Shri Govindbhai Kalyanbhai Panchani, Surat V. ACIT(OSD), Ward-3(2)(3), Surat

ITA 104/SRT/2019

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 9253 (ITAT-SURAT)
• Duration Of Justice: 2 year(s) 5 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-08-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2015-2016
• Appeal Filed On: 19-02-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANUPAMA SINGLA
• Assessee Lawyers: RASESH SHAH
• Keywords: Unexplained cash credit; Business income; Opportunity of being heard; Non compliance
• Section: 68; 44AD; 143(3); 250

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, SURAT BENCH, SURAT BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER AND DR. ARJUN LAL SAINI, ACCOUNTANT MEMBER ITA NO. 104/SRT/2019 (AY 2015-16) (H EARING IN VIRTUAL COURT) SHRI GOVINDBHAI KALYANBHAI PANCHANI 7-11, GALA,MIRA NAGAR SOCIETY, VARACHHA ROAD, SURAT-395006 PAN : ADQPP 1375 E VS ACIT (OSD), WARD-3(2)(3), AAYKAR BHAVAN, MAJURAGATE SURAT-395001 ASSESSEE / APPELLANT REVENUE /RESPONDENT ASSESSEE BY SHRI RASESH SHAH, C.A REVENUE BY MS. ANUPAMA SINGLA SR-DR DATE OF HEARING 03.08.2021 DATE OF PRONOUNCEMENT 03.08.2021 ORDER UNDER SECTION 254(1) OF INCOME TAX ACT PER PAWAN SINGH, JUDICIAL MEMBER : 1. THIS APPEAL BY ASSESSEE IS DIRECTED AGAINST THE ORDER OF LD. COMMISSIONER OF INCOME TAX (APPEALS)-3, SURAT DATED 22.11.2018 FOR ASSESSMENT YEAR (AY) 2015-16. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL:- 1. ON FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS GROSSLY ERRED IN PASSING THE IMPUGNED APPELLATE ORDER ON AN EX-PARTE BASIS, WITHOUT PROVIDING THE APPELLANT A PROPER OPPORTUNITY OF BEING HEARD AND ALSO WITHOUT PROPERLY APPRECIATING THE FACTS AND MERITS OF THE CASE. THEREFORE, THE IMPUGNED ORDER AS PASSED BY THE LEARNED CIT(A), NEEDS TO BE QUASHED AS BEING ERRONEOUS, ILLEGAL AND BAD-IN-LAW. 2. ON FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS GROSSLY ERRED IN CONFIRMING THE LEARNED ASSESSING OFFICER'S ACTION OF DETERMINING THE INCOME OF THE APPELLANT ON SALE OF PLOT OF LAND AT RS.28,50,362/- ITA NO.104/SRT/2019 SH.GOVINDBHAI K PANCHANI (A.Y 15-16) 2 INSTEAD OF RS.2,90,112/- AS RIGHTLY COMPUTED BY THE APPELLANT, WHICH IS ABSOLUTELY ERRONEOUS AND ILLEGAL AND HENCE, NEEDS TO BE DELETED. 3. ON FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS GROSSLY ERRED IN CONFIRMING THE ADDITION OF RS.37,40,000/- BY TREATING THE UNSECURED LOANS AS RECEIVED BY THE APPELLANT DURING THE YEAR UNDER CONSIDERATION AS UNEXPLAINED CASH CREDIT U/S 68 AND MAKING ADDITION FOR THE SAME U/S 68 OF THE ACT, WHICH IS ABSOLUTELY ERRONEOUS AND INCORRECT REQUIRING OUTRIGHT ANNULMENT. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS AN INDIVIDUAL AND ENGAGED IN THE BUSINESS OF CIVIL CONTRACTOR AND HAS SHOWN BUSINESS PROFIT UNDER SECTION 44AD OF THE ACT. THE ASSESSEE FILED HIS RETURN OF INCOME DECLARING OF RS.45,17,890/-.THE RETURN OF INCOME WAS SELECTED FOR SCRUTINY. THE ASSESSMENT WAS COMPLETED UNDER SECTION 143(3) ON 29.12.2017. THE AO WHILE PASSING THE ASSESSMENT ORDER MADE ADDITION OF RS.28,50,362/- ON ACCOUNT OF BUSINESS INCOME AND ADDITION OF RS.37,40,000/- ON ACCOUNT OF UNEXPLAINED CASH CREDIT UNDER SECTION 68 OF THE ACT. ON APPEAL BEFORE THE LD. CIT(A) UPHELD THE ORDER OF ASSESSING OFFICER. THE LD. CIT(A) UPHELD THE ORDER IN EX-PARTE PROCEEDINGS. FURTHER AGGRIEVED THE ASSESSEE FILED APPEAL BEFORE THE TRIBUNAL. 3. WE HAVE HEARD THE SUBMISSION OF LD. AUTHORIZED REPRESENTATIVE (AR) OF THE ASSESSEE AND THE LD. SENIOR DEPARTMENTAL REPRESENTATIVE (SR.DR) FOR THE REVENUE AND HAVE GONE THROUGH THE ORDERS OF AUTHORITIES BELOW. THE LD. AR OF THE ASSESSEE SUBMITS THAT LD. CIT(A) IN HIS ORDER HELD THAT IN RESPONSE TO ITA NO.104/SRT/2019 SH.GOVINDBHAI K PANCHANI (A.Y 15-16) 3 VARIOUS NOTICES AS ISSUED UNDER SECTION 250 OF THE ACT AND ASSESSEE HAS FAILED TO COMPLY WITH THE SAID NOTICES. THE AR OF THE ASSESSEE WAS PRE-OCCUPIED IN FINALIZATION OF HIS AUDITS CASES WHICH WERE GETTING TIME BARRED ON 30 TH SEPTEMBER WHICH LATER WAS EXTENDED TO 30 TH OCTOBER IMMEDIATELY FOLLOWED BY DIWEALI VACATION AND COULD NOT APPEAR BEFORE THE LD. CIT(A) TO MAKE THE SUBMISSION ON MERITS. THE HEARING OF APPEAL BEFORE LD CIT(A), WAS FIXED ON TWO OCCASIONS. FIRST NOTICE OF HEARING WAS NOT RECEIVED TO THE ASSESSEE. THE LD AR FOR THE ASSESSEE SUBMITS THAT THERE WAS ONLY ONE DEFAULT IN APPEARANCE BEFORE LD. CIT(A). THE DEFAULT IN NON-APPEARANCE WAS NEITHER INTENTIONAL NOR DELIBERATE. IT WAS EXPLAINED THAT IN SURAT DURING THE DIWALI FESTIVAL MOST OF THE ESTABLISHMENTS ARE CLOSED ALONG WITH TO CELEBRATION OF GUJARATI NEW YEAR FESTIVAL AND MOST OF THE PEOPLE ARE OUT OF STATION FOR THEIR VACATION. THE LD. AR OF THE ASSESSEE SUBMITS THAT THE ASSESSEE HAS A GOOD CASE ON MERIT AND IS LIKELY TO SUCCEED, IF THE ASSESSEE GIVEN ONE MORE OPPORTUNITY TO CONTEST THE CASE ON MERIT. THE LD.AR OF THE ASSESSEE SUBMITS THAT ADDITION OF UNDER SECTION 68 OF THE ACT THAT EVEN THIS CASE CAN BE DISPOSED OF BY TRIBUNAL, ON MERIT. 4. ON THE OTHER HAND, LD. SENIOR DEPARTMENTAL REPRESENTATIVE (SR-DR) FOR THE REVENUE SUBMITS THAT ASSESSEE WAS GIVEN FAIR AND SUFFICIENT OPPORTUNITIES OF HEARING. THE APPEAL WAS FIXED ON 16.11.2018 NEITHER THE ASSESSEE NOR HIS ITA NO.104/SRT/2019 SH.GOVINDBHAI K PANCHANI (A.Y 15-16) 4 REPRESENTATIVE ATTENDED THE HEARING NOR FILED ANY ADJOURNMENT APPLICATION. IN THE CIRCUMSTANCES, THE LD. CIT(A) HAS NO OPTION EXCEPT TO DECIDE THE CASE ON THE BASIS OF MATERIAL AVAILABLE ON RECORD. THE ASSESSEE DOES NOT DESERVE ANY FURTHER LENIENCY IN RESTORING THE CASE TO THE FILE OF LD CIT(A). 5. WE HAVE CONSIDERED THE RIVAL SUBMISSION OF BOTH THE PARTIES AND PERUSED THE RECORD CAREFULLY. WE FIND THAT DATE OF HEARING WAS FIXED BY LD. CIT(A) ON TWO OCCASIONS. THE LD. AR SUBMITS THAT NOTICE FOR FIRST HEARING ON 26.09.2018 WAS NOT RECEIVED. WE FIND THAT APPEAL WAS FINALLY FIXED ON 16.11.2018. DUE TO NON COMPLIANCE ON 16.11.2018, NO FURTHER DATE WAS FIXED BY THE LD. CIT(A) AND THE APPEAL OF THE ASSESSEE WAS DISMISSED IN LIMINE . IN OUR VIEW NO REASONABLE AND FAIR OPPORTUNITY WAS GRANTED TO THE ASSESSEE. THE LD. CIT(A) DISMISSED THE APPEAL WITHOUT ADJUDICATING THE ABOVE ON MERIT. WE FIND THAT LD. CIT(A) HAS NOT PASSED THE ORDER AS PER THE MANDATE OF SECTION 250(6) OF THE ACT. SECTION 250(6) MANDATES THAT ORDER OF LD. CIT(A) MUST CONTAIN THE POINT OF DETERMINATION, DECISION THEREON AND REASONS OF SUCH DECISION. THE LD. CIT(A) DISMISSED THE APPEAL OF ASSESSEE WITHOUT FOLLOWING THE MANDATES OF SEC. 250(6) OF THE ACT. THEREFORE, THE APPEAL OF THE ASSESSEE IS RESTORE BACK TO THE FILE OF LD CIT(A) TO ADJUDICATE THE GROUNDS OF APPEAL WITH SPEAKING ORDER. ITA NO.104/SRT/2019 SH.GOVINDBHAI K PANCHANI (A.Y 15-16) 5 6. NEEDLESS TO DIRECT THE LD. CIT(A) BEFORE PASSING THE ORDER AFRESH, SHALL GRANT FAIR AND REASONABLE OPPORTUNITY OF HEARING TO THE ASSESSEE. THE ASSESSEE IS ALSO DIRECTED TO THE VIGILANT IN FUTURE AND NOT TO MAKE DEFAULT IN ATTENDING HEARING BEFORE LD. CIT(A). THE LD.AR OF THE ASSESSEE WAS ALSO DIRECTED TO FURNISH E-MAIL ADDRESS EITHER OF ASSESSEE OR THE PERSON AUTHORIZED BY HIM IN THE OFFICE OF LD. CIT(A) TO COMMUNICATE THE NOTICE BY WAY OF ELECTRONIC MODE TO AVOID FURTHER DELAY. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON 03/08/2021 BY PLACING THE RESULT ON THE NOTICE BOARD AS PER RULE 34(5) OF THE INCOME TAX (APPELLATE TRIBUNAL) RULE 1963. SD/- SD/- ( DR ARJUN LAL SAINI) (PAWAN SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER SURAT, DATED: /08/2021 DKP. OUT SOURCING P.S COPY TO: 1. APPELLANT-SHRI GOVINDBHAI K PANCHANI 7-11, GALA,MIRA NAGAR SOCIETY, VARACHHA ROAD SURAT-395006 2. RESPONDENT- ACIT (OSD), WD-3(2)(3), AAYKAR BHAVAN, MAJURA GATE, SURAT-395001 3. CIT(A)-SURAT 4. CIT 5. DR 6. GUARD FILE TRUE COPY/ BY ORDER ASSISTANT REGISTRAR, ITAT, SURAT