DEPUTY COMMISSIONER OF INCOME TAX, KOLKATA V. LOKENATH PRASAD GUPTA, KOLKATA

ITA 72/KOL/2025

AI Insights

The case involves an appeal by the revenue against the order of the Commissioner of Income Tax (Appeals), which had deleted an addition made by the Assessing Officer regarding certain commodity transactions allegedly conducted by the assessee, Lokenath Prasad Gupta, through the Indian Commodity Exchange Ltd. (ICEX). The Assessing Officer had added an amount of Rs.50,47,895 to the assessee's income based on these transactions. The CIT(A) deleted this addition, citing a lack of evidence provided by the Assessing Officer. The revenue appealed, arguing that the necessary evidence was available but not considered by the CIT(A). The tribunal found a violation of the principles of natural justice as the assessee was not given an opportunity to cross-examine the official who provided the adverse information. The matter was remanded back to the Assessing Officer for a fresh assessment after providing the assessee a fair opportunity to contest the evidence against him.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 360661 (ITAT-KOLKATA)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-05-2025
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Assessment Year: 2012-2013
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: MONALISA PAL MUKHERJEE
• Assessee Lawyers: RAJEEVA KUMAR
• Keywords: Set aside; Principle of natural justice

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH KOLKATA BEFORE SHRI GEORGE MATHAN, JUDICIAL MEMBER & SHRI SANJAY AWASTHI, ACCOUNTANT MEMBER ITA No.72/Kol/2025 Assessment Year: 2012-13 DCIT, Central Circle-3(3), Kolkata Vs. Lokenath Prasad Gupta R. K. Dev Path, Titagarh, North 24 Parganas-700119 (PAN:ADUPG5810F) (Appellant) (Respondent) Present for: Appellant by : Ms. Monalisa Pal Mukherjee, JCIT, Sr. DR Respondent by : Shri Rajeeva Kumar, Advocate Date of Hearing : 22.05.2025 Date of Pronouncement : 22.05.2025 O R D E R Per Bench : The captioned appeal filed by the revenue is against the order of the Ld. Commissioner of Income Tax (Appeals), Kolkata-21 (in short “CIT(A) vide order No. ITBA/APL/S/250/2024-25/1070002587(1) dated 28.10.2024 passed u/s. 250 of the Income Tax Act, 1961 (hereinafter referred to as the “Act”) for the assessment year 2012-13. 2. Ms. Monalisa Pal Mukherjee, JCIT, Sr. DR represented on behalf of the revenue and Shri Rajeeva Kumar, Advocate appeared on behalf of the assessee. 2 ITA No. 72/Kol/2025 Lokenath Prasad Gupta, AY: 2012-13 3. It was submitted by the Ld. Sr. DR assisted by the Ld. CIT, DR that this is a case where the Assessing Officer has received information that the assessee has transacted in certain commodities through the Indian Commodity Exchange Ltd. (in short “ICEX”). The transaction was to an extent of Rs.50,47,895/-. It was the submission that the assessee had filed an affidavit before the Assessing Officer that he had not done such a transaction. The Assessing Officer had not accepted the contention and had made the addition. 4. On appeal, the Ld. CIT(A) had deleted the addition on the basis of affidavit filed by the assessee and by taking the stand that the Assessing Officer had not provided the information or the evidences before the Ld. CIT(A). It was submitted by the Ld. Sr. DR that the evidence has been received from National Multi commodity Exchange (in short “NMCE”), merged with ICEX and the evidence was shown as follows: 3 ITA No. 72/Kol/2025 Lokenath Prasad Gupta, AY: 2012-13 5. It was the further submission that before the Ld. CIT(A) the said information had been specifically provided vide the letter of the DCIT, Central Circle-3(3), Kolkata received in the office of the Ld. CIT(A) on 15.07.2024. The Ld. Sr. DR placed before us the copy of the communication sent to the Ld. CIT(A) which are as follows: 4 ITA No. 72/Kol/2025 Lokenath Prasad Gupta, AY: 2012-13 6. It was the submission by the Ld. Sr. DR that the Assessing Officer made the addition on the basis of the evidence available with the him in the form of correspondence with NMCE. It was the submission that the order of the Ld. CIT(A) may be reversed. 7. In reply, the Ld. AR submitted that the adverse evidence which has been claimed by the revenue representing the letter from NMCE was not given to the assessee for his rebuttal nor was the concerned official provided to the assessee for cross examination. It was the submission that the assessee had produced the bank statement to show that the said transactions have not been done by the assessee. It was further submitted that though the Assessing Officer had provided a copy of e-mail to the assessee in respect of the same communication which has been received from NMCE, the assessee denied the said transaction in its entirety. It was the submission that the opportunity to cross examine the person who has given such a wrong information against the assessee have also not been provided to the assessee. It was the submission that the order of the Ld. CIT(A) is liable to be upheld. 8. We have considered the submissions of both the parties. A perusal of the facts in the present case clearly shows that on the first occasion there is a violation of the principles of natural justice on the part of the Assessing Officer in so far as the Assessing Officer has not given the assessee the opportunity to cross examine the concerned official who has provided the information regarding the transaction of the assessee. We do recognize that the assessment is an old assessment and substantial time has passed. However, the details of such transaction would be available with NMCE if there are changes in the officials the transaction can still be traced with NMCE/ICEX. On the second aspect, a perusal of the order of the Ld. CIT(A) when compared to the evidence that has been produced by the Assessing Officer clearly shows that the information sought by the Ld. CIT(A) was very 5 ITA No. 72/Kol/2025 Lokenath Prasad Gupta, AY: 2012-13 much made available to the Ld. CIT(A). This being so, we are unable to agree with the Ld. CIT(A) that there has been failure on the part of the Assessing Officer to comply with the submissions and the evidence before him. As admittedly, there has been a violation of the principles of natural justice in so far as the assessee has not been granted the opportunity to cross examine and rebut the adverse evidence that is available with the Assessing Officer in the form of communication from NMCE, in the interest of natural justice, we are of the view that the issues in this appeal may be restored to the file of the Assessing Officer for re-adjudication after granting the assessee adequate opportunity to substantiate his case. The Assessing Officer shall provide the assessee on such adverse evidence which it proposes to use against the assessee. The Assessing Officer shall provide the assessee opportunity to cross examine the concerned officials who provided the Assessing Officer with the adverse information that he proposes to use in the assessment of the assessee. The assessee shall cooperate in the set aside proceeding, in the case of failure on the part of the assessee to cooperate in the set aside assessment proceeding, liberty is granted to the Assessing Officer to draw adverse inference. It is advisable that the Assessing Officer must initiate the set aside proceeding at an early date so that the proceeding can be concluded well within the time barring date. 9. In the result, the appeal of the revenue is partly allowed for statistical purposes. Order is dictated and pronounced in the open court. Sd/- Sd/- (Sanjay Awasthi) (George Mathan) Accountant Member Judicial Member Dated: 22nd May, 2025 JD, Sr. P.S. 6 ITA No. 72/Kol/2025 Lokenath Prasad Gupta, AY: 2012-13 Copy to: 1. The Appellant: DCIT, Central Circle-3(3), Kolkata. 2. The Respondent- Shri Lokenath Prasad Gupta. 3. CIT(A), Kolkata-21. 4. Pr. CIT 5. DR, ITAT, Kolkata Bench, Kolkata 6. Guard file. True Copy By Order Assistant Registrar ITAT, Kolkata Benches, Kolkata "