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Income Tax Appellate Tribunal, “C” BENCH: KOLKATA
Before: Shri A. T. Varkey, JM & Dr. A. L. Saini, AM]
ORDER
Per Shri A.T.Varkey, JM
This is an appeal filed by the assessee against the order of Ld. CIT(A)-30, Kolkata dated 26.03.2013 for AY 2008-09.
At the outset itself, the Ld. Counsel for the assessee drew our attention to the fact that the order passed by the Ld. CIT(A) as well as by the AO are ex parte orders. According to the Ld. Counsel, the assessee had entrusted the tax matters with one Shri A. B. Moitra, who expired in the month of December, 2007 and thereafter, his chamber junior Shri Santanu Lahiri was entrusted by the assessee to represent the matter before the AO. However, he made appearance twice before the AO, thereafter he did not appear. The AO issued show cause notice to the AR, but since the AR did not turn-up or give any reply to the said show cause notice resultantly, the AO rejected the book of accounts of the assessee and the auditor’s report and thereby he did not allow the expenses claimed by the assessee to the tune of Rs.66,59,246/-. During the appeal before the Ld. CIT(A), in the same way the Ld. AR did not turn-up before him also, which prompted him to dismiss the appeal. According to the assessee, the developments after filing of appeal and thereafter the dismissal of the same was not communicated to the assessee by Shri Santanu Lahiri and the assessee got a shock when she received the demand notice and then only realized the negligence of her AR Sutapa Bose, AY, 2008-09 Shri Santanu Lahiri. Immediately thereafter, she confronted, Shri Santanu Lahiri, who could not explain as to why in the appellate proceeding he was not present and why he did not communicate the result of the appellate proceedings to the assessee. Thereafter, Shri Somnath Ghosh, Advocate was entrusted the tax matter, who immediately advised her to file the appeal before the Tribunal and thus the appeal was filed which resulted in delay of 860 days. According to the Ld. Counsel, assessee entrusted the matter to Shri Santanu Lahiri, an Advocate on the bonafide belief that the lawyer would represent her case to the best of his ability before the Ld. CIT(A) and communicate to her the result of the proceedings before the ld. CIT(A). Since she was not at fault, the Ld. Counsel prays that the delay may be condoned and the matter be remitted back to the file of the AO for fresh adjudication since evidence could not be furnished before the AO.
We have heard rival submissions and gone through the facts and circumstances of the case. We note that there was a delay of 860 days for preferring an appeal before the Tribunal. According to the affidavit filed by the assessee, we note that assessee’s tax consultant Shri A. B. Maitra was expired in the month of December, 2007 and thereafter the junior of Mr. Maitra Shri Santanu Lahiri, Advocate was looking after the tax matter of the assessee. During the assessment proceedings, Shri Lahiri appeared twice and thereafter he did not appear and failed to furnish the documents that was asked by the AO to assess the assessee which resulted in the AO rejecting the auditor’s report u/s. 145(3) of the Income- tax Act, 1961 (hereinafter referred to as the “Act”) and made disallowance of the entire claim of Rs.66,59,246/-. During appellate proceedings, Shri Lahiri did not appear before the Ld. CIT(A) and the impugned order was passed by the ld. CIT(A) on 26.03.2013 and thereafter, Shri Lahiri did not had the courtesy to even inform the assessee about the dismissal of the appeal. Only when the demand was raised, the assessee was shocked to realize that the appeal has been dismissed. She confronted Shri Lahiri who could not explain as to the reason why he did not represent her case before the ld. CIT(A) and simply handed over the file to the assessee. Assessee thereafter immediately approached Shri Somnath Ghosh, Advocate, who advised the assessee to file the appeal along with the condonation petition for 860 days delay. According to the Ld. Counsel, for the mistake committed by the advocate of the assessee, the assessee should not be penalized. For that he relied on the decision of Hon’ble Supreme Court in the case of N. Balakrishnan Vs. M. Krishnamurthy (1998) 7 SCC 123 wherein a similar case where there was a delay of 883 Sutapa Bose, AY, 2008-09 days because of the mis-handling the case by the Advocate of the petitioner, the Hon’ble Supreme Court condoned the delay taking note that the petitioner cannot be faulted due to the latches of the lawyer. Taking note of the Hon’ble Supreme Court’s decision, and the facts narrated above which caused the delay, we are convinced that the fault lies with the Advocate who was entrusted with the appeal and for the fault of her lawyer, the assessee cannot be penalized, so, we are inclined to condone the delay of 860 days and remand the matter back to the file of the AO since the matter has not been adjudicated properly by the AO because of non-production of documents at the stage of assessment proceeding itself. For doing so, we rely on the order of the Hon’ble Supreme Court (three Judges) Bench decision in Tin Box Company Vs. CIT (2001) 249 ITR 216 (SC) wherein the Hon’ble Supreme Court has held as under (Head Note): “Held, reversing the decision of the High Court, that once the Tribunal found that the Income-tax Officer had not given to the assessee proper opportunity of being heard, that the assessee could have placed the evidence before the appellate authority or before the Tribunal was really of no consequence for it was the assessment order that counted: that order had to be made after the assessee had been given a reasonable opportunity of being heard.”
In the light of the aforesaid decision of the Hon’ble Supreme Court, cited supra, we are inclined to remand the matter back to the file of the AO for de novo assessment. Needless to say, assessee should be given reasonable opportunity of being heard by the AO and we give liberty to assessee to adduce evidence in support of her claim for expenses. The assessee is also directed to cooperate in the de novo assessment proceedings before the AO. Appeal of assessee is allowed for statistical purposes.