Wednesday, October 26, 2011

Compilations of case law: General Topics: OPPORTUNITY OF BEING HEARD

ITO issuing notice u/s.271(1)(a) – No explanation furnished by assessee – change of ITO – assessee not asking for opportunity to be heard by successor ITO – Imposition of penalty by successor ITO without giving assessee opportunity to be heard – Penalty valid.
CIT Vs Laljidas Agarwalla (Patna) 190 ITR 429
CWT Vs Gilliaram Suggiram (Patna) 186 ITR 445
CWT Vs Azizunnisa Begum (SC) 243 ITR 852

Change of incumbent of office during pendency of assessment proceedings – As per Sec.129, re-hearing by new officer is not obligatory – it is required only when there is a demand from assessee.
K. Venkata Ramana & Budha Appa Rao Vs CIT (AP) 168 ITR 747
CWT Vs Umrao Lal (All) 136 ITR 49

Opportunity to be heard afforded to major partner of firm – Amounts to opportunity to be heard given to firm.
Manaklal Porwal Vs CIT (Raj) 155 ITR 648

Assessee not availing of opportunities given before completion of assessment – Not entitled to allege contravention of principles of natural justice.
P.N. Baslasubramanian Vs ITO & Ors. (AP) 112 ITR 512

The principle of "audi alteram partem" only means that the party affected should be given sufficient opportunity to meet the case against him. It is not necessary that assessee should be heard at each and every stage of proceedings – when an appeal was filed before AAC, ITO's orders merges with order of AAC and where there is no grievance that no opportunity was given by AAC, he cannot have a grievance that he was denied reasonable opportunity by ITO.
Kashmir Vastralaya Vs CIT (Pat) 112 ITR 630

ITO is not bound by any technical rules of the law of evidence – He can record statement from witnesses in the absence of assessee – But before using the same, assessee should be given opportunity to cross –examine.
C. Vasantal & Co. Vs CIT (SC) 45 ITR 206

Firm dissolved - Penalty notice issued to one of the partners – is sufficient notice – Individual notice on every partner is not necessary.
India Chemical Agency Vs CIT (Mad) 119 ITR 569

For every reason formulated by ITO in his order, no need to give opportunity to produce fresh evidence or fresh explanation.
Newton Chikli Collieries Ltd. Vs CIT (SC) 44 ITR 495
DCIT Vs Subhash Kumar Jain (ITAT, Chd) 69 ITD 313

Right to cross –examine witness who made adverse report, is not an invariable attribute of requirement of 'audi alteram parterm' - When statement of witness is only secondary evidence, there is no denial of natural justice if witnesses were not allowed to be cross-examined by assessee.
G.T,.C. Industries Limited Vs ACIT (ITAT, Bom) 65 ITD 380

Suit against Public Officer in respect of act done under warrant of authorization – opportunity to be granted to Public Officer before granting relief – notice mandatory
Union of India v. Natwarlal M. Bandari (Guj) 250 ITR 641

Simply because an opportunity of being heard was not given to the assessee, will not invalidate an assessment order – It is only a procedural lapse
Kailash Moudgil Vs DCIT (ITAT, Del-SB) 72 ITD 97

If assessee is aware of the contents of the statements recorded from witnesses, failure to provide copies of the same before cross-examination, is not fatal – Addition on account of inflation of purchase price upheld
H.M. Sarif and Sons Vs CIT (All) 296 ITR 523

Non-furnishing of copy of statement given by production-in-charge did not amount to denying opportunity of cross examination to assessee, especially when the addition was made solely on the basis of return filed, documents produced and submissions made by assessee.
DXN Herbal Mfg. (India)(P.) Ltd. Vs ITO (ITAT, Chennai) 110 ITD 99

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