UDAY C. SHAH, MUMBAI v. ITO WD 20(3)-1, MUMBAI

I.T.A NO.2675/ MUM/2010 UDAY C.SHAH 1 IN THE INCOME TAX APPELLATE TRIBUNAL F BENCH MUMBAI. [ CORAM: D.K. AGARWAL JM AND PRAMOD KUMAR AM ] I.T.A NO.2675/ MUM/2010 ASSESSMENT YEAR: 2000-2001 UDAY C.SHAH .. APPELLANT PROP. KANCHI & SONS 208 SHREEJI CHAMBERS TATA ROAD-1 OPERA HOUSE MUMBAI. PIN-400 004 PA NO.AAIPS 6826 Q VS INCOME TAX OFFICER WARD 20(3)-1 . RESPONDEN T PIRAMAL CHAMBER TARDEO ROAD NEAR MORARJI MILLS PAREL MUMBAI. APPEARANCES: B.V.JHAVERI FOR THE APPELLANT L.K. AGARWAL FOR THE RESPONDENT O R D E R PER PRAMOD KUMAR: 1. BY WAY OF THIS APPEAL THE ASSESSEE HAS CALLED INTO QUESTION CORRECTNESS OF CIT(A)S ORDER DATED1.2.2010 IN THE MATTER OF ASSESSMEN T UNDER SECTION 143(3) OF THE INCOME TAX ACT 1961 FOR THE ASSESSMENT YEAR 2000 -2001 ON THE FOLLOWING GROUNDS:- 1. THE CIT (A) ERRED IN DISPOSING OF THE APPEAL EXPA RTE BY PASSING THE ORDER ON 1 ST FEBRUARY 2010 EVEN THOUGH THE ASSESSEES ADVOCATE SHRI B.V.JHAVERI HAD SENT A PAPER BOOK WITH A COVERING L ETTER ON 21 ST JANUARY 2010 WHICH WAS NOT ACCEPTED ON THE GROUND T HAT THE HEARING WAS FIXED IN THE MORNING ON 21 ST JANUARY 2010. 2. THE CIT(A) ERRED IN UPHOLDING THE REOPENING OF THE ASSESSMENT. I.T.A NO.2675/ MUM/2010 UDAY C.SHAH 2 3. THE CIT (A) ERRED IN UPHOLDING THE COMPUTATION O F DEDUCTION U/S. 80 HHC OF THE ACT AT ` .1 36 60 563 AS AGAINST THE CLAIM OF THE ASSESSEE OF ` .1 41 94 842. 2. TO ADJUDICATE ON THIS APPEAL IT IS SUFFICIENT TO T AKE NOTE OF THE FACT THAT THE CIT (A) HAS DISPOSED OF THE MATTER EX PARTE ON THE GROUND THAT NOTICES OF HEARING AS ISSUED BY THE CIT (A) WERE NOT COMPLIED WITH. IT WA S OBSERVED BY THE CIT (A) THAT HEARING SCHEDULED FOR 9 TH SEPTEMBER 2009 HAD TO BE ADJOURNED ON THE GROUND THAT THE CHARTERED ACCOUNTANT HANDLING THE MATTER WAS ADM ITTED IN THE HOSPITAL. ON TWO SUBSEQUENT OCCASIONS I.E. ON 5.10.2009 AND 27.11.2009 THERE WAS NO COMPLIANCE TO THE NOTICES OF HEARING. ON 18.12.2009 THE ASSESSEE SOUG HT ADJOURNMENT ON THE GROUND THAT THE C.A. HANDLING THE MATTER HAS SINCE P ASSED AWAY. THE MATTER WAS ACCORDINGLY ADJOURNED TO 11/1/2010. HOWEVER ON T HE SAID DATE AGAIN ADJOURNMENT WAS SOUGHT BY THE ASSESSEE ON THE GROUND THAT THE ADVOCATE HANDLING THE MATTER WAS BUSY IN THE HONBLE BOMBAY HIGH COURT. THE CASE WAS THUS FINALLY ADJOURNED TO 21.1.2010 AT 11.30AM. HOWEVER ON THE SAID DATE NONE APPEARED FOR THE HEARING AND IT WAS IN THIS BACKGROUND THAT THE MA TTER WAS DECIDED EXPARTE. 3. LEARNED COUNSEL FOR THE ASSESSEE POINTS OUT THAT M.H. DALAL CA WHO WAS HANDLING THE MATTER OF THE ASSESSEE WAS SERIOUSLY ILL AN D THEREFORE HAD TO BE HOSPITALIZED. IT WAS BECAUSE OF THIS ILLNESS THAT M.H.DA LAL LATER PASSED AWAY. IT WAS IN THIS BACKDROP THAT THE ADJOURNMENTS WERE SOUGHT BY THE ASSESSEE. IT HAS ALSO BEEN POINTED OUT THAT ADJOURNMENT WAS SOUGHT ON 11.1. 2010 ON THE GROUND THAT SHRI B.V.JHAVERI LEARNED ADVOCATE WAS BUSY BEFORE THE HO NBLE HIGH COURT AND ON 21.1.2010 WHICH WAS THE SCHEDULED DATE OF HEARING S HRI JHAVERI DID VISIT THE CIT (A)S OFFICE AT 2.45 PM. HOWEVER NEITHER THE CIT ( A) ACCEPTED THE COMPILATION NOR THE WRITTEN NOTE PREPARED BY THE ASSESSEE ON THE GROUND THAT THE HEARING WAS SCHEDULED AT 11.430AM. IT IS FURTHER POINTED OUT THA T ON SUCH A REFUSAL OF CIT (A) TO RECEIVE THE SUBMISSIONS AND COMPILATION THESE DOCUMENTS WERE MADE TO THE CIT (A) OFFICE BY SPEED POST. WITH THE HELP OF THESE FACTS LE ARNED COUNSEL MADE AN EFFORT TO DEMONSTRATE THAT NON-APPEARANCE OF THE ASSESSEE BEFOR E THE CIT (A) WAS NOT MALAFIDE AND WAS ON ACCOUNT OF FACTORS BEYOND ASSESSEES C ONTROL. EVEN THOUGH I.T.A NO.2675/ MUM/2010 UDAY C.SHAH 3 LEARNED COUNSEL IS KEEN THAT WE SHOULD HEAR THE MATTE R ON MERITS AND SHOULD NOT SEND BACK THE MATTER FOR FRESH ADJUDICATION BY THE CI T (A) WE CONSIDER IT APPROPRIATE TO DEAL WITH THIS GRIEVANCE AGAINST THE O RDER BEING EXPARTE. 4. LEARNED DEPARTMENTAL REPRESENTATIVE ON THE OTHER HAND RELIES UPON THE STAND TAKEN BY THE CIT (A). 5. HAVING REGARD TO THE RIVAL CONTENTIONS AND HAVING PERUSED THE MATERIAL PLACED ON RECORD WE ARE OF THE CONSIDERED VIEW THAT IT WAS NOT A FIT CASE TO DECIDE THE MATTER EXPARTE AS THE REASON FOR WHICH ADJOURNME NTS SOUGHT WERE APPARENTLY NOT MALAFIDE OR UNREASONABLE. IT IS A MATTER OF RECO RD THAT THE C.A. WHO WAS HANDLING THE TAX MATTER OF THE ASSESSEE WAS HOSPITALIZED AND LATER PASSED AWAY AND IN THESE CIRCUMSTANCES ADJOURNMENTS SOUGHT BY THE ASSESSEE CANNOT BE SAID TO BE UNREASONABLE. SIMILARLY AS FAR AS APPEARANCE OF SHRI B.V.JHAVERI IS CONCERNED ON ONE OCCASION HE WAS BUSY BEFORE THE HONBLE HIGH COUR T WHICH IS NOT A FRIVOLOUS REASON AND ON OTHER OCCASION LEARNED COUNSEL DID APPE AR BEFORE THE CIT (A) THOUGH LITTLE LATE ON THE DAY. IT DOES NOT SEEMS TO BE A C ASE IN WHICH MATTER SHOULD BE DECIDED EXPARTE. KEEPING IN VIEW THE ENTIRETY OF T HE FACTS AND CIRCUMSTANCES OF THE CASE WE DEEM IT FIT AND PROPER TO REMIT THE MATTER BACK TO THE FILE OF THE CIT (A) FOR FRESH ADJUDICATION ON MERITS AFTER HEARING THE ASSESSEE. 6. SINCE WE HAVE REMITTED THE MATTER TO THE FILE OF THE CIT(A) FOR FRESH ADJUDICATION THERE IS NO NECESSITY TO ADJUDICATE OTH ER GROUNDS OF APPEAL RAISED BY THE ASSESSEE. 7. IN THE RESULT APPEAL IS TREATED AS ALLOWED FOR STAT ISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON 23 RD FEBRUARY 2011 SD/- (D.K.AGARWAL ) (JUDICIAL MEMBER) SD/- (PRAMOD KUMAR) (ACCOUNTANT MEMBER) MUMBAI DATED 23 RD FEBRUARY 2011 PARIDA I.T.A NO.2675/ MUM/2010 UDAY C.SHAH 4 COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. COMMISSIONER OF INCOME TAX (APPEALS) 31 MUMBAI 4. COMMISSIONER OF INCOME TAX 20 MUMBAI 5. DEPARTMENTAL REPRESENTATIVE BENCH F MUMBAI //TRUE COPY// BY ORDER ASSTT. REGISTRAR ITAT MUMBAI I.T.A NO.2675/ MUM/2010 UDAY C.SHAH 5