ROOP NARAYAN PANDEY, Sultanpur V. IT OFFICER, Sultanpur

ITA 101/ALLD/2019

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 0674 (ITAT-ALLAHABAD)
• Duration Of Justice: 1 year(s) 11 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-07-2021
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 02-08-2019
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Principle of natural justice; Peak credit; Reassessment proceedings
• Section: 142(1); 133(6); 147; 148; 144

Judgement Text

IN TH E INCOME TAX APPELLATE TRIBUNAL ALLAHABAD BENCH SMC ALLAHABAD [THROUGH VIRTUAL COURT] BEFORE SHRI. VIJAY PAL RAO, JUDICIAL MEMBER ITA NO. 101 /ALLD/20 19 ASSESSMENT YEAR: 20 11 - 12 ROOP NARAYAN PANDEY MADANPURA, PANIYAR PUR, PANDEYPUR SULTANPUR - 228001 . V. INCOME TAX OFFICER SULTANPUR - 228001. TAN/PAN: AOHPP4841F (APPELLANT) (RESPONDENT) APPELLANT BY: NONE RESPONDENT BY: SHRI A.K. SINGH , CIT ( SR. DR) DATE OF HEARING: 12 . 0 7 .202 1 DATE OF PRONOUNCEMENT: 15 . 07 . 202 1 O R D E R PER SHRI VIJAY PAL RAO, JUDICIAL MEMBER: THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 29 . 0 5 .201 9 OF LD. CIT( A ) , LUCKNOW FOR THE A . Y . 20 11 - 12 . 2. N ONE APPEARED ON BEHALF OF THE ASSESSEE TILL THE MATTER WAS TAKEN UP AT THE END OF BOARD . THE HEARING OF THE MATTER HAS BEEN ADJOURNED FROM TIME TO TIME EITHER DUE TO NONE REPRESENTATION OF THE ASSESSEE OR ON THE REQUEST OF THE ASSESSEE. ON LAST SEVEN OCCASION, THE HEARING OF THE CASE WAS ADJOURNED DUE TO NON AVAILABILITY OF THE ASSESSE E AND REQUEST OF THE ASSESSEE THROUGH APPLICATION. ON THE LAST DATE OF HEARING I.E. 5 TH JULY 2021, THE HEARING WAS AGAIN ADJOURNED AT THE REQUEST OF THE ASSESSEE AND LAST OPPORTUNITY WAS GRANTED. DESPITE THE LAST OPPORTUNITY GRANTED TO THE ASSESSE NEITHER ANYBODY APPEARED ON BEHALF OF THE ASSESSEE NOR ANY ADJOURNED APPLICATION IS FILED . ACCORDINGLY, THE APPEAL WAS TAKEN UP FOR HEARING AND ADJUDICATION EXPARTE. 3 . THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS IN THIS APPEAL. ITA NO. 101 /ALLD/20 19 M/S.ROOP NARAYAN PANDEY 2 1. BECAUSE PROCEEDINGS UNDER SECTION 147 HAVE NEITHER VALIDITY INITIATED NOR CONDUCTED IN ACCORDANCE WITH THE PROVISIONS OF LAW AND THE ASSESSMENT ORDER DATED 16.03.2016 AS HAS BEEN IMPUGNED IN THIS APPEAL, IS VOID AB - INITIO. 2. BECAUSE OTHERWISE ALSO, THE 'REASONS RECORDED' IN THE INSTANT CASE ARE NOT RELEVANT FOR ASSUMPTION OF JURISDICTION FOR MAKING REASSESSMENT UNDER SECTION 147 AND VERY INITIATION OF PROCEEDINGS UNDER SECTION 147 IS ILLEGAL. 3. BECAUSE THE ASSESSING OFFICER DID NOT GET JURISDICTION TO MAKE ASSESSMENT IN PURSUANCE OF NOTICE UNDER SECTION 148 SAID TO HAVE BEEN ISSUED ON 08.08.2014 AS NO SUCH NOTICE WAS SERVED ON THE APPELLANT, IN ACCORDANCE WITH THE PROVISIONS OF THE LAW. 4. BECAUSE THE APPELLANT BELONGS TO A LOW CLASS STRATA WITH LI MITED MEANS OF LIVELIHOOD AND HAS NEVER DEPOSITED SUCH HUGE AMOUNT IN THE BANK ACCOUNT MAINTAINED WITH HDFC BANK FOR THE SAME TO BE UTILIZED IN TRADING ACTIVITY OF COMMODITIES, SO THE ADDITION OF RS. 43.87.320/ - MADE IN HIS HAND AND THE LIABILITY SO CREATE D AGAINST HIM IS ERRONEOUS AND IS LIABLE TO BE STUCK DOWN. 5. BECAUSE THE ENTIRE TRANSACTION IN THE SAID BANK ACCOUNT, ALTHOUGH IN THE NAME OF THE APPELLANT, SAME BELONGS TO THE PERSON UPON WHOM THE ENTIRE LIVELIHOOD OF THE APPELLANT WAS DEPENDENT WHOLLY A ND SOLELY, THE ALLEGED TRANSACTION IN THE HDFC ACCOUNT NO. 09442560000449 CANNOT BE TAKEN AS THE BASIS FOR MAKING AN ADDITION OF SUMS AGGREGATING TO RS. 43,87,320/ - IN THE REASSESSMENT PROCEEDINGS UNDER SECTION 147 OF THE ACT. 6. BECAUSE IN VIEW OF THE AF ORESAID GROUND NO. 5 ABOVE, THE ENTIRE WITHDRAWAL AND DEPOSIT IN THE SAID BANK ACCOUNT SHOULD BE ACCESSIBLE IN THE HANDS OF THE PERSON UPON WHOM THE APPELLANT FOR HIS LIVELIHOOD. 7. BECAUSE FOR THE GROUND N.O. 5 & 6 ABOVE, THE APPELLANT WAS PREVENTED FRO M APPEARING AND REPRESENTING THE FACTS OF HIS CASE BEFORE THE ASSESSING OFFICER, SO DUE ALLEGED NON - COMPLIANCE AN EXPARTE ORDER WAS PASSED BY ASSESSING OFFICER AND A HUGE ADDITION OF RS. 43,87,320/ - WAS MADE IN HIS HAND. 8. BECAUSE SUM AGGREGATING TO RS. 19,66,687/ - FORMS PART OF THE ALLEGED DEPOSITS IN BANK ACCOUNT, OWNERSHIP OF WHICH ITSELF IS IN DISPUTE, ADDITION OF RS. 1,57,335/ - (8% OF 19.66.687) ON SUCH DEPOSITS IS WHOLLY ERRONEOUS ON FACTS OF THE CASE. 9. BECAUSE WITHOUT PREJUDICE TO ALL THE GROUND S AS HAS BEEN RAISED ABOVE, THE ASSESSING OFFICER HAS ERRED IN LAW AND ON FACTS IN ADOPTING A PICK AND CHOOSE ITA NO. 101 /ALLD/20 19 M/S.ROOP NARAYAN PANDEY 3 METHOD FOR ASSESSING THE INCOME OF THE APPELLANT AS AGAINST THE ESTABLISHED LAW OF' PEAK CREDIT' ON THE BASIS OF TELESCOPIC VIEW OF THE SAID ACCOU NT. 10. BECAUSE OTHERWISE ALSO THE RATE OF PROFIT DETERMINED @ 8% IS MUCH TOO HIGH AND EXCESSIVE AND BEYOND THE NORMAL PROFITS IN THIS TYPE OF TRADE. 11. BECAUSE THE ORDER APPEALED AGAINST IS CONTRARY TO FACTS, LAW AND PRINCIPLES OF NATURAL JUSTICE. 12. TH E APPELLANT CRAVES LEAVE TO ADD/ MODIFY/ RAISES ANY OTHER GROUND DURING THE COURSE OF APPELLATE PROCEEDINGS. 4 . GROUND NOS. 1 TO 3 ARE REGARDING VALIDITY OF THE REOPENING OF THE ASSESSMENT. THE ASSESSEE HAS RAISED THE OBJECTION AGAINST SERVICE OF THE NOTICE ISSUED U/S 148 OF THE I. T. ACT, 1961. ON THE OTHER HAND, THE LD. DR HAS SUBMITTED THAT THE ASSESSING OFFICER HAS REOPENED THE ASSESSMENT BASED ON TRANSACTIONS STATEMENT AND CIB INFORMATION REGARDING THE TRANSACTIONS CARRIED OUT BY ASSESSEE IN MULT I COMMODITY EXCHANGE (MCX ) AS WELL AS CASH DEPOSITS OF RS.42,29,985/ - IN THE BANK ACCOUNTS OF THE ASSESSEE. THE ASSESSING OFFICER ISSUED THE NOTICE U/S 148 OF THE ACT ON 08.08.2014 WHICH WAS DULY RECEIVE D BY THE ASSESSEE ON 22.08.2014 THEREFORE, THERE IS NO QUESTION OF NONE SERVICE OF THE NOTICE ISSUED U/S 148 OF THE ACT. HE HAS FURTHER CONTENDED IN RESPONSE TO THE NOTICE U/S 148 OF TH E ACT, THE ASSESSEE HAS NOT FILED ANY RETURN OF INCOME . E VEN THE ASSESSEE HAS NOT RESPONDED TO THE NOTICE U/S 142(1) OF THE ACT ISSUED BY ASSESSING OFFICER REPEATEDLY. THE REQUISITE INFORMATION CALLED BY ASSESSING OFFICER HAS NOT BEEN FURNISHED BY ASSESSEE. NEITHER REQUISITE DETAILS NOR BOOKS OF ACCOUNTS WERE PRODUCED BY ASSESSEE DURING THE COURS E OF ASSESSMENT PROCEEDINGS. CONSEQUENTIAL, THE ASSESSING OFFICER HAS MADE ADDITION OF RS. 42,29,985/ - ON ACCOUNT OF UNEXPLAINED DEPOSIT IN THE BANK ACCOUNT AS WELL AS RS.1,57,335/ - TOWARDS INCOME FROM TRANSACTIONS CARRIED OUT BY ASSESSEE ON MULTI COMMODIT Y EXCHANGE (MCX ) BY APPLYING NET PROFIT RATE AT 8% ON THE RECE IPT OF RS.11,66,687/ - . THE LD. D R HAS POINTED OUT THAT THE ASSESSING OFFICER HAS OBTAINED THE NECESSARY DETAILS AND INFORMATION FROM M/S. KARVY COMMTRADE LTD. (BROKER HYDERABAD) BY ISSUING NOTI CE U/S 133(6) OF THE I. T. ACT AND BASED THE SAID INFORMATION THE ASSESSING OFFICER HAS ESTIMATED THE INCOME BY APPLYING THE NET PROFIT RATE OF 8%. THE LD. D R HAS ITA NO. 101 /ALLD/20 19 M/S.ROOP NARAYAN PANDEY 4 SUBMITTED THAT IN THE ABSENCE OF ANY CONTRARY FACT OR M ATERIAL BROUGHT ON RECORD BY ASSESSEE, T HE CIT(A) IS JUSTIFIED IN CONFIRMING THE ADDITION ON ACCOUNT OF CASH DEPOSIT IN BANK ACCOUNT AND RESTRICTING THE ADDITION ON TRANSACTIONS WITH MULTI COMMODITY EXCHANGE (MCX ) BY APPLYING THE PROFIT RATE @ 1%. HE HAS RELIED UPON THE ORDERS OF THE AUTHORITIES BELOW. 5 . I HAVE CONSIDERED THE STAND TAKEN BY THE ASSESSEE BEFORE THE CIT(A), GROUNDS RAISED IN THE PRESENT APPEAL AND THE ARGUMENT OF THE LD. DR AS WELL AS RELEVANT MATER IAL ON RECORD. AS REGARDS THE VALIDITY OF THE ASSESSMENT ON THE GROUNDS OF THE SERVICE O F NOTICE U/S 148 IS CONCERNED IT IS NOTED THAT THE ASSESSING OFFICER HAS STATED IN THE ASSESSMENT ORDER THAT THE NOTICE U/S 148 OF THE ACT ISSUED ON 08.08.2014 WAS RECE IVED BY ASSESSEE ON 22.08.2014. FURTHER, THE ASSESSEE HAS NOT DISPUTED THE CORRECTNESS OF THE ADDRESS TO WHICH THE NOTICE WAS SENT BY ASSESSING OFFICER AS WELL AS IN TH E ABSENCE OF ANY CONTRARY FACT OR MATERIAL TO DESPITE THE FACT RECORDED BY ASSESSING OFFICER I DO NOT FIND ANY MERITS OR SUBSTANCE IN THE OBJECTION OF THE ASSESSEE RAISED IN THE GROUND NOS. 1 TO 3. THE ASSESSEE HAS JUST RAISED THE OBJECTION AGAINST REOPENING OF THE ASSESSMENT WITHOUT SPECIFYING AS TO HOW THE REOPENING IS INVALID. THEREFORE , THE OBJECTION OF THE ASSESSEE OR DEVOID OF ANY MERITS OR SUBSTANCE AND THE SAME ARE DISMISSED. 6 . THE GROUND NOS. 4 TO 10 ARE REGARDING ADDITION MADE BY ASSESSING OFFICER ON ACCOUNT OF CASH DEPOSIT MADE IN THE BANK ACCOUNT BY ASSESSEE AS WELL AS THE ESTI MATION OF INCOME ON THE TRANSACTIONS CARRIED OUT WITH THE MULTI COMMODITY EXCHANGE (MCX ). THE ASSESSEE HAS NOT APPEARED BEFORE THE ASSESSING OFFICER DURING THE ASSESSMENT PROCEEDINGS AND THE ASSESSMENT WAS COMPLETED U/S 147 R.W. 144 OF THE ACT. THE ASSESSING OFFICER HAS ISSUED VARIOUS NOTICE U/S 142(1) CALLING THE ASSESSEE TO FURNISH THE REQUISITE DETAILS AND RECORD HOWEVER , THE ASSESSEE DID NOT COMPLY WITH THE NOTICE ISSUED BY ASSESSING OFFICER. THE ASSESSING OFFICER THEN SOUGHT INFORMATION BY ISSUING NOTICE U/S 133(6) OF THE ACT TO M/S. KARVY COMMTRADE LTD. (BROKER HYDERABAD) THROUGH WHICH THE ASSESSEE HA S CARRIED OUT THE TRANSACTION ON MULTI COMMODITY EXCHANGE (MCX ). THE ASSESSING OFFICER HAS ALSO OBTAINED THE BANK ACCOUNT ST ATEMENT OF THE ASSESSEE FROM HDFC BANK AND THEN COME ITA NO. 101 /ALLD/20 19 M/S.ROOP NARAYAN PANDEY 5 TO THE CONCLUSION THAT THE ASSESSEE HAS MADE CASH DEPOSIT IN BANK ACCOUNT TO THE TUNE OF RS. 42,29,985/ - . THE DETAILS OF THE CASH DEPOSIT MADE ON VARIOUS DATES HAS BEEN GIVEN BY ASSESSING OFFICER AT PAGE NO. 3 AND 4 OF THE ASSESSMENT ORDER. TH E ASSESSEE HAS NOT DISPUTED THE DATES AND AMOUNT OF DEPOSIT S EXTRACTED IN THE TABLE REPRODUCED BY ASSESSING OFFICER IN THE ASSESSMENT ORDER. IN THE ABSENCE OF ANY EXPLANATION REGARDING SOURCE OF THESE DEPOSITS, THE AS SESSING OFFICER HAS RIGHTLY MADE THE ADDITION OF THE SAID AMOUNT WHILE COMPLETING EXPARTE ASSESSMENT. EVEN BEFORE THE CIT(A) AS WELL AS BEFORE THIS TRIBUNAL, THE ASSESSEE HAS NOT FURNISHED ANY DETAILS OR EXPLANATION REGARDING T HE SOURCE OF THESE DEPOSITS. H ENCE, I DO NOT FIND ANY ERROR OR IRREGULARITY IN THE ORDER S OF THE AUTHORITIES BELOW ON THE ISSUE OF ADDITION MADE ON ACCOUNT OF CASH DEPOSIT IN THE BANK ACCOUNT. 7 . AS REGARDS THE ADDITION MADE BY ASSESSING OFFICER ON ACCOUNT OF INCOME FROM TRANSACTIONS CARRIED OUT ON MULTI COMMODITY EXCHANGE (MCX) I T IS NOTED THAT THE CIT(A) HAS RESTRICTED THE SAID ADDITION BY APPLYING PROFIT RATE @ 1% AS AGAINST 8% APPLIED BY ASSESSING OFFICE. T HE CIT(A) HAS SUSTAINED THE ADDITION ON THIS ACCOUNT ONLY TO THE EXTENT OF RS.19,667/ - AS AGAINST RS.1,57,335/ - ESTIMATED BY ASSESSING OFFICER. THE ASSESSEE HAS NOT FILED ANY DETAILS OR RECORD TO CONTROVERT THE FACT THAT HE HAS CARRIED OUT THE TRANSACTIONS ON MULTI COMMODITY EXCH ANGE (MCX ). THE ESTIMATION OF INCOME BY CIT(A) BY APPLYING NET PROFIT AT 1% IS JUST AND PROPER. ACCORDINGLY, I DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDER OF THE CIT(A) ON THIS ISSUE. 8 . IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS DISMISSED . (ORDER PRONOUNCED ON 15 /07 /2021 AT ALLAHABAD IN THE OPEN COURT THROUGH VIDEO CONFERENCING) SD/ - [ VIJAY PAL RAO ] JUDICIAL MEMBER DATED : 15 / 0 7 /202 1 ALLAHABAD VIJAY PAL SINGH (SR. PS) ITA NO. 101 /ALLD/20 19 M/S.ROOP NARAYAN PANDEY 6 COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT(A) , ALLAHABAD 4. CIT 5. DR //TRUE COPY// BY ORDER ASSISTANT REGISTRAR