Prabodh Sadashiv Sadavarte (Huf), A Hindu Undivided Family, Through Itskarta Adv. Prabodh S. Sadavarte, Agedabout 72 Years, Occupation : Legal Practitioner, Res v. The Income Tax Officer, Ward

914-J-ITL-11-20 IN THE HIGH COURT OF JUDICATURE AT BOMBAYNAGPUR BENCH, NAGPUR. INCOME TAX APPEAL NO.11 OF 2020 Prabodh Sadashiv Sadavarte (HUF), a Hindu undivided Family, through itsKarta Adv. Prabodh S. Sadavarte, agedabout 72 years, occupation : Legal Practitioner, resident of Ram Nagar, Nagpur … Appellant -vs- The Income Tax Officer, Ward No.1(4), Saraf Chambers, Sadar, Nagpur … Respondent Shri S. N. Bhattad, Advocate for appellant. Shri Anand Parchure, Advocate for respondent. CORAM : A. S. CHANDURKAR AND N. B. SURYAWANSHI JJ. DATE : December 09, 2020 Judgment : (Per A. S. Chandurkar, J.) Admit on the following substantial questions of law : i) Whether the Tribunal was justified in remanding theproceedings without granting due and sufficient opportunity to theappellant ? ii) Whether the Tribunal before passing the impugnedorder ought to have granted an opportunity to the appellant tochallenge the legality of the notice of reassessment which waspermissible under Rule 27 of the Income Tax Appellate TribunalRules, 1963 ? ” Heard the learned counsel for the parties. 2. Pursuant to the order of assessment passed by the AssessmentOfficer on 26/03/2014, the assessee sought to challenge the same by filingan appeal before the Commissioner of Income Tax (Appeals). Since theAssessment Officer initiated proceedings based on re-assessment, aground in that regard was raised in the appeal. The Assessment Orderwas also challenged on merits. The Commissioner of Income Tax(Appeals) did not accept the contention that the notice issued underSection 148 of the Income Tax Act, 1961 (for short, the said Act) was badin law. He however held that the assessment as made was not proper andexemption under Section 54-B of the said Act was liable to be allowed.The Revenue being aggrieved by the appellate order preferred furtherappeal before the Income Tax Appellate Tribunal. During pendency ofsaid appeal pursis was filed on their behalf seeking to withdraw theappeal on the ground that the tax effect involved was within theprescribed monetary limit. The appeal was accordingly dismissed aswithdrawn. Thereafter the Revenue sought restoration of the appeal onthe ground that the same was falling within exception 10(c) of theCircular dated 11/07/2018 in view of the fact that the audit objectionraised by the Department had been accepted. It therefore soughtrestoration of the proceedings. After issuing notice to the assessee theTribunal restored the appeal. By its judgment dated 19/02/2020 itallowed the appeal and as a result the proceedings were remanded to the Commissioner of Income Tax (Appeals). Being aggrieved the presentappeal has been filed. 3.Shri S. N. Bhattad, learned counsel for the appellant submitsthat on 18/02/2020 the counsel for the assessee was not present and arequest of adjournment was made before the Tribunal by one Shri MukeshAgrawal. He had not been instructed to argue the appeal on merits butonly to seek adjournment. Further when the order was passed on19/02/2020 it was recorded by the Tribunal that the counsel for theassessee has appeared and had supported the order impugned. Relyingupon the roznama of the proceedings it was submitted that no authorityhad been given to said Shri Mukesh Agrawal to represent the assessee.He specifically referred to the averments in paragraph 8 of the presentappeal memo and submitted that there was no specific denial of the samein the reply as filed. According to him after the appeal was restored on17/01/2020 a right to raise cross-objection under Rule 27 of the IncomeTax Appellate Tribunal Rules, 1963 arose. As a result of the impugnedorder such rights could not be exercised. He therefore prays that theproceedings be remanded to the Tribunal for fresh adjudication. 4.Shri Anand Parchure, learned counsel for the Revenuesupported the impugned order and submitted that as per the practice 4.Shri Anand Parchure, learned counsel for the Revenuesupported the impugned order and submitted that as per the practice prevailing the appellant had been represented by Shri Mukesh Agrawal.The impugned order had been passed after hearing the appellant’srepresentative. He further submitted that a request for restoration of theproceedings for re-hearing could be made before the Tribunal itself andthe same was not done by the assessee. He referred to the submissionsfiled on record and especially paragraph 4 thereof in that regard. Hetherefore submitted that there was no reason to interfere with theimpugned order. 5.We have heard the learned counsel for the parties. It is not indispute that after the proceedings were withdrawn before the Tribunal afresh application for restoration of the proceedings on the ground that thematter was falling within exception as carved out by Clause 10(c) of therelevant Circular was filed. The proceedings were accordingly restoredon 17/01/2020 and the same were thereafter fixed on 06/02/2020. Therecord indicates that vakalatnama of Shri S. N. Bhattad, Advocate wasfiled on record and Shri Mukesh Agrawal had not signed the vakalatnama.According to the appellant Shri Mukesh Agrawal was not duly authorisedin that regard. Request for adjournment was made on 19/02/2020 asaverred in paragraph 8 of the memorandum of appeal which has not beenspecifically traversed by the Revenue. The contention that the appellantought to have moved the Tribunal for restoration of the proceedings cannot be accepted for the reason that the Tribunal has decided theproceedings on merits and hence the appeal challenging its decesion hasbeen rightly filed. 6.After the proceedings were restored on 17/01/2020 right toraise cross-objection was available to the respondent in those proceedingsunder Rule 27 of the Rules of 1963. We find that such opportunity hasbeen lost in the process by the appellant. Considering the specificaverments made in paragraph 8 of the memorandum of appeal we are ofthe view that an opportunity to contest the proceedings on meritsdeserves to be granted to the appellant. Hence the substantial questions of law as framed are answeredin favour of the appellant. It is held that remand of the proceedings by theTribunal was not justified in the facts of the case. Accordingly thejudgment of the Income Tax Appellate Tribunal dated 19/02/2020 is setaside. The proceedings before it are restored for fresh adjudication inaccordance with law. It is made clear we have not examined the meritsof the respective challenges. All points in that regard are kept open. TheAppeal is allowed. The parties to bear their own costs. JUDGE JUDGE