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Income Tax Appellate Tribunal, INDORE BENCH, INDORE
Before: MS. SUCHITRA R. KAMBLE & SHRI B.M. BIYANI
आदेश / O R D E R
Per Bench:
Feeling aggrieved by appeal-orders passed in Appeal No. IT-82/16-17/171 and IT-629/14-15/170, both dated 20.07.2017 and passed by learned Commissioner of Income-Tax (Appeals)-II, Indore [“Ld. CIT(A)”], which in turn arise out of assessment-orders dated 06.03.2014 and 06.02.2015 passed by learned DCIT / ACIT, Circle-5(1), Indore [“Ld. AO”] u/s 143(3) of the Income- tax Act, 1961 [“the Act”] for Assessment-Year [“AY”] 2011-12 and 2012-13 respectively, the assessee has filed these appeals.
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Heard the learned Representatives of both sides and case-records perused.
Ld. AR submits that these appeals have been filed after a delay of 502 days. He further submits that the assessee-firm has filed condonation- applications supported by duly-sworn affidavit of its partner Shri Ravinder Singh, seeking condonation of delay. Referring to the averments made in condonation-applications, he submits that the present appeals are filed against the orders dated 20.07.2017 of first-appellate authority, but those orders appealed against were not served upon assessee and it is only when the Ld. AO proceeded for recovery as well as launching of prosecution against assessee in the month of Oct, 2018 that the assessee approached his counsel and inquired about result of first-appeals. Thereafter, the counsel of assessee made inquiries from the office of Ld. CIT(A) and informed to assessee that the first-appeals had already been dismissed on 20.07.2017. It is thereafter the copies of appeal- orders were received from the office of Ld. CIT(A) and the present appeals were filed to ITAT without further delay. Ld. AR submits that the delay in filing present-appeals is only because of non-receipt of orders appealed against and not because of any lethargy, negligence or mala fide intention on the part of assessee. Ld. AR submits that by making delay in filing appeals, the assessee does not stand to derive any benefit, rather it is suffering. Placing reliance upon the decision of Hon’ble Supreme Court in Collector, Land Acquisition Vs Mst. Katiji and others 1987 AIR 1353, 1987 2 SCC 387, Ld. AR prayed to take a judicious view qua the assessee, condone delay and proceed with appeals.
In the case of Collector, Land Acquisition vs Mst. Katiji (Supra), the Hon'ble Supreme Court held:
“The expression ‘sufficient cause’ employed by the legislature is adequately elastic to enable the courts to apply the law in a
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meaningful manner which subserves the ends of justice -- that being the life-purpose for the existence of the institution of Courts.” The Hon’ble Court also made following observations:
“1. Ordinarily a litigant does not stand to benefit by lodging an appeal late. 2. Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As against this when delay is con- doned the highest that can happen is that a cause would be decided on merits after hearing the parties. 3. "Every day's delay must be explained" does not mean that a pedantic approach should be made. Why not every hour's delay, every second's delay? The doctrine must be applied in a rational common sense pragmatic manner. 4. When substantial justice and technical considerations are pitted against each other, cause of substantial justice deserves to be preferred for the other side cannot claim to have vested right in injustice being done because of a non-deliberate delay. 5. There is no presumption that delay is occasioned deliberately, or on account of culpable negligence, or on account of mala fides. A litigant does not stand to benefit by resorting to delay. In fact he runs a serious risk. 6. It must be grasped that judiciary is respected not on account of its power to legalize injustice on technical grounds but because it is capable of removing injustice and is expected to do so.” In the instant case, applying the same principles set out by Hon’ble Supreme Court, we find that there is no culpable negligence or malafide intention on the part of the assessee in delayed filing of present appeals. We do not find anything on record to suggest that there was a deliberate attempt to take any kind of benefit by late filing. Therefore, in such circumstances, we find that there exists sufficient and reasonable cause for condoning delay and as held by the Hon’ble Supreme Court, where substantial justice and technical considerations are pitted against each other, the cause of substantial justice
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deserved to be preferred. We confronted Ld. DR who left it to the wisdom of Bench. Having regard to the sufficient cause explained by assessee and in exercise of powers under section 253(5) of the Income-tax Act, 1961, we hereby condone the filing-delay in present appeals and proceed to adjudicate.
These appeals belong to the same assessee; represented by same counsel; involve similar set of facts; and raise identical grounds for adjudication, hence they were heard together and being disposed of by this common order. We take ITA No. 917/Ind/2018 of AY 2011-12 as a lead case and our conclusions shall apply mutadis mutandis to ITA No. 918/Ind/2018 of AY 2012-13.
The assessee has raised following grounds in ITA No. 917/Ind/2018 of AY 2011-12:
1.On the facts and circumstances of the case the CITCA) erred in not
considering to any single appeal submission of the Appellant during
passing his Appeal Order. Hence whole Order is illegal and bad in Law. 2.On the facts and in the circumstances of the case the CITCA) erred in
confirming the rejection of books of account while the books of account of
the assessee are duly audited u/s 44AB of the Income Tax Act. 3.On the facts and in the circumstances of the case the CIT CA) erred in
sustaining addition to the estimating net profit @ 10.66% on third party
lorry hire charges receipt after alleging as assessee has earned such net
profit on own lorry after calculating wrong calculation of net profit. But
said addition confirm by CITCA) even addition made without disclosing to
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the applying provision of section 145(3) of the act. 4.On the facts and in the circumstances of the case the CITCA) erred in
sustaining addition Rs. 998112/-. to the estimated income without
subtracting to the said remaining already disclosed income. Hence whole
order is bad in law.
Any other relief which the Hon'ble Tribunal finds fit and Proper for relief.
That the appellant reserves its right to add to amend to alter or to modify any of above grounds and to pursue any other or further grounds as may be required.
During assessment-proceeding, Ld. AO observed that the assessee produced in-complete books of accounts, vouchers and bills; that in some cases there were no vouchers / bills at all; and that some vouchers were mere print-outs taken from computer system and not original vouchers. Ld. AO also recorded statement of Shri Ravindra Singh, partner of assessee-firm, on 04.02.2014, which are re-produced in the body of assessment-order. Finally being unsatisfied, Ld. AO rejected book-results of assessee, applied net-profit rate and computed taxable income on estimation basis.
During first-appeal, Ld. CIT(A) upheld assessment-order and confirmed computation of taxable income done by Ld. AO. The assessee could not succeed in first-appeal.
During hearing, Ld. AR drew our attention to Para No. 2.7 of the assessment-order, where the statements of assessee’s partner Shri Ravindra Singh, recorded by Ld. AO u/s 131 on 04.02.2014 have been re-produced. We extract below the statements for a ready reference:
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Analysing above statements, Ld. AR pointed out that in answer to Q.No.
3, the assessee-firm’s partner has clearly replied that he developed a dispute
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with his brother due to which he had to shift office and the original-vouchers
remained in the old office in possession of his brother. Hence, the assessee had
to take print-outs of vouchers and submit to Ld. AO. But subsequently on
receipt of original-vouchers from brother, the original-vouchers were produced
before Ld. AO for verification. Thereafter, in reply to Q.No. 5, it was again
submitted that due to dispute with brother, the original-vouchers were not
available, hence computerized-vouchers were submitted. Ld. AR submitted that
these statements were made by partner of assessee in the proceeding of section
131 and on 04.02.2014 (much before completion of assessment on
06.03.2014), therefore Ld. AO must have holistically considered the same and
made a proper assessment having regard to the vouchers / documents which
the assessee was trying to produce. But, however, rather than acting upon the
submission of assessee, Ld. AO stuck to the printed-vouchers submitted earlier
and concluded that the vouchers / bills were incomplete / fabricated and
thereby went on rejecting the books of account of assessee and estimating net
profit of business. Ld. AR submitted that the Ld. AO ought to have considered
the submissions of assessee judiciously and practically, given adequate
opportunities to the assessee and thereafter make a proper assessment but the
same has not been done. Lastly Ld. AR also drew our attention to the order of
ITAT, Indore in ITA No. 514/Ind/2013 of AY 2009-10 dated 19.01.2018 in
assessee’s own case, a copy placed in the Paper-Book, wherein the Hon’ble
Co-ordinate Bench was pleased to set aside the assessment-order to the file of
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Ld. AO for the reason that the Ld. AO had rejected books of account without
giving sufficient opportunities to assessee. Ld. AR prayed that in present-
appeals also, the same view must be carried and the assessment-orders must
be set aside to the Ld. AO for a proper assessment after hearing assessee.
Per contra, Ld. DR placed a strong reliance upon the orders of lower
authorities and vehemently supported their actions.
We have considered rival submission of both sides. On a careful
consideration of the material held on record and pointed out by Ld. AR during
the hearing as narrated above, we note that the assessee has explained the
reason due to which he was unable to produce original vouchers etc. in the
beginning. We also observe that at a later stage, the assessee was ready to
produce the original vouchers before Ld. AO, but the Ld. AO has not given a
due consideration to the submission of assessee and passed assessment-order.
In our considered view, assessment-proceeding is such an exercise wherein the
assessee’s submission should not be heard adequately but also well-considered
by Ld. AO for the simple reason that it fastens monetary liability upon the
assessee. In any case, following the earlier decision of Hon’ble Co-ordinate
Bench of ITAT, Indore as cited above and in the interest of justice, it would be
just and appropriate to give one opportunity to the assessee to submit his
documents to the Ld. AO and explain his case whereupon the Ld. AO would be
able to frame a proper assessment in accordance with law.
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In view of above and for the reasons stated above, we are inclined to
remand the cases of both assessment-years viz. AY 2011-12 and 2012-13 to
Ld. AO for a fresh assessment. Needless to mention that the Ld. AO shall give
adequate opportunities to the assessee and consider the evidences /
documents / details as may be filed by the assessee and thereupon pass order
in accordance with law.
In the result, these appeals of Assessee are allowed for statistical purposes. Order pronounced as per Rule 34 of I.T.A.T. Rules, 1963 on 21.10.2022.
Sd/- Sd/- (SUCHITRA R. KAMBLE) (B.M. BIYANI) JUDICIAL MEMBER ACCOUNTANT MEMBER Indore �दनांक /Dated : 21.10.2022 Patel/Sr. PS Copies to: (1) The appellant (2) The respondent (3) CIT (4) CIT(A) (5) Departmental Representative (6) Guard File By order UE COPY
Sr. Private Secretary Income Tax Appellate Tribunal Indore Bench, Indore
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Date of taking dictation 23.9.22
Date of typing & draft order placed before the 23.9.22 Dictating Member
Date on which the approved draft comes to the Sr. P.S./P.S.
Date on which the fair order is placed before the Dictating Member for pronouncement
Date on which the file goes to the Bench Clerk
Date on which the file goes to the Head Clerk
Date on which the file goes to the Assistant Registrar for signature on the order
Date of dispatch of the Order