Smt. Usha Manchanda, New Delhi V. DCIT, New Delhi

ITA 1005/DEL/2015

• Counselvise Citation: 100520114 RSA 2015
• Duration Of Justice: 6 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-08-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC 2
• Next Hearing Date: 20-07-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 19-02-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PARWINDER KAUR
• Keywords: Business income; Opportunity of being heard; Additional evidence
• Section: 234B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH SMC -2, NEW DELHI BEFORE SH. N. K. SAINI, AM ITA NO. 1005/DEL./2015 : ASSTT. YEAR : 2008-09 USHA MANCHANDA C-5, VISHAL ENCLAVE NEW DELHI VS DCIT CIRCLE-26(1) NEW DELHI (APPELLANT) (RESPONDENT) PAN NO. AKAPM5239P APPELLANT BY : SH. RA JESH JAIN, C.A. RESPONDENT BY : SMT. PARWIN DER KAUR, SR. DR DATE OF HEARING : 20.07.2015 DATE OF PRONOUNCEMENT :26 .08.2015 ORDER PER N.K. SAINI, A.M. THIS IS AN APPEAL BY THE ASSESSEE AGAINST THE ORDER DATED 25.09.2014 OF THE LD. CIT(A)-XXIV, NEW DELHI. 2. FOLLOWING GROUNDS HAVE BEEN RAISED IN THIS APPE AL :- 1. THAT THE LEARNED C.I.T.(APPEAL) ERRED IN UPHOLDING THE ORDER OF THE ASSESSING OFFICER AND SU STAINED THE ASSESSED INCOME AS RS. 13,11,800/- AGAINST RETU RNED INCOME OF RS. 5,20,900/- WITHOUT ADJUDICATING THE SUBMISSIONS OF THE APPELLANT JUDICIALLY AND FURTHER WITHOUT ITA NO.1005/DEL/2015 2 CONSIDERING THE REMAND REPORT OF THE ASSESSING OFFI CER AT ALL IN THE APPELLATE ORDER. 2. THAT THE LEARNED C.I.T.(A) ERRED IN UPH OLDING THE ACTION FOR THE ASSESSING OFFICER IN MAKING ADDITION OF RS. 3,91,000/- AND RS. 1,00,000/- ON ACCOUNT OF CASH DE POSITED IN ALLAHABAD BANK, RAJOURI GARDEN BRANCH NEW DELHI AND ICICI BANK RESPECTIVELY OUT OF BUSINESS RECEIPTS OF HIRING OF VEHICLE AS UNEXPLAINED INCOME ARBITRARILY MERELY ON SUSPICION AND WITHOUT ANY BASIS. 3. THAT THE LEARNED C.I.T.(A) ERRED IN UPH OLDING THE ORDER OF THE ASSESSING OFFICER IN DISALLOWING DEPRE CIATION OF VEHICLE USED FOR THE PURPOSE OF HIRING. 4. THAT THE LEARNED C.I.T.(A) ERRED IN UPH OLDING THE ORDER OF ASSESSING OFFICER IN TREATING THE LONG TER M CAPITAL GAIN OF RS. 30,190/- AS SHORT TERM CAPITAL GAIN. 5. THAT THE ORDERS OF THE ASSESSING OFFICER AND C.I.T.(A) ARE NOT BASED ON PROPER APPRECIATION OF F ACTS & EVIDENCES AND ENTIRELY MADE ON SUSPICION & HENCE L IABLE TO BE QUASHED. 6. THAT THE INTEREST U/S 234B & 234C CHARGED B Y THE ASSESSING OFFICER IS NOT IN ACCORDANCE WITH THE LAW . 3. GRIEVANCE OF THE ASSESSEE IN THIS APPEAL RELAT ES TO THE CONFIRMATION OF ADDITION OF RS. 4,91,000/- MADE BY THE AO ON ACCOUNT OF CASH DEPOSITED IN THE BANKS AND IN TRE ATING THE LONG TERM CAPITAL GAIN AS SHORT TERM CAPITAL GAIN. 4. THE FACTS OF THE CASE IN BRIEF ARE THAT THE ASSESSEE FILED THE RETURN OF INCOME ON 24.3.2009 DECLARING AN INCOME OF RS. 5 ,20,902/- WHICH WAS PROCESSED U/S 143(1) OF THE IT ACT, 1961 (HEREI NAFTER REFERRED TO ITA NO.1005/DEL/2015 3 AS THE ACT) ON 17.3.2010 AT THE RETURNED INCOME. LA TER ON, THE CASE WAS SELECTED FOR SCRUTINY. 5. DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE AO NOTICED THAT THE ASSESSEE MADE A CASH DEPOSIT OF RS. 3,91,0 00/- IN THE BANK ACCOUNT MAINTAINED WITH ALLAHABAD BANK AND RS. 1,00 ,000/- IN THE BANK ACCOUNT WITH ICICI BANK, RAZOURI GARDEN, NEW D ELHI. ACCORDING TO THE AO, THE ASSESSEE FAILED TO EXPLAIN THE SOURCE, THEREFORE THE ADDITION OF RS. 4,91,000/- (3,91,000/ - + RS. 1,00,000/-) WAS MADE. THE AO ALSO ASKED THE ASSESSEE TO GIVE TH E DETAILS OF SHARES PURCHASED AND SOLD IN WHICH SHE EARNED PROFI T/GAIN. THE ASSESSEE SUBMITTED THAT SHE HAD EARNED THE SHORT TE RM CAPITAL GAIN OF RS. 50,470 AND LONG TERM CAPITAL GAIN OF RS. 301 09/-. HOWEVER, THE AO TREATED THE ENTIRE GAIN ON THE SALE OF SHARE S AS SHORT TERM CAPITAL GAIN BY OBSERVING THAT THE ASSESSEE COULD N OT SUBMIT THE EVIDENCE IN SUPPORT OF HER CLAIM. 6. BEING AGGRIEVED THE ASSESSEE CARRIED THE MATTER TO THE LD. C.I.T.(A) AND SUBMITTED THAT CASH DEPOSIT OF RS. 3 ,91,000/- WAS MADE IN SAVING BANK ACCOUNT OF ALLAHABAD BANK JOINT LY BY THE ASSESSEE AND HER HUSBAND SHRI SATISH MALCHAND FROM THE SOURCE OF CASH IN HAND AND FROM THE CASH WITHDRAWALS FROM ANO THER SAVING BANK ACCOUNTS MAINTAINED WITH ICICI BANK. IT WAS FU RTHER STATED THAT ITA NO.1005/DEL/2015 4 THE SAID DEPOSIT WAS MADE TO MAINTAIN THE BALANCE F OR THE PURPOSE OF CLEARING OF INSTALMENT OF REPAYMENT OF TWO CAR LOAN S I.E. ONE IN THE NAME OF THE ASSESSEE AND THE OTHER IN THE NAME OF H ER HUSBAND. IT WAS FURTHER STATED THAT THE ASSESSEE WAS HAVING CASH IN HAND OF RS. 2,42,000/- AS ON 1.4.2007 AND THE TOTAL WITHDRAWALS MADE FROM THE ICICI BANK DURING THE PERIOD 1.4.2007 TO 31.3.2008 WERE OF RS. 7,51,000/- AND BESIDES THAT THE ASSESSEE HAD ALSO W ITHDRAWAN CASH IN THE IMMEDIATELY PRECEDING YEAR OF RS. 16,00,000/- ( AGGREGATE) FROM HER BANK ACCOUNT AT ALLAHABAD BANK. THUS SUFFICIENT CASH WAS AVAILABLE WITH HER WHICH WAS SUBSEQUENTLY DEPOSITED ON DIFFERENT DATES IN THE BANKS. IT WAS FURTHER STATED THAT THE ASSESSEE HAD INCOME AS LONG TERM CAPITAL GAIN ON THE SALE OF SHARES OF SYNDICATE BANK WHICH WERE ACQUIRED DIRECTLY FROM THE BANK BY WAY O F INITIAL PUBLIC OFFER AND SUBSEQUENTLY SOLD DURING THE RELEVANT ASS ESSMENT YEAR. THE ASSESSEE FURNISHED COPIES OF ACCOUNT OF SHARES CERT IFICATE, PAYMENT OF SECURITY TRANSACTION TAX, DEMAT ACCOUNT ETC WHIC H COULD NOT BE SUBMITTED BEFORE THE AO AND REQUESTED TO ADMIT UNDE R RULE 46A OF THE INCOME TAX RULES. THE LD. C.I.T.(A) FORWARDED T HE ADDITIONAL EVIDENCES TO THE AO FOR HIS COMMENTS. IN RESPONSE, THE AO SUBMITTED HIS REMAND REPORT DATED 19.10.2012, HOWEV ER, THE LD. C.I.T.(A) CONFIRMED THE ADDITION MADE BY THE AO. NOW THE ASSESSEE IS IN APPEAL. ITA NO.1005/DEL/2015 5 7. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THA T THE LD. CIT(A) NEITHER CONSIDERED THE SUBMISSIONS OF THE ASSESSEE NOR THE REMAND REPORT OF THE AO. IT WAS FURTHER SUBMITTED THAT THE ISSUE MAY BE SENT BACK TO THE AO. IN HIS RIVAL SUBMISSIONS, THE LD. D R SUPPORTED THE ORDER OF THE LD. C.I.T.(A) AND SUBMITTED THAT SINCE THE ASSESSEE COULD NOT PRODUCE THE EVIDENCES, DURING THE COURSE OF ASS ESSMENT PROCEEDINGS BEFORE THE AO, THE ADDITION WAS RIGHTLY MADE AND THE LD. C.I.T.(A) WAS JUSTIFIED IN CONFIRMING THE SAME. 8. I HAVE CONSIDERED THE SUBMISSIONS OF BOTH T HE PARTIES AND CAREFULLY GONE THROUGH THE MATERIAL AVAILABLE ON TH E RECORD, IN THE PRESENT CASE, IT APPEARS THAT THE ASSESSEE COULD NO T PRODUCE CERTAIN RELEVANT DOCUMENTS DURING THE COURSE OF ASSESSMENT PROCEEDINGS WHICH WERE FURNISHED TO THE LD. C.I.T.(A) WHO ADMIT TED THE SAME UNDER RULE 46A OF THE IT RULES AND ASKED THE REMAND REPORT OF THE AO. HOWEVER, IN THE IMPUGNED ORDER THERE IS NO DIS CUSSION ABOUT THE CONTENTS OF THE REMAND REPORT AND THE SUBMISSIO N OF THE ASSESSEE. THEREFORE BY CONSIDERING THE TOTALITY OF THE FACTS, I AM OF THE VIEW THAT THIS ISSUE REQUIRES A FRESH ADJUDICATION AT TH E LEVEL OF THE AO. ACCORDINGLY THE IMPUGNED ORDER IS SET ASIDE AND THE CASE IS REMANDED BACK TO THE FILE OF THE AO TO BE ADJUDICAT ED AFRESH IN ACCORDANCE WITH LAW, AFTER PROVIDING DUE AND REASO NABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. ITA NO.1005/DEL/2015 6 9. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLO WED FOR STATISTICAL PURPOSES. (ORDER PRONOUNCED IN THE COURT ON 26/08/2015). SD/- (N. K. SAINI) ACCOUNT ANT MEMBER DATED: 26 / 08/2015 *BINITA* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITA NO.1005/DEL/2015 7 DATE INITIAL 1. DRAFT DICTATED ON 25.08.2015 2. DRAFT PLACED BEFORE AUTHOR 26.08.2015 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS PS/PS 6. KEPT FOR PRONOUNCEMENT ON 26.8.2015 PS 7. FILE SENT TO THE BENCH CLERK PS 8. DATE ON WHICH FILE GOES TO THE AR 9. DATE ON WHICH FILE GOES TO THE HEAD CLERK. 10. DATE OF DISPATCH OF ORDER.