E-proceedings and face less assessment and appeals- officers need to be more attentive, responsible and answerable.

[DEV KUMAR KOTHARI]

Earlier articles on e-proceedings:

E-PROCEEDINGS OF APPEAL - MOCKERY EVEN AT LEVEL OF COMMISSIONER JUST TO DISMISS APPEAL IN ANY MANNER TO HARASS ASSESSEE – Why action is not taken against Erring officers? Will NAMO 2 government curtail power to harass public? An Article By: - CA DEV KUMAR KOTHARI   July 13, 2019 

Details and information in e-proceedings need to be more relevant and timely to make e-proceeding user friendly. An Article By: - CA DEV KUMAR KOTHARI  July 2, 2019

UNJUST INTIMATION AND ADJUSTMENTS BY CPC – an unexpected, new source and style of harassment of taxpayers.  An Article By: - CA DEV KUMAR KOTHARI May 8, 2019

Order of Tribunal against order of CIT(A) referred to in the article dt. July 13,2019 is reported as follows:

2020 (9) TMI 1015 - ITAT KOLKATA

VARUN FINANCE PVT. LTD. VERSUS INCOME-TAX OFFICER, WD-5 (4) , KOLKATA

In earlier articles author has discussed about  unintended fate of e-proceedings resulting into litigation and harassment of tax payers.

In the article dated July 13, 2019 (supra.) a case was discussed in which Ld. CIT(A) had made mockery of e-proceedings by confirming wrongly levied penalty u.s. 271.1.c by the Ld. AO by ignoring even statement of facts, grounds of appeal and assessment records. He also ignored submissions made through e-proceeding and by emails.

Therefore, though the amount involved was small and matter was very old for assessment year 2006-07 the assesse preferred appeal before the Tribunal with the following grounds enclosed to the  appeal memo filed by assesse: 

Grounds of Appeal

1. For that Ld. CIT(A) was wrong in dismissing the appeal ignoring (a)  fact that appellant had opted for e-proceedings  (b) submitted written submissions and judgments relied on through e-proceedings in my account on departmental  website  and also by way of emails  on official email id of Ld. CIT(A),  (c) Ld. CIT(A) has himself considered the appeal through e-proceedings and had uploaded order on portal and did not serve hard copy of order  and (d) the notice of Ld. CIT(A) clearly mentioned to the effect that  personal appearance is not necessary and appellant can file written submission by email etc.
2. For that Ld. CIT(A) was wrong in holding that appellant had not made representations and has not filed written submissions  there was no compliance etc. and that appellant is not interested in pursuing appeal etc.
3.  For that ld. CIT(A) has not passed order, as he is required to pass an order on appeal and after considering material available on records and on merit.
4. For that Ld. CIT(A) was wrong in ignoring that the appellant had paid appeal fees  and had filed appeal with documents,  and also  filed  written submissions, therefore presumption of appellant not being interested is wrong, unjust and illegal.
5. For that even on basis of statement of facts and grounds of appeal the ld. CIT(A) must have allowed appeal as per precedence relied on in the statement of facts and before the LD. AO.
6. For that the Penalty  order is without jurisdiction, the notice u.s. 271  was not specific of charge, and in any case disallowances made by AO and partially confirmed by Ld. CIT(A)  are on highly  contentious issues therefore, the penalty levied by Ld.AO and confirmed by Ld. CIT(A) be deleted fully.
7. For that in view of facts and circumstances of the case honorable Tribunal may consider to grant cost of appeal in favor of appellant.
8.  For that appellant pray for permission to raise new contentions and grounds of appeal.

After filing of appeal assesse also filed paper book with written submissions before the honorable Tribunal.

Order of Tribunal:

Honourable Tribunal has considered documents in appeal. Honourable Tribunal has allowed appeal of assesse  on consideration of one of aspects and contentions raised and vacated penalty levied following binding precedence relied on by assessee and also other judgments after hearing the departmental representative (D.R).

On perusal of the order of Tribunal we find that only grounds 1-6 have been mentioned and considered in the order. Ground no. 7 and 8 have not even be mentioned / reproduced in the order and has not been decided.  Ground no. 7 was important as it relates to request of appellant / assessee  for costs of appeal which is in discretion of honourable Tribunal and can be allowed by Tribunal as per provisions reproduced below with highlights added:

Orders of Appellate Tribunal.

254. (1) The Appellate Tribunal may, after giving both the parties to the appeal an opportunity of being heard, pass such orders thereon as it thinks fit.

Xxx

(2B) The cost of any appeal to the Appellate Tribunal shall be at the discretion of that Tribunal.

This case was fit and  suitable case  to allow costs in favour of assesse because Ld. AO imposed penalty  which was contrary to settled law  by way of precedence relied on by assesse. This forced assessee to prefer appeal before Ld. CIT(A). Ld. CIT(A) ignored appeal records and assessment records and  confirmed penalty by dismissing appeal in a way of gross mockery of appeal and e-proceedings for appeal.

By ignoring the ground no. 7 honourable Tribunal has also passed order in a half-hearted manner. At least the ground should have been considered and decided irrespective of whether cost was allowed or not as it is in discretion of the Tribunal.

In fact this was a case in which honourable Tribunal could have allowed costs of appeal  in favour even if there was no ground taken by assesse. This is because the Ld. AO imposed penalty by ignoring several judgments of the Supreme Court on issue of penalty when notice u.s. 271  was not specific and also when disallowances made are on highly contentious issues and similar issues  have been decided in favour of other assessee  (like disallowance u.s. 14A and counting of 12 months for considering long-term capital asset by considering each calendar month in which asset was held including part of any months). On both issues assesse also relied on precedence which were  unfortunately not given credence and  the Ld. CIT(A) in his own style of  mostly dismissing appeals had  confirmed some additions  in appeal against quantum order and then again he did  not delete penalty  and dismissed appeal against penalty by presuming  that appellant is not interested in pursuing appeal by ignoring every vital and small matter like payment of appeal fees elaborate statement of facts and ground of appeal and written submissions made in e-proceedings.

It seems that even Tribunals and Courts generally have a soft corner for government authorities and  we can find that there are large number of deserving cases in which costs were not allowed in favour of tax payers.

In this regard readers can also  refer to the following article:

Awarding heavy costs is the only way to prevent Dept from indulging into un-necessary litigation

An Article By: - C.A. DEV KUMAR KOTHARI

February 29, 2012 in which  COMMISSIONER OF INCOME-TAX VERSUS DSL SOFTWARE LTD - [2011 (10) TMI 423 - KARNATAKA HIGH COURT]. Was also discussed.