G.Navin , Chennai V. ACWT Circle 1, , Vellore

CO 5/CHNY/2020

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 3633 (ITAT-CHENNAI)
• Duration Of Justice: 1 month(s) 2 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 26-02-2020
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2011-2012
• Appeal Filed On: 23-01-2020
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: A SOUNDARARAJAN
• Assessee Lawyers: A SUNDARARAJAN
• Keywords: Opportunity of being heard; Reasonable cause; Set aside

Judgement Text

, , IN THE INCOME-TAX APPELLATE TRIBUNAL B BENCH, CHENNAI . , , BEFORE SHRI DUVVURU RL REDDY, JUDICIAL MEMBER & SHRI S. JAYARAMAN, ACCOUNTANT MEMBER W.T.A. NOS. 52, 43, 44, 45 & 46/CHNY/2019 /ASSESSMENT YEARS: 2010-11 TO 2014-15 & C.O. NOS. 05, 06, 07, 08 AND 09/CHNY/2019 [IN W.T.A. NOS. 52, 43, 44, 45 & 46/CHNY/2019] THE ASSISTANT COMMISSIONER OF WEALTH TAX, CIRCLE 1, VELLORE, CENTRAL REVENUE BUILDINGS, 2 ND BARRACKS CROSS, OFFICERS LINE, VELLORE 632 001. VS. SHRI G. NAVIN, NO. 24, ARUNACHALAM ROAD, SALIGRAMAM, CHENNAI 600 093. [PAN: ABEPN7406L] ( /APPELLANT ) ( RESPONDENT/CROSS OBJECTOR ) / APPELLANT BY : SHRI A. SUNDARARAJAN, ADDL. CIT / RESPONDENT BY : SHRI A. SOUNDARARAJAN, C.A. / DATE OF HEARING : 24.02.2020 /DATE OF PRONOUNCEMENT : 26.02.2020 / O R D E R PER BENCH: THESE FIVE APPEALS FILED BY THE REVENUE ARE DIRECTED AGAINST THE COMMON ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS)-13, CHENNAI DATED 28.12.2018 RELEVANT TO THE ASSESSMENT YEARS 2010-11, 2011- 12, 2012-13, 2013-14 AND 2014-15. THE ONLY EFFECTIVE COMMON GROUND IN THIS APPEAL RAISED BY THE REVENUE IS THAT THE LD. CIT(A) HAS ERRED IN ADMITTING FRESH EVIDENCES FILED BY THE ASSESSEE AND DECIDED THE APPEAL IN FAVOUR OF THE ASSESSEE WITHOUT CALLING FOR A REMAND REPORT FROM THE I.T.A. NOS.52, 43-46/CHNY/19 & C.O.NOS. 05-09/CHNY/19 2 ASSESSING OFFICER OR PROVIDING AN OPPORTUNITY TO THE ASSESSING OFFICER IN VIOLATION OF RULE 46A OF THE INCOME TAX RULES. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE THE ASSESSEE IS A DOCTOR AND ALSO DOING FAMILY BUSINESS OF RUNNING A LEDGE. THE ASSESSEE DID NOT FILE THE WEALTH TAX RETURNS FOR THE ASSESSMENT YEARS UNDER CONSIDERATION. THUS, NOTICE UNDER SECTION 17 OF THE WEALTH TAX ACT, 1957 WAS ISSUED TO THE ASSESSEE INSPITE OF ISSUANCE OF REMINDERS ON VARIOUS OCCASIONS. SINCE THERE WAS NO RESPONSE FROM THE ASSESSEE AND THE ASSESSEE HAS NOT FILED HIS RETURN OF WEALTH FOR ANY OF THE ABOVE STATED YEARS, DESPITE, THE ASSESSEE IS LIABLE TO WEALTH TAX, THE ASSESSING OFFICER COMPLETED THE WEALTH TAX ASSESSMENT UNDER SECTION 16(5) OF THE ACT. ON APPEAL, AFTER CONSIDERING THE EXPLANATIONS OFFERED BY THE ASSESSEE, THE LD. CIT(A) PARTLY ALLOWED THE APPEAL FILED BY THE ASSESSEE. 3. AGGRIEVED, THE REVENUE IS IN APPEAL BEFORE THE TRIBUNAL FOR ALL THE ASSESSMENT YEARS UNDER CONSIDERATION. THE LD. DR HAS SUBMITTED THAT WITHOUT OBTAINING REMAND REPORT ON THE FRESH EVIDENCES AS WELL AS EXPLANATIONS OFFERED BY THE ASSESSEE, IN VIOLATION OF RULE 46A OF IT RULES, THE LD. CIT(A) ERRONEOUSLY DELETED THE ADDITIONS AND PLEADED FOR SUITABLE DIRECTIONS. ON THE OTHER HAND, THE LD. COUNSEL FOR THE ASSESSEE STRONGLY SUPPORTED THE ORDER PASSED BY THE LD. CIT(A). I.T.A. NOS.52, 43-46/CHNY/19 & C.O.NOS. 05-09/CHNY/19 3 4. WE HAVE HEARD BOTH THE SIDES, PERUSED THE MATERIALS AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF AUTHORITIES BELOW. SINCE THE ASSESSEE HAS NOT FILED THE WEALTH TAX RETURN FOR THE ASSESSMENT YEARS UNDER CONSIDERATION, THE ASSESSING OFFICER COMPLETED THE ASSESSMENT UNDER SECTION 16(5) OF THE ACT. WITH REGARD TO THE ADDITION TOWARDS WEALTH TAX ON HOUSE AT BEEMAKULAM, PLOT AT SALIGRAMAM AND PLOT AT VELLORE OF .28,14,087/-, .10,80,000/- AND .1,03,46,132/-, AFTER CONSIDERING THE DOCUMENTS INCLUDING VAO CERTIFICATES PRODUCED BY THE ASSESSEE, THE LD. CIT(A) HAS HELD THAT THE ADDITION TOWARDS HOUSE AT BHEEMAKULAM IS UNWARRANTED, THE ASSESSING OFFICER WAS DIRECTED TO CONSIDER WITH RESPECT TO THE ASSESSEES SHARE IN THE SALIGRAMAM PLOT/RESIDENTIAL BUILDING AND WHETHER OR NOT IT EXCEEDS 500 SQ. M. AND ALSO BY ADOPTING THE RENTAL METHOD OF VALUING THE VELLORE TENANTED PROPERTY WHILE GIVING EFFECT TO HIS ORDER IN LINE WITH THE CASE LAW REFERRED IN THE ORDER, WITHOUT OBTAINING ANY REMAND REPORT FROM THE ASSESSING OFFICER, WHICH IS IN VIOLATION OF RULE 46A OF THE IT RULES. 5 WITH REGARD TO THE ADDITION TOWARDS CASH BALANCE, AFTER CONSIDERING THE FINANCIAL CHART FURNISHED BY THE AR OF THE ASSESSEE ON THE CASH BALANCES WITH THE ASSESSEE ON VARIOUS CORRESPONDING VALUATION DATES AGAIN DULY VOUCHED BY THE RELEVANT BANK ACCOUNTS/CASH BOOK, THE LD. CIT(A) HAS OBSERVED THAT THE VALUATION DATES OF CASH BALANCE VARIES QUITE SUBSTANTIALLY DURING THE SAID PERIOD FROM THE ASSESSMENT YEAR 2010-11 TO 2014-15 AND I.T.A. NOS.52, 43-46/CHNY/19 & C.O.NOS. 05-09/CHNY/19 4 THEREFORE, HELD THAT THE ASSESSING OFFICERS ACTION IN EXTRAPOLATING BOTH BACKWARDS AND FORWARD THE CASH BALANCES FOR THE YEAR ENDING FY 2012-13 OR AY 2013-14 OF .77,87,678/- IN AN IDENTICAL MANNER WITHOUT ANY COGENT EXPLANATION IS CLEARLY INCORRECT AND NOT BORNE OUT FROM THE RECORDS INCLUDING THE SUBMISSIONS MADE AT THE TIME OF APPELLATE PROCEEDINGS BUTTRESSED BY RELEVANT PROOF EVIDENCING SUCH BALANCE AS AGAINST THE UNIFORM FIGURE OF .77,87,678/- ADOPTED BY THE ASSESSING OFFICER FOR ALL THE ASSESSMENT YEARS. MOREOVER, THE LD. CIT(A) HAS OBSERVED THAT THE ASSESSING OFFICER HAS NOT GIVEN THE BENEFIT OF .50,000/- AS PER SECTION 2(EA)(VI) WHILE ARRIVING AT THE CASH IN HAND TO BE INCLUDED IN THE NET WEALTH FOR THE PURPOSES OF CHARGE THEREON AND DIRECTED THE ASSESSING OFFICER TO GIVE WHILE INCLUDING SUCH CASH BALANCE AS MENTIONED ABOVE IN THE NET WEALTH OF THE ASSESSEE FOR THE IMPUGNED YEARS IN APPEAL. WHILE HOLDING SO, THE LD. CIT(A) HAS NOT GIVEN ANY OPPORTUNITY OF BEING HEARD TO THE ASSESSEE, WHICH IS IN VIOLATION OF RULE 46A OF THE IT RULES. ACCORDINGLY, WE SET ASIDE THE ORDER OF THE LD. CIT(A) ON THE ABOVE ISSUES AND DIRECT THE ASSESSEE TO FURNISH EXPLANATION WITH COMPLETE EVIDENCES BEFORE THE ASSESSING OFFICER AND AFTER CONSIDERING THE EXPLANATIONS AND EVIDENCES, THE ASSESSING OFFICER IS DIRECTED TO DECIDE THE ISSUES FRESH IN ACCORDANCE WITH LAW AFTER AFFORDING SUITABLE OPPORTUNITIES OF BEING HEARD TO THE ASSESSEE. I.T.A. NOS.52, 43-46/CHNY/19 & C.O.NOS. 05-09/CHNY/19 5 6. THE CROSS OBJECTIONS FILED BY THE ASSESSEE FOR THE ASSESSMENT YEARS 2010-11 TO 2014-15 ARE DELAYED BY 162 DAYS IN FILING THE SAME BEFORE THE TRIBUNAL, FOR WHICH, THE CONDONATION PETITION FILED IN THE FORM OF AFFIDAVIT, THE ASSESSEE HAS TAKEN THE ONLY PLEA THAT THE RELEVANT PAPERS WERE MISPLACED BY THE MANAGER OF THE ASSESSEE IS NOT SUFFICIENT REASONABLE CAUSE FOR THE HUGE DELAY IN FILING THE CO AND THE SAME IS LIABLE TO REJECTED. OTHERWISE ALSO, ON MERITS, WE HAVE REMITTED THE MATTER BACK TO THE FILE OF ASSESSING OFFICER FOR FRESH ADJUDICATION; THE CROSS OBJECTIONS FILED BY THE ASSESSEE BECAME INFRUCTUOUS AND ACCORDINGLY DISMISSED. 7. IN THE RESULT, ALL THE APPEALS FILED BY THE REVENUE ARE ALLOWED FOR STATISTICAL PURPOSES AND ALL THE CROSS OBJECTIONS FILED BY THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED ON THE 26 TH FEBRUARY, 2020 AT CHENNAI. SD/- SD/- (S. JAYARAMAN) ACCOUNTANT MEMBER (DUVVURU RL REDDY) JUDICIAL MEMBER CHENNAI, DATED, THE 26.02.2020 VM/- /COPY TO: 1. / APPELLANT, 2. / RESPONDENT, 3. ( ) /CIT(A), 4. /CIT, 5. /DR & 6. /GF.