Loading judgment…
No AI summary yet for this case.
Income Tax Appellate Tribunal, KOLKATA ‘C’ BENCH, KOLKATA
Before: SRI RAJPAL YADAV & SRI RAJESH KUMAR
order : July 6th, 2023 ORDER Per Rajpal Yadav, Vice-President (KZ): The assessee is in appeal before the Tribunal against the order of Commissioner of Income Tax (Appeals) [in short ld. 'CIT(A)'] dated 16.11.2022 passed for AY 2013-14.
The solitary grievance of the assessee is that ld. CIT(A) has erred in dismissing the appeal of the assessee on a preliminary issue that the appeal I.T.A. No.: 37/KOL/2023 Assessment Year: 2013-2014 The Braithwate Burn & Jessop Construction Company Limited. is being not signed by the Managing Director rather Manager, Finance. In other words, according to ld. CIT(A), the appeal ought to have been signed either by the Managing Director or the Director of the appellant company whereas in the present case the appeal has been signed by Deputy Manager, Finance & Accounts who is not a competent person for verifying the appeal form, hence ld. CIT(A) has dismissed the appeal in limine.
In response to the notice of hearing an employee from the assessee company namely Vijay Kumar appeared and sought an adjournment. After perusing the impugned order, we did not deem it appropriate to adjourn the hearing. We have gone through the record with the assistance of ld. D/R and proceed to decide the appeal on merit.
Brief facts of the case are that assessee is a Central Public Sector Enterprise under Ministry of Heavy Industry, Govt. of India. It has filed its return of income electronically for AY 2013-14 on 28.09.2013 at a total income of Rs. 58,31,08,360/-. The Assessing Officer (in short ld. 'AO') has passed an assessment order on 08.01.2016 u/s 143(3) of the Income Tax Act, 1961 (in short the 'Act'). In the return filed by the assessee it has claimed MAT credit of Rs. 3,14,03,485/- which was verified by ld. AO during the scrutiny assessment and such MAT credit was allowed. Ld. AO thereafter determined that taxable income of the assessee after adjusting the brought forward losses and giving credit of MAT, ld. AO has determined the tax payable by the assessee. After some time, ld. AO has suo moto initiated proceeding u/s 154 of the Act for rectifying certain error. He passed the impugned order on 08.10.2018.
Dissatisfied with this rectification order, the assessee carried the matter in appeal before ld. CIT(A). Ld. first Appellate Authority instead of decide the appeal on merit, dismissed it for the simple reason that appeal form was not signed by the Director/Managing Director. The finding of ld. CIT(A) read as under:
I.T.A. No.: 37/KOL/2023 Assessment Year: 2013-2014 The Braithwate Burn & Jessop Construction Company Limited. “The Present appeal is against order u/s. 154 of the Act dated 08.10.2018 which has been signed by Chandrima Baneijee, Deputy Manager (F & A) of the Appellant Company. As per section 140 (Return to whom to be verified), which is as under:- 140. The return under 35[section 115WD or] section 139 shall be 36[***] verified— [(a) ………………………………………………………. (b) ………………………………………………………. [(c) in the case of a company, by the managing director thereof, or where for arty unavoidable reason such managing director is not able to 42[***] verify the return, or where there is no managing director, by any director thereof 43[or any other person, as may be prescribed for this purpose]: [Provided that where the company is not resident in India, the return may be 45[***] verified by a person who holds a valid power of attorney from such company to do so, which shall be attached to the return 46: Provided further that – 1. Where the company is being wound up, whether under the orders of a court or otherwise, or where any person has been appointed as receiver of any assets of the company, the return shall be 47[***] verified by the liquidator referred to in sub-section (1) of section 178; 1. Where the management of the company has been taken over by the central government or any state government under any law, the director of the company shall be 47[***] verified by the principal officer thereof; [or] 1. 1. where in respect of a company, an application for corporate insolvency resolution process has been admitted by the Adjudicating Authority under section 7 or section 9 or section 10 of the Insolvency and Bankruptcy Code, 2016 (31 of 2016), the return shall be verified by the insolvency professional appointed by such Adjudicating Authority. Explanation.—For the purposes of this clause the expressions "insolvency professional" and" Adjudicating Authority" shall have the respective meanings assigned to them in clause (18)50of section 3 and clause (1) of section 550 of the Insolvency and Bankruptcy Code, 2016.
6. Further, the appeal u/s. 249(1) also shall be verified in the prescribed manner. Rule 45 further says: The Form of appeal prescribed by Sub-rule (1), the grounds of appeal and the form of verification appended there too relating to an assessee shall be I.T.A. No.: 37/KOL/2023 Assessment Year: 2013-2014 The Braithwate Burn & Jessop Construction Company Limited. signed and verified by the person who is authorised to sign the return of income u/s 140 of the Income Tax Act, 1961, as applicable to the assessee.
Therefore the appeal filed is not a valid appeal. Consequently, the appeal is dismissed without deciding the merits.
8. In the result, the appeal is dismissed.”
A perusal of the appeal form and other details would reveal that the stand of the assessee is that Deputy Manager, Finance is an authorized officer under the delegation of administrative powers which was duly approved by the Board of Directors. When we put it to ld. D/R, she was unable to controvert.
7. On due consideration of the record, we are of the view that impugned order of ld. CIT(A) is not sustainable. Ld. CIT(A) ought to have appreciated that it is just a procedural defect which can be cured, had it been pointed out to the assessee. It is also pertinent to note that had the assessee was confronted with regard to the deficiency in verification of the appeal form then probably the assessee could have submitted the fresh Form no.-35. It is also pertinent to note that once assessee has been claiming that its Deputy Manager, Finance has been authorized by the Board of Directors for signing income tax return as well as appeal form, then it was incumbent upon ld. CIT(A) to decide whether such an authority can sign the appeal forms or not. Such an authority would be functioning as a representative of the assessee under the delegation of the powers. It is akin to an authorized power of attorney holder for acting on behalf of any individual/entity. All these aspects have not been noticed by ld. first Appellate Authority. Ld. CIT(A) has just reproduced the procedure required to be adopted but in case an explanation is being given that has not been gone into. It suggests that ld. first Appellate Authority has miserably failed in adhering to the procedure or basic procedure of law required to be followed by him. This order is not sustainable, accordingly we set aside this order and direct ld. CIT(A) to decide the appeal on merit. The assessee is directed to submit copy of authorization letter in I.T.A. No.: 37/KOL/2023 Assessment Year: 2013-2014 The Braithwate Burn & Jessop Construction Company Limited. favour of Deputy Manager, Finance along with the copy of the Board approval by the Board of Directors. In view of the above, the appeal of the assessee is allowed for statistical purposes.
In the result, the appeal filed by the assessee is allowed for statistical purposes. Kolkata, the 6th July, 2023