Shri Vikram Shantilal Patel, Baroda V. The Income Tax Officer, Ward-2(6), Baroda

ITA 1094/AHD/2015

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 0914 (ITAT-AHMEDABAD)
• Duration Of Justice: 5 year(s) 1 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-06-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 08-04-2020
• Assessment Year: 2007-2008
• Appeal Filed On: 29-04-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Reopening of assessment; Unexplained cash credit; Opportunity of being heard; Additional evidence; TDS
• Section: 40(a)(ia); 147; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, AHMEDABAD [CONDUCTED THROUGH VIRTUAL COURT] BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER& MS. MADHUMITA ROY, JUDICIAL MEMBER I.T.A. NOS. 1094&1095/AHD/2015 (ASSESSMENT YEARS: 2007-08&2008-09) SHRI VIKRAM SHANTILAL PATEL 13/B, SANMATI SOCIETY, AKOTA, BARODA-10 VS. THE INCOME TAX OFFICER WARD-2(6), AAYAKAR BHAWAN BARODA [PAN NO. ACQPP7443J] ( APPELLANT ) .. ( RESPONDENT ) APPELLANT BY : SHRI MANISH SHAH, AR RESPONDENT BY : SHRI VIDHYUT TRIVEDI, SR. DR DATE OF HEARING 27.05.2020 DATE OF PRONOUNCEMENT 08 . 0 6 . 20 20 O R D E R PER MS. MADHUMITA ROY - JM: BOTH THE APPEALS FILED BY THE ASSESSEE ARE DIRECTED AGAINST THE ORDERS BOTH DATED 19.12.2014 PASSED BY THE COMMISSIONER OF INCOME TAX (APPEALS) 5, VADODARA FOR ASSESSMENT YEARS 2007-0 8 & 2008-09 RESPECTIVELY. SINCE THE ISSUES INVOLVED IN THESE T WO APPEALS ARE IDENTICAL AND OF THE SAME ASSESSEE, THESE ARE HEARD ANALOGOUS LY AND ARE BEING DISPOSED OF BY A COMMON JUDGMENT. ITA NO. 1094/AHD/2015 (A.Y. 2007-08) IS TAKEN AS A LEAD CASE. 2. AT THE TIME OF HEARING OF THE INSTANT APPEAL THE LD. ADVOCATE APPEARING FOR THE ASSESSEE SUBMITTED BEFORE US THAT HE DOES NOT WANT TO PRESS ITA NOS.1094&1095/AHD/2015 SHRI VIKRAM SHANTILAL PATEL VS. ITO ASST.YEARS 2007-08 & 2008-09 - 2 - GROUND NO. 1 RELATING TO REOPENING OF ASSESSMENT UN DER SECTION 147 OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED AS TO T HE ACT). HENCE, THE GROUND NO. 1 IS DISMISSED AS NOT PRESSED. 3. THE NEXT EFFECTIVE GROUND IS AGAINST THE CONFIRM ATION OF ADDITION MADE BY THE LD. AO IN TREATING UNSECURED LOAN OF RS . 10,50,000/- AS UNEXPLAINED CASH CREDIT UNDER SECTION 68 OF THE ACT UPON REJECTION OF THE EVIDENCES FILED BY THE APPELLANT. 4. DURING THE ASSESSMENT PROCEEDING THE ASSESSEE WA S DIRECTED TO FURNISH CONFIRMATION ALONG WITH PROOF OF SOURCE OF INCOME OF THE PERSONS FROM WHOM UNSECURED LOANS OF RS. 10,50,000/- WAS OB TAINED BY THE ASSESSEE. HOWEVER, AS IT APPEARS FROM THE ORDER PA SSED BY THE LD. AO THAT IN THE ABSENCE OF ANY SUPPORTING DOCUMENT IN THE FO RM OF RETURN OF INCOME, BANK STATEMENT ETC. BY THE ASSESSEE IN ORDER TO EST ABLISH THE IDENTITY, CREDITWORTHINESS OF THE DEPOSITOR AND THE GENUINENE SS OF THE TRANSACTION, THE MATTER WAS DECIDED AGAINST THE ASSESSEE. IN APPEAL THE APPELLANT SUBMITTED THE COPY OF CONFIRMATIONS FROM ALL THE PARTIES ALON G WITH THE BANK STATEMENT. HOWEVER, THOSE ADDITIONAL EVIDENCES FILED BEFORE TH E LD. CIT(A) WERE REJECTED IN THE ABSENCE OF ANY PLAUSIBLE EXPLANATIO N FORTHCOMING FROM THE ASSESSEE FOR NOT PRODUCING THE SAME BEFORE THE LD. AO, HOLDING IT VIOLATIVE OF RULE 46A; RESULTANTLY ADDITION WAS CONFIRMED. 5. AT THE TIME OF HEARING OF THE INSTANT APPEAL, TH E LD. COUNSEL APPEARING FOR THE ASSESSEE HAS TAKEN US TO THE ADDI TIONAL EVIDENCES SO FILED BEFORE THE FIRST APPELLATE AUTHORITY, ANNEXED TO TH E PAPER BOOK FILED BEFORE US BEING THE BANK STATEMENT OF THOSE DIFFERENT PART IES WHICH WAS OBTAINED BY ITA NOS.1094&1095/AHD/2015 SHRI VIKRAM SHANTILAL PATEL VS. ITO ASST.YEARS 2007-08 & 2008-09 - 3 - THE ASSESSEE SUBSEQUENT TO THE ASSESSMENT ORDER. F URTHER THAT THE DETAILS OF UNSECURED LOANS IN RESPECT OF 11 PARTIES AVAILABLE AT PAGE 1 OF THE PAPER BOOK; THE PAYMENT MADE THREIN THROUGH CHEQUE IS ALS O EVIDENT FROM THE SAID DOCUMENTS. IT WAS FURTHER SUBMITTED BY THE LD. ADV OCATE APPEARING FOR THE ASSESSEE THAT ALL THOSE PARTIES ARE WILLING TO APPE AR BEFORE THE AUTHORITIES BELOW FOR EXAMINATION AND HENCE HE PRAYS FOR SETTIN G ASIDE THE ISSUE BEFORE THE LD. AO. ON THIS GROUND THE LD. AR ALSO RELIED UPON THE JUDGMENT PASSED BY THE SUPREME COURT IN THE MATTER OF BASIR AHMED SISODIA VS. INCOME TAX OFFICER, REPORTED IN [2020] 116 TAXMANN. COM 375 (SC), THE JUDGMENT PASSED BY THE DELHI BENCH IN THE MATTER OF PADAM LAL DUA VS. INCOME TAX OFFICER, REPORTED IN [2016] 76 TAXMANN.C OM 354 AS WELL. THE LD. DR, WITH ALL HIS FAIRNESS, THOUGH RELIED U PON THE ORDER PASSED BY THE AUTHORITIES BELOW, NOT RAISED SERIOUS OBJECT ION TO SUCH OF THE PRAYER MADE BY THE LD. AR. 6. WE HAVE HEARD THE PARTIES AND PERUSED THE RELEVA NT MATERIALS AVAILABLE ON RECORD. WE HAVE CAREFULLY CONSIDERED THE JUDGMENT PASSED B Y THE SUPREME COURT IN THE MATTER OF BASIR AHMED SISODIA VS. ITO WHEREFROM IT APPEARS THAT UPON PERUSAL OF THE EXPLANATION OFFERED BY WAY OF AN AFFIDAVIT AND THE STATEMENT OF THE CONCERNED UNREGISTERED DEALERS REC ORDED DURING THE PENALTY PROCEEDINGS ESTABLISHING THEIR IDENTITY AND CREDITW ORTHINESS, THOUGH PENALTY WAS IMPOSED BUT NO NEGATIVE OBSERVATION WAS MADE BY THE APPELLATE AUTHORITY, NOT ONLY PENALTY WAS DELETED BUT ALSO TH E ADDITION MADE UNDER SECTION 68 OF THE ACT TOWARDS CASH CREDIT AMOUNT SH OWN AGAINST THE NAME OF ITA NOS.1094&1095/AHD/2015 SHRI VIKRAM SHANTILAL PATEL VS. ITO ASST.YEARS 2007-08 & 2008-09 - 4 - CONCERNED UNREGISTERED DEALERS HAS BEEN SET-ASIDE B Y THE HONBLE APEX COURT. WE HAVE FURTHER CAREFULLY CONSIDERED THE JU DGMENT PASSED IN THE MATTER OF PADAM LAL DUA VS. ITO WHERE DENIAL OF PRO VIDING OPPORTUNITY TO PRODUCE THE ADDITIONAL EVIDENCES THOUGH NOT THROUGH APPROPRIATE APPLICATION UNDER RULE 46A, HAS BEEN TERMED AS ARBITRARY. WE, THEREFORE, TAKING INTO CONSIDERATION THE ENTIRE ASPECT OF THE MATTER PARTI CULARLY THE DOCUMENTS ANNEXED TO THE PAPER BOOK IN SUPPORT OF THE CASE MA DE OUT BY THE ASSESSEE IN RESPECT OF THE UNSECURED LOAN OBTAINED FROM 11 P ARTIES AND THE PAYMENT MADE TO THOSE PARTIES AND THE RATIO LAID DOWN BY TH E JUDGMENTS CITED ABOVE, OF THE CONSIDERED OPINION FOR THE ENDS OF JUSTICE T O REMIT THE ISSUE TO THE FILE OF THE LD. AO TO DECIDE THE SAME AFRESH IN ACCORDAN CE WITH LAW, UPON GIVING AN OPPORTUNITY OF BEING HEARD TO THE ASSESSE E AND UPON TAKING INTO CONSIDERATION THE EVIDENCE ON RECORD AND ANY OTHER EVIDENCE WHICH THE ASSESSEE MAY CHOOSE TO FILE AT THE TIME OF HEARING OF THE MATTER AND ALSO UPON EXAMINING THE PARTIES AS NARRATED HEREINBEFORE , IF REQUIRED. THUS, THIS GROUND OF APPEAL ALLOWED FOR STATISTICAL PURPOSE. 7. THE NEXT GROUND OF APPEAL RELATES TO DISALLOWANC E OF INTEREST OF RS. 2,36,791/- UNDER SECTION 40(A)(IA) OF THE ACT REJEC TING THE EVIDENCES FILED BY THE APPELLANT. DURING THE COURSE OF ASSESSMENT PROCEEDING, IT APP EARS, THAT THE ASSESSEE HAS PAID INTEREST OF RS. 2,36,791/- TO VAR IOUS PERSONS. BUT THE TDS WHEREUPON WAS NOT PAID; NEITHER THE DETAILS OF TDS WAS FILED BY THE ASSESSEE. FINALLY THE AO DISALLOWED RS. 2,36,791/- AS INTEREST EXPENSES UNDER SECTION 40(A)(IA) OF THE ACT FOR NON-FULFILLM ENT OF TDS PROVISION. IN APPEAL THE APPELLANT FILED COPIES OF FORM 15G RECEI VED FROM THOSE PARTIES ITA NOS.1094&1095/AHD/2015 SHRI VIKRAM SHANTILAL PATEL VS. ITO ASST.YEARS 2007-08 & 2008-09 - 5 - FOR NON-DEDUCTION OF TDS AS THEIR INCOME IS BELOW T AXABLE LIMIT; AS SUCH THOSE PARTIES WERE AGRICULTURISTS AND NOT ASSESSED TO INCOME TAX ACT. HOWEVER, THE SAID COPIES OF FORM 15G SINCE NOT FILE D BEFORE THE AO THE SAME WAS NOT ACCEPTED AS ADDITIONAL EVIDENCES UNDER RULE 46A BY THE LD. CIT(A) AND FINALLY ADDITION WAS CONFIRMED. 8. WE HAVE HEARD THE PARTIES AND PERUSED THE RELEVA NT MATERIALS AVAILABLE ON RECORD. IN OUR CONSIDERED OPINION THIS IS A FIT CASE TO SE ND THE ISSUE TO THE FILE OF THE LD. AO FOR DECIDING THE SAME AFRESH IN ACCOR DANCE WITH LAW BY PROVIDING AN OPPORTUNITY OF HEARING TO THE ASSESSEE WHO HAS BEEN DENIED JUSTICE WITHOUT ANY COGENT REASON. WE DO NOT INDUL GE THE MANNER IN TREATING THE ASSESSEE BY THE LD. CIT(A) IN VIEW OF THE RATIO LAID DOWN BY THE HONBLE APEX COURT IN THE CASE OF BASIR AHMED SISOD IA VS. ITO AS WELL AS HONBLE DELHI BENCH IN THE CASE OF PADAM LAL DUA VS . ITO AS ALREADY NARRATED HEREINABOVE. WE THUS, TAKING INTO CONSIDE RATION THE ENTIRE ASPECT OF THE MATTER, FIND IT FIT AND PROPER TO REMIT THE ISSUE TO FILE OF THE LD. AO TO DECIDE THE SAME AFRESH IN ACCORDANCE WITH LAW, UPON TAKING INTO CONSIDERATION THE EVIDENCE ON RECORD AND ANY OTHER EVIDENCE WHICH THE ASSESSEE MAY CHOOSE TO FILE AT THE TIME OF HEARING OF THE MATTER AND UPON GIVING AN OPPORTUNITY OF BEING HEARD TO THE ASSESSE E. THIS GROUND OF APPEAL IS, THUS, ALLOWED FOR STATISTICAL PURPOSE. ITA NO. 1095/AHD/2015(A.Y. 2008-09):- 9. THE ISSUE INVOLVED IN THE PARTICULAR CASE IS IDE NTICAL TO THAT OF THE ISSUE ALREADY DECIDED BY US IN FAVOUR OF THE ASSESS EE IN ITA NO. ITA NOS.1094&1095/AHD/2015 SHRI VIKRAM SHANTILAL PATEL VS. ITO ASST.YEARS 2007-08 & 2008-09 - 6 - 1094/AHD/2018 FOR A.Y. 2007-08 AND IN THE ABSENCE O F ANY CHANGED CIRCUMSTANCES THE SAME SHALL APPLY MUTATIS MUTANDIS . HENCE, THE SAME IS ALLOWED FOR STATISTICAL PURPOSE. 10. IN THE COMBINED RESULT, ASSESSEES APPEAL IS AL LOWED FOR STATISTICAL PURPOSE. THIS ORDER PRONOUNCED IN OPEN COURT ON 08/06/2020 SD/- SD/- (WASEEM AHMED) (MS. MADHUMITA ROY) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED 08/06/2020 TANMAY, SR. PS TRUE COPY / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / CONCERNED CIT 4. ( ) / THE CIT(A)- 5. , ! ' , #$%% / DR, ITAT, AHMEDABAD 6. &' () / GUARD FILE. / BY ORDER, / (DY./ASSTT. REGISTRAR) !, #$ / ITAT, AHMEDABAD 1. DATE OF DICTATION 27.05.2020 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 28.05.2020 3. OTHER MEMBER 4. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S 01 .06.2020 5. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT .06.2020 6. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S 08.06.2020 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 08.06.2020 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK ... 9. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 10. DATE OF DESPATCH OF THE ORDER