Income Tax Appellate Tribunal - Bangalore
Abdul Kareem Ladsab Telgi, Bangalore vs Assessee
IN THE INCOME TAX APPELLATE TRIBUNAL
BANGALORE 'B' BENCH, BANGALORE
BEFORE SHRI SHAILENDRA KUMAR YADAV, JM
AND
SHRI N.L.KALRA, AM
WTA Nos. 5 to 14(Bang.)/2009
(Assessment years : 1999-2000,2001-02-2004-05 and
1999-2000 to 2004-05)
Shri Abdul Kareem Lad Sab Telgi
Now lodged in Hospital Room No.8, Central Jail,
Parappana Agrahara,
Bangalore Appellant
Vs
The Assistant Commissioner of Income-tax,
Central Circle-(1),
Bangalore Respondent
Appellant by : Shri K.Y.Ningoji Rao
Revenue by : Smt.V.S.Sreelekha
ORDER
PER BENCH:
The assessee has filed appeals against the orders of the CWT(A), Bangalore. The AO completed the wealth tax assessment and has also imposed penalty u/s 18(1)(c) of the Wealth Tax Act, 1957 for the assessment years 1999-200 to 2004-05 (except 2000-01). The assessee filed appeals against the wealth tax assessment orders as well as against the orders imposing penalty before the CIT(A).2 WTA Nos.5 to 14(B)/09
2. First we shall take up the appeals filed against the wealth tax assessment order for the assessment years 1999-2000 to 2004-05, except 2000-01.
3. The AO issued notice u/s 16(4) on 28-10-2004, in which the assessee was asked to file the return of wealth. As per AO, there was no reply to this notice. Since the assessment was going to be barred by limitation on 31-03-2005, the AO therefore, completed the wealth tax assessment by estimating the value of properties known as Shirin Manzil and Alankar Lodge and the assessment has been completed ex-parte.
4. The assessee has filed the appeal before the CWT(A) belatedly. It was submitted that the assessee was in Police custody since 07-11-2001. Photocopies of the wealth tax assessment orders were received by the authorized representative on 06-10-2008 and therefore, the appeals were filed on 06-11- 2008. The CWT(A) held that the assessee was negligent and had not shown sufficient cause for the condonation of delay. Hence, the appeals were dismissed, as filed belatedly.
5. Before us, the authorized representative in the grounds of appeal had submitted that the property known as Shirin Manzil is not the property of the assessee. The said property was taken as tenant and was being used for business purposes. Similarly, 3 WTA Nos.5 to 14(B)/09 the property known as Alankar Lodge was also taken as tenant. Before us, the authorized representative has also filed a request for admitting additional evidences. In the paper book filed, the assessee had also given the copy of the reply given by CBI in (MCOCA) Pune, Special Case No.2/2003 before the Court of Special Judge, in which the nature of rights in various properties had been mentioned.
6. We have heard both parties. It is seen that the AO has not provided adequate opportunity of hearing to the assessee, before completing the assessment. For adopting the value of properties for the purpose of wealth tax, the AO has not referred the said properties to the valuation cell, but has taken the value on adhoc basis. The CWT(A) has not admitted the appeal by condoning the delay. In the request for condonation of delay before the CWT(A), it is mentioned that the assessee was not aware of the assessment, but the assessee became aware of the assessment when the proceedings were initiated by the Tax Recovery Officer. The Tax Recovery Officer tried to recover the demand by auctioning the properties one by one. No person is going to be benefited by filing the appeals belatedly. It is substantial cause of justice, which should be served. In the additional evidences filed by the assessee, the assessee has filed 4 WTA Nos.5 to 14(B)/09 documents to show that the properties assessed by the wealth tax officer were used by him as tenant. It is also on record that the AO before making assessment u/s 16(5) of the WT Act, 1957 has not proposed to assessee, as to how he is going to assess the value. Hence, there is total lack of opportunity to the assessee. The CWT(A) should have condoned the delay and would have decided the issue on merits. After considering the nature of material to be considered for concluding the wealth assessment. We think that it is reasonable to set aside the assessment, so that the wealth tax officer gets an opportunity to appreciate the evidences for making the wealth tax assessment. Hence, the assessment order is set aside.
Assessment year : 2001-02
7. The assessment for the assessment year 2001-02 is on similar lines, as per the assessment year 1999-2000, except that in this year wealth tax officer has included 10 properties in the wealth tax of the assessee. The AO has not given basis for the value to be estimated in respect of each property. These properties have not been referred to the Valuation Cell. The wealth tax officer has not considered the applicability of Schedule III of WT Act. The CWT(A) has disposed all the appeals by holding that the appeals were filed belatedly and the assessee has not been able to give 5 WTA Nos.5 to 14(B)/09 sufficient reasons for condonation of delay, hence the appeals were dismissed as filed belatedly. Considering our findings for the assessment years 1999-2000, we feel it proper to set aside this assessment on the file of the wealth tax officer. Assessment years : 2002-03 to 2004-05
8. The facts in respect of these appeals are same as per the assessment year 2001-02, except that the number of properties are different. Following our findings for the assessment year 2001-02, these assessments are also set aside.
9. During the course of assessment proceedings, the authorized representative has assured us that the wealth tax returns will be filed, so that the assessee shows the value of each property, as per the provisions of law by returning the wealth. The wealth tax officer will be in a position to fairly ascertain the value of properties as per the provisions law. In case, if he wants to increase the value beyond the percentage prescribed under sec.16(5) of Wealth tax Act, then he will be required to refer the same to the valuation cell.
10. Since we are setting aside the wealth tax assessments, the penalty imposed for all the above referred assessment years are also set aside and are to be made on the basis of the wealth tax assessments.
6 WTA Nos.5 to 14(B)/09
11. In the result, all the appeals filed by the assessee are allowed for statistical purposes.
Order pronounced in the open court on the date of hearing.
(SHAILENDRAKUMARYADAV) (N.L.KALRA)
JUDICIAL MEMBER ACCOUNTANT MEMBER
Place: Bangalore
Dated: 2009
am*
Copy to :
1. The Assessee
2. The Revenue
3. CIT(A)
4. CIT
5. DR
6. GF(B'lore)
7. GF(Delhi)
By Order
AR, ITAT, BANGALORE