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08-07-2019, Varghese M. Uthup, Section 249(2), 153A, 144, Tribunal Cochin
Asstt. Year - 2009-10, 2010-11, 2012-13, 2013-14, 2014-15, 2015-16
PER : CHANDRA POOJARI, AM:
These appeals filed by the assessee is directed against the common order of the CIT(A)-III, Kochi dated 04/02/2019 which relates to quantum additions as well as levy of penalty u/s. 271(1)(c) of the Act and pertain to the assessment years 2009- 10, 2010-11, 2012-13, 2013-14, 2014-15, 2015-16.
2. The assessee has raised the following grounds of appeal:
1. The order passed by the CIT(A) is against equity and justice.
2. The CIT(A) ought to have considered the fact that the appellant had received the assessment orders only 16/03/2018 and the appeals were filed within 30 days as permitted by section 249(2) and hence there was delay in filing the appeals.
3. If at all the date of service of notice is taken as the date on which the assessment orders were handed over to the ex-employee of M/s. Al Zarafa Travels and Manpower Consultants (P) Ltd., the CIT(A) ought to have considered the fact that the delay in filing the appeals was on account of reasons beyond the control of the appellant.
4. The basic purpose of appeals is to provide justice to assesses. By not condoning the delay on valid grounds, the CIT(A) has acted against the legislative intent behind appellate proceedings, that too in a case where assessments have been made ex parte.
5. The appeals were dismissed in haste by the CIT(A) ignoring the appellant’s request to keep the proceedings in abeyance till the disposal of appeals by the ITAT in the case of M/s. Al Zarafa Travels and Manpower Consultants (P) Ltd. against order of CIT(A) for non-condonation of delay in filing the appeal on similar grounds.
6. The CIT(A) ought to have considered the decision of the Hon’ble Supreme Court n Collector, Land Acqu sition, Anantnag and Another vs. MST. Katiji & Others (2002- TIOL-44-SC-LMT)
7. The CIT(A) ought to have considered the fact that the assessment orders were passed ex parte u/s. 144 of the Income Tax Act, 1961 and substantial injustice would be caused to the appellant if the delay is not condoned. When substan ial justice and technical consideration are pitted against each other, the CIT(A) ought to have given preference to substantial justice rather than giving preference to technicalities.
8. For the above grounds and such other grounds as may be raised at the time of hearing, it is prayed to condone the delay in filing the appeals before the CIT(A) and restore the case back to the file of CIT(A) to adjudicate the matter.
2.1 The crux of the above grounds is that the CIT(A) erred in not adjudicating the appeals on account of delay in filing the same before the CIT(A).
3. The facts of the case are that Shri Varghese M Uthup is the Managing Director of M/s Al Zarafa Travels and Manpower Consultants Pvt. Ltd., which is a manpower recruitment agency. There was a search action u/s 132 of the Income Tax Act against Shri Varghese Uthup on 27.03.2015. The assessments in these cases were completed u/s 153A r.w.s 144 of the 1.T. Act, 1961 on 29.11.2016 & 30.11.2016. Subsequently notices u/s 271(l)(c) of the IT Act were issued in this case and penalty proceedings were finalized on 30.05,2017 & 31.05.2017 as till such time no appeals were filed. Subsequent to the above appeals were f led before CIT(A) in the aforesaid cases on the following dates:-
3.1 Thus, there was a substantial delay in filing of appeals before the CIT(A) in the aforesaid cases, with a delay ranging from several months to over one year. A show cause notice for the validity of the aforesaid appeals was sent by CIT(A) to the assessee vide letter dated 29.01.2019. In response to the above, the assessee filed a reply stating:-
“At the time of assessment proceedings and serving the assessment orders, appellant was a non resident residing outside India and could not travel to India due to travel ban imposed by UAE Govt on the request of Govt agencies in India. Subsequently, the Hon. High Court of Kerala granted permission to the appellant to travel to India. On 14th March, 2018, appellant had to appear in the CBI Court, Ernakulam in connection with getting his passport back as per directions of the Hon. High Court of Kerala. In the CBI Court, an order under section 230 against the appellant was handed over to the court in the form of a petition. Only at this point appellant was aware about the assessments. The assessment order was handed over to the office of Al Zarafa Travels andManpower Consultants, Cochin, alleging that appellant is the managing director of the company, whereas appellant had resigned directorship on 01.10.2009 and was not associated with the company. In the assessment orders also, address of the appellant was written as the address of the company, whereas as per PAN records the address of the appellant is his residence address at Puthuppally, Kottayam. Appellant contacted one of the employees of the company and was informed that the assessment order was handed over to the erstwhile Chartered Accountant on 16.03.2018. If at all the date of service of the order at the office, it is prayed to condone the delay in filing the appeal at it was due to reasons beyond the control of the appellant. It may be noted that appellant was not a director of the company "Al Zarafa Travels and Manpower Consultants (P) Ltd". He has resigned his directorship on 01.10.2009. His address as per PAN records is his residence address. The assessment orders and penalty orders were served on an ex-employee handed over the same to the erstwhile Chartered Accountant. The appellant got the assessment orders only on 16.03.2018. The appeals were filed on 20.03.2018. The service of the assessment order on the ex-employee of Al Zarafa Travels and Manpower Consultants (P) Ltd. cannot be taken as service of notice on the appellant Hence, there is no delay in filing the appeal. Condonation is sought as matter of abundant caution. Considering the above, kindly treat the appeals as valid.”
3.2 The CIT(A) called for remand report from the Assessing Officer and the Assessing Officer vide his letter dated 01.02.2019 stated as follows:-
“In respect of point no (i), it is submitted that the notices u/s 153A was served at the address as seen in the warrant of authorization u/s 132. In response to the notice, one Shri James Thomas (erstwhile Chartered Accountant) appeared and filed his letter. Since the AR could not furnish any