAJPAL YADAV)
ACCOUNTANT MEMBER JUDICIAL MEMBER
Ahmedabad : Dated 24/04/2015
ak
SP Nos. 35 & 36/Ahd/2015 & I.T.A Nos. 1301 & 1303 /Ahd/2011 A.Y. 2009-10 Page No. 8
Yashashavi Rasayan Pvt. Ltd vs. JCIT & HL Equipments vs. JCIT respectively आदे श क ूितिल प अमे षत / Copy of Order Forwarded to:-
1. Assessee
2. Revenue
3. Concerned CIT
4. CIT (A)
5. DR, ITAT, Ahmedabad
6. Guard file.
By order/आदे श से, उप/सहायक पंजीकार आयकर अपीलीय अिधकरण, अहमदाबाद