LOOMS INDIA,MUMBAI vs. ITO WD 18(2)(2), MUMBAI
What did the Tribunal hold?
The Tribunal found merit in the assessee's contention regarding the lack of proper opportunity of being heard. Consequently, the CIT(A)'s order was set aside and the matter was restored to the CIT(A)'s file for fresh adjudication after providing the assessee with a reasonable opportunity to be heard.
What were the facts?
The assessee's appeal before the ITAT pertains to an order passed by the CIT(A) which the assessee claims was passed without a proper opportunity of being heard. The CIT(A) allegedly passed an ex-parte order on a date prior to the scheduled hearing, despite the assessee's attendance on previous dates and filing of written submissions.
What were the issues?
Whether the CIT(A) erred in passing an ex-parte order without affording the assessee a proper opportunity of being heard, and if the order was passed prematurely.
Which sections of the Income-tax Act were involved?
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, MUMBAI BENCH “A”, MUMBAI
ORDER PER G.S.PANNU,A.M:
The captioned appeal filed by the assessee pertaining to assessment year 2003-04 is directed against an order passed by CIT(A)- 29 Mumbai dated 19/01/2010 which in turn arises out of an order passed by the Assessing Officer under section 143(3) of the Income Tax Act, 1961 (in short ‘the Act’) dated 27/03/2006.
In this appeal, the assessee has raised multiple grounds of appeal, which are as follows:-
(Assessment Year 2003-04) “1. On the facts and in the circumstances of the case and in law the learned Commissioner of Income Tax (Appeal) erred in passing an Appellate Order and that too without giving full and proper opportunity of being heard in the matter.
2. On the facts and in the circumstances of the case and in law the learned Commissioner of Income Tax (Appeal) erred in holding that none had attended from appellant side without appreciating the facts that hearing was attended on various date as per the notices issued by the CIT(A) and written submission were also filed by the appellant.
On the facts and in the circumstances of the case and in law the order passed by the learned Commissioner of Income Tax (Appeal) is bad in law as the appellate order was passed on 19-01- 2010 that is prior to the date of hearing which was fixed on 22-01-2010 as per the letter of adjournment dated 04-01-2010 filed on 05-01-2010.
4. On the facts and in the circumstances of the case and in law the learned Commissioner of Income Tax (Appeal) erred in passing an appellate order without considering fully and properly the submissions made during the course of hearing proceedings.
On the facts and in the circumstances of the case and in law the learned Commissioner of Income Tax (Appeal) erred in not accepting the book results and confirming addition of an amount of Rs.25, 00,0001- as suppressed income without appreciating that there was no difference in the amount of closing stock 6. On the facts and in the circumstances of the case and in law the learned Commissioner of Income Tax (Appeal) erred in confirming the disallowance of an amount of Rs.13,30,000/- u/s 40A(3) of the I. T. Act without appreciating the facts that the purchases were directly connected with export business.
On the facts and in the circumstances of the case and in law the learned Commissioner of Income Tax(Appeal) erred in confirming the disallowance of an amount of Rs.12,466/- out of motor car expenses claimed of Rs.62,333/-.
On the facts and in the circumstances of the case and in law the learned Commissioner of Income Tax (Appeal) erred in confirming the disallowance of Rs. 1,241/- out of depreciation on motor car claimed of Rs.6,208/- 9. On the facts and in the circumstances of the case and in law the learned Commissioner of Income Tax (Appeal) erred in confirming the disallowance of an amount of Rs.26,042/- out of total telephone & telex expenses claimed of Rs 1,30,213/- (Assessment Year 2003-04) 10. On the facts and in the circumstances of the case and in law the learned Commissioner of Income Tax (Appeal) erred in confirming the disallowance of an amount of Rs.15,94,232/- being interest expenditure claimed without appreciating that the interest free funds received were much more than the interest free funds given that too is to the same parties or their sister concern which could have been routed through partners capital accounts.
On the facts and in the circumstances of the case and in law the learned Commissioner of Income Tax (Appeal) erred in not allowing interest income on FDR as business profit which is eligible for deduction U/s. 80HHC of the I.T. Act. 12 On the facts and in the circumstances of the case and in law the learned Commissioner of Income Tax(Appeal) ought to have at least given the benefit of netting off by setting off interest expenses against the interest income.”
3. At the time of hearing, the Ld. Representative for the assessee contended that the order of the CIT(A) suffers from a pertinent infirmity as it has been passed without affording the assessee full and proper opportunity of being heard. The Ld. Representative for the assessee pointed out that the CIT(A) has passed an ex-parte order inspite of the fact that assessee did appear on various dates and indeed the matter was finally adjourned for 22/01/2010, whereas the CIT(A) has passed the order on an anterior date i.e. 19/01/2010 itself. In any case, it is pointed out that due to the aforesaid reason the say of the assessee could not be made available to the CIT(A), which has resulted in a prejudice to the assessee..The Ld. Representative for the assessee submitted that the appellant would be satisfied, if the matter is remanded back to the file of the CIT(A) for an adjudication afresh on merits of the various issues raised, after allowing an opportunity of being heard to the assessee as per law.
The Ld. Departmental Representative has not raised any serious objection with respect to the aforesaid preliminary plea of the assessee.
(Assessment Year 2003-04) 5. Considering the fact position and the circumstances explained before us, we deem it fit and proper to set aside the order of the CIT(A) and restore the matter back to his file for adjudication afresh in accordance with law after allowing the assessee a reasonable opportunity of being heard. It is clarified that our decision to remand the matter back to the file of the CIT(A) shall not be construed as any reflection on the merits of the various issues raised by the assessee, which shall be dealt with by the CIT(A) as per law.
In the result, appeal of the assessee is allowed for statistical purposes, as above.
Order pronounced in the open court on 23/09/2016
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