Sh. Bhagwan Singh, Nabha V. ITO, Nabha

ITA 1164/CHANDI/2018

• Counselvise Citation: [2022] 105 COUNSELVISE.COM (IT) 8070 (ITAT-CHANDIGARH)
• Duration Of Justice: 3 year(s) 5 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-02-2022
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: 2010-2011
• Appeal Filed On: 04-09-2018
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Section: 148; 263; 143(3)

Judgement Text

आयकर अपील य अ धकरण,च डीगढ़ यायपीठ, च डीगढ़ I N T H E I N C O M E T A X A P P E L L A T E T R I B U N A L D I V I S I O N B E N C H , “ A ” , C H A N D I G A R H BEFO RE SHRI N .K . SAI NI , VI CE PRESI DE NT & SHRI SUDHANSHU SRI V AST AVA, JUDI CI AL M EM BER आयकर अपील सं./ ITA No. 277/C H D / 2 0 2 1 नधा रण वष / Assessment Year : 2 0 1 1 - 1 2 Sh. Bhagat Ram Kaushal, C/o Rajiv Goel and Associates SCO 823-824, Sector 22A, Chandigarh बनाम Pr. Commissioner of Income Tax, Panchkula थायी लेखा सं./PAN NO: BREPK2050A अपीलाथ /Appellant यथ /Respondent Hearing though video Conferencing नधा रती क ओर से/Assessee by : Sh. Rohit Goel, CA राज व क ओर से/ Revenue by : Sh. Vivek Nangia, CIT DR स ु नवाई क तार%ख/Date of Hearing : 14.12.2022 उदघोषणा क तार%ख/Date of Pronouncement : 28.02.2022 आदेश/Order Pe r Sudhans hu Sr ivas tava, Judic ial Me mbe r : Thi s a ppe al i s pre fer red b y t he a s s es s ee aga inst t he order dat ed 19.03.2021 pa s se d b y the Ld. Princ ipa l Commi ss ione r of Inc o me Ta x (Ap pea ls ), Pa nchkula [her ei naft er re ferred to a s ‘P CIT’] for a ss e ssme nt ye a r 2011-12. ITA No. 277-Chd-2021 Sh. Bhagat Ram Kaushal, Amabala 2 2. Bri ef fa ct s of t he ca se are t hat the a ss e ss e e had re ti red fro m t he Pos ta l De part me nt a nd de rive d i nco me f ro m pens ion. The re turn of inc o me was fil ed dec la ring inc o me of Rs . 1, 75, 880/- . Subse quent l y, the ca s e was r eopene d u/ s 148 of the Inc o me Tax Act, 1961 (he reinaf te r c al le d 't he Ac t' ), as the a ss e ss e e had made Ti me Depos it s of Rs . 11,85,000/- wi th Punjab Nat i ona l Bank. Dur ing the course of ass es s ment pr ocee dings, t he daught er of the as s es s ee Ms. Re nu Sahni s ta te d t hat t he Ti me Depos it s ma de b y her fa the r were fr o m t he rene wa l of t he Fixed De pos it s al re ad y ma de fro m the re ti re me nt bene fits . The re- as s es s ment proce edi ngs we re co mplet ed b y a c ce pt ing the re turned i nco me . 2. 1 Subse quent l y, t he Ld. PCI T is s ued s how caus e not i ce on 24. 02.2021 ment i oning all ege d i ns ta nce of fai lure on the par t of t he Ass es s ing of fic er (AO) and aft er cons ide ring the repl y of t he as s es s ee t her eto, re ache d t he c onc lusi on t hat the as se ss me nt proc eedi ngs co mp l et ed u/ s 143(3) re ad wit h s ect i on 147 of the Ac t were e rr oneous i n s o f ar as pr ej udi ci al t o t he int ere s t of Re venue in t er ms of pr ovis ions of se ct ion 263 of the Ac t i ncl uding Expl ana ti on 2. The Ld. PCIT proce eded to canc el the a s se ss me nt dat ed 31. 10.2008 a nd di rec te d t he Ass es s i ng off ice r to pas s an order af res h. ITA No. 277-Chd-2021 Sh. Bhagat Ram Kaushal, Amabala 3 2. 2 Aga ins t thi s ca ncel la ti on of a ss e ssme nt, the ass es s ee has now appr oache d t his Tribuna l chal le nging the ac ti on of the Ld. PCIT b y ra is ing fol lowing grounds of appe al:- 1. That the Ld. PCIT has er r ed on f acts and in law i n exe r ci si ng r evis ionar y powe rs u/s 263 of t he Ac t whil e pas s ing the orde r dat ed 19. 3.2021. 2. That the appe llant cr ave s le ave to add, al te r, ame nd or to s ubst i tut e the abov e gr ounds of appeal eit her bef or e or at t he ti me of he aring of cas e . 3. 0 At the out se t, the Ld. Authorise d Re pres ent ative ( AR) s ub mit t ed tha t t here was a del a y of 147 da ys in fi li ng the appea l. He dre w our a tt ent ion to t he a ffi davi t of the appl ica nt for condona ti on of del a y i n t hi s re gard, whe rei n, it has bee n s t at ed that t he as s es s ee ’s wi f e M rs . Shas hi Ka nt a ha d bee n ta ken s eri ous l y i l l and the a s se sse e c oul d not approa ch t he couns e l’s offi ce for fi ling of a ppeal and s i gning of nece s sa r y pape rs . It ha s also be en st at ed t hat his wife pass ed a wa y on 07. 04.2021. A c op y of t he Dea th Cert i fic at e of Mr s . Sha s hi Kant a has al s o bee n enc los ed. It has bee n f ur the r st at ed tha t, ther eaft er , t her e was onse t of se cond wa ve of CO VID - 19 r e s ult ing i n l ock down i n Ha r ya na i n the months fro m April to J une 2021. I t has al so be en s tate d that the a ss e ss e e hi mse lf was bed r idde n due to hi s old a ge of 90 ye ars and, s ubs equent l y, only whe n t he as s e s s ee’s daught er visi te d hi m in ITA No. 277-Chd-2021 Sh. Bhagat Ram Kaushal, Amabala 4 Sept e mber 2021, the a ppeal c ould be fi le d whe n she c ould cont act t he a ss e ss ee ’s c ounse l. It ha s been pra ye d t hat the del a y due t o the af ores ai d rea sons ma y ki ndl y b e c ondoned and the appe al be ad mit te d for he aring. 4. 0 Per c ontra , the Ld. CI T DR t ook no obje ct ion t o the condona ti on of del a y. 5. 0 Ha ving hea rd both the partie s a nd c onsider ing the fac tua l ma tri x whi ch led to de la y in fil ing the appea l and a lso c ons ideri ng t he fa ct t hat t he as se ss e e would not get an y bene fit fr o m a del a y in fi li ng the a ppea l to pr ote ct hi s int ere st , we de e m i t a ppropr ia te to condone the de la y of 147 da ys and admit t he appe al for hear ing. 6. 0 The Ld. AR s ubmi t te d t hat the a ss e ss e e i s a Se nior Cit iz en age d 90 pl us a nd had ret ir ed as a Sect ion Offi cer fr om t he Pos tal Depart ment a nd hi s ma jor s our ce of i nco me t hroughout hi s worki ng l ife was sa la r y i nc o me a nd, l at er on, pens i on. It wa s s ub mi tt ed tha t he ha d a cc umula te d s uch e arni ng b y wa y of fi xed depos its and re curri ng de posi t s whi ch he maint ai ned wi th vari ous banks and was ea rni ng inte res t fro m the s a me . It was s ub mi tt ed tha t during t he ye a r under cons idera ti on so me fi xed depos i ts a nd r ecurring depos its got mat ured a nd the as s es s ee wi thdr ew the se mat urit y proc ee ds in ITA No. 277-Chd-2021 Sh. Bhagat Ram Kaushal, Amabala 5 ca s h fro m t he Post Offic e a nd the saving bank ac count wi th St ate Bank of India a nd de posi ted in a newl y opened ac count wit h Punj ab Nati onal Bank for maki ng fre sh FDRs . t he Ld. AR refe rred t o t he as s es s ment orde r a nd s ubmit te d t ha t the se fa ct s were dul y br ought t o the notic e of the As s es sing offic er during the cours e of as s es s ment proce edi ngs a nd t he expla nat ion of the as s es s ee was ac ce pte d b y t he As s es s ing offic er aft er due exa minati on. The Ld. AR s ub mit te d that no fr es h f ixe d de pos i ts had bee n ma de during t he ye a r unde r c onsider at ion a nd it was onl y old de pos it s whi ch had bee n use d to ma ke new FDRs. He drew our at t e nt i on to the s u mma r y of ca s h de posits and wi thdr awals made dur ing the ye a r under consi dera ti on as wel l as t o c op y of the bank st at e me nt whi ch have be en fil ed bef ore the Ass e ss i ng off ice r as well as Ld. PCIT and ha ve now been fil ed be fore us in t he for m of pape r book and s ub mit t ed t hat t hes e docu me nts ha d dul y c ons ider ed b y t he Ass es s ing of fic er be fore a cc epti ng t he ret urned income of t he as s es s ee . The Ld. AR, re ferr ing t o the obs er vation of the Ld. PCIT t hat t her e wa s tw o or thre e mont hs gap bet we en c as h depos it s and wit hdrawal s, s ubmi tt ed tha t the re wa s a gap of onl y 2 months bet we en June and Augus t 2010 whil e t he re ma ini ng deposit s had bee n made i mmed i at el y aft er wi thdra wa ls . It wa s furthe r s ub mi tt ed t hat eve n where there has be en a gap i n de posi t of cas h, there i s no ITA No. 277-Chd-2021 Sh. Bhagat Ram Kaushal, Amabala 6 al l egat ion of an y f oul pla y b y t he Ld. PCIT nor has t here be en an y evi denc e on wit hdra wn ca sh havi ng been us ed for an y othe r purpos e ot her tha n f or be ing depos i te d for the pur pose of ma k ing the FDRs. The Ld. AR re it er ate d tha t the As ses s ing offi ce r had ac cept ed t he as s es s es ’s re turn of inc o me a fte r ver ifi ca ti on of bank st at e me nts and sub mi s s ions of t he a s se ss e e and had, t here aft er, re ac hed t he conc lusi on that t he cont ent ion of t he as s es s ee was c orrec t, whe reas , t he Ld. PCIT had hel d t he a s se ss me nt order to be e rroneous and pre judi ci al to the i nter es t of Reve nue wi thout provi ding a n y r e as on and eve n wit hout c onducting an y in qui r y in thi s r egar d. The Ld. AR al s o pl ac ed r el ia nce on nu merous judic ia l prec ede nts, whic h ha ve bee n s ta te d in t he wri tt en s ub mis s i ons a nd have been ta ken on re cord. 7. 0 Per c ontra , , the Ld. CI T DR vehe me ntl y s upported t he Revi s ion pr oc ee dings a nd s ub mit te d t hat the re was a co mplet e la ck of inqui r y at t he end of the As se ssi ng of fic er as he had fai le d t o i nquire i nto t he source of depos i ts . The Ld. CI T DR ha rped upon t he obse rvat ion of t he Ld. PCIT t hat t here was del ay i n de posi t a fte r al l eged wit hdrawal s b y the as se s se e a nd f urthe r there was no evi denc e tha t t he wit hdrawal s a nd de pos it s were l i nked. The CIT DR al s o s ub mi t t ed t hat the Ld. PCIT had right l y i nvoked ITA No. 277-Chd-2021 Sh. Bhagat Ram Kaushal, Amabala 7 Expl ana ti on 2 t o se ct ion 263 of the Ac t as i t wa s square l y cover ing t he fa ct s of t he ca se . The Ld. CIT DR al so rel ied on nu merous j udici al pre ce dents in suppor t of his conte nti on a nd pra yed t hat t he orde r pa s sed u/s 263 be upheld. 8. 0 We have hea rd t he riva l sub mis s ions a nd have a ls o pe rus ed t he mat eri al on rec ord. We have a ls o gone t hrough the bank s ta te ment of the a s s es s ee whic h have been f il ed i n s upport of t he cont ent ion t hat mos t of t he depos its ha d be en made on the s a me d a y of wit hdrawal s fr o m the bank acc ount. We fi nd t hat t he conte nti on of t he Ld. AR t hat exce pt for the months of J une t o Augus t 2010, whe re t here wa s a gap, mos t of the depos i ts found in the bank ac count wer e aft er ma king the wi thdra wa ls on t he s ame da y. This l eads c rede nce to t he conte ntion of the Ld. AR t hat depos i ts i n t he bank we re made f r o m t he wit hdrawal s fro m t he Pos t offi ce a ccount and t he ac count wit h St at e Bank of India . Of c ours e, ther e is no bar i n depos i ti ng or wi t hdrawing the a mount unless and unt i l so me f oul pa y ha s brought on re cord, whi ch is not t he ca se here. We a ls o not e t hat although t he Ass e ss i ng offi cer might not have writ t en i t i n a s ma n y s ent ence s a nd pha se s a bout t he docume nts he had ver ifi ed duri ng t he cour se of as s es s ment proce edi ngs for t he purpos e of re achi ng the c oncl usi on tha t the bank depos it s wer e ITA No. 277-Chd-2021 Sh. Bhagat Ram Kaushal, Amabala 8 i ndeed out of wi thdra wa ls f ro m t he ba nk, the re is no pre sc ri bed for ma t for wri ti ng an ass es s me nt orde r and a pe rus al of t he as s es s ment or der would s how t hat t he As s es s ing officer has dul y me nti oned t hat the re quire d docu me nts were exa mine d and that the daught er of t he a ss es s ee Ms Re nu Sa hni ha s explai ned that the Ti me Depos i ts made b y her fat her wer e fro m rene wal of FDRs al re ad y ma de fr o m t he re ti re me nt bene fit s . So, i n our c onsi der ed opi nion, t he As s es s ing offi ce r did c onduct prope r inqui res, as warra nte d on the f act s of thi s ca se , a nd we do not agree wi th t he cont ent ion of the Ld. CIT DR t hat there was an y lack of inqui r y b y t he As se s si ng of fic er. It is the ar gume nt of the Ld. CI T DR t hat t he s ource of de pos its was not exa min e d b y t he As s es s ing offi cer but we a gain note tha t thi s conte nti on of the Ld. CIT DR i s fal la ci ous , i n as much as , t he de pos its we re li nked to the bank ac count a nd the ca s h de posi t s i n t he bank were l inke d to the cash wi t hdr awals . The refor e, it c annot be s ai d that the re was an y la ck of inqui r y on t he part of t he Asse ss i ng of fic er. 8. 1 The Hon'bl e Del hi High Court i n t he ca se of C IT Vs . Sunbe a m Aut o Ltd re porte d i n [2011] 332 IT R 167 (De l. ) in par agra ph 17 has rul ed t hat one has t o kee p in mind t he dis ti nct ion betwe en ‘l ac k of i nquir y’ and ‘ina dequat e inqui r y’ a nd furt her if the re wa s an y ITA No. 277-Chd-2021 Sh. Bhagat Ram Kaushal, Amabala 9 i nquir y, e ven i na dequa te , that would not b y it s el f give occ as ion t o t he Co mmis s ione r t o pa s s order s u/ s 263 of t he Ac t, mere l y beca us e he has a di ffe rent opinion i n the mat te r. It wa s f urthe r hel d b y t he Hon' ble Del hi Hi gh Court t hat if an y As s es s ing officer , ac ti ng in ac corda nce wi th l aw, ma kes a c ert a i n as se s s ment, t he s a me ca nnot be brande d as e rrone ous b y t he Co mmi s si oner s imp l y bec aus e, ac cordi ng t o him, t he or der s houl d have been wri tt en more el abor ate l y. 8. 2 Si mi la r were t he obs erva tion of the Hon' ble De lhi High Court i n t he cas e of ITO Vs . DG Hous ing Pr oje cts Lt d [2012] 343 ITR 329 (De l). In thi s c as e, t he Hon' ble Del hi Hi gh Cour t we nt on to obs erve that in c as e wher e t here is i n-ade quat e inquir y but no la ck of i nquir y, the CI T mus t gi ve a nd rec ord a findi ng that the order / enqui r y made i s e rrone ous and t hat t his ca n ha ppen onl y i f an i nquir y a nd ve ri f ic at ion is conducte d b y the CI T. The Hon'bl e Delhi High Court in t he cas e of ITO Vs . DG Hous i ng Pr oj ec ts Ltd (s upra ) a ls o he ld that i n mos t c as es of a ll eged ‘i nadequa te i nquir es ’ i t wi ll be di ffi cult to hol d tha t t he order of t he Asses s i ng of fic er, who ha d c onducted enqui rie s and had ac te d a s a Inves t iga tor, is er roneous , wi thout the CIT conduct ing ve ri fic at ion / inqui r y hi mse lf . Ho weve r, in t he cas e , no suc h i nqui r y ha s be en ca rrie d out ITA No. 277-Chd-2021 Sh. Bhagat Ram Kaushal, Amabala 10 b y the Ld. PCIT and he ha s s i mpl y di rec ted t he As s es s ing offi ce r t o c arr y out de ta iled i nquire s. 8. 3 In our cons i dere d opini on, t he Ld. PCI T, wit hout ma king furt her i nquir y o n hi s own ac count , ha s s i mpl y s ta te d in t he i mpugned orde r tha t the As s es si ng off ice r was required to ma ke mo re i nquir ie s. The Ld. PCIT has not pointe d out as t o what furt her inqui r y wa s the As s es sing off ice r re quire d to make a nd as t o how wi thout thos e inqui re s the order of t he As s es si ng offi ce r was errone ous in s o fa r as prre judi ci al to t he i nt ere st of t he Reve nue. 8. 4 As pe r the pr ovis ions of s ect ion 263( 1) of the Act , a fte r get ti ng the e xpla nat ion of the ass ess ee t o t he show ca us e not ic e, t he Ld. PCIT i s s uppos e d t o exa mi ne t he conte nti on of t he a ss e ss e e and bef ore pas s ing a n orde r canc el li ng the a ss ess ment, he is s uppos ed to conduct an i nquir y hi ms el f or c aus e t o make s uc h an i nquir y, as he deems fi t / nece ss a r y. 8. 5 As far as t he i nvoca ti on b y the Ld. PCIT of Expl ana ti on 2 to s ec ti on 263 of the Act i s c oncer ned, the Del hi Be nch of t he ITAT had a n oc ca si on to c onsi der this aspe ct i n the c as e of A mi r a Pur e ITA No. 277-Chd-2021 Sh. Bhagat Ram Kaushal, Amabala 11 Foods Pvt. Ltd Vs . Pri nci pal CIT ( 2017) 51 CCH 0473 (De lhi - Tri bunal ) where in, the De lhi Benc h, whil e re l yi ng upon t he j udge ment of t he Hon' ble Del hi Hi gh Cour t in the c ase of PCI T Vs. Delhi Airport Me tro Expres s Pvt Lt d (ITA No. 705/ 2017) has held t hat Expla nat ion 2 c annot be st at ed t o have ove rri dden t he l aw as i nter pret ed b y va ri ous Hi gh Courts , whe re the Hi gh Courts ha ve hel d t hat bef ore r eac hing the conc lus ion tha t t he order of t he Ass es s ing off ic er i s er roneous and pre judi ci al t o the int ere st of Reve nue. The Commi s si oner hi mse lf has to undert ake s o me enqui r y t o e s tabl ish t hat the a ss e ss me nt order i s errone ous a nd pr ej udi ci al t o t he i nt ere st of Reve nue. Si mil arl y, t he Coordi nat e Bench of ITA T, Mu mba i in t he cas e of Na ra ya n Ta tu Ra ne r eport ed in TS- 290-ITAT 2016 (Mu mba i) has he ld t hat Expl ana tion 2 to s ec tion 263 does not provi de unfet te red ri ght t o t he PCI T to re vi s e ea ch and eve r y orde r. It wa s he ld that i t i s the re spons i bilit y of t he PCI T to s how t hat t he enqui r y for ver ifi ca ti on conduct ed b y the As s es si ng offi ce r was not in acc ordanc e wit h t he e nquir es or veri fic at ion t hat woul d have be en ca rri ed out b y a prudent offi cer . 8. 6 There fore, on an ove rall vie w of the fac ts of the ca s e, we ar e of the c ons ide red opinion tha t the exerc is e of revis iona l j ur is di cti on b y the Ld. PCIT i s wi thout an y j us t if ica tion. The Ld. PCIT has ITA No. 277-Chd-2021 Sh. Bhagat Ram Kaushal, Amabala 12 s ought to rea pprai s e t he evidence i n the garb of revi sional j uris di ct ion. Ac cordi ngl y, we s et as i de t he orde r pas sed u/ s 263 of t he Ac t and al low the a ppea l of the a s se s se e. 9. 0 I n t he fi nal res ult , the a ppeal of the a ss e ssee st ands al lowed. Order pronounce d on 28.02.2022. Sd/- Sd/- ( N. K. SAINI) (SUDHANSHU SRIVASTAVA) Vice President Judicial Member Dated : 28.02.2022 “आर.के .” आदेशक त,ल-पअ.े-षत / Copy of the order forwarded to : 1. अपीलाथ / The Appellant 2. यथ / The Respondent 3. आयकरआय ु /त/ CIT 4. आयकरआय ु /त (अपील)/ The CIT(A) 5. -वभागीय त न2ध, आयकरअपील%यआ2धकरण, च4डीगढ़/ DR, ITAT, CHANDIGARH 6. गाड फाईल/ Guard File आदेशान ु सार/ By order, सहायकपंजीकार/ Assistant Registrar