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Income Tax Appellate Tribunal, “G” BENCH, MUMBAI
Before: SHRI PRASHANT MAHARISHI & SHRI SANDEEP SINGH KARHAIL
The present appeal has been filed by the assessee challenging the impugned order dated 29/11/2021, passed under section 250 of the Income Tax Act, 1961 (“the Act”) by the learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, [“learned CIT(A)”], for the assessment year 2014–15.
2. In this appeal, the assessee has raised the following grounds:
Sudarshan Roshanlal Kharbanda ITA No.1677/Mum./2022 “1. The order of the Learned Commissioner of Income-tax (Appeals) and that of the Assessing Officer is contrary to the facts and circumstances of the case and is against the principles of equity and natural justice.
The Learned Commissioner of Income Tax (Appeals) has passed an ex-party order under section 143(3) without considering the responses filed against the notices issued during the proceedings.
3. The Learned Commissioner of Income-tax (Appeals) has erred in stating that no response was received to the notices issued by the CIT(A)/CIT(AU).
Sr. Date of Submission Date of Notice Date of Hearing no. Adjournment sought 13.01.2021 28.01.2021 at 11:00 AM 1. Adjournment sought 21.10.2021 28.10.2021 at 01:17 PM 2. Response filed on 15/11/2021 05.11.2021 22.11.2021 at 11:00 AM 3. (Acknowledgment attached)
4. The Learned Commissioner of Income-tax (Appeals) has erred in not mentioning about the hearing notice issued u/s 250 vide DIN: ITBA/NFAC/F/APL 1/2021- 22/1037000267(1) dated 17/11/2021 wherein date of hearing was fixed on 24/11/2021 and response was submitted on 23/11/2021 (acknowledgment attached)).
5. The Learned Commissioner of Income-tax (Appeals) has erred in rejecting the legitimate claim of deduction under section 801C(2)(a)(ii) of the Act without bringing any material on record. 6. The Learned Commissioner of Income-tax (Appeals) has erred in concluding that since the audit report in Form No. 10CCB has alleged error in reporting at column no, 25(1), the appellant is not eligible to claim deduction u/s 801C of the Act, without bringing any further ground or material on record 7. The Learned Commissioner of Income-tax (Appeals) has erred in ignoring the order of the Commissioner of Income Tax (Appeals) in the appellants' case for the AY 2011-12 wherein it was held that the activity of manufacturing carried out by the appellant in the notified areas squarely falls within the criteria to claim deduction u/s 801C(2)(a)(ii) of the Act. 8. The Learned Commissioner of Income-tax (Appeals) has erred in concluding and pointing out the following so-called discrepancies: a) That mere obtaining of registration/approval from various departments for carrying out manufacturing activity in the notified area only shows the intention
Sudarshan Roshanlal Kharbanda ITA No.1677/Mum./2022 to manufacture and is not a conclusive evidence to grant exemption as per the provisions of section 80IC of the Act. b) That assembling of watches did not involve any manufacturing activity and does not fall within the meaning of the word "manufacture": Wherein detailed explanation on the process of manufacturing along with a host of case laws supporting the appellant's claim was provided to substantiate the same. c) That the Appellant had failed to corroborate the quantum of production of watches vis à-vis the number of employees and their professional qualification, electricity consumption and machinery used and also not providing step wise manufacturing activity: Where in fact the Appellant had furnished host of documentary evidence to support the manufacturing activity carried out. d) That the Appellant is not engaged in manufacturing activity: Where in fact host of details of raw material consumed and finished products as per State Excise records were submitted in the course of the assessment proceeding. e) That the Appellant had failed to provide the cogent explanation about "day" and "night 'consumption of electricity units: where in the copy of the electricity bill issued by the electricity board official had been furnished thereby ignoring the actual billing.
9. The Learned Commissioner of Income-tax (Appeals) has erred in holding that the turnover of the Appellant vis-à-vis the machinery usage and expenses claimed are disproportionate, without verifying the facts of the case and without bringing any material on record 10. The Learned Commissioner of Income-tax (Appeals) has erred in assuming that the Appellant could not have carried out any manufacturing or assembling activity without realizing the lesser manpower and other requirements of Watch manufacturing industry.
The Learned Commissioner of Income-tax (Appeals) has erred in disallowing the legitimate claim under section 80IC on unreasonable and frivolous grounds without considering the contentions of the Appellant.
The Learned Commissioner of Income-tax (Appeals) has erred in levying interest u/s 234B & 234C of the Income Tax Act.
The Learned Commissioner of Income-tax (Appeals) has erred in initiating penalty under section 271(1)(c) of the Income Tax Act.
The appellant craves leave to add, amend, alter or delete and/or modify the above grounds of appeal before or during the course of hearing.”
When the appeal was called for hearing, neither anyone appeared on behalf of the assessee nor was any application seeking adjournment filed.
Sudarshan Roshanlal Kharbanda ITA No.1677/Mum./2022 Therefore, we proceed to dispose off the appeal ex-parte qua the assessee after hearing the learned Departmental Representative (“learned D.R.”) and based on material available on record.
The present appeal filed before us is delayed by 147 days. In this appeal, the impugned order dated 29/11/2021, was received by the assessee on the same date. Thus, as per the provisions of section 253(3) of the Act, the assessee was required to file the appeal within 60 days from the date of receipt of the order. However, the assessee filed the appeal, for the year under consideration, on 24/06/2022. We find that the Hon'ble Supreme Court, vide order dated 10/01/2022, passed in M.A. no.21 of 2022, in M.A. no.665 of 2021, in Suo-Motu Writ Petition (Civil) no.3 of 2020, directed that the period from 15/03/2020 till 28/02/2022, shall stand excluded for the purpose of limitation as may be prescribed under any general or special laws in respect of all judicial and quasi judicial proceedings. As part of the limitation period for filing the present appeal was falling within the aforesaid time period, in view of the order passed by the Hon'ble Supreme Court, the same shall be excluded till 28/02/2022. However, even after the exclusion of the aforesaid time period and upon computation of the limitation period thereafter, the appeal is still delayed by almost 56 days. In the application seeking condonation of appeal filed along with the appeal, the assessee has submitted that due to his ill- health, the present appeal could not be filed within the limitation period. In support of its contention, the assessee has also filed a medical certificate.
Sudarshan Roshanlal Kharbanda ITA No.1677/Mum./2022 Accordingly, the assessee has prayed for condonation of delay in filing this appeal.
During the hearing, the learned D.R. did not raise serious objections against the prayer for condonation of delay. In view of the above, we are of the considered view that there was a sufficient cause that prevented the assessee from filing this appeal within the limitation period. Accordingly, we condone the delay in filing the appeal and proceed to dispose off the appeal on merits.
The brief facts of the case as emanating from the record are: The assessee is a proprietor of M/s. Time Link, and is engaged in manufacturing of Quartz Watches. For the year under consideration, the assessee filed its return of income on 28/09/2014, declaring a total income of Rs.9,94,450. The Assessing Officer (“A.O”), vide order dated 30/12/2016, passed u/s 143(3) of the Act disallowed the deduction of Rs.95,88,879, claimed by the assessee u/s 80IC(2)(a)(ii) of the Act.
The learned CIT(A), vide impugned order, dismissed the appeal filed by the assessee in the absence of any response to various notices issued by the learned CIT(A).
We have heard the submissions of the parties and perused the material available on record. As per the grounds raised before us, the assessee claims that the assessee did respond to some of the notices and also filed its submissions. However, from the perusal of the impugned order, we find that Page | 5
Sudarshan Roshanlal Kharbanda ITA No.1677/Mum./2022 the learned CIT(A) has not dealt with any of the submissions as claimed to have been filed by the assessee. We further find that the learned CIT(A) has also not dealt with the merits of the disallowance made by the A.O. and has dismissed the appeal filed by the assessee without providing any reasons. In our considered view, irrespective of the non-appearance of the assessee, the learned CIT(A) ought to have dealt with the issues so raised by the assessee in its appeal on merits on the basis of material available on record and by way of a speaking order and in accordance with law. We, therefore, deem it fit and proper to restore the matter to the file of the learned CIT(A) for adjudication of the appeal filed by the assessee on merits. Needless to mention that no order shall be passed without affording reasonable opportunity of hearing to the parties. As the matter is being restored to the file of the learned CIT(A) for adjudication on merits, the other grievances raised by the assessee, on merits, do not call for any adjudication at this stage. Accordingly, grounds raised by the assessee are allowed for statistical purposes.
In the result, the appeal by the assessee is allowed for statistical purposes. Order pronounced in the open Court on 28/11/2022