Income Tax Appellate Tribunal - Mumbai
Dy. Cit vs Harshad S. Mehta on 18 July, 2007
ORDER
Sushma Chowla, Judicial Member
1. The revenue has filed an appeal against the order of Commissioner (Appeals), Central-V, Mumbai dated 28-2-2003 relating to assessment year 1992-93 against the order under Section 144 of the Income Tax Act.
The assessee has filed cross-objection against the said appeal filed by the revenue on 19-6-2006.
2. The preliminary objection raised by the revenue is against the late filing of the cross-objections by the assessee. The revenue authorities filed the appeal on 9-5-2003 and it is the: claim of the revenue that the assessee was in the knowledge of the pendency of the said appeal from 2004 and as such the assessee has filed the present cross-objections on 19-6-2006 after a long delay.
3. The learned AR f or the assessee has elaborately explained that there is no default in filing the present cross-objections, but in the alternative has also prayed for condonation of delay if any in presenting, the said cross-objections before the Tribunal. In order to adjudicate upon the preliminary issue raised by the parties, it is necessary to go into certain facts of the case. The assessee in the present appeal is a notified person under the provisions of the Special court (TORTS) Act, 1992. The assessee expired on 31 -12-2001 and the present cross-objection has been filed by Mrs. JyotiH. Mehta, wife and legal heir of late Shri Harshad S. Mehta.
4. The revenue filed the present appeal on 9-5-2003. On the memo of appeal the address of the assessee was provided as under:
Late Harshad S. Mehta, 1205/06, Makfaer Chamber V, Nariman Point, Mumbai - 400 021.
5. The said appeal was found to be in order by the Registry vide order sheet entry dated 16-7-2004. The Registry issued the notice of hearing on 4-7- 2006 fixing the date of hearing on 11 -8-2006, for which the notice was sent to the assessee on the above said address.
6. The assessee has filed a letter dated 7-6-2006 before the Assistant Registrar wherein it claims to have received the information that the department had filed an appeal for which the copy of Form No. 36 and the grounds of appeal were not received by the assessee. Thereafter, the assessee filed its cross-objection on 19-6-2006. The assessee on 19-6-2006 also filed a letter claiming to have received the Form No. 36 filed by the department along with grounds of appeal on 13-6-2006. The appeal alongwith cross-objections were fixed for hearing on 11-8-2006, on which date the matter was adjourned to 28-8-2006. Thereafter, the matter was taken upon 11-9-2006.
7. The assessee was asked to file an affidavit as prima facie, it appeared that the cross-objections were filed late. The matter was adjourned to 13-12-2006. The assessee filed an affidavit dated 13-10-2006, copy of which is placed at pages 7 and 8 of the paper book filed on 16-7-2007. In the said affidavit the wife of the assessee has affirmed that she received the certified copy of Form No. 36 upon the payment of requisite charges on 13-6-2006 and the cross-objections were filed on 19-6-2006.
8. Thereafter an affidavit was filed on 14-11-2006 by Mr. Pitamber Das, DCIT, Central Circle-2, Mumbai. In the said affidavit, it was stated by the DCIT that during the course of proceedings before the Hon'ble Special court in State bank of lndia v. Custodian (MA No. 210 of 2003), the Income-tax department, an affidavit dated 30-12-2004 were filed and on page 2 of the said affidavit table was given containing, inter alia, the pendency of appeal in Harshad S. Mehta group of cases. It was further affirmed that in the said table, the case of late Shri Harshad S. Mehta for assessment year 1992-93 was clearly shown. Further, reliance was placed on the affidavit dated 10-8-2005, Exhibit-I, which contains list of material provided for inspection to State bank of India by the Income-tax department and Serial No. 5 of the Exhibit reads Second Appeal to ITAT by Commissioner (Appeals) for assessment year 1992-93. The DCIT further af firms that in various proceedings before the Hon'ble Special Court, Hon'ble ITAT and Custodian, it has been discussed time and again that "demand in the case of Late Shri Harshad S. Mehta assessment year 1992-93 is confirmed in first appeal and depart-mental appeal is pending". Thereafter, DCIT affirms that Smt. Jyoti H.Mehta was fully aware regarding the pendency of departmental appeal in the case of Late Shri Harshad S. Mehta for assessment year 1992-93 at least from 2004, if not earlier. The copy of the said affidavit of Mr. Pitamber Das is enclosed at pages 9 to 12 of the paper book filed on 16-7-2007 along with affidavit filed before Special court and affidavit filed by Asstt. GM of State bank of India.
9. The assessee also moved a petition for condonation of delay in presenting the cross-objections before the Tribunal on 6-12-2006 along with an affidavit and copy of the petition along with the affidavit is filed at pages 25-30 of the paper book filed on 16-7-2007.
10. The learned AR for the assessee pointed out that in the present appeal by the department the old address of the assessee is mentioned. The said property was sold by the Custodian of Special court on 14-5-2004 and from then the assessee is not in possession of the said property. The learned AR for the assessee also pointed out that the notices in the present appeal are also being sent to the old address of the assessee which is mentioned in the Memo of Appeal filed by the department, though the wife of the assessee is operating from another address, which is mentioned in the cross-objections filed. The claim of the learned AR for the assessee is that in view of the said circumstances Memo of Appeal or any notice were not received by the assessee and only during the course of hearing in other appeals it came to his knowledge that department has filed an appeal against the order of Commissioner (Appeals) relating to assessment year 1992-93.
Thereafter, on 13-6-2006, the wife of the assessee moved an application and on deposit of requisite fee for inspection and supply of copies, the Memo of Appeal along with ground of appeal was issued. On the receipt of the said Memo of Appeal, the assessee filed the present cross-objections. The learned AR for the assessee further pointed out that there is no merit in the affidavit filed by the DCIT wherein it refers to the list of cases pending and though the column 'where any appeal has been filed, the answer is yes'. But, in the next column 'where the appeal is pending or disposed off, the answer is "pending at ITAT, assessment order has been conf irmed by Commissioner (Appeals)".' The learned AR pointed out that the same reflects that an appeal has been filed by the assessee, as the order has been confirmed by Commissioner (Appeals), whereas in the present case, the department is in appeal. With regard to the reference of second affidavit filed, it was clarified by learned AR for the assessee that the said affidavit was between the department and the State bank of India and the assessee has no connection with the same.
11. The learned AR drew our attention to the provisions of Section 253(4)of the Income Tax Act and pointed out that the limitation for filing the cross-appeals starts on receipt of the notice, that an appeal against the order of Commissioner (Appeals) has been preferred by the other party. Even if the wife of the assessee was aware regarding the pendency of department appeal, but the awareness does not in any manner prescribes the limitation period in the matter. The first notice in the hearing was issued on 4-7-2006 fixing the matter on 11-8-2006.
12. We have heard the rival submissions and perused the records. The provisions of Section 253(4) provide that the assessee or the revenue has the liberty of filing cross-objections against the appeal filed by the other, only on receipt of notice that such appeal has been filed and the limitation period is 'within 30 days of receipt of the notice'. Thus the limitation period in the present case for filing the cross-objection would arise only once the notice has been received by the legal-heir of the assessee that an appeal has been preferred against the order of Commissioner (Appeals): The present appeal was preferred by the department on 9-5-2003, in which the old address of the assessee was mentioned in the memo of appeal. The said property was sold by the Income-tax Authorities on 14-5-2004 and on the perusal of records of Tribunal it transpires that till date the revenue authorities have f ailed to furnish the change in address of the assessee up-to-date. We have seen the appeal records and it appears that the memo of appeal was; not received by the assessee prior to 13-6-2006, affidavit to this effect has been filed by the legal heir of the assessee. Though, there is a noting in the order Sheet that 'Trip. Issued on 10-7-2004', but service of memo of appeal on the assessee is not available on record. Various notices have been issued to the assessee on the address mentioned in the memo of appeal and the same have been retumed by the postal authorities with the remark 'left'. The said envelopes along with notices are available on record. The revenue further claims that it had f orwarded the copies of aff idavit filed bef ore the Special court in State bank of India's case (supra), which contained the inf ormation regarding the pendency of appeal in Harshad Mehta group of cases. From the perusal of affidavit and the Annexure thereto it transpires that no clear information in respect of the pendency of departmental appeal is available from the said affidavits. In any case, even if such information was available, the same does not become notice in terms of provisions of Section 253(4) of the Income Tax Act.
13. In the alternative, the assessee has also sought permission for condomnation of delay in preferring the present cross-objections and perusal of the said petition at pages 25 to 28 of the paper book reveals that assessee was prevented by sufficient cause in filing the present cross-objection. In group cases, where the appeals have been filed after a delay ranging between 83 to 827 days, application for condonation of delays have been considered by the Tribunal and the said appeals have been admitted for disposal on merits and decided thereafter. Copies of orders in the case of group cases have been furnished at pages 35 to 63 of the paper book. Keeping in view the circumstances and various proceedings pending before different forums including the Income Tax Appellate Tribunal, Special Court, Custodian etc, we find merit in the application of the wife of the assessee.
14. In view of the totality of the f acts and circumstances of the case, we deem it fit to admit the cross-objections filed by the assessee and post the same for hearing along with departmental appeal on 18-7-2007. Both, departmental Appeal in ITA No. 3664/Mum./2004 and cross-objection of the assessee in ITA No. 211/Mum./2006 shall be fixed for hearing on 18-7-2007.
15. In the result, the preliminary objection to the filing of cross-objection is dealt with as indicated above and the present cross-objection are to be taken on record as filed in-time and both the departmental appeal in ITA No. 3664/Mum./2004 and cross-objection of the assessee in ITA No. 211/ Mum./2006 are to be listed for hearing on 18-7-2007.