GHANSHYAM PANDET,LN MISHRA COLONY, BAJRA, ITKI ROAD RAN V. ASST COMMISSIONER, RANCHI

ITA 173/RAN/2023

AI Insights

The case involves Ghanshyam Pandet, a government contractor and director of M/s. Maa Contract (P.) Ltd., who was found in possession of Rs. 9,70,000 during the 2019 General Parliamentary Election. The cash was seized by the police, and subsequent inquiries led to the addition of this amount as unexplained money under Section 69A of the Income Tax Act, 1961. The Assessing Officer (AO) and the Commissioner of Income Tax (Appeals) upheld this addition without sufficient examination of the books of account provided by the assessee. The Tribunal criticized the lack of a detailed inquiry and remanded the case for a comprehensive review and a reasoned decision.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 46665 (ITAT-RANCHI)
• Duration Of Justice: 1 year(s) 2 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-10-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2020-2021
• Appeal Filed On: 08-08-2023
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Set aside; Corroborative evidences
• Section: 250; 131; 69A

Judgement Text

"आयकर अपीलीय अधिकरण र ांची 'एसएमसी' पीठ, र ांची में IN THE INCOME TAX APPELLATE TRIBUNAL RANCHI ‘SMC’ BENCH, RANCHI श्री प र्थ स रर्ी चौिरी, न्य धयक सदस्य क े समक्ष Before SRI PARTHA SARATHI CHAUDHURY, JUDICIAL MEMBER I.T.A. No.: 173/RAN/2023 Assessment Year: 2020-21 Ghanshyam Pandet.................................................................Appellant [PAN: AIXPP 9852 C] Vs. ACIT, Ranchi……..................................................................Respondent Appearances: Assessee represented by: Manjeet Verma, AR. Department represented by: None. Date of concluding the hearing : October 21st, 2024 Date of pronouncing the order : October 22nd, 2024 ORDER Per Partha Sarathi Chaudhury, Judicial Member: This appeal preferred by the assessee emanates from the order of the Commissioner of Income Tax (Appeals)-3, Patna [hereinafter referred to as 'ld. CIT(A)'] dated 26.05.2023 for Assessment Year 2020-21 as per the grounds of appeal on record. 1.1. At the time of hearing, None appeared for the Department. However, an adjournment petition was filed which is extracted as follows: \"This is to bring to your kind attention that unavoidable requirement, I will not be able to appear before the honourable Bench on 21.10.2024. Under these circumstances, I would be deeply obliged if the cases are kindly adjourned, and fixed for hearing on any other suitable date. I.T.A. No.: 173/RAN/2023 Assessment Year: 2020-21 Ghanshyam Pandet. Page 2 of 4 I am extremely apologetic for this unforeseen event and inconvenience caused is deeply regretted.\" 1.2. It is noticed from the adjournment petition that no specific reasons have been enumerated therein which calls for adjournment. Therefore, keeping in mind the directives of the Hon'ble Supreme Court that adjournment should not be granted on a routine manner the adjournment petition is rejected and I hereby proceed to hear the matter after considering the documents on record and the submissions of the ld. AR. Furthermore, this appeal has been preferred by the assessee for which the assessee has paid the Tribunal fees and therefore, it is all the more essential that justice should not be delayed and since the ld. AR is present in the Court, the matter should be adjudicated and heard. 2. The relevant facts are that during the General Parliamentary Election, 2019, an information was received from the Superintendent of Police (Rural), Ranchi about the assessee who was detained with Rs. 9,70,000/- of cash in his possession in his vehicle at Nagri Thana, Ranchi on 27.04.2019. Accordingly, the statement u/s 131 of the Income Tax Act, 1961 (hereinafter the 'Act') was recorded in which he had stated that he is a Government contractor and director of M/s. Maa Contract (P.) Ltd. and claimed that he was going to Sisai to make payment for labour where rural road was being constructed. It was further claimed by the assessee that the said amount did not belong to him but it belonged to the company i.e. M/s. Maa Contract (P.) Ltd. and that the assessee is only one of the directors in the said company. The assessee had furnished books of account along with cash book before the Assessing Officer (hereinafter referred to as the 'AO'), however, no bills/vouchers or any other document corroborating the said amount that it belonged to the company, nothing was furnished before the ld. AO. Accordingly, this amount of Rs. 9,70,000/- was added u/s 69A of the Act as unexplained money. The only reason held by the ld. AO is that the assessee was unable to furnish appropriate documentary evidences corroborating his claim that the money belonged to the company and not his I.T.A. No.: 173/RAN/2023 Assessment Year: 2020-21 Ghanshyam Pandet. Page 3 of 4 personal money. ld. AO has not brought out any clear examination of facts while upholding the addition. Similarly, the ld. CIT(A) also upheld the addition based on the presumption basis without calling for any remand report from the ld. AO, nor conducted any independent enquiry as mandated u/s 250 Clause '4' & '6' of the Act. The ld. CIT(A) has simply relied on the order of the ld. AO and though his powers are co-terminus with that of the ld. AO post June, 2001 it was mandatory for the First Appellate Authority to verify the facts and come out with a speaking order before making the addition. 3. I have carefully considered the facts on record and the documents therein. I have also heard the submissions of the ld. AR. The basic premise of addition made u/s 69A of the Act as unexplained money is that the assessee was not able to provide corroborative evidences such as bills, vouchers etc. However, the books of account along with cash book have been presented before the Department. That neither the ld. AO nor the ld. CIT(A) has given any comment as to the contents of the books of account and whether it can be ascertained from therein that the money which was seized from the assessee belongs to the company or to the assessee. Further, the ld. CIT(A) has not conducted any independent enquiry to reach a definite conclusion for confirming the addition. It is common principle of law that addition as per the Act cannot be made on guess work and surmises. The quasi-judicial authority needs to come out with a speaking order analyzing the merits of the addition made in the case of the assessee. However, in order to maintain the scales of justice, one opportunity should also be provided to the Revenue to come out with a speaking order. In view thereof, I set aside the order of the ld. CIT(A) and remand the matter back to his file to pass order in terms with Section 250 Clause '4' & '6' of the Act, verifying the facts of the case coming out with a speaking order whether the addition can be sustained or not u/s 69A of the Act. Needless to say, the assessee should be provided proper opportunity of hearing before the ld. CIT(A). As per the above terms, the grounds stand allowed for the statistical purposes. I.T.A. No.: 173/RAN/2023 Assessment Year: 2020-21 Ghanshyam Pandet. Page 4 of 4 4. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open Court on 22nd October, 2024. Sd/- [Partha Sarathi Chaudhury] Judicial Member Dated: 22.10.2024 Bidhan (P.S.) Copy of the order forwarded to: 1. Ghanshyam Pandet, Bajra, Itki Road, Hehal, Ranchi, Jharkhand, 834005. 2. ACIT, Ranchi. 3. CIT(A)-3, Patna. 4. CIT- 5. CIT(DR), Ranchi Benches, Ranchi. //True copy // By order Private Secretary (On tour) ITAT, Ranchi Benches Ranchi "