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Income Tax Appellate Tribunal, ‘B’ (SMC
Before: SHRI ABRAHAM P. GEORGE]
आदेश / O R D E R
Assessee in these appeals assails an order dated 20.12.2016 passed by the ld. Commissioner of Income Tax (Appeals)-19, Chennai for the impugned assessment year.
The impugned order passed by the ld. Commissioner of 2.
Income Tax (Appeals) dealt with issues raised by the assessee, on an & 223/Mds/2017 :- 2 -: assessment done u/s.143(3) of the Income Tax Act, 1961 (in short ‘’the Act’’) and a reassessment done u/s.143(3) r.w.s.147 of the Act.
Ld. Counsel for the assessee submitted that ld. Commissioner of Income Tax (Appeals) had dismissed the appeals of the assessee for a reason that nobody had appeared on behalf of the assessee on various dates on which the appeals were posted for hearing. As per ld. Authorised Representative ld. Commissioner of Income Tax (Appeals) had no powers to dismiss the appeals without dealing with the merits of the cases.
Per contra, ld. Departmental Representative submitted that 4.
he had no objection in remitting the appeals back to the ld. Commissioner of Income Tax (Appeals) for considering it on merits.
I have considered the rival contentions and perused the 5. orders of the authorities below. Issues raised by the assessee in both these appeals relate to additions made on account of variation in value of stocks as arrived by survey party who conducted a survey u/s.133A of the Act on the premises of the assessee on 04.05.2007 and value of the stock as arrived by the assessee. Contention of the assessee all along was that stock value was arrived based on sale price and not on & 223/Mds/2017 :- 3 -: cost hence incorrect. The appeals of the assessee were dismissed with the following observations:- ‘’Considering the various submissions made, the case was further posted for hearing. Meanwhile the AO had forwarded the copies of the impounded material, statement recorded of Shri S.Nagarajan on 4.5.2007 in the business premises of the assessee during the course of survey. All these documents are already in possession of the assessee. The case had been posted for hearing on various dates. Shri K.Ravi advocate had appeared on 30.6.2011, 26.7.2011, 11.8.2011, 8.9.2011, 13.10.2011, 11.11.2011 before the CIT(A). However, nobody is appeared in response to the later notices dated 31.7.2015, 26.10.2015 & 27.11.2016. Nonetheless, considering all the information on the record, the appeal proceedings are finalized as under’’.
From the above, it is clear that in spite of reposting the hearing on various dates, neither the appellant nor the authorized representative attended. This is a clear case of callous and indifferent attitude of the appellant towards appellate proceedings. Hence, it is obvious that the appellant is not interested in pursuing the present appeal. In such a situation, the appeal is liable to be dismissed in terms of verdicts of the Hon 'ble Apex Court and various other Courts. The Horr'ble Apex Court, in the case of CIT V. B. N. Bhattacharjee and another (118 ITR 461) held that an appeal means an effective appeal. It held that purposefully interpreted, preferring an appeal means more than formally filing it but effectively pursuing it. If a party retreats before the contest begins, it is as good as not having entered the fray. The Horr'ble MP High Court in Estate of Late Tukojirao Holkar V. CIT, 223 ITR 480(MP) has held that if a party, at whose instance the reference is made, fails to appear at the hearing, or fails in taking steps for preparation of & 223/Mds/2017 :- 4 -: paper books so as to enable hearing of the reference, the court is not bound to answer the reference. Similar view has also been taken by the Hon'ble ITAT in the case of CIT V. Multiplan (India) Pvt. Ltd, 38 ITD 320 (Del). Under similar circumstances, following the ratio of Multiplan (India) Ltd (supra), the jurisdictional Chennai Tribunal has also dismissed appeal for non-prosecution in the case of M/ s. Helios and Matheson Information Technology Ltd Vs. ITO in dated 5.7.2011 for A.Y.2006-07. There is no reason why the ratio of the above decisions will not be applicable to the appellant. In view of the above, the appeal is held as dismissed.
No doubt the ld. Commissioner of Income Tax (Appeals) had considered the workings furnished by the assessee while deciding the appeals, stating that assessee had admitted excess stock of Rs.32,49,240/-. Relevant observation of the ld. Commissioner of Income Tax (Appeals) as it appear in para 8 of its order is reproduced hereunder:- ‘’What has transpired during the course of survey can only be witnessed by means of statement recorded, inventory of goods and inventory of stock on hand. All the three corroborate to the fact that there was excess stock. The assessee has now come forward with a value of excess stock as below:
Stock value at tag price as adopted by the ld. 89,99,488 Assessing Officer Less: GP average at the time of 10.86% 9,77,530 Cost of stock value as on 04.05.2007 80,22,138 Closing stock on hand as on 4.5.2007 as arrived by the assessee 66,73,902 & 223/Mds/2017 :- 5 -:
Excess stock worked out 13,48,236/-
This working now given by the AR cannot be accepted as the assessee has clearly admitted an excess stock value of Rs.32,49,240 in the statement on oath corroborated by inventory of stock and verification of stock on hand as on the date of search. Considering the same, the appeal filed by the assessee cannot be entertained and is dismissed’’.
Be that as it may, what I find is that nobody had appeared on behalf of the assessee on the dates of hearing fixed by the ld. Commissioner of Income Tax (Appeals). Though laxity on the part of assessee, in entering appearance is pregnant, rules of fairness require an assessee to be heard before adjudication, unless the negligence is so grave that it cannot be condoned. That apart, by virtue of Sub Section 6 to Sec.
250 of the Act, the ld. Commissioner of Income Tax (Appeals) has to state the point for determination and decision thereon with reasons for such decision on his order. Considering the facts and circumstances of the case, I am of the opinion that matters require a fresh look by the ld. Commissioner of Income Tax (Appeals). I remit both the appeals back to the file of the ld. Commissioner of Income Tax (Appeals) for consideration afresh in accordance with law. Needless to say assessee shall be given an opportunity to explain his case and submit evidence in support. & 223/Mds/2017 :- 6 -:
In the result, the appeals of the assessee are allowed for statistical purposes.
Order pronounced on Wednesday, the 26th day of April, 2017, at Chennai