G.N. DEVELOPERS, NAVI MUMBAI v. DCIT CIR 22(2), NAVI MUMBAI

ITA 1107/MUM/2010 | 2001-2002
Pronouncement Date: 03-12-2010 | Result: Allowed

Appeal Details

RSA Number 110719914 RSA 2010
Assessee PAN AACFG7218C
Bench Mumbai
Appeal Number ITA 1107/MUM/2010
Duration Of Justice 9 month(s) 22 day(s)
Appellant G.N. DEVELOPERS, NAVI MUMBAI
Respondent DCIT CIR 22(2), NAVI MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 03-12-2010
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted G
Tribunal Order Date 03-12-2010
Date Of Final Hearing 29-11-2010
Next Hearing Date 29-11-2010
Assessment Year 2001-2002
Appeal Filed On 11-02-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL 'G' BENCH MUMBAI BEFORE SHRI R.S. PADVEKAR JUDICIAL MEMBER AND SHRI B. RAMAKOTAIAH ACCOUNTANT MEMBER ITA NO. 1107/MUM/2010 (ASSESSMENT YEAR: 2001-02) M/S. G.N. DEVELOPERS DCIT CIRCLE 22(2) MUKTHYARSING SAINI VASHI NAVI MUMBAI B/4 MANJULIKA CO-OP. HSG. SOCIETY VS. PLOT NO. 28 SECTOR NO. 2 SHIVAJI CHOWK VASHI NAVI MUMBAI PAN - AACFG 7218 C APPELLANT RESPONDENT APPELLANT BY: DR. P. DANIEL RESPONDENT BY: SHRI PAVAN VED O R D E R PER B. RAMAKOTAIAH A.M. THIS APPEAL BY THE ASSESSEE IS AGAINST THE ORDER OF THE CIT XXII NAVI MUMBAI DATED 19.03.2009. 2. ASSESSEE FILED THE APPEAL WITH A CONDONATION PETITI ON SEEKING CONDONATION OF DELAY OF 257 DAYS. THE DUE DATE FOR FILING THE APPEAL WAS BY 20.05.2009. THE APPEAL WAS FILED ON 11.02.1020 WITH A DELAY OF 257 DAYS. THE REASONS FOR DELAY WERE SUBMITTED AS UNDER: - THE ASSESSEE IS A BUILDER & DEVELOPER IN VASHI & P ANVEL. FOR ALL OUR INCOME TAX AND ACCOUNTS MATTERS WE HAVE APPROACHED A QUALIFIED CHARTERED ACCOUNTANT. THE ORDER U/S. 263 WHEN RECE IVED I APPROACHED MY CHARTERED ACCOUNTANT. MY CHARTERED ACCOUNTANT ON RECEIVING THE ORDER INFORMED ME THAT NOTHING IS TO BE DONE. AFTER SOME TIME THERE WAS A DISPUTE BETWEEN THE PARTNERS IN THE PARTNERSHIP F IRM. THEN I APPROACHED ANOTHER CHARTERED ACCOUNTANT WHO ATTENDED IN MY INCOME TAX MATTERS THEREAFTER. BOTH THE CHARTERED ACCOUNTANTS DID NOT ADVISE ME TO FILE ANY APPEAL. AN AFFIDAVIT FROM MY ORIGINAL C.A MR. MAYUR M. GANGAR HAVE BEEN OBTAINED AND THE SAME IS FILED. AS THE A.O. & T.F.O. PRESSED FOR RECOVERY I APPROACHED A SENIO R LAWYER ON TAXATION MATTERS WHO ADVISED ME TO FILE MY APPEAL AGAINST T HE ORDER U/S. 263 OF THE INCOME TAX ACT 1961 AND WITHIN TWO DAYS I AM F ILING THIS APPEAL. ITA NO. 1107/MUM/2010 M/S. G.N. DEVELOPERS 2 3. IT WAS THE SUBMISSION THAT THE DELAY WAS DUE TO WR ONG ADVICE BY THE CHARTERED ACCOUNTANT AND IT WAS NOT DELIBERATE OR I NTENTIONAL. IT WAS FURTHER SUBMITTED THAT THE CONDONATION COULD NOT ADVERSELY AFFECT THE REVENUE WHEREAS IT WOULD AFFECT THE ASSESSEE. IN SUPPORT OF THE CONTENTION ASSESSEE ALSO FILED AN AFFIDAVITS OF SHRI M.S. SAINI PARTNE R OF THE FIRM ALONG THE CHARTERED ACCOUNTANT SHRI M.M. GANGAR DATED 10.02. 2010. THE CHARTERED ACCOUNTANT DID ADMIT THAT HE ADVISED THE ASSESSEE N OT TO FILE APPEAL AS THE ASSESSMENT WAS BEING FRAMED CONSEQUENT TO SETTING A SIDE OF THE ISSUE AND ACCORDINGLY HE ADVISED THAT THERE WAS NO NEED FOR F ILING THE APPEAL ON SEC.263 ORDER ITSELF. 4. THE LEARNED CIT D.R. HOWEVER OBJECTED TO THE AFFI DAVIT STATING THAT THE AFFIDAVIT WAS NOT VERIFIED AND THE SAME CANNOT BE ADMITTED AS EVIDENCE AND RELIED ON THE DECISION OF THE HON'BLE SUPREME C OURT IN THE CASE OF A.K.K. NAMBIAR VS. UNION OF INDIA AIR 1970 (SC) 652 . 5. THE LEARNED COUNSEL SUBMITTED THAT THIS IS THE PROF ORMA BEING FILED EVEN BEFORE THE HON'BLE HIGH COURT AND THERE IS A V ERIFICATION AT THE END OF THE AFFIDAVIT STATING THAT WHATEVER STATED HEREINA BOVE IS TRUE TO THE BEST OF KNOWLEDGE AND BELIEF AND NOTHING MATERIAL IS WITHHE LD. IT WAS HIS SUBMISSION THAT THIS IS PROPER VERIFICATION WHICH S UFFICES THE REQUIREMENTS OF LAW. 6. WE HAVE CONSIDERED THE ISSUE. THERE IS MERIT IN THE CONTENTIONS OF THE ASSESSEE FOR FILING THE APPEAL BELATEDLY. THE OBJEC TIONS OF THE LEARNED D.R. ARE WITH REFERENCE TO THE AFFIDAVITS BEING FILED W HICH IN HIS VIEW ARE NOT VERIFIED. THE HON'BLE SUPREME COURT IN THE CASE REL IED UPON A.K.K. NAMBIAR (SUPRA) HAS HELD WITH REFERENCE TO THE AFFIDAVIT AS UNDER: - THE REASONS FOR VERIFICATION OF AFFIDAVITS ARE TO ENABLE THE COURT TO FIND OUT WHICH FACTS CAN BE SAID TO BE PROVED ON THE AFF IDAVIT EVIDENCE OF RIVAL PARTIES. ALLEGATIONS MAY BE TRUE TO INFORMATION REC EIVED FROM PERSONS OR ALLEGATIONS MAY BE BASED ON RECORDS. THE IMPORTANCE OF VERIFICATION IS TO TEST THE GENUINENESS AND AUTHENTICITY OF ALLEGATION S AND ALSO TO MAKE THE DEPONENT RESPONSIBLE FOR ALLEGATIONS. IN ESSENC E VERIFICATION IS REQUIRED TO BE ENABLE THE COURT TO FIND OUT AS TO W HETHER IT WILL BE SFE TO ACT ON SUCH AFFIDAVIT EVIDENCE. IN ABSENCE OF PROPE R VERIFICATION AFFIDAVITS CANNOT BE ADMITTED IN EVIDENCE. ITA NO. 1107/MUM/2010 M/S. G.N. DEVELOPERS 3 7. IN THE ABOVE SAID CASE VIDE PARA 11 OF THE ORDER IT WAS STATED THAT THE APPELLANT FILED AN AFFIDAVIT IN SUPPORT OF THE PETI TION. NEITHER THE PETITION NOR THE AFFIDAVIT WAS VERIFIED. ON THE SET OF FACTS TH E HON'BLE SUPREME COURT HELD THAT IN THE ABSENCE OF PROPER VERIFICATION THE AFFIDAVIT CANNOT BE ADMITTED AS EVIDENCE. HOWEVER IN THE PRESENT CASE IT WAS SOLEMNLY AFFIRMED AND AT THE END OF THE AFFIDAVIT THERE IS A VERIFICA TION STATING THAT WHATEVER STATED HEREINABOVE IS TRUE TO THE BEST OF MY KNOWLE DGE AND BELIEF AND THIS AFFIDAVIT WAS DULY NOTARISED. SINCE THE REQUIREMEN TS OF LAW ARE FULFILLED WE ARE OF THE OPINION THAT THE TECHNICAL OBJECTION RAI SED BY THE LEARNED CIT D.R. IS NOT VALID. 8. AS FAR AS THE CONDONATION IS CONCERNED THE ASSESSEE HAS PROPER AND REASONABLE CASE IN NOT FILING THE APPEAL IN TIME AN D ACCORDINGLY THE DELAY IN FILING THE APPEAL IS CONDONED AND THE APPEAL IS ADM ITTED. 9. COMING TO THE MERITS THE CIT HAS UNDERTAKEN THE PR OCEEDINGS UNDER SECTION 263 ON AN ORDER UNDER SECTION 144 R.W.S. 14 7 DATED 05.12.2006 AND DECIDED THE ISSUES VIDE HIS ORDER UNDER SECTION 263 DATED 19.03.2009. THERE WAS AN ORDER UNDER SECTION 143(3) ORIGINALLY IN ASS ESSEES CASE FOR THE SAME ASSESSMENT YEAR DT. 05.03.2003. THIS ASSESSMENT WAS REOPENED UNDER SECTION 147 BY THE A.O. AND REASSESSMENT PROCEEDING S WERE COMPLETED WHEREIN THE A.O. MADE AN ADDITION OF ` 30 00 000/- STATING THAT THE DEDUCTIONS CLAIMED WAS NOT ALLOWABLE UNDER SECTION 37(1). THIS ORDER WAS SUBJECT MATTER OF APPEAL BEFORE THE CIT(A) AND THE ITAT. THE ITAT IN ITA NO. 4547/MUM/2008 DATED 18.12.2009 NOT ONLY HELD THAT T HE REASSESSMENT PROCEEDINGS WERE BAD IN LAW BUT ALSO THE CLAIM OF T HE ASSESSEE EVEN ON MERIT WAS ALLOWABLE AS DEDUCTION. IN VIEW OF THE F INDINGS THEREIN THE PROCEEDINGS UNDER SECTION 147 WERE QUASHED AND ASSE SSEES CONTENTIONS WERE ALLOWED. SINCE THE VERY BASIS ON WHICH THE CIT HAS UNDERTAKEN 263 PROCEEDINGS WAS HELD TO BE BAD IN LAW CONSEQUENT P ROCEEDINGS UNDER SECTION 263 ON THE SAID ORDER DATED 05.12.2006 BECO MES INFRUCTUOUS. CONSEQUENTLY THE GROUNDS RAISED BY THE ASSESSEE ON MERITS AS WELL AS THE LEGAL ISSUES ARE TO BE UPHELD AS THE ORDER UNDER SE CTION 263 IS AB INITIO VOID CONSEQUENT TO QUASHING OF THE ORDER U/144 R.W.S 147 DT.05-12-2006 ON THE ITA NO. 1107/MUM/2010 M/S. G.N. DEVELOPERS 4 BASIS OF WHICH THE PROCEEDINGS HAVE BEEN INITIATED. IN VIEW OF THIS THE GROUNDS RAISED BY THE ASSESSEE ARE CONSIDERED ALLOW ED. THE ORDER U/S 263 IS ALSO QUASHED. 10. IN THE RESULT APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 3 RD DECEMBER 2010. SD/- SD/- (R.S. PADVEKAR) (B. RAMAKOTAIAH) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI DATED: 3 RD DECEMBER 2010 COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) MUMBAI 4. THE CIT XXII NAVI MUMBAI MUMBAI CITY 5. THE DR G BENCH ITAT MUMBAI BY ORDER //TRUE COPY// ASSISTANT REGISTRAR ITAT MUMBAI BENCHES MUMBAI N.P.