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Income Tax Appellate Tribunal, DELHI BENCH: ‘D’ NEW DELHI
Before: SHRI H.S. SIDHU & SHRI PRASHANT MAHARISHI
ORDER PER H.S. SIDHU, JM
These appeals are filed by assessee against the separate Orders both dated 28.3.2014 passed by the Ld. CIT(A), Meerut relating to Assessment Year 2008-09. Since the facts and circumstances of the case are similar and pertaining to same assessment year i.e. 2008-09, hence, the appeals were heard together and are being disposed of by this common order for the sake of convenience, by dealing with (AY 2008-09).
The grounds raised in (AY 2008-09) read as under:-
1. That the present appeal is filed within time.
2.That the ld. CIT(Appeals) has passed an arbitrary ex-parte appellate order, which is in contravention to the principles of natural justice, and is liable to be set aside.
3.That the appellants had filed an adjournment application on the last date of hearing fixed on 14.03.2014, requesting another date of hearing, on the grounds that the counsel for the appellants was out of station on the particular date for treatment of his back pain. But no date was granted and no notices were sent for the date of order, i.e. 28.03.2014, and the said order was passed ex-parte, thereby denying the appellant their substantive right of being heard, thereby being bad in Law and unsustainable.
4.That the issue of imposition of penalty u/s 271-A, the provisions of Section 44-AA of the Income Tax Act are not attracted in the present case, as the declared income from professions emanates from the gross receipts of Rs.3,98,975/-, and the rest of his receipts are from business and speculation in futures trading. Thus, the gross receipts are well within the minimum limit of Rs. Ten lacs, as specified u/ s 44-AB for compulsory maintenance of books of accounts therewith, and no penalty is, therefore, leviable on the appellants for the relevant assessment year.
5. That also the net income from profession for the relevant assessment year has resulted in a loss of Rs.3,32,028/- and the return of income is filed on a salary of Rs.l,44,000/-. Thus, the provisions of Section 44AA are again not attracted herewith, and the impugned order is liable to be quashed.
6. That, as per facts and circumstances o f the case the order passed by the assessing officer in levying the penalty is not justified, since the original order passed by the assessing officer
under section 143(3) of the Income Tax Act 1961 is already appealed for.
7. That, the assessee had filed his return under section 44AD showing the loss from shares future & option trading of Rs. 608528/, (including expenses of Taxes 0f Rs. 9513/-, as per guidance note issued by I.C.A.I. and decided judgement of Mumbai Tribunal Bench in the case of "BABU LAL ENTERPRISES VS. CIT (ITA NO. 6031/MUM/1996)" & also the ruling in the Royal Cushion Vinyl Products Ltd., case, as under:-
"It is only net of the sale and purchase that is to be treated as turnover, which in the assessee case is only Rs. 608528/- and is below the limit of Rs. 40.00 Lacs, hence no audit is required under section 44AB of the Income Tax Act, 1961.
8. That the appellant craves leave to add, alter/amend any of the grounds of the appeal before or at the time of hearing of the appeal.
PRAYER
The appellants pray that in view of the above grounds and submissions that :-
1. The impugned order may please be set aside.
2.The penalty imposed u/s 271B may please be waived.
3. That the appellants craves leave to add, alter, amend or withdraw any of the submissions made hereinabove.
4.That an opportunity for personal hearing may please be granted to the appellant.”
The grounds raised in (AY 2008-09) read as under:-
1. That the present appeal is filed within time.
2.That the ld. CIT(Appeals) has passed an arbitrary ex-parte appellate order, which is in contravention to the principles of natural justice, and is liable to be set aside.
3.That the appellants had filed an adjournment application on the last date of hearing fixed on 14.03.2014, requesting another date of hearing, on the grounds that the counsel for the appellants was out of station on the particular date for treatment of his back pain. But no date was granted and no notices were sent for the date of order, i.e. 28.03.2014, and the said order was passed ex-parte, thereby denying the appellant their substantive right of being heard, thereby being bad in Law and unsustainable.
4.That the issue of imposition of penalty u/s 271-B, the provisions of Section 44-AA of the Income Tax Act are not attracted in the present case, as the declared income from professions emanates from the gross receipts of Rs.3,98,975/-, and the rest of his receipts are from business and speculation in futures trading. Thus, the gross receipts are well within the limit as specified u/ s 44-AB for compulsory maintenance of books of accounts therewith, and no penalty is, therefore, leviable on the appellants for the relevant assessment year.
5. That, as per facts and circumstances of the case the order passed by the assessing officer in levying the penalty is not justified, since the original order passed by the assessing officer under section 143(3) of the Income Tax Act 1961 is already appealed for.
That, the assessee had filed his return under section 44AD showing the loss from shares future & option trading of Rs. 608528/, (including expenses of Taxes 0f Rs. 9513/-, as per guidance note issued by I.C.A.I. and decided judgement of Mumbai Tribunal Bench in the case of "BABU LAL ENTERPRISES VS. CIT (ITA NO. 6031/MUM/1996)" & also the ruling in the Royal Cushion Vinyl Products Ltd., case, as under:-
"It is only net of the sale and purchase that is to be treated as turnover, which in the assessee case is only Rs. 608528/- and is below the limit of Rs. 40.00 Lacs, hence no audit is required under section 44AB of the Income Tax Act, 1961.
8. That the appellant craves leave to add, alter/amend any of the grounds of the appeal before or at the time of hearing of the appeal.
PRAYER
The appellants pray that in view of the above grounds and submissions that :-
The impugned order may please be set aside.
2.The penalty imposed u/s 271B may please be waived.
3. That the appellants craves leave to add, alter, amend or withdraw any of the submissions made hereinabove.
4.That an opportunity for personal hearing may please be granted to the appellant.”
Facts narrated by the revenue authorities are not disputed by both the parties, hence, the same are not repeated here for the sake of convenience.
Ld. Counsel of the assessee has stated that the revenue authorities has passed an arbitrary ex-parte order, which is in contravention to the principles of natural justice, and is liable to be set aside. He further stated that the assessee had filed an adjournment application on the last date of hearing fixed on 14.03.2014, requesting another date of hearing, on the grounds that the counsel for the assessee was out of station on the particular date for treatment of his back pain. But no date was granted and no notices were sent for the date of order, i.e. 28.03.2014, and the said order was passed ex-parte, thereby denying the assessee their substantive right of being heard, thereby being bad in Law and unsustainable.
6. On the other hand, Ld. DR relied upon the orders of the revenue authorities.
We have heard both the parties and perused the records especially the impugned order. We find that AO has observed that assessee failed to furnish books, bills, vouchers etc, hence, the penalty in dispute was imposed. We further find that the revenue authorities passed the exparte order, which is not sustainable in the eyes of law.
Therefore, in the interest of justice, the matter needs to be examined afresh at the level of the AO, after considering all the documents / evidences, if any. Accordingly, we set aside the issues in dispute to the file of the AO for fresh consideration, as per law, after considering all the documentary evidences. However, the assessee is directed to fully cooperate with the AO during the proceedings before him and not to take any unnecessary adjournment in the case and also produce all the necessary evidences before the AO to substantiate his claim.
In the result, both the appeals filed by the assessee stands allowed for statistical purposes.