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Income Tax Appellate Tribunal, “D” BENCH, MUMBAI
Before: SHRI SAKTIJIT DEY & SHRI N.K. PRADHAN
PER SAKTIJIT DEY, J.M.
The aforesaid appeals by the assessee are directed against two separate orders of the learned Commissioner (Appeals)–39, Mumbai, for the assessment year 2009–10. While the appeal in Mum./2012, is on the quantum, the appeal in ITA no.2256/Mum./ 2015, is challenging imposition of penalty under section 271(1)(c) of the Act.
2 The Deniel Investments Pvt. Ltd. ITA no.1901/Mum./2012
A search and seizure operation under section 132 of the Act was conducted in the case of Nissan Copper Ltd. on 16th January 2009. The assessee being a part of the group was also covered under the search and seizure operation. On 29th September 2009, assessee filed its return of income declaring nil income. In the course of assessment proceedings, the Assessing Officer while examining the balance sheet found that in Schedule–L, assessee has shown an amount of ` 1.15 crore as loss on forfeiture of share warrant. The Assessing Officer called upon the assessee to explain why such loss should not be considered as capital loss. Though, the assessee justified its claim, however, the Assessing Officer rejecting the submissions of the assessee held that the loss arising out of forfeited shares being a capital loss cannot be set–off with other business income. Further, he also disallowed an amount of ` 2,55,829 under section 14A r/w rule 8D. As a result, the total income was determined at ` 42,41,638. Being aggrieved of the additions made, assessee preferred appeal before the first appellate authority.
The learned Commissioner (Appeals) disposed off the appeal ex– parte by confirming the additions made by the Assessing Officer.
We have considered the submissions of the parties and perused the material available on record. The basic grievance of the assessee
3 The Deniel Investments Pvt. Ltd. is, against the ex–parte order passed by the learned Commissioner (Appeals) without affording proper opportunity of being heard to the assessee. The learned Departmental Representative, though, tried to justify the action of the learned Commissioner (Appeals) in disposing off the appeal, however, he has no serious objection if one more opportunity is granted to the assessee to represent the case before the learned Commissioner (Appeals). We have noted that though the learned Commissioner (Appeals) in Para–4 of his order has observed that the appeal was posted on three occasions, however, there is nothing on record to suggest that the hearing notices were served on the assessee. Moreover, it is evident, the learned Commissioner (Appeals) has disposed off the appeal in a non–speaking manner without assigning any reasons while confirming the additions made by the Assessing Officer. In the aforesaid view of the matter, we are inclined to set aside the impugned order of the learned Commissioner (Appeals) and restore the matter back to his file for deciding afresh after providing due opportunity of being heard to the assessee. The learned Commissioner (Appeals) must pass a speaking order on the issues raised by the assessee. We also direct the assessee to comply to the notice of hearing to be issued by the learned Commissioner (Appeals) by appearing before him to represent the case in proper manner. All the grounds are, therefore, restored back to the file of the learned Commissioner (Appeals).
4 The Deniel Investments Pvt. Ltd.
In the result, assessee’s appeal is allowed for statistical purpose.
ITA no.2256/Mum./2015
This is an appeal against imposition of penalty under section 271(1)(c) of the Act.
As could be seen, the quantum appeal filed by assessee before the learned Commissioner (Appeals) was decided ex–parte as the assessee failed to appear on a number of occasions. However, considering the fact that while deciding assessee’s appeal against quantum we have restored the issue back to the file of the learned Commissioner (Appeals) for deciding afresh, consequently, the issue relating to imposition of penalty under section 271(1)(c) requires to be restored back to the file of the learned Commissioner (Appeals) for deciding afresh on the basis of decision to be taken in quantum proceedings.
In the result, both the appeals of the assessee are allowed for statistical purposes.
Order pronounced in the open Court on 20.12.2016