Nitin Narayan Keskar, Pune V. Income-tax Officer, Ward - 7(4), Pune

ITA 115/PUN/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 3141 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 1 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-03-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2014-2015
• Appeal Filed On: 24-01-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ALOK MALVIYA
• Assessee Lawyers: NITIN N KESKAR
• Keywords: Business income; Opportunity of being heard; Principle of natural justice; Additional evidence; Condonation of delay; Revised return; TDS
• Section: 143(1); 13

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, PUNE BEFORE SHRI D. KARUNAKARA RAO, AM AND SHRI PARTHA SARATHI CHAUDHURY , JM . / I TA NO. 115 /PUN/20 1 9 / ASSESSMENT YEAR : 20 1 4 - 1 5 NITIN NARAYAN KESKAR, C - B/1, YASHODHAN, 999, SUNDERBAN SOCIETY, NAVI PETH, PUNE 411030 PAN: A BXPK0862G ....... / APPELLANT / V/S. THE INCOME TAX OFFICER , WARD 7(4) , PUNE / RESPONDENT A SSESSEE BY : SHRI NITIN N. KESKAR REVENUE BY : SHRI ALOK MALVIYA / DATE OF HEARING : 11 .0 3 .2020 / DATE OF PRONOUNCEMENT : 11 .0 3 .2020 / ORDER PER D. KARUNAKARA RAO , A M : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) , PUNE - 5 , PUNE , DATED 2 6 . 0 9 .201 8 FOR THE ASSESSMENT YEAR 20 1 4 - 1 5 . 2 ITA NO. 115 /PUN/20 1 9 NITIN N. KESKAR 2. BRIEFLY STATED THE RELEVANT FACTS INCLUDE THAT THE ASSESSEE IS AN INDIVIDUAL IN THE BUSINESS OF ELECTRICAL CONTRACTOR . THE ASSESSEE FILED RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION ON 17.07.2015 DECLARING TOTAL INCOME OF RS.6,44,890/ - WHICH WAS PROCESSED U/S 143(1) OF THE INCOME - TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT). THE ASSESSEE IS ALSO A REGISTERED CONTRACTOR WITH MILITARY ENGINEERING SERVICES AND CARRIED OUT ELECTRICAL REPAIRS AND MAINTENANCE WORK. THE TOTAL SALES WERE DISCLO SED AT RS.58,34,329/ - AND THE G.P. IS DISCLOSED AT RS.21,46,992/ - . APART FROM THIS, THE ASSESSEE HAS ALSO CREDITED BROKERAGE, BANK INTEREST AND INTEREST RECEIVED FROM FIXED DEPOSITS. THE NET PROFIT ARRIVED AT WAS RS.7,58,953/ - . THE CASE WAS SELECTED FOR LIMITED SCRUTINY THROUGH CASS AND THE REASONS FOR SELECTION HAD BEEN MENTIONED BY THE ASSESSING OFFICER AT PARA 4 OF THE ASSESSMENT ORDER , WHICH ARE AS UNDER: - (I) MISMATCH IN SALES TURNOVER AS REPORTED IN AUDIT REPORT AND ITR. (II) SUBSTANTIAL INCREASE IN CAPITAL IN A YEAR. THE ASSESSING OFFICER MADE AN ADDITION OF RS.1,70,64,450/ - ON ACCOUNT OF INCREASE IN CAPITAL TO THE TOTAL INCOME OF THE ASSESSEE. ASSESSED INCOME IS DETERMINED AT RS.1,77,09,340/ - AGAINST THE RETURNED INCOME OF RS.6,44,890/ - . 3. IN THE FIRST APPELLATE PROCEEDINGS, THE LD. CIT(A) UPHELD THE ORDER OF ASSESSING OFFICER . THERE WAS NONE TO REPRESENT THE ASSESSEE BEFORE THE CIT(A). HOWEVER, THERE WAS SOME ADDITIONAL EVIDENCES FURNISHED BEFORE THE CIT(A) AND THE SAME WAS REJECTED. 3 ITA NO. 115 /PUN/20 1 9 NITIN N. KESKAR 4 . AGGRIEVED WITH THE ORDER OF THE CIT(A), THE ASSESSEE IS IN APPEAL BEFORE US AND HAS RAISED THE FOLLOWING GROUNDS: - 1 ) THE LEARNED C I T (A) HAS NOT APPRECIATED THE FA C T THAT THE APPLICANT IS H ONESTLY OFFERING TO PAY THE TAX AS PER REVISED SET OF BOOKS OF ACCOUNT FROM ASSESSMENT YEAR 2005 - 06 TO 2014 - 15. LD CIT (A) HAS ALSO N OT APPRECIATED THE FACT THAT THE APPELLANT WAS DECEIVED BY HIS CHARTERED ACCOUNTANT AND FILED THE RETURNS ON THE BASIS OF MISLEAD ING INFORMATION. 2) THE APPELLANT FILED RETURNS OF INCOME FOR A. Y 2013 - 14 AND 2014 - 15 ON THE BASIS OF REA CCOUNTING DONE BY HIM. R ETURN FOR A.Y 2012 - 13 WAS TIME BARRED . HENCE THE LD ASSESSING OFFICER REFUSED TO ACCEPT THE SAME HARD COPY OF THIS RETURN. 3) THE LD CIT (A) OVERLOOKED THE FACT THAT THE OTHER P ARTY AND THE APPELLANT'S CONTRACTOR HAD DEDUC TING TAX AT SOURCE IN A.Y. 200 8 - 0 9, 2009 - 10 AND 2010 - 11 IN THE PERIOD THE PERTAINING TO THE A. Y 2018 - 19. 4) THE LD CIT (A) ALSO OVERLOOKED THE FACT THAT CREDIT OF TDS WAS NOT GIVEN TO THE APPELLANT WHICH WAS AP PEARING IN THE FORM NO.26AS AND MARKED AS 'P' . L D CIT (A) ALSO IGNORED THE FACT THAT ALL THE TDS ENTRIES WHERE PERTAINING TO THE MILITARY ENGINEERING SERVICES WHICH IS A GOVERNMENT DEFENCE ORGANISATION WHICH CANNOT ISSUE FALSE TDS CER TIFICATE . THE LD. CIT(A) HAS ALSO OVERLOOKED THAT A LETTER NO. PN/ ITO(TDS1)/ G RI EVANCE/NITIN KESKAR/2018 - 19/42, DATED 29/06/2018 ISSUED BY ITO TDS (1). FOR G IVING CREDIT OF THE AMOUNTS MARKED AS 'P' IN FORM NO 26AS. 5) THE LD CIT (A) ALSO IGNORED THAT THE APPLICATION MADE BY THE APPELLANT BEFORE LD PR.CIT (RANGE - 4) VIDE HIS LETTER RECEIVED BY PR C I T OFFICE ON 16/02/2018 FOR CONDONATION OF DELAY IN SUBMITTING REVISED RETURNS FROM A. Y 2005 - 06 TO A. Y 2012 - 13 WAS PENDING AND THAT NO REPLY WAS GIVEN BY PR CIT(12), PUNE 6) THE LD CIT(A) ERRED IN PASSING ORDER ON THE BASIS OF THE LETTER ISSUED BY ITO H.Q. (12) WHICH WAS MISLEADING AND ISSUED WITHOUT UNDERSTAND ING THE FACTS IN THE APPELLANT MATTER. 7) ALTER NATIVELY THE APPELLANT RE Q UEST THAT THERE ARE SOME AMOUNTS S TILL RECEI VABLE FROM A.Y. 2005 - 06 TO TILL THIS DATE AND THAT THERE IS TDS ON THESE AMOUNTS. THESE AMOUNTS ARE INVOLVED IN THE COURT MATTER CIVIL SUIT NO. SP I .C.S./200748/2013. THE APPELLANT MAY RECOVER THESE AMOUNTS AFTER LONG PERIOD. HENCE THESE AMOUNTS MAY BE ALLOWED TO BE EXCLUDED FROM THE GROSS CONTRACT RECEIPT IN THE RELEVANT RESPECTIVE YEARS AND CHARGED TO TAX IN THE ACTUAL YEAR OF RECEIPT AS PER THE COURT ORDER. 5. AT THE OUTSET, WITHOUT GOING INTO THE MERITS OF THE ADDITION, LD. AR SUBMITTED THAT THE ASS ESSEE WAS NOT PROPERLY REPRESENTED BEFORE THE CIT(A) OR ASSESSING OFFICER AS THE ASSESSEE I S NOT AWARE OF ANY INTRICACIES OF THE INCOME - TAX ACT. NUMBER OF PROCEDURAL ISSUES WERE NARRATED IN THE GROUNDS. MENTIONING THAT THE ORDER PASSED BY CIT(A) IS NOT S PEAKING ORDER ON THESE 4 ITA NO. 115 /PUN/20 1 9 NITIN N. KESKAR ISSUES , LD. COUNSEL SUBMITTED THAT THIS IS FIT CASE FOR REMANDING THE MATTER TO THE FILE OF THE CIT(A) FOR ONE MORE ROUND OF ADJUDICATION. THE ASSESSEE WHO APPEARED PERSONALLY BEFORE US SUBMITTED THAT HE APPEARED BEFORE THE CIT(A) A LSO AND WAS SURPRISED TO NOTE THAT CIT(A) DID NOT MENTION ABOUT HIS ATTENDANCE BEFORE HER. HE ALSO CONTESTED THE NON ADMISSION OF THE ADDITIONAL EVIDENCES. HE REQUESTED FOR REMANDING THE ISSUES AND FOR ADMITTING OF THE ADDITIONAL EVIDENCE. 6. THE LD. DR ON THE OTHER HAND, RELIED ON THE ORDERS OF ASSESSING OFFICER AND CIT(A). 7. HEARD BOTH SIDE S ON THIS ISSUE OF REQUIREMENT OF REMANDING THE MATTER ONCE AGAIN TO THE FILE OF THE CIT(A). WE FIND THAT THE CIT(A) HAS DECIDED THE ISSUE S WITHOUT ADMITTING ADDI TIONAL EVIDENCE PRODUCED BY THE ASSESSEE DURING THE STAGE OF APPELLATE PROCEEDINGS. FOR THE SAKE OF COMPLETENESS, THE RELEVANT PARA 8 OF THE ORDER OF THE CIT(A) IS EXTRACTED AS UNDER : - 8 .......THE ADDITIONAL EVIDENCE PRODUCED NOW CANNOT BE ADMITTED, AS THE APPELLANT HAD AMPLE OPPORTUNITY AND DID NOT FIT IN THE CONDITIONS OF RULE 46A OF THE I.T. RULES. THEREFORE, THE ADDITIONAL EVIDENCE ALSO IS NOT ACCEPTED. THE CONTENTION OF THE APPELLANT OBVIOUSLY IS HELD TO BE DEVOID OF MERIT AND IS ACCORDINGLY DISM ISSED. 8 . FROM THE ABOVE, IT IS EVIDENT THAT THE CIT(A) WITHOUT ADMITTING THE ADDITIONAL EVIDENCE PRODUCED BY THE ASSESSEE HAS D ECIDED THE APPEAL OF ASSESSEE. NO SPECIFIC REASON IS MENTIONED FOR SUCH NON ADMITTING OF THE ADDITIONAL EVIDENCES. FURTHER, IT IS EVIDENT THAT THE ORDER PASSED BY THE CIT(A) CANNOT BE CONSIDERED TO BE A SPEAKING ORDER. THEREFORE, WE ARE OF THE CONSIDERED OPINION THAT THE ORDER OF THE CIT(A) NEEDS TO BE SET - ASIDE AND ISSUES NEEDS TO BE REMANDED TO THE FILE OF THE CIT(A ) FOR FRESH ADJUDICATIO N IN 5 ITA NO. 115 /PUN/20 1 9 NITIN N. KESKAR THE MATTER. ACCORDINGLY, WE ORDER TO REMIT THE ISSUES RAISED IN THE PRESENT APPEAL TO THE FILE OF CIT(A) FOR DE NOVO ADJUDICATION. THE CIT(A) IS DIRECTED TO ADMIT THE ADDITIONAL EVIDENCES PRODUCED BY THE ASSESSEE , USE THE SAME FOR ADJUDICATION AND DECIDE THE ISSUES IN ACCORDANCE WITH LAW. NEEDLESS TO SAY, THE CIT(A) SHALL GRANT REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE IN ACCORDANCE WITH SET PRINCIPLES OF NATURAL JUSTICE. THUS, THE GROUNDS RAISED BY THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. 9 . IN THE RESULT, THE APPEAL OF ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 11 TH MARCH , 2020. SD/ - SD/ - PARTHA SARATHI CHAUDHURY D. KARUNAKARA RAO JUDICIAL MEMBER ACCOUNTANT MEMBER / PUNE; / DATED : 11 TH MARCH , 2020. GCVSR / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT. 2. / THE RESPONDENT 3. THE CIT (APPEALS) , PUNE - 5 , PUNE . 4. THE PR. CIT , PUNE - 4 , PUNE . 5. , , , , / DR, ITAT, A BENCH, PUNE. 6. / GUARD FILE. / BY ORDER, // // TRUE COPY// / SR. PRIVATE SECRETARY , / ITAT, PUNE