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TMI Blog2013 (10) TMI 1118X X X X Extracts X X X X X X X X Extracts X X X X ..... t to set aside the assessment back to the file of assessing officer to decide the objections of the assessee by speaking order and then to consider proceeding with reassessment – Decided in favor of Assessee. Allowance u/s 37(1) of the Income Tax Act – Held that:- Expenditure pertaining to the payment made to Canara Bank on the direction of DRT, the hypothecation defalcation and its consequent effect on the immovable property placed by the assessee is purely a civil dispute and any damages allowed in this behalf even referred to as penal by DRT, do not constitute payment for infraction of law – Therefore, deduction allowed – Decided in favor of Assessee. 50% disallowance u/s 40A(ia) – Held that:- Commission payment has been made to foreign parties for procurement of foreign business and they had no presence or office in India – Disallowance deleted – Decided in favor of Assessee. - ITA No.831, 832 & 952/Del/2009 - - - Dated:- 13-9-2013 - R.P. TOLANI AND B.C. MEENA , JJ. For the Appellant : Shri S R Wadhwa Adv. For the Respondent : Ms Y Kakkar Sr. DR ORDER:- PER : R P Tolani These are three appeals by the assessee against separate orders of CIT(A) relati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on after it was received on 19-12-2005 as per the past practice as he has always been handling the income tax affairs of the Company. (ii) Unfortunately, within a short time thereafter, her son Dhivesh Kr. Vyas died in a motor-cycle accident on 13-01-2006 at Bangalore causing her great mental agony and grief and resulting in her going in depression. For the next about six months, she could not attend her income tax affairs and forgot to ask Shri Harish Gambhir if the appeal had been filed. Copy of the Death Certificate dated 13-01-2006 of her son is enclosed at Annex-I. (iii) The authorized representative of the company Shri Harish Gambhir, Chartered Accountant, who was representing the case before the Assessing officer as well as the CIT(A) has himself been a patient of acute diabetes and high blood pressure and was also suffering from several other ailments including cardiac problems and chronic rental failure and was dialysis dependent. Because of these ailments, he would often relapse into amnesia and was hospitalized for a long time before his death on 29-04-2008. Copies of the medical reports in support of the appellant s submissions are enclosed at Annex-I and his ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) for the proposition that that for delay attributable to personal inability of counsel, litigant cannot be blamed. Such delay constitutes sufficient cause for condoning the delay in terms of sec. 256(5) of the I.T. Act. 5. Ld. DR opposed the same and contends that the assessee was not diligent in pursuing the legal remedies. 6. We have heard rival contentions and gone through the entire material available on record. The facts of the delay, which are specified by affidavits and death certificates indicate the unfortunate circumstances which the litigant had to face. The Hon ble Supreme Court in the case of Mst. Katiji others (supra) has held that when the technical consideration and cause of substantial justice are pitted against each other the cause of substantial justice has to prevail. It has been further held that while considering the issues of condonation of delay, a rigid and pedantic approach should not be adopted and the issue should be decided conforming to natural justice. In the case of Prem Chand Bansal Sons (supra), the Hon ble Delhi High Court has dealt with the issue of the inability of the counsel causing the delay in filing the appeal and has held that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e reassessment proceedings are liable to be quashed in view of the various Delhi and Hon ble Punjab Haryana High Courts judgments. 8. In reply to these two issues, ld. DR relied on the order of CIT(A) and about the service of notice ld. DR contends that the service of notice can be ascertained from the record only. 9. Ld. counsel for the assessee contends that the Bench on earlier occasions has directed the ld. DR to establish the factum of service, however, the relevant record has not been produced so far. 10. We have heard rival contentions and gone through the entire material available on record. Apropos the issue raised about the objections of the assessee on reopening of assessment which was already earlier completed u/s 143(3) assessing officer failed to decide the objections one way or the other which is against the ratio of Hon ble Supreme Court judgment in the case of G.K.N. Driveshaft (supra). CIT(A) has held that according to him the objections raised by assessee were not proper. In our considered view the issue decided by CIT(A) is not in consonance with Hon ble Supreme Court judgment in the case of G.K.N. Driveshaft (supra). In view of Hon ble Supreme Court jud ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he direction of Debt Recovery Tribunal (DRT) apropos default of some hypothecation of stock and second charge on immovable assets. Merely because DRT used the word amount being penal the same has been disallowed u/s 37(1) as being infraction of the law. It is pleaded that the issues relating to loan recovery, defalcation in hypothecation terms is a civil matter and merely because the DRT used the word penal, it does not make the amount criminal in nature paid for infraction of law. Therefore, lower authorities erred in disallowing the same. 12.1. Apropos ground no. 2 i.e. disallowance of claim of bad debts written off in the books of a/c, it is pleaded that all the details are filed by the assessee which are placed on paper book no. 12 and the reason thereof along with various other paper book pages from 13 to 43 including the details claimed by CIT(A) not to have been not filed by the assessee. Thus, the observations are purely mistaken. All the relevant having been filed, there is no justification in disallowing the claim of bad debts in this behalf. 12.2. About charging of interest u/s 234A, B and C the ld. Counsel conceded that the same is consequential. 13. Ld. DR supp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... non-resident companies for securing business outside India where the said entities have no office or business operations in India." 16.1. It has not been disputed that the reminder amount of commission was paid by the assessee to non-resident companies for securing business outside India and then had no office or business operations in India. This view is further upheld by Hon ble Supreme Court in the case of Transmission Corporation of A.P. Ltd. Vs. CIT 239 ITR 587. Apropos ground no. 2 it is contended that the amount on account of various loans has been added by assessing officer by holding that assessee company agreed for this addition subject to no penal action. The assessee denied having made any voluntary offer therefore on 22-12-2009, assessee asked the assessing officer to provide a copy of the proceeding sheet. The same has not been given. The order sheet entry would show that CA of the assessee was not present on the date of alleged offer. Copy of the order sheet entry has not been given so far. Apropos ground no. 3 it is pleaded that the payment of ESI and PF amounting to Rs. 17,395/- was deposited on the dates prior to the due date of filing of the return. The last pa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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