M/s. Reliance Construction Co.,, Ahmedabad v. The ACIT.,(OSD) Circle-9,, Ahmedabad

ITA 499/AHD/2011 | 1996-1997
Pronouncement Date: 22-07-2011 | Result: Partly Allowed

Appeal Details

RSA Number 49920514 RSA 2011
Bench Ahmedabad
Appeal Number ITA 499/AHD/2011
Duration Of Justice 5 month(s) 3 day(s)
Appellant M/s. Reliance Construction Co.,, Ahmedabad
Respondent The ACIT.,(OSD) Circle-9,, Ahmedabad
Appeal Type Income Tax Appeal
Pronouncement Date 22-07-2011
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted D
Tribunal Order Date 22-07-2011
Assessment Year 1996-1997
Appeal Filed On 18-02-2011
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH D AHMEDABAD BEFORE SHRI MUKUL SHRAWAT JUDICIAL MEMBER AND SHRI A.N. PAHUJA ACCOUNTANT MEMBER ITA NO. 4 99 /AHD/ 2011 ASSESSMENT YEAR:1996-97 DATE OF HEARING:15.7.11 DATE OF DRAFTING:20.7.11 M/S. RELIANCE CONSTRUCTION CO. NEAR C.P.NAGAR NEAR VARDHMANNAGAR FLATS GHATLODIA AHMEDABAD [PAN :AALPS1024P] V/S . DEPUTY COMMISSIONER OF INCOME-TAX CIRCLE- 3 AHMEDABAD (APPELLANT) .. (RESPONDENT) ASSESSEE BY :- SHRI M.K. PATEL AR REVENUE BY:- SHRI B.L. YADAV DR O R D E R A.N.PAHUJA :THIS APPEAL BY THE ASSESSEE AGAINST AN ORDER DATE D 13-12-2010 OF THE LD. CIT(APPEALS)-XV AHMEDABAD RAISES THE F OLLOWING GROUNDS:- (1) THAT THE LEARNED COMMISSIONER OF INCOME-TAX (A PPEALS) HAS GRIEVOUSLY ERRED IN LAW AND ON FACTS IN DISPOSING THE APPEAL E X PARTE WITHOUT GIVING OPPORTUNITY TO THE APPELLANT TO REPRESENT THE APPEA L. (2) THAT ON FACTS AND IN LAW THE LEARNED CIT(APPEAL S) HAS GRIEVOUSLY ERRED IN DISPOSING THE APPEAL WITHOUT PASSING A SPEAKING ORD ER ON MERITS AND ONLY DISPOSING THE MATTER IN A SUMMARY MANNER. (3) THAT ON FACTS THE APPEAL OUGHT TO HAVE BEEN DEC IDED ON MERITS BY A SPEAKING ORDER BY CONSIDERING THE REPLIES SUBMISSI ONS ETC. FILED DURING ASSESSMENT PROCEEDINGS AND ALREADY ON RECORD OF THE DEPARTMENT. 4. THE APPELLANT CRAVES LEAVE TO ADD ALTER AMEND ANY GROUND OF APPEAL. 2. FACTS IN BRIEF AS PER THE RELEVANT ORDERS ARE THAT RETURN DECLARING INCOME OF RS.26 69 904/- FILED ON 31-08-1996 BY THE ASSESSEE AFTER BEING PROCESSED ON 24- 12-1996 U/S.143(1) OF THE INCOME-TAX ACT 1961 (HER EINAFTER REFERRED TO AS ACT) WAS SELECTED FOR SCRUTINY. SUBSEQUENTLY ASSESSMENT IN T HIS CASE WAS COMPLETED U/S 143(3) OF THE ACT ON 12-03-1999 DETERMINING TOTAL INCOME OF RS.45 08 828/-. SINCE ITA NO.499/AHD/2011 A.Y. 1996- 97 M/S RELIANCE CONSTN. CO. V. ACIT CIR-9 ABD PAGE 2 AN AMOUNT OF RS.13 94 908/- ADDED IN THE ASSESSMENT ORDER WAS INADVERTENTLY NOT CONSIDERED IN THE TOTAL INCOME AN ORDER U/S.154 OF THE ACT WAS PASSED 23-06-2000 ADDING THE SAID AMOUNT RESULTING IN TOTAL INCOME O F RS.59 03 376/-. 2.1. ON APPEAL THE LD. CIT(APPEALS) DELETED THE FOL LOWING DISALLOWANCES: I. OUT OF DISALLOWANCE OF LABOUR EXPENSES RS.7 7 0 903/- II. OUT OF ADDITION ON ACCOUNT OF UNEXPLAINED CASH CREDITS RS.2 02 114/- III OUT OF DISALLOWANCE OF CAR DEPRECIATION RS. 10 880/- IV. OUT OF ADDITION ON ACCOUNT OF UNEXPLAINED DEPOSITS (VIDE ORDER U/S 154 DTD. 23.06.2000) RS.13 94 908/- 2.2. ON FURTHER APPEAL BY THE ASSESSEE AND THE REVE NUE THE ITAT VIDE THEIR ORDER DATED 16.11.2007 IN ITA NO.1334/AHD/2001 AND 1243/A HD/2001 RESTORED THE ISSUES INVOLVED IN BOTH THE APPEALS BACK TO THE FILE OF A SSESSING OFFICER FOR FRESH ADJUDICATION IN ACCORDANCE WITH LAW AFTER ALLOWING SUFFICIENT OPPORTUNITY TO THE ASSESSEE. ACCORDINGLY THE ASSESSING OFFICER DETERM INED THE TOTAL INCOME OF RS.55 48 424/- WITH THE FOLLOWING DISALLOWANCES:- ADDITION ON ACCOUNT OF SUPPRESSION OF DEVELOPME NT FEE RS. 1 99 826/- DISALLOWANCE OUT OF LABOUR EXPENDITURE RS. 78 694/- DISALLOWANCE OUT OF PAYMENT MADE TO LABOUR CONT RACTORS RS.10 31 473/- ADDITION OF ON-MONEY CASH RECEIPTS RS.15 68 527/- 3. ON APPEAL DESPITE REPEATED OPPORTUNITIES FOR HE ARING ON 29-04-2010 21-05- 2010 10-06-2010 24-06-2010 & 29-11-2010 NONE APP EARED ON BEHALF OF THE ASSESSEE NOR ANY WRITTEN SUBMISSIONS OR EXPLANATION WAS FILED. IN THESE CIRCUMSTANCES THE LD. CIT(APPEALS) WITHOUT GOING INTO THE MERITS OF VARIOUS ADDITIONS DISMISSED THE APPEAL OF THE ASSESSEE. 4. THE ASSESSEE IS NOW IN APPEAL BEFORE US CONTENDI NG THEREIN THAT THE LD. CIT(APPEALS) DISPOSED OF THE APPEAL WITHOUT GIVING OPPORTUNITY TO THE ASSESSEE AND WITHOUT PASSING A SPEAKING ORDER. THE LD. AR APPEAR ING BEFORE US AGREED THAT THE ASSESSEE UNDERTAKES TO APPROACH THE LD. CIT(A) FOR EXPEDITIOUS DISPOSAL OF APPEAL AND SHALL NOT SEEK ANY ADJOURNMENT IN THE EVENT MA TTER IS RESTORED BACK TO HER FILE. THE LD. DR ON THE OTHER HAND SUPPORTED THE IMPUGN ED ORDER. ITA NO.499/AHD/2011 A.Y. 1996- 97 M/S RELIANCE CONSTN. CO. V. ACIT CIR-9 ABD PAGE 3 5. WE HAVE HEARD BOTH THE PARTIES AND GONE THROUGH THE FACTS OF THE CASE. INDISPUTABLY THE ASSESSEE WAS ALLOWED VARIOUS OPPO RTUNITIES BY THE LD. CIT(A) FOR HEARING ON 15.4.2010 29-04-2010 21-05-2010 10-06 -2010 24-06-2010 & 29-11- 2010. NONE APPEARED ON BEHALF OF ASSESSEE BEFORE TH E LD. CIT(A) EXCEPT FOR SEEKING ADJOURNMENT ON 15.4.2010 NOR ANY WRITTEN SUBMISSIO NS OR REASONS FOR ABSENCE ON VARIOUS DATES WERE FILED. THUS PLEA OF THE ASSES SEE IN GROUND NO.1 OF THEIR APPEAL THAT THE LD. CIT(A) DISPOSED OF THE APPEAL EXPARTE WITHOUT GIVING OPPORTUNITY TO THE ASSESSEE IS BASELESS AND IS THEREFORE REJECTED. T HE LD. AR APPEARING BEFORE US DID NOT PLACE ANY MATERIAL EVIDENCING THAT THE ASSESSE E EVER ATTEMPTED TO APPEAR BEFORE THE LD. CIT(A) ON 29-04-2010 21-05-2010 10 -06-2010 24-06-2010 & 29-11- 2010.IN THESE CIRCUMSTANCES WE DO NOT FIND ANY MER IT IN GROUND NO.1 IN THE APPEAL. 5.1. AS REGARDS GROUND NOS.2 & 3 IN THE APPEAL AS IS APPARENT THE AFORESAID ORDER OF THE LD. CIT(A) IS NOT A SPEAKING ORDER. TH E LD. CIT(A) WHILE UPHOLDING THE ADDITIONS MADE BY THE AO DID NOT ANALYSE THE ISSUE S NOR ASSIGNED ANY REASONS. A MERE GLANCE AT THE IMPUGNED ORDER REVEALS THAT THE ORDER PASSED BY THE LD. CIT(A) IS CRYPTIC AND GROSSLY VIOLATIVE OF ONE OF THE FACETS OF THE RULES OF NATURAL JUSTICE NAMELY THAT EVERY JUDICIAL/QUASI-JUDICIAL BODY/AUT HORITY MUST PASS REASONED ORDER WHICH SHOULD REFLECT APPLICATION OF MIND BY THE CON CERNED AUTHORITY TO THE ISSUES/POINTS RAISED BEFORE IT. THE APPLICATION OF MIND TO THE MATERIAL FACTS AND THE ARGUMENTS SHOULD MANIFEST ITSELF IN THE ORDER. SECT ION 250(6) OF THE INCOME TAX ACT 1961 MANDATES THAT THE ORDER OF THE CIT(A) WHILE D ISPOSING OF THE APPEAL SHALL BE IN WRITING AND SHALL STATE THE POINTS FOR DETERMINATIO N THE DECISION THEREON AND THE REASON FOR THE DECISION. THE REQUIREMENT OF RECORD ING OF REASONS AND COMMUNICATION THEREOF HAS BEEN READ AS AN INTEGRAL PART OF THE CONCEPT OF FAIR PROCEDURE. THE REQUIREMENT OF RECORDING OF REASONS BY THE QUASI-JUDICIAL AUTHORITIES IS AN IMPORTANT SAFEGUARD TO ENSURE OBSERVANCE OF T HE RULE OF LAW. IT INTRODUCES CLARITY CHECKS THE INTRODUCTION OF EXTRANEOUS OR I RRELEVANT CONSIDERATIONS AND MINIMIZES ARBITRARINESS IN THE DECISION-MAKING PROC ESS. WE MAY REITERATE THAT A DECISION DOES NOT MERELY MEAN THE CONCLUSION. I T EMBRACES WITHIN ITS FOLD THE REASONS FORMING BASIS FOR THE CONCLUSION.[MUKHTIAR SINGH VS. STATE OF PUNJAB (1995)1SCC 760(SC)]. AS IS APPARENT THE IMP UGNED ORDER SUFFERS FROM LACK OF REASONING AND IS NOT A SPEAKING ORDER. IN VIE W OF THE FOREGOING ESPECIALLY WHEN THE LD. CIT(A) HAS NOT PASSED A SPEAKING ORDER ON VARIOUS ISSUES RAISED IN GROUND ITA NO.499/AHD/2011 A.Y. 1996- 97 M/S RELIANCE CONSTN. CO. V. ACIT CIR-9 ABD PAGE 4 NOS. 1 TO 4 IN THE APPEAL BEFORE HER WE CONSIDER I T FAIR AND APPROPRIATE TO SET ASIDE THE ORDER OF THE LD. CIT(A) AND RESTORE THE MATTER TO HER FILE FOR DECIDING THE ISSUES RAISED IN THE GROUNDS RAISED BEFORE HER BY THE ASS ESSEE AFRESH IN ACCORDANCE WITH LAW AFTER ALLOWING SUFFICIENT OPPORTUNITY TO BOTH THE PARTIES. NEEDLESS TO SAY THAT WHILE REDECIDING THE APPEAL THE LEARNED CIT(A) SHA LL PASS A SPEAKING ORDER KEEPING IN MIND INTER ALIA THE MANDATE OF PROVISIONS OF S EC. 250(6) OF THE ACT. WE MAY CLARIFY THAT AS UNDERTAKEN BY THE LD. AR APPEARING BEFORE U S THE ASSESSEE SHALL APPROACH THE LD. CIT(A) FOR EXPEDITIOUS DISPOSAL OF APPEAL A FTER RECEIPT OF THIS ORDER AND SHALL NOT SEEK ANY ADJOURNMENT WITHOUT VALID REASONS. WIT H THESE OBSERVATIONS GROUND NOS. 2 & 3 IN THE APPEAL ARE DISPOSED OF. 6. NO ADDITIONAL GROUND HAVING BEEN RAISED BEFORE US IN TERMS OF THE RESIDUARY GROUND NO. 4 IN THE APPEAL ACCORDINGLY THIS GROUN D IS DISMISSED. 7. IN THE RESULT APPEAL IS PARTLY ALLOWED BUT FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON 22/07 /2011 SD/- SD/- (MUKUL SHRAWAT) (A.N. PAHUJA) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) AHMEDABAD DATED : 22/07/2011 *DKP COPY OF THE ORDER FORWARDED TO:- 1. M/S. RELIANCE CONSTRUCTION CO. NR. C.P.NAGAR NEARVARDHMANNAGAR FLATS GHATLODIA AHMEDABAD 2. DEPUTY COMMISSIONER OF INCOME-TAX CIRCLE-3 AH MEDABAD. 3. CIT(APPEALS)-XV AHMEDABAD 4. CIT CONCERNED 5. THE DR ITAT D BENCH AHMEDABAD 6. GUARD FILE. BY ORDER DEPUTY / ASSTT.REGISTRAR ITAT AHMEDABAD