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आदेश/Order
Per Sanjay Garg, Judicial Member:
The present appeal has been preferred by the assessee against the order dated 18.09.2008 of the Commissioner of Income Tax (Appeals), Shimla [hereinafter referred to as’ CIT(A)’ ].
The assessee in this appeal has raised following grounds of appeal:- 1. That the Ld. Commissioner of Income Tax(Appeals) has erred in law in dismissing the appeal ex-parte without
ITA No. 852-c-2017 M/s K.K. Apparels,Ludhiana 2 affording a proper opportunity of hearing which is against the Principals of Natural Justice and as such the order passed is illegal, arbitrary, unjustified which merits annulment.
Without prejudice to the above, the Ld. Commissioner of Income Tax(Appeals) has erred in upholding the disallowance of deduction under section 80IB claimed at 100% resulting in an addition of Rs. 1,28,89,273/- without any independent reasoning which is arbitrary and unjustified.
That the order of Commissioner of Income tax(Appeals) is erroneous, arbitrary, opposed to the facts of the case and is unsustainable in law.
The appeal is barred by long limitation period of 8 years and 228
days. A separate application for Condonation of Delay has been filed,
wherein, it has been pleaded that the order was passed by the Ld.
CIT(A) on 18.9.2008. That the assessee firm was closed in April, 2007
and no business was conducted after April 2007. That after the closure
of the business in April 2007, Bank of India, Chandigarh took the
possession and sold the machinery of the firm to cover its outstanding
dues. That the assessee had never received any copy of the impugned
order of the CIT(A). That it was only that the assessee firm received the
demand notice issued by the DCIT Circle, Parwanoo dated 24.1.2017
and that the assessee firm came to know about the passing of the
impugned order of the CIT(A). Thereafter, the assessee immediately
made request to the office of the CIT(A), Shimla at Solan vide letter
ITA No. 852-c-2017 M/s K.K. Apparels,Ludhiana 3 dated 24.2.2017 for issue of copy of the appeal order for assessment
year 2005-06, which was received on 24.4.2017. The assessee thereafter
immediately filed the present appeal before this Tribunal. That the
delay, if any, in filing present appeal is not on account of any
intentional negligence or willful default on the part of the assessee.
Reiterating the above submissions, the Ld. Counsel for the
assessee has submitted that the delay in filing the present appeal before
this Tribunal may be condoned.
On the other hand, the Ld. DR has submitted that from the perusal
of the record, it is revealed that the copy of the impugned order of the
CIT(A) dated 18.9.2008 was dispatched to the assessee by registered
post on 30.09.2018 at the address “KK Apparels, Village Chowkiwala,
Nalagarh, Distt Solan (HP)”. That further as informed by the Ld.
CIT(A) Shimla, the order was never returned back to their office
undelivered. That even the assessee had sought an adjournment through
application and also a telegram received in the office of the CIT(A) on
16.09.2008, however, the Ld. CIT(A) rejected the said application for
adjournment and an intimation this respect was not sent to the assessee
vide letter dated 18.9.2008. That, thereafter, the assessee never enquired
about the status of its appeal for the assessment year under
consideration despite the fact that the appeals of the assessee for
assessment years 2002-03, 2003-04 and 2004-05 were pending before
ITA No. 852-c-2017 M/s K.K. Apparels,Ludhiana 4 the ITAT and as such the assessee was reasonably supposed to make
enquiries from the office of the CIT(A), Shimla regarding the status of
its appeal case for the assessment year under consideration.
The Ld. DR, therefore, has vehemently opposed the application of
the assessee for Condonation of Delay.
In rebuttal the Ld. Counsel for the assessee has invited our
attention to the letter dated 29.3.2017 from the office of the CIT(A)
Shimla, wherein, it has been mentioned that the impugned order dated
18.09.2008 was sent to the assessee at the following address:-
“KK Apparels, Village Chowkiwala, Nalagarh, Distt Solan (HP)”.
The Ld. Counsel has further invited our attention to Form No. 35, which
is the opening form of the appeal, wherein, in the column meant for
‘address to which notice may be sent to the appellant’, the address of
the assessee has been mentioned as under:-
“M/s K.K. Apparels, Vill: Chowkiwala, Nalagarh, C/o 68, Sarabha Nagar, Ludhiana.”
The Ld. Counsel, therefore, has submitted that the impugned order was
never sent at the address mentioned in form No. 35. Further, that the
impugned order was allegedly sent at the factory premise which was
already closed down and possession was taken over by the bank.
ITA No. 852-c-2017 M/s K.K. Apparels,Ludhiana 5
We have considered the rival submissions. The plea of the Ld. DR
has been that despite the fact that that though the order might have been
sent at the factory premises of the assessee, however, there was a
negligence on the part of the assessee as it did not enquire about the
fate of its appeal for the assessment year under consideration especially
when the appeals of the assessee for other assessment years were
pending before the Tribunal. That under the circumstances, there was no
justification for condoning the long delay of 8 years and 228 days in
filing the present appeal. However, considering the entire facts and
circumstances, we are convinced with the submissions of the Ld.
Counsel for the assessee that the order was not sent by the office of the
CIT(A) at the correct address of the assessee. Further that since the
assessee firm had already closed down and the assets taken were over
by the bank and the staff already retrenched, there was no proper
person to look after the affairs of the assessee firm. Further it has also
been submitted that the advocate who was looking after the matter
namely Shri S.S. Rikhi had already expired and the firm had no
information of the status of the appeal after his death. Hence,
considering the above factual aspect and also considering the interest of
justice, we deem it fit to condone the long delay in filing the present
appeal. We order accordingly.
ITA No. 852-c-2017 M/s K.K. Apparels,Ludhiana 6 7. Now coming to the merits of the case. The Ld. Counsel for the
assessee, at the outset, has invited our attention to the impugned order
of the CIT(A) to submit that the same is an ex-parte order. As stated
above, the Ld. counsel for the assessee had moved an application for
adjournment of the case for the said date which was also followed by a
telegram, however, the Ld. CIT(A) rejected the application and passed
the impugned order on the same date. In our view, the assessee has not
been given a reasonable opportunity to present its case before the
CIT(A).
In view of this, the impugned order of the CIT(A) is set aside and
the matter is restored to the file of the CIT(A) for decision afresh in
accordance with law. Needless to say that the Ld. CIT(A) will give
proper opportunity to the assessee to present its case. At the same time,
we direct the assessee to promptly appear before the Ld. CIT(A), as and
when called for, and not to seek unnecessary adjournments.
With the above observations, the appeal of the assessee is treated
as allowed for statistical purposes.
Order pronounced in the Open Court on 20.08.2019.
Sd/- Sd/- (संजय गग� / SANJAY GARG) (एन. के. सैनी / N.K. SAINI) उपा�य� /Vice President �या�यकसद�य/ Judicial Member Dated : 20.08. 2019 “आर.के.”
ITA No. 852-c-2017 M/s K.K. Apparels,Ludhiana 7 आदेश क� ��त�ल�प अ�े�षत/ Copy of the order forwarded to : 1. अपीलाथ�/ The Appellant 2. ��यथ�/ The Respondent 3. आयकर आयु�त/ CIT 4. आयकर आयु�त (अपील)/ The CIT(A) 5. �वभागीय ��त�न�ध, आयकर अपील�य आ�धकरण, च�डीगढ़/ DR, ITAT, CHANDIGARH 6. गाड� फाईल/ Guard File
आदेशानुसार/ By order, सहायक पंजीकार/ Assistant Registrar